2008 | Annual Report
CONTENTS
Letter from the Chairman................................................ 4
Board of Directors ........................................................... 7
The Elecnor Group Worldwide......................................... 8
Group Structure ............................................................ 10
Key economic figures .................................................... 12
Balance Sheet Trends..................................................... 16
Stock market information.............................................. 18
The Elecnor Group in 2008 ........................................... 19
Business trends...................................................... 22
Networks and Infrastructure .......................... 25
Renewable Energy..........................................40
Technology and IT Systems .............................48
Concessions ...................................................53
International ..................................................54
Es Pagos solar farm in Porreres,
Mallorca.
Research, Development and Innovation ..................61
Quality Management .............................................64
Environmental Management ..................................65
Human Resources.................................................. 67
Occupational Risk Prevention................................. 70
Auditing........................................................................ 73
Economic profile of the Elecnor Group .......................... 77
Management Report ................................................... 149
Economic profile of Elecnor, S.A. ................................. 157
Addresses.................................................................... 161
2008 ANNUAL REPORT
3
LETTER FROM THE CHAIRMAN
Dear shareholders:
As Chairman of the Board of Directors of Elecnor, S.A., it's
my pleasure to present you with the 2008 Annual Report
for Elecnor and its Group of companies.
We consider the last fiscal year a significant one for
different reasons. It was, as we explained in the previous
Annual Report, our 50th anniversary, a special occasion
that served many purposes. For example, creating closer
ties with our customers, an essential aspect of our historic
progress and our current approach. We also celebrated
with the more than 8,000 Group employees in different
parts of the country, coming together with an upbeat and
optimistic view of the future of this organisation. It was a
full programme of activities with an unforgettable
conclusion: an audience that His Majesty King Juan Carlos I
granted to the Board of Directors on December 2nd, 2008.
This year was also special due to the economic
climate, with slow growth that led to deceleration, officially
starting a recession. And what is most worrisome, an
absence of any truly trustworthy diagnosis of the formulas
and periods that the global economy, and of course the
Spanish one, will need to overcome the situation.
In this difficult and unexpected position, we would
like to highlight another singular event in 2008: the near
achievement of our goal, established by our 2006-2010
Strategic Plan, to double the sales and profits of the
Elecnor Group, two years before the set date. To be
specific, invoicing in 2005 was consolidated at more than
781.4 million euro, and in 2008 closed with 1.911 billion.
In reality, the goal to double sales was already achieved by
the end of 2007, when we reached 1.65 billion euro; the
figures for 2008 simply confirm our success.
In terms of consolidated net profits, the 47.3
million registered in 2005 passed more than 93.6 million
last year.
The growth achieved in 2008 over 2007 was very
significant, even more so when considering the previously
mentioned climate of global economic downturn.
Concretely, consolidated net profits went up by 27.2%
and the Group's sales by 15.8%.
It's true that in 2008 there were some exceptional
factors that that are unlikely to be repeated to the same
degree. I refer primarily to the intense rhythm at which we
have carried out projects in the area of photovoltaic solar
Hotel Eurostar
Madrid Tower.
SacyrVallehermoso
Tower (Madrid).
Full-service
maintenance.
energy, favoured by the regulatory framework for this
sector during a good part of the year. But it's also clear
that the policies for diversification began years ago and
reinforced through the current Strategic Plan are working
well. Prudent diversification, focused on activities, market
areas and kinds of income that can compensate for
downturns, has been our traditional business plan.
As I said before, the macro-economic situation has
caused unexpected disturbances, especially since
September, when the worst of the financial crisis began to
be felt, with effects serious enough to cause repercussions
in the actual economy. In these circumstances, the equity
markets, as a reliable mirror of what awaits the economy
in the medium-term, saw days full of panic, with annual
index falls around the world that were often recordbreaking.
In times like these, the close and logical link
between a company's health and its register in the Stock
Market is often broken. The normal rules seem
inapplicable, giving way to irrational behaviour. This is
similar to what we saw in 2000 and 2001, after the wellknown tech bubble burst. And now it has happened again
with a number of different companies, many of which
looked forward to a promising if not perfect business
future.
Elecnor has not gone unscathed from this
phenomenon, though it's true that in our case we have
seen more than a decade of continual revaluation of our
market quotes, on some occasion dramatic ones, that
placed our securities at historic levels of capitalisation.
In 2007, our stock was revalued at 48.3%. A year
before it was 101.5%. And in 2005, it was 57.7%
Percentages of these have a net-worth that is greater than
those registered by the leading market indexes. In 2008,
on the other hand, Elecnor fell by 64.2%. This event,
considered in the context of the years mentioned before,
in terms of sales and profits, is not a reflection of the
Group's capacity to pursue sustained development.
It was also independent of the fact that in 2008
our policy for paying stockholders with dividends grew in
relation to the income seen in fiscal year 2007, and will
continue to grow if the Board of Directors' proposal for the
use of 2008 profits is approved.
of quote adjustments, Elecnor counts on a high rate of
historic profitability, thanks to the sustained growth of its
total brute dividend.
The ability to maintain remuneration for our
stockholders will continue to be valued and without a
doubt will help us through a period as difficult as the one
we are in now. These hard times remind of us past crises.
Even then, Elecnor knew how to adopt the necessary
measures to overcome difficulties and to head into a
sustainable and profitable future; for this reason we will
persevere with certain plans that have already shown their
efficacy.
In some way, this spirit was evident in the words
spoken at the Elecnor Board of Directors' audience with
H.M. King Juan Carlos I, as we mentioned before, which
served as a finale and culmination of the 50th anniversary
celebrations. Allow me to now share with you a passage
from my speech:
"The founders of Elecnor were destined to live in
difficult times, very far from the economic surge
experienced by the country at the beginning of the 1960s.
Today, things are different. With the resolute support of
His Majesty and the dedicated work of the various
governments that have been in place during his reign, our
country has become one of the most dynamic, open and
entrepreneurial economies in the world. With modesty, but
also, perhaps, with appropriate pride, I can confirm that
our Group has worked decidedly in that direction,
contributing to the world leadership of our country in
complex infrastructure projects and in the sector of clean
energy."
Months later, during a full recession and facing a
multitude of uncertainty regarding the duration and depth
of this economic downturn, I am heartened by these
words. Realism forces us to be prudent when making
predictions, without, however, losing sight at any time of
our Group's long-term capacity to continue at the
forefront of the new Spanish economic movement.
I'll conclude by thanking you for the trust that you,
our shareholders, have placed in Elecnor. I would like to
communicate this same appreciation to our customers and
to the entire team at Elecnor, without whose efforts and
dedication none of this would be possible.
Best Regards,
Payment by dividends is, without a doubt, one of
Elecnor's attractions in the stock market, as demonstrated
by its continuous growth. At this point in time, in which
many companies are taking a step back in this regard,
forced to do so by the economic recession, our ability to
continue growing gives us, to my understanding, incredible
value. In this sense, we mustn't forget that during this time
Fernando Azaola
Chairman
2008 ANNUAL REPORT
5
BOARD OF DIRECTORS
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
Mr. Fernando Azaola Arteche
VICE-CHAIRMEN
Mr. José María Prado García
Mr. Guillermo Barandiarán Alday
MEMBERS
Mr. Gonzalo Cervera Earle
Honourable Sir Cristóbal González de Aguilar Enrile
Mr. Juan Landecho Sarabia
Mr. Fernando León Domecq
Mr. Miguel Morenés Giles
Mr. Gabriel de Oraa y Moyúa
Mr. Jaime Real de Asúa Arteche
SECRETARY COUNSEL
Mr. Rafael Prado Aranguren
Airport Management Centre for the
new terminal area CGA-NAT in the El
Prat de Llobregat Airport
(Barcelona). Comprehensive Civil
Works and Facilities.
2008 ANNUAL REPORT
7
THE ELECNOR GROUP
WORLDWIDE
ELECNOR
Spain
Angola
Algeria
Canada
Honduras
Dominican Rep.
Venezuela
SUBSIDIARIES
Argentina
Brazil
Chile
Ecuador
Honduras
Mexico
Peru
Portugal
Uruguay
Venezuela
OTHER COUNTRIES IN THE WORD
Belgium
Bolivia
Bosnia
Burkina Faso
Cameroon
China
Colombia
Congo
Côte d’lvoire
Costa Rica
Cuba
Egypt
El Salvador
France
Germany
Ghana
Greece
India
Israel
Italy
Kenya
Macedonia
Mali
Mauritania
Mozambique
Morocco
Nicaragua
Panama
Paraguay
Philippines
Romania
Russia
Senegal
South Africa
Tunisia
Turkey
Ukranie
U. Arab Emirates
United States
United Kingdom
Vietnam
2008 ANNUAL REPORT
9
INFORME ANUAL 2008
11
MAIN AGGREGATES
ELECNOR GROUP
At 31 December each year and in thousands of euros
Result figures
2004
2005
2006
2007
2008
Operating profit
36,406
39,714
78,196
118,865
151,188
EBITDA
49,956
64,253
111,232
189,287
228,345
Pre-tax profit
43,398
68,269
72,491
102,304
137,997
Cash-flow
32,904
47,285
54,853
73,554
93,593
Assets
2004
2005
2006
2007
2008
141,348
193,776
215,039
292,556
299,070
2004
2005
2006
2007
2008
657,790
781,403
Other figures
2004
2005
2006
2007
2008
Employees
6,197
5,926
7,031
7,356
8,400
Share capital and reserves
Turnover
Sales
Castaños
Market Civic
Centre in Bilbao
(Vizcaya).
Restoration.
1,095,554
1,650,234
1,911,347
2008 ANNUAL REPORT
13
MAIN AGGREGATES
ELECNOR, S.A.
At 31 December each year and in thousands of euros
Result figures
2004
2005
2006
2007 *
2008 *
Operating profit
25,831
20,567
15,919
26,624
25,123
EBITDA
31,063
26,427
22,523
34,264
71,898
Pre-tax profit
32,122
27,816
33,831
46,364
54,769
Cash-flow
23,228
26,759
30,932
38,900
49,652
Assets
2004
2005
2006
2007 *
2008 *
130,576
149,154
155,183
176,330
202,424
2004
2005
2006
2007 *
2008 *
Sales
611,191
637,586
815,603
1,360,379
1,468,494
Spain
544,267
564,009
688,192
1,175,822
1,256,347
66,924
73,577
127,411
184,557
212,147
Other figures
2004
2005
2006
2007
2008
Employees
3,557
3,964
4,409
4,962
5,891
Share capital and reserves
Turnover
Abroad
* Acoording to the new PGC.
Ariany Public
School
(Mallorca).
Civil works.
2008 ANNUAL REPORT
15
BALANCE SHEET TRENDS (thousands of Euros)
ASSETS
2004
2005
2006
2007
2008
Goodwill
1,200
14,316
16,755
16,945
20,040
Property intangible
1,044
835
1,380
21,923
31,917
233,079
314,340
502,787
528,182
499,298
Investments accounted for using
the equity method
25,416
40,869
104,354
175,468
202,683
Non-current financial assets
15,328
26,375
34,940
42,122
40,146
8,590
12,744
12,024
20,287
43,306
284,657
409,479
672,240
804,927
837,390
-
17,995
-
-
4,460
93,475
126,594
79,181
112,492
73,916
350,933
399,253
705,432
910,111
790,664
1,882
3,062
11,646
2,724
3,654
33,486
24,430
29,680
29,460
38,128
3,780
35,633
11,073
14,543
26,344
605
966
1,530
2,247
1,805
53,317
142,426
101,188
79,476
158,911
Total current assets
537,478
750,359
939,730
1,151,053
1,097,882
TOTAL ASSETS
822,135
1,159,838
1,611,970
1,955,980
1,935,272
Property, plant and equipment
Deferred tax assets
Total not-current assets
Non-current assets held for sale
Inventories
Trade and other receivables
Trade receivables from related companies
Tax receivables
Other receivables
Other current assets
Cash and cash equivalents
EQUITY AND LIABILITIES
2004
Share capital
2005
2006
2007
2008
9,000
9,000
9,000
9,000
9,000
101,964
140,281
154,426
213,890
201,143
Profit for the year attributable to the Parent
32,904
47,285
54,853
73,554
93,593
Interim dividend for the year
(2,520)
(2,790)
(3,240)
(3,888)
(4,666)
141,348
193,776
215,039
292,556
299,070
9,640
43,927
50,539
53,075
50,143
150,988
237,703
265,578
345,631
349,213
91
7
8,979
19,041
23,599
2,184
2,722
2,890
30,634
64,624
201,709
310,405
388,167
434,568
440,706
Other non-current liabilities
5,518
2,124
3,863
4,175
8,149
Deferred tax liabilities
5,276
16,261
14,589
14,481
15,793
214,778
331,519
418,488
502,899
552,871
62,447
81,446
76,386
110,998
69,402
1,445
3,127
4,689
4,768
2,983
355,269
439,547
786,140
913,606
862,338
37,208
66,496
60,689
78,078
98,465
Total current liabilities
456,369
590,616
927,904
1,107,450
1,033,188
TOTAL EQUITY AND LIABILITIES
822,135
1,159,838
1,611,970
1,955,980
1,935,272
Reserves
Minority interests
Total equity
Deferred income
Provisions for contigencies and charges
Bank borrowings and other financial liabilities
Total non-current liabilities
Bank borrowings and other financial liabilities
Trade payables to associates and
related companies
Trade and other payables
Other liabilities
Building on the
street Amor de
Dios (Seville).
Restoration.
2008 ANNUAL REPORT
17
STOCK MARKET INFORMATION
MONTHLY QUOTATION AND TRADING TRENDS IN 2008
Figures adjusted for the Sept. 2008 stock split
Monthly listings
Trading volume
Days listed
Maximum
Minimum
Average
Closing
Shares
Cash
JANUARY
22
20.75
14.50
16.80
15.85
1,115,962
18,744,977.74
FEBRUARY
21
16.70
15.03
15.80
15.70
304,720
4,815,322.56
MARCH
19
16.50
13.35
14.99
14.24
286,432
4,293,235.31
APRIL
22
15.45
13.78
14.94
15.40
126,900
1,895,525.43
MAY
21
16.19
15.03
15.69
15.65
118,712
1,862,346.62
JUNE
21
15.80
14.05
14.89
15.00
139,020
2,070,574.85
JULY
23
15.00
12.50
12.79
12.50
419,094
5,360,934.32
AUGUST
21
13.40
12.50
13.04
13.40
53,494
697,338.70
SEPTEMBER
22
13.70
11.20
12.82
12.49
154,709
1,983,854.09
OCTOBER
23
12.99
7.50
9.90
9.24
158,744
1,572,271.79
NOVEMBER
20
9.29
7.85
8.73
8.60
222,751
1,943,517.33
DECEMBER
19
8.95
6.96
7.74
7.09
229,863
1,779,889.39
254
20.75
6.96
14.12
7.09
3,330,401
47,019,788.13
TOTAL 2008
DIVIDEND PER SHARE
Figures adjusted for the Sept. 2008 stock split
Ordinary Dividend
Extraordinary
Total
s
Pay-out
0.062
0.090
12.50%
34.87%
-
-
0.031
0.073
0.104
15.56%
34.98%
-
-
0.036
0.097
0.133
27.40%
38.55%
-
-
2007
0.043
0.116
0.159
20.00%
35.56%
0.045
2008
0.052
0.165*
0.217
36.27%
39.27%
-
Year
Interim
2004
0.028
2005
2006
Extra
* Proposal of the Board of Directors to the Shareholder’s Meeting.
EVOLUTION OF THE QUOTE
Dividend
Pay-out
10.00%
-
The Elecnor Group
in 2008
Los Concejiles Wind
Farm (Salamanca).
2008 ANNUAL REPORT
19
THE ELECNOR GROUP IN 2008
Together with the regular analysis of the Elecnor Group's
activities and figures from the fiscal year presented in this
Annual Report, this year we will also highlight a special
event from 2008: the celebration of the 50th anniversary
of its creation.
Elecnor was created on June 6th, 1958. Exactly fifty
years later, on June 6th, 2008, the employees of
Management South were invited to celebrate this
commemoration with a private event held in Seville. This
day-long event, with presentations from the company and
video projections, was especially planned for the occasion,
demonstrating that the Group today is actively involved in
key sectors for economic progress and social development.
The event in Seville was one of five that were held
through Spain. The series of events was begun in
Barcelona, then proceeded to Valencia and Bilbao. After
Seville, the final celebration was held in Madrid, on the
20th of June, an impressive culminating event with nearly
one thousand attendees.
Among the speeches delivered to the employees at
these five events, those of the Chairman and the General
Director were the most noteworthy. At one of the events,
the Chairman emphasised that: "Adequate technical
capacity and service is not enough to assure our success in
the future, nor is an effective strategy for commercial
expansion. I don't even think it's enough to count on the
best professionals. It seems essential to me, that aside
from all of this, there be a shared sense of the mission of
the company. And we have this at Elecnor, which makes
me confident that when designing the future of this great
institution, we will do so feeling proud of our role."
The General Director, on the other hand, referred
to the specific focus of the anniversary event: "The
philosophy that we would like to commemorate after 50
years of our company's existence is very clear. We have
chosen to be prudent, knowing that our reputation in the
market is based on effort, exactitude, credibility, fulfilling
our promises and striving to meet all expectations. We do
this without any grand displays or declarations, but
through hard work and professionalism."
But the 50th anniversary isn't just about internal
workings. Instead, it is an excellent opportunity to
construct new bridges to our main stakeholders and to
society as a whole.
Three fundamental tools for this included creating a
slogan (50 years fulfilled), publishing a commemorative
book (50 years providing energy, generating light) and the
launch of the Elecnor Foundation, lasting evidence of the
spirit of commitment and responsibility that inspired this
anniversary.
The fiftieth anniversary book has been widely
distributed among shareholders, customers, governing
bodies, opinion leaders and the media. It is much more
than just a chronology of accomplishments. It is the
expression of our business culture, one of initiative and
entrepreneurship, created during the difficult conditions of
post-war Spain and developed over the following five
decades by various generations of directors and
employees. As the Chairman mentioned in his message, if
there is one essential thing that the 300 pages of this book
demonstrate, it is that Elecnor continues to expand today
with the same energy as it had on the first day. We are
always ready for new challenges, breaking barriers and
seeking to satisfy the needs of our customers.
With regard to the Elecnor Foundation, the Group's
growing social involvement has inspired its directors to
become more involved in the challenges and needs of the
areas in which they work. The answer to this was the
Foundation, through which it is hoped to formalise
initiatives that pursue social infrastructure, technological
innovation, training and sociocultural patronage.
To conclude, it is evident to the Company that the
best way to include Elecnor's shareholders in the
celebration of their 50th anniversary is by giving them a
special dividend, approved at the Annual Shareholders
Meeting on June 18, 2008 and paid out on September
8th. The amount was 0.089€ for each title, making the
total brute dividend paid out in F.Y. 2008 reach 0.407€ per
share.
This whole series of celebrations required a unique
finale. And that was accomplished. His Majesty King Juan
Carlos I gave an audience to the Board of Directors on
December 2nd. During the audience, the Chairman relayed
Elecnor's commitment to the country's progress, following
a tradition since 1958.
The spirit that will always be remembered by those
who've lived through these events is one of a company
that began its journey --a history of the last 50 years
involving the efforts of its employees, directors, customers,
and shareholders-- with the same conviction as before:
that the Group will be capable of facing the challenges of
the future.
The Elecnor Board of Directors' audience with H.M. King Juan Carlos I.
2008 ANNUAL REPORT
21
Line 9 of the Barcelona Metro.
Telecommunications system and
electrical distribution.
business trends
If 2007 was an authentic "end of the party" for the most
developed economies, among them Spain's, 2008 has
been witness to a deepening of economic problems
everywhere in the world; no one hesitates to classify this
period as the most difficult since the Second World War, or
even perhaps since the Great Depression itself, starting in
1929 and lasting into the 1930s.
These events are rooted in the burst of the dot-com
bubble in 2001. Shares and real estate assets then began
to be the preferred method of investment, a phenomenon
encouraged by the low interest rates that resulted from an
excess of liquidity. This is when the now well-known "subprime" mortgages emerged, designed to offer low interest
rates that began to change in 2004 when the American
FED raised them for the first time in years. At the end of
2006, high rates and the end of the qualifying period for
many mortgages caused problems for many homeowners.
However, it was in June 2007 when the magnitude of
this was fully felt, causing a retraction in liquidity worldwide,
followed by tension in the interbank markets; these
phenomena, a year later, led to an extended series of cracks in
financial institutions and in stock markets, from the summer of
2008 until the culmination in October with international panic.
The financial crisis has inevitably led to the
economic crisis, affecting the most powerful and
consolidated economies as well as the emerging ones.
Everyone is looking for common solutions but those that
are most widely applied are the combined methods of
financial rescue and increased public investment, adopted
by each Government with its own focuses.
Though global growth in 2006 and 2007 registered
around 5%, in 2008 it did not exceed 3.6%. And for
2009, it's foreseen that there could even be economic
contraction, an event that has not occurred since the
introduction of the emerging economies. Thus, Latin
America --of great importance for the Elecnor Group's
international activities-- is affected by various factors that
are inhibiting its potential growth: the significant reduction
of international trade and the consequent impact on the
exportation capacity for primary materials, diminished
foreign investment, and a notable change in immigrants'
remittances.
Concerning the Elecnor Group's principal market,
which is domestic, the beginning of the crisis was
especially abrupt, with a practical free-fall in growth and
job loss increasing at a speed and intensity not seen
before. Although the economy moved ahead, growing
1.1% during the fiscal year, the last two quarters were
negative, placing the country in its first recession since
1993.
In this climate, the Elecnor Group closed F.Y. 2008
with a consolidated net profit of 93.9 million euro, which
was an increase of 27.2% over 2007. On the other hand,
the figure for consolidated businesses grew by 15.8%,
from 1.65 billion euro in 2007 to 1.911 billion in 2008.
These figures show that the high growth rate from
previous years has continued. Concretely, the Elecnor
Group has doubled its net profits in the last three years,
with 47.3 million euro in 2005 and reaching the
aforementioned 93.6 million last year.
The parent company of the Group, Elecnor S.A.,
had after-tax profits of 49.7 million euro in 2008, which
compared to 2007 was a growth similar to that of the
Group itself: 27.6%. Regarding the figures for individual
businesses, these grew by 7.9%, reaching 1.468 billion.
The key to this satisfactory evolution, within the
current context of economic crisis, is found in three-fold
diversification: by sector, by territory and by income type.
In terms of the first, Elecnor has stood behind renewable
energy, in particular photovoltaic solar energy,
compensating for the lag in other activities. With regard to
territory, its activities in more than 20 countries allow
Elecnor to balance any cyclical downturns in other
markets, as is currently the case with Spain. This also
includes converting part of the business into regular
earnings, thanks to increased concessions in our country
and other certain emerging areas, like Brazil.
All these factors can be better appreciated through
the traditional analysis of the Elecnor Group's activity
according to the triple criteria for the territories in which it
works, the companies it consists of and the sectors in
which these operate:
• Territorial breakdown: though in 2007 the domestic
market showed greater strength than the
international one in terms of growth in business
figures, in 2008 the reverse was true. In effect, sales
outside of Spain increased by 32.2% while in Spain it
was 12%. For this reason, the national market
weight went down 3 points, to 78.4% of total sales.
The international market was at 21.6%.
The Elecnor Group carries out business in more
than 20 countries, directly through its parent
company, Elecnor, S.A. as well as through its
subsidiaries with direct implementation in specific
markets: Central America, Ecuador, Chile, Argentina,
Mexico, Brazil, Uruguay, Venezuela and Portugal.
Among the unique activities undertaken outside
our borders in 2008, we can highlight the concession
granted for the construction and operation of a new
system for electric transmission in the Brazilian state
of Mato Grosso do Sul which will receive an
investment of approximately 135 million euro. With
this, as of the close of 2008, Elecnor participates in
15 transmission systems, having won its first
concession in Brazil in 2000.
Enerfin Sociedad de Energía, and Elecnor Group
subsidiary, was selected by Hidro-Québec Distribution
to supply 100 megawatts of electricity generated
from wind power project in Québec, Canada. The
Elecnor Group participated in the construction and
exploitation of wind farms that produced more than
780 megawatts, among them the biggest of Latin
America situated in Rio Grande do Sul, Brazil.
In another key strategic market, the United
States, we have obtained the first permits for
construction and operation of two wind farms.
• Breakdown by companies: though the parent
company of the Elecnor Group maintained its normal
prevalence in terms of the relative weight of its sales
total (76.8%), the most impressive occurrence was
the spectacular growth of its subsidiary specialised in
photovoltaic solar energy, Atersa, which recorded its
relative participation at 11.7%, putting it in second
place among the companies that make up the
Group. This is due to the completion of various
projects for solar plants that occurred this fiscal year.
In terms of companies located overseas, it's
worth noting that Elecnor in Mexico had a 221.8%
growth in sales. Also noteworthy is the progress of
another overseas subsidiary that is strongly
consolidated in its market and therefore has few
expansion opportunities: Elecnor in Brazil, whose
sales grew by 14.5%.
• Breakdown by sectors: The Elecnor Group operates in
a total of 9 different sectors. Since its creation in
1958, and until the year 2007, the predominate one
was electricity, but this year it has begun to lead in
Renewable Energy. In the past year, development of
the different areas has confirmed this change, since
growth for Renewable Energy is greater than that for
Electricity: 22.1% and 17.8%, respectively. Thus, the
former has a relative weight of 34%, while the latter
is at 32.3%.
The greatest growth rates, however, are found in
other areas: Telecommunications, in Infrastructure as
well as Systems (32.5% and 22.1% respectively), and
Gas (25.1%).
The third most important sector for the Group in
terms of relative sales is Installations, whose weight
increased slightly in 2008, until reaching 10.7%.
These and other figures, all available in detail in this
2008 Annual Report, reflect the complete fulfilment of the
quantitative goals laid out in the 2006-2010 Strategic Plan,
to which we've added a financial risk management policy
that, though always rigorous and prudent, in the current
context of the financial and liquidity crisis, has prioritised
analysing the financial solvency of customers.
2008 ANNUAL REPORT
23
Senmenat-Bescano
400 kW Line
(Gerona)
West Circle (Cordoba).
Lighting.
NETWORKS AND INFRASTRUCTURES
ELECTRICITY
This year, Elecnor is once again a leading company in its
area, consolidating its operations with the principal
Spanish electricity operators, such as Endesa, Iberdrola,
Union Fenosa, Hc Energia and E-ON.
In the past fiscal year, Elecnor not only continued its
leadership in the sector, but it also consolidated a greater
presence through the framework concession contract for
Construction and Service of the low- and medium-voltage
Distribution Networks in the city of Jaen.
In 2008, Elecnor maintained its presence in all of
the Autonomous Communities of Spain through
framework contracts, whether for Distribution, Substation
Maintenance or for Aerial Electrical Lines.
As part of the work undertaken for individual
customers in the domestic market, we can especially
emphasise providing energy and public lighting for large
housing developments and industrial parks, such as the
Terrazas de la Torre Golf Resort and Mar Menor 2 in
Murcia, and the Development of Sector 14-B Valdepeñas
Golf in Ciudad Real, the Los Tempranales Housing
Development in Madrid, medium- and low-voltage
installations and lighting in the third Tunnel of
Guatarrama, renovation of the two existing ones, as well
as the medium voltage connection of the Santa Eulalia
Desalinazation plant in Ibiza.
With regard to the work carried out by the
electrical companies, we can mention: the project to
construct an aerial section of the 400 kW Transportation
Line between Tordesillas and Segovia, the 400 kW
Sentmenat-Bescano Line in Gerona, or the reinforcement
of the 220 kW Cartuja-Don Rodrigo Line in Seville for the
Spanish Electricity Network. Equally important was the
underground insertion of a section of the 132 kW Vilanova
de Castellon-Gandía Line, in the Community of Valencia
for Iberdrola, or the construction of 66 kW substations in
Badajoz, the substation De la Victoria in Jaen, as well as
common infrastructures, substations, aerial and
subterranean electrical lines, for the evacuation of the
Wind Farms in Arcos de la Frontera, Cadiz, for Endesa.
Internationally, there are many projects completed
or in process, among which we can include:
• The 400 kW Transportation Line in Sonelgaz, Algeria.
• The 345 kW "electric highway" Transportation Line
in the Dominican Republic.
• The Capanda-Lucala-Viana transmission system, 300
km of 400 kW Transportation Line in Angola.
• Substations, each with 500 kW in Luziania,
Emborgaçao, Samambaia and Serra da Mesa II, Brazil.
• Construction of the Mantaro-Caravelí-Montalvo 550
kW line, approximately 760 km long, with a
transmission capacity of 600 MW, in Peru.
• Construction of two 550 kW substations, one in
Mantaro and one in Montalvo, Peru.
2008 ANNUAL REPORT
25
NETWORKS AND INFRASTRUCTURES
GAS
In 2008, Elecnor continued to consolidate its leadership as
a provider, developing the Gas energy sector in different
areas of its application, from transport, through the
network of gas lines, to distribution for industrial or
individual use.
Throughout the year, Elecnor also strengthened its
involvement with the principal clients in this sector, among
them Gas Natural, Enagás, Gas Extremadura, Hidrocantábrico
and Naturgas. In addition, we began to work with new
clients like Endesa Energia and Tecnicas Reunidas.
Special mention should be made for Elecnor's
collaboration with Gas Natural, with whom it has obtained
framework contracts for different Group distributors:
Cegas (Valencia), Gas Natural Andalucía (Huelva), a new
incorporation in Seville, Gas Rioja (La Rioja), Gas Castilla y
León (Burgos), Gas Natural Castilla la Mancha (Guadalajara
and Toledo) and Gas Natural (Barcelona, Aragon and
Madrid).
Balmori-Posada
gas piping in
Llanes (Asturias).
Some of the contracts with Gas Natural that
deserve mention are:
• Network distribution and shared receiving facilities.
• Renovation, mechanical maintenance and network
surveillance (Catalonia).
• Periodic systematic inspections (Catalonia).
• Individual facilities.
• Advancing new supply points.
• Consolidation of the framework contract for Steel
Networks and Connections (Catalonia, Aragon and
Andalusia).
In addition, other noteworthy projects have been
taken on, such as:
• The Huelva-Ayamonte Gas Pipeline, 70 km of
secondary transport and 7 distribution points.
• Regulation and/or Metering Stations located on the
Huelva-Ayamonte Gas Pipeline.
• The Utiel APA (High Pressure > 16 bars) branch line, 3 km
NETWORKS AND INFRASTRUCTURES
• Polyethylene branch lines in the Cabra-Lucena-Baena
Gas Pipeline.
• Modifications to the Steel Network for the Huelva
Technical Services.
• Placement and a regulation and metering station for
gas supply at the Combined-Cycle Power Plant
(CCPP) in Malaga.
• Remote control project for valve nodes in the
distribution network for Gas Natural.
As for projects linked with other Group activities
and related to Gas Natural, we can highlight the
construction of:
• The evacuation line for the Puerto de Barcelona CCPP.
• The evacuation line for the Malaga CCPP.
• The tertiary treatment for cooling at the Malaga CCPP.
• Waste water treatment for the cooling towers at the
Malaga CCPP.
89 km), Yela-Villar de Arrendó Gas Pipeline, northern
section (30” and 139 km), and Bermeo-Lemona Gas
Pipeline (24” and 32 km).
Gas Extremadura, for its part, should be mentioned
for consolidation of the framework contract to be carried
out for Distribution, Regulation and Metering Stations, and
APA Branch lines, including the following activities: pipe
laying, distribution and receiving facilities in Badajoz,
Cáceres, Montijo and Olivenza.
Other activities of note:
• Interior installations in the Cerro Gordo
Development.
• Construction of an APA Branch line.
• Construction of the G-1600 Regulation and Metering
Station in Caceres.
The most important activities for Hidrocantabrico were:
Our commercial activity with Gas Natural focused
on service commissions and new customer recruitment,
according to the following figures:
• Intake at supply points: an increase of 56% was
registered compared with 2007.
• New supply points: there was an increase of 50%
compared to the previous year.
The most notable projects with Enagás were:
• Consolidating, in its second year, the Maintenance
and Service Contract for the Basic Network of Gas
Pipelines in zone East.
• Construction of Regulation and/or Metering stations
located in the Basic Network of Gas Pipelines (RBG).
• Modifications to the RBG positions.
• Construction of the evacuation line for the power
generation cycle located at the Compression Station
in Almendralejo.
• Contract for the assembly of electric and instrument
facilities at the Compression Stations in Lumbier
(Pamplona) and Haro (Logroño).
• Maintenance contract for electrical lines and
transformer stations located at RBG facilities.
• Contract for Input and Output positions (Denia-IbizaMallorca) for implementation of the Submarine Gas
Pipeline project in the Balearic Islands.
• Contract for a turbine calibration bench at the R&D
Centre in Zaragoza.
• Contract for projects that form part of the
Framework Agreement, corresponding to the
Strategic Plan for Gas Transport, which are the
following: Castropodame-Villafranca Gas Pipeline
(30” and 30 km), Algete-Yela Gas Pipeline (26” and
• Continuation of the framework contracts from 2006
with regard to Domestic Activity.
• Framework agreement for Gas Distribution in Avilés.
For Naturgas, the significant accomplishments were:
• Construction of the Baracaldo-Santurzi variant in
Vizcaya
• Modifications to the Trápaga Network, also in
Vizcaya.
• Construction of 7 km of the Velorio-Balmori-Posada
de Llanes network layout for Natural Gas Distribution
in the Asturian municipal district.
• Framework contract for the distribution of gas,
receiving facilities, and individual and commercial
installations in the municipal district of Villajero de
Salvanés in Madrid.
With respect to Repsol-Butano, Elecnor completed
its Marketing, Distribution and Installation activities in
Campo Real in Madrid.
And finally, among the special projects we can
highlight the following three:
• Contract for the Regulation and Metering Station,
electrical lines and interior distribution lines for
turbine supply at Endesa's Son Reus Headquarters.
• Contract with Tecnicas Reunidas for the Regulation
and Metering Station for the CCPP in Puerto de
Barcelona, owned by Gas Natural.
• Contract with Tecnicas Reunidas for the Regulation and
Metering Station for the CCPP in Besós, owned by
Endesa.
2008 ANNUAL REPORT
27
CENAT Electricity Plant in new
terminal area. El Prat de
Llobregat Airport (Barcelona).
TELECOMMUNICATIONS INFRASTRUCTURE
Elecnor offers a wide array of services in the area of
telecommunications infrastructure, among which we can
underscore:
• Feasibility studies and business plans
• Engineering and design
• Site scouting and network planning
• Permits and licenses from public authorities and
private entities
• Supply of telecommunications materials, equipment
and systems
• Lay-out and auxiliary civil works
• Installation and connection
• Testing and commissioning of equipment and
systems
• Operations and maintenance
• Customer service
All these services make Elecnor a turnkey supplier, a
fundamental role in the telecommunications sector.
In 2008 Elecnor took on numerous jobs and
projects in telecommunications infrastructures. On the
national level, significant projects included:
• A global customer loop contract for Telefónica de
España in 12 provinces: Valladolid, Burgos, Vizcaya,
Álava, La Rioja, Navarra, Zaragoza, Huesca, Teruel,
Gerona, Valencia and Murcia. This contract covers full
implementation and maintenance of the telephone
distribution and scatter network in these 12 provinces.
• Implementation of the new network for fibre optic to
the home (FTTH) for Telefonica de España, in the
cities of Bilbao, Vitoria, Valladolid and Zaragoza.
• Contract for construction and installations for ONO
Telecommunications company in the Autonomous
Communities of Navarra, La Rioja, Castile and Leon,
Madrid and Catalonia. Elecnor is one of the leading
companies in the deployment of ONO’s entire
network in these Autonomous Communities.
• Supply and installation of mobile telephone base
stations for the expansion of GSM coverage (the EGSM project), for Motorola-Telefonica de España in
Extremadura and Andalusia.
• Execution of Project HEURA for the Generalitat
(regional government) of Catalonia. The project
consists of designing and later installing voice and
data cabling in 520 schools in Catalonia.
• Framework agreements to develop the fibre optic
cable network for Adif and Gas Natural.
• Inventory services and full-service maintenance for
the telecommunications network of the Sociedad
Estatal de Correos y Telégrafos, for Correos
Telecom.
• Corrective maintenance of Orange's fibre optic
infrastructure for Alcatel-Lucent.
• Installation and Start-up of the PLC Network for
Iberdrola. This contract consists of providing services
associated with engineering, installation and start-up
of equipment that offers a data network, based on
PLC technology, utilising Iberdrola's medium and lowvoltage electrical cables.
NETWORKS AND INFRASTRUCTURES
INSTALLATIONS
Throughout the last few decades, Elecnor has become a
reference point for this activity, always offering the best
solutions for the development of large infrastructures, such
as airports, buildings, hotels, hospitals, shopping centres,
offices, solar plants, wind farms, etc.
Some of Elecnor's foremost capacities in the
installations sector include:
• General electrical installations
• Monitoring
• Heating and air conditioning
• Mechanical and electrical assembly
• Fire protection systems
• Communications
• Security
• Solar energy
Among the distinguished projects in 2008, we can
start with the skyline of Madrid. In 2008, Elecnor finished
the complete installations of the Sacyr-Vallehermosa Tower,
one of the four towers that make up the Business Area
Complex situated at the end of the Paseo de la Castellana,
in the area of the former Ciudad Deportiva of the Real
Madrid football team.
This tower was designed by the prestigious
architects Carlos Rubio Carvajal and Enrique Álvarez-Sala
Walther. The building is 236 m tall and it has a total of 64
floors. The total surface area is 117,000 m2.. It offers
more than 1,150 parking spots and 25 elevators. Also
noteworthy is that, inside the Tower, Elecnor provided
complete installations for the Eurostars Madrid Tower, a
top-notch five-star hotel with 475 rooms. The offices,
also administered by Elecnor, are distributed over 17
floors in the uppermost part of the skyscraper just below
the four technical floors and four more that form the top
of the tower. This took advantage of the synergy
generated between the offices, the hotel and the
convention hall.
At the same time, Elecnor has continued to
strengthen its commitment to the Spanish Airports, as
leaders in installation of the most advanced systems for
airport traffic control facilities. This was clearly made
evident when it received a commission from the airport
of Jerez de la Frontera, Cadiz, to renovate its traffic
control facility. The control system installed there will be
exactly like those in the most important international
airports; currently only a few such systems exist in
Spain.
Research and Technology Centre for
Ormazabal en Amorebieta (Vizcaya).
Complete installations.
2008 ANNUAL REPORT
29
SacyrVallehermoso
Tower (Madrid).
Complete
installations.
NETWORKS AND INFRASTRUCTURES
Along the same lines, the work carried out in the
Electrical Power Plant in Malaga is noteworthy, as well as
the concession in 2008 for the contract for Maintenance
Service and Local Manoeuvres for the High-Voltage
Electricity Production and Distribution Network in the
Malaga Airport.
Elecnor continues to maintain the high-voltage
installations at the Madrid-Barajas Airport and provide fullservice maintenance of electrical and mechanical
installations at the Bilbao airport. In Barcelona, it
undertook the installations in the Airport Management
Centre, the facilities and control system for airport parking,
the first phase of the sound-proofing project for
neighbouring houses, and the integration of the electricity
system, as well as the Electrical Power Plant CENAT.
In addition, there have been a number of
installation activities in the airports of Palma de Mallorca,
Málaga, Ibiza, Lanzarote, Logroño, Santander and Jerez de
la Frontera.
Another example of Elecnor's work in large projects
and infrastructures is the Henares Hospital (Madrid), which
currently offers medical care to residents of Cosalda,
Loeches, Velilla de San Antonio, Mejorada del Campo and
San Fernando de Henares, and where the company
provided full-service installations. This hospital was
designed with the capacity to attend to 170,000 patients
in its facilities. This modern hospital centre offers the latest
technology and has 194 individual rooms that can be
converted into doubles in response to demand. The total
surface area of the construction is 58,149 m2 and it will
house one thousand health professionals.
In addition, Elecnor has completed installations for the
new complex of Cepsa's R&D&I laboratories, located in Alcala
de Henares, Madrid, the new ESADE Campus in Barcelona,
and the new headquarters for Vital Kutxa and BBVA in Bilbao.
Finally, Elecnor has taken on a great number of shopping
centres recently, of note in 2008: the electrical installations for
the Isla Azul Shopping Centre in Madrid, with a surface area
of 256,000 m2, the electrical installations for the Aguilas Plaza
Shopping Centre, Murcia, and the electrical and special
installations for the Portal Shopping Centre at the Marina and
at the Hipermercado Eroski, both in Ondara, Valencia. And
finally, various electrical and special installations at the Altrium
Shopping Centre in Sant Celoni, Barcelona.
Altrium Shopping Centre
(Barcelona). Special and electrical
installations.
2008 ANNUAL REPORT
31
Monte San Isidro
Hospital (Leon).
Full-service
maintenance.
MAINTENANCE
Elecnor's maintenance activity is very diverse,
encompassing building conservation, daily operations,
preventative maintenance and high- & low-voltage
technical or legal maintenance, heating and air
conditioning, fire protection systems, and highly-qualified
predictive maintenance such as thermographs, vibrations
analysis, air quality studies; through its own specialised
technical office, it carries out projects such as energy
audits, minor renovations, procedural studies and
implementation of IT management for maintenance, etc.
Elecnor offers a highly-trained team that currently
undertakes projects of full-service maintenance for:
hospitals, business complexes, shopping centres, bank
branches, office building, city halls, airports, thermal
power stations, nuclear power stations, wind farms, solar
plants, factories and universities.
As an example of the variety of our resources and
the diversification of our maintenance activities, we can
highlight, among others, the following activities:
• Low-voltage installation maintenance in the Madrid
Airport, with full-service upkeep of the movement
and access areas, including its flight field.
• Maintenance of substations, transformer stations and
high-voltage lines at the Madrid Airport for Aene.
• Maintenance of the Solar Farm in Jumilla and the
Solar Farms Lorca I and Lorca II, both in Murcia.
• Maintenance of complete installations for the Gran
Turia Shopping Centre in Xirivella, Valencia.
• Maintenance of electrical installations at the
Polytechnic University of Valencia
• Maintenance of complete installations for the Luis
Alcañiz Hospital in Xativa, Valencia.
• Maintenance of complete installations for the
Valencia Institute of Oncology (IVO).
• Maintenance of the Aguilas Plaza Shopping Centre in
Aguilas, Murcia.
• Full-service maintenance of the Puerta de Valencia Hotel.
• Maintenance of security and fire protection facilities
at the Congress of Deputies in Madrid.
• Full-service maintenance of the judicial buildings of
the Principality of Asturias.
Hotel Eurostar Madrid Tower.
Sacyr-Vallehermoso Tower
(Madrid). Full-service
maintenance.
• Full-service maintenance of the Monte San Isidro and
Santa Isabel buildings at León Hospital.
• Maintenance of fire protection facilities at the Alcala
de Henares, Carlos III, and Castilla La Mancha
Universities.
• Full-service maintenance of the following shopping
centres: Moraleja Green, Montecarmelo and
DiverValles for ING, Opcion for Metrovacesa and
Loranca for SCCE, all located in Madrid.
• Maintenance of the Business Complexes in Las Tablas
and in Campo Las Naciones for Metrovacesa.
• Maintenance of heating/cooling and fire fighting
facilities at the central headquarters and secondary
buildings of the Social Security Institute in Madrid.
• Full-service maintenance of the Hotel Eurostar Madrid
Tower.
• Maintenance of transformer stations, generator sets
and UPS's in the M-30 Tunnels in Madrid for Emesa.
• Maintenance and upkeep of the Presas Zona Norte
for the Canal de Isabel II.
• Electromechanical maintenance of the facilities in the
East and West Zones, Canal de Isabel II.
• Full-service maintenance and preservation of the
Mateu Cromo Industrial Park in Madrid for Mathew
Chrome.
• Maintenance of the heating and air-conditioning and
medium- and low-voltage installations in Telefonica
buildings in Galicia, Castile and Leon, Asturias, and
parts of Madrid.
• Full-service maintenance and preservation of the
Presidencia building and the Telefonica ShopMuseum located on Calle Gran Via in Madrid.
• Electrical maintenance of Petronor’s refinery in
Muskiz, Vizcaya.
• Electromechanical maintenance of facilities at Bilbao
Airport.
Telefónica
Central
Headquarters on
Calle Gran Via
(Madrid).
Full-service
maintenance.
2008 ANNUAL REPORT
33
NETWORKS AND INFRASTRUCTURES
CONSTRUCTION
The year 2008 was particularly complicated for
construction projects, above all for residential buildings.
Nevertheless, the Elecnor Group's strategy to avoid this
area of the economy has made it possible to maintain the
business volume and consolidate this activity. In addition,
during the year the company Ehisa began to earn a
reputation as a specialised company of the Elecnor Group
in the area of construction.
• Singular structures with high-tech components and
installations (electrical, mechanical, and electronic).
• Civil Works projects associated with the traditional
Elecnor activities (energy generation, hydraulic
projects, and housing developments).
• Hydraulic projects for public and private service
operators (distribution networks, pumping and
sanitation systems).
Following the path of previous years, Elecnor has
made itself known in the construction sector through a
variety of work:
Management efforts were directed towards
increasing Elecnor's market share in Public Administration
and to widen its offer of construction services for its
"Basketball City,"
facility in
Badalona
(Barcelona).
Housing
development.
Reus Airport
(Tarragona).
Equipment.
regular customers. Civil works associated with energy
generation and hydraulic infrastructures have also been a
priority activity.
Also worth mentioning is the consolidation of a
new activity developed by Elecnor in the area of
construction, which is for Infrastructure and Interior
Design. With this service, Elecnor offers its customers the
possibility to complement their building projects with plans
for interior design and the comprehensive infrastructure of
the building. Thus, we've taken a step forward in the area
of turnkey projects, enabling our customers to use the
building for operations starting from the moment the
project is completed.
In another area, we've increased invoicing for work in
construction, operation and maintenance of water networks
for operational service companies, such as: Canal de Isabel II
and Aguas de Valencia. Elecnor's goal is to be a leader in
quality and service in collaboration with these companies.
Following the path taken up in 1996, Elecnor has
continued working to develop urban land, by acting both
as a Property Developer and a Construction Company.
Elecnor has an impressive portfolio of land to be
urbanised, currently in different stages of development for
urban use.
Given that the Elecnor Group's Strategic Plan for
2006-2010 emphasises the company's participation in
the concessions market for public buildings, last year it
began an analysis of its viability and the administrative
proceeding for various city government projects. It is
hoped that in the coming years some of these projects
will get the green light, giving Elecnor a boost in its
construction activities and in the generation of core
earnings.
Among the most important events of this year, we
can underscore the following:
2008 ANNUAL REPORT
35
• Civil Works for the Granadilla and Vallitos Substations
for Endesa Andalucía.
• Water supply for Torres Pozuelo in Madrid for Canal
Isabel II.
• Multi-use municipal pavilion for the City Government
of Alcala de Guadaira, Seville.
• Outfitting of the Reus Airport in Tarragona.
• Multi-use buildings for the City Government of
Aizarnazabal, Guipúzcoa.
The construction sector also encompasses the
activities of Adhorna Prefabricación, a specialised
subsidiary of the Elecnor Group.
In 2008, an important event in the 45-year history
of this company, a Group subsidiary known as Placarmada,
took place: its absorption by Postes Nervion. As a result of
this merger, the two companies created the new Adhorna
Prefabricación. The main goal of the merger was to
integrate the activities of the two companies, Postes
Nervion and Placarmada, to justify the use of their
productive resources to improve costs and management,
optimising their financial resources and integrating their
commercial networks in such a way as to create the
necessary teamwork between the products the two
companies produced.
Villanueva I Wind Farm in Jarafuel
(Valencia). Foundation.
• Construction of the access roads and windmill
foundations for the Villanueva I Wind Farm in
Jarafuel, Valencia.
• Furnishing and outfitting the terminal expansion at
the Barcelona Airport.
• The Ciudad Ros Casares housing development in
Valencia.
• Access road and civil works for the Lorca II
Photovoltaic Solar Plant in Murcia.
• Water supply at the Ara field for the Hydrographic
Confederation of the Tajo River.
• Rehabilitation of the Mossen Sorell Market in
Valencia.
• Avenida de Cataluña housing development for the
City Government of Igualada, Barcelona.
• Construction of the Municipal Market for the Bilbao
City Government.
• Reforms of the ICU at the Virgen Macarena Hospital
for Andalusia's public Health Services.
• Espacios del Este housing development in Valencia.
In addition, this merger launched two new factory
plants, one in Tortosa, to substitute the Placarmada plant
in Llica d'Amunt (Granollers) and designed to produce
prefabricated components, as well as another in Avala,
specifically in the industrial park of Subillabide, to produce
GRP columns. The latter took the place of the factory in
Arrigorriaga and the warehouse in Orozco. The new plant
has two new injection machines, a new robot and a drying
oven, which were the most pertinent investments for the
facility in order to improve its production capacity to
respond to product growth.
The company's section sales for Transformer Stations
grew by 40% thanks to the investment in solar farms.
In the section for sheds, which also includes buildings
for electrical substations, of special note are the 18 substations
for Grupo Iberdrola; of these, the four most important were
those in Montebello (Alicante), Albal (Valencia), and in
Ormaiztegui and Itziar, both located in Guipúzcoa.
For the section on civil works, some important
projects include the walls for the High-Speed Train (AVE) in
the segment between Torrejon de Velasco and Seseña, in
Toleda, for Aldesa; the rib vaults for the Perthus tunnel,
and for the tunnels of La Famada, Codina and Carrera.
NETWORKS AND INFRASTRUCTURES
ENVIRONMENT
The Elecnor Group's work with regard to the environment
is carried out through two highly-specialised work groups.
On one hand is the subsidiary company Hidroambiente,
which focuses on purifying industrial waste water, offering
turnkey solutions through its own engineering
developments for waste treatment. On the other, Elecnor's
Environmental Department specialises in treating urban
and rural waste water. Consequently, the Group, being
both reliable and competitive, is in a position to take on
waste water purification projects (industrial, urban and
rural), tertiary purification treatments, water treatment for
urban supply and processing, classification and recovery of
solid waste, both urban and from construction, clean
points and land decontamination.
Providing the necessary development for
environmental infrastructure will be very important in the
next few years. This said, it is one of the most important
points of the Elecnor Group's strategy for the future. The
objective is to work in the construction as well as in the
operation of treatment plants for all kinds of waste, to the
point of even investing as concessionaries in the plant.
Elecnor is clearly relying on obtaining concession
contracts for this activity. An outcome of this is the
progressive commissioning of waste water purification
plants that are part of the concessions for Zone 4 and 6 of
the Special Plan for Waste Water Purification in Aragon; of
special mention is the Waste Water Treatment Plant
(WWTP) in Zuera, Zaragoza, with a purification capacity
sufficient for more than forty thousand inhabitants.
Of the other significant projects carried out in this
year, we can highlight the following:
• Construction of the WWTP in Guadalhorce for Gas
Natural.
• The settling tank in L'Ampolla for the Water
Consortium in Tarragona.
• Solid urban waste plant in Arico for the Tenerife
Island Council.
• Water supply treatment plant for the Enagas
Combined Cycle Power Plant in Malaga for Alstom
Power.
• Water supply in the Campo Arañuelo
Commonwealth for the Hydrographic Confederation
of the Tajo River.
• Legionella treatment plant at the Huelva prison for
the Secretary of State for Penitenciary Affairs.
• Tordesillas WWTP for the Environmental Council of
the Government of Castille and Leon.
For the subsidiary Hidroambiente, 2008 was a
year of transition from already-established activities in the
market to the launch of new business lines and a new kind
of customer, following the strategy designed three years
before.
Within the traditional markets, Siderurgia's
continuing presence is noteworthy, having carried out a
variety of projects for customers like Sidenor, Nervacero,
Alcoa and Tubos Reunidos.
The Basauri factory has undergone an extension
and installations for new continuous casting, a new river
water intake, and new supply pumps for the factory, as
well as a new desilter that is 27 m in diameter.
In the Sidenor Factory in Azkoitia, a new cooling
line for the new lamination technique was installed, and
for the factory in Legazpi, a new system for ladle
metallurgy.
Along the same lines, the Potable Water Treatment
Stations of Roncal and Larrate were also contracted, the
latter for the Commonwealth of Aguas de Mairaga, both
in the Foral Community of Navarre.
In terms of new market penetration, the
reengineering of waters was completed for the entire
Repsol Petroleum Refinery in Tarragona, consisting of a
new treatment plant for discharges, tertiary treatment with
membranes for reuse, a waste water recovery plant for
towers and a new reverse osmosis plant for supply, as well
as the renovation of the old supply plant.
In addition, Iberdrola contracted the modification
of the polishing system for water vapour for the Thermal
Power Station in Lada. There were also modifications to
the physical-chemical treatment of the Mutiloa landfill for
Cespa-Ferrovial and finally a new reverse osmosis plant for
the Water Consortium Bilbao Bizkaia.
One of the most important accomplishments of the
year, both economically and strategically, was the launch
of a Service Department which is focused on three key
activities: maintenance and operation of water
installations; technical assistance, advice and training;
marketing spares, supplies and small repairs, as well as
engineering projects and studies focused on engineering
and complex processes.
2008 ANNUAL REPORT
37
Seville-Cadiz
Line. Jerez-Cadiz
Airport branch.
Electrification.
Garages in Lakua
(Álava).
Electrification.
RAILWAYS
Elecnor continues to actively participate in the
development of railway infrastructures in Spain, for both
the High Speed lines as well as the traditional ones,
metros, trams, etc.
In 2008, it was involved in the following activities,
among others, for the Railway Infrastructure
Administration (Adif):
• Access to Albacete through the Railway Line LevanteMadrid-Castilla La Mancha.
• Electrification of the new Atocha-Chamartin tunnel.
• Renovation of the tracks and electrification of the
segment between Villasequilla and Villacañas (Toledo).
• Rehabilitation and modernisation of the catenary in
the section between Baracaldo and Santurce
(Vizcaya).
• The substations at Flix (Tarragona) and Huelva.
NETWORKS AND INFRASTRUCTURES
• Work has also commenced for substations for the
High Speed lines Torrejón-Motilla-Valencia-Albacete.
Chamartín tunnel of the regional rail network for the
Ministry of Public Works.
Other projects carried out for the Railway
Administration:
Elecnor also participates in maintaining various
railway and tramway lines, among them:
• Electrification installations for the railway stops at San
Vicent del Raspeig (Alicante) and University of
Alicante for the Valencian Government Railway
Administration (FGV).
• The project with the Basque Government to electrify
the tram in Victoria was continued.
• Work for Madrid Norte and the substation in
Arganzuela for Mintra.
• Service start-up for the Travellers Information system
in 21 stations for the Catalonian Government
Railway Administration (FGC).
• Electrification of the Portugalete-Santurtzi segment
of Line 2 of Bilbao's Metro for the Transport
Consortium of Bizkaia (CTB).
• Completion of Power Supply for the new Atocha-
• High-Speed Catenary Line Madrid-Barcelona (LeridaBarcelona segment).
• Catenary and substations for the High-Speed line
from Madrid to Seville.
• High Speed Catenary Line from Cordoba to Malaga.
• Cantenary Lines for Eusko Tren and Eusko Tran
(Bilbao tram).
• Catenary Lines 1 and 2 for the Bilbao Metro.
Various substations for the Santo Domingo Metro
have also been built for Siemens.
Finally, the creation of the Travellers Information
Systems for the Valencia-Málaga-Barcelona line was
undertaken for Adif and Renfe-Operadora.
Electrification of
Victoria tram
(Álava).
2008 ANNUAL REPORT
39
RENEWABLE ENERGIES
In the last few years, the Group has been among the
important leaders for renewable energy, both in Spain and
internationally.
In particular, Elecnor has made itself one of the
sector’s leading developers and turnkey contractors,
tackling projects in the fields of wind power, photovoltaic
and thermoelectric solar energy and hydroelectric power
plants.
Villanueva I
Wind Farm in
Jarafuel
(Valencia).
Due to this progress, the Elecnor Group has gone
from contracting specific supply and assembly packages to
serving as a developer, operator and general contractor,
generating an exponential growth reflected by the Group's
business figures, which show that 34% of all its activities is
devoted to Renewable Energy.
distinguished response to the needs and particulars of
every project.
WIND POWER
In 2008, 1,609 MW were installed in Spain, reaching a total
accumulative energy of 16,740 MW, putting Spain in third
place among the countries in the world with installed wind
power. In the coming years, it is hoped that the current
pace of growth will be kept up, potentially allowing us to
reach 20,155 MW of wind power, the goal of the
Renewable Energy Plan for 2005-2010.
To this end, Enerfín Sociedad de Energía, a
subsidiary of Elecnor, is a company dedicated to
promoting, supervising and managing the construction
and operation of investment projects in the wind energy
sector, both in the domestic and international market.
Enerfín not only develops its own project portfolio
but also provides supervision, operational management
and technical, financial, administrative and accounting
services for the wind power subsidiaries of the Elecnor
Group: Enerfín-Enervento, Elecnor Financiera, Eólica de la
Patagonia, and their respective investee companies.
In 2008, Enerfín Sociedad de Energía has continued
developing wind projects in Spain, undertaking the
construction of the first two farms for the Wind Energy
Plan for the Community of Valencia, the Villanueva I and II
(in Jarafuel, Valencia), with a total energy of 66.7 MW. The
first 18.4 MW correspond to Villanueva II, which began
operating in the month of December. At the same time,
Enerfín has pushed to proceed to the following 100 MW
that are to be created for the Community, of the total 356
MW that are included in the Wind Energy Plan.
Enerfín also has undertaken intensive development
activities in the markets of Canada, the U.S., and Brazil.
Enerfín was one of the companies selected for the
commission of the Canadian electric company Hydro Quebec
Distribution for the supply of energy from wind farms; its 100
MW wind energy project is to be developed in the area of
L'Erable. Of the 66 proposals submitted, only 15 were accepted
and Enerfín was the only Spanish company among them.
Since the beginning of its operations, Enerfín has
consolidated its position relative to the wind energy
market with more than 700 MW exploited, as well as
developing its international scope, which counted as its
first important achievement the 2006 concession for the
biggest complex in Latin America, located in the Rio
Grande do Sul State of Brazil, with 150 MW.
In terms of the United States, at the beginning of
2008 Enerfín took on its first project for 80 MW in the
initial development stages in the state of Montana. Since
then, its activity has been focused on moving forward with
this project, with the goal of constructing during 20092010, while continuing to pursue other business
opportunities in the country; encouraging possibilities
began to be seen there in the first quarter of 2009.
In these years, Enerfín has developed its own
business style, designing important projects that
incorporate the latest and most efficient technology,
inspired by aesthetics, harmony, art and the historical and
cultural values of the surroundings, offering a unique and
In Latin America, Enerfín continued its development
activity in Brazil, pushing the development of new wind
farms with the objective of doubling the power that the
current exploitation offers, having also initiated work in
the wind energy market in Mexico.
2008 ANNUAL REPORT
41
RENEWABLE ENERGIES
SOLAR POWER
The evolution of Spain's photovoltaic sector in 2008 was
closely watched by international markets. The
disproportional growth of installed power in Spain has
reached more than 429%, within a context noted for the
strict project deadlines and the uncertainty of the market's
evolution in the short-term.
Photovoltaic activity has developed under the
protection of a specific regulation, RD 661/2007, which is
barely a year old. The application of this regulation is
marked by the race against the clock in carrying out
photovoltaic projects, due to the restrictive conditions
announced by the Administration for future projects.
Based on this fact, the year 2008 was a difficult test for
agents working in this market.
Once again, the Elecnor Group has demonstrated
its extraordinary capacity to adapt to change and adverse
conditions. In this climate, our customers have relied more
than ever on our excellent group, with its capacity to move
forward with large projects fulfilling the requirements and
quality demanded by those financing the project; the
Elecnor Group has successfully finished all the projects
developed in 2007 as well as the ones contracted in 2008.
Among the former, we can underscore the 58.7
MW that were added to the following solar farms:
• Olmedilla Solar Farm: 10 MW in Olmedilla de Alarcón
(Cuenca).
• Guadarranque Solar Farm: 12.3 MW in
Guadarranque (Cádiz).
• Almodóvar del Campo Solar Farm: 10 MW in
Almodóvar del Campo (Ciudad Real).
• Las Magasquillas Solar Farm: 10 MW in Trujillo
(Cáceres).
• Arroyo de San Serván Solar Farm: 10 MW in Arroyo
de San Serván (Badajoz).
• Lorca I Solar Farm: 6.4 MW in Lorca (Murcia).
And of those contracted in 2008:
• Lorca II Solar Farm: 6.8 MW in Lorca (Murcia).
• Zuera Solar Farm: 9 MW in Zuera (Zaragoza).
A total of 74.5 MW were added to a long list that
has been developed since the beginning of the Group's
photovoltaic activity, accumulating more than 163 MWp,
making the Elecnor Group the undeniable world leader in
the photovoltaic sector and in large farms connected to
the network.
The paralysis of the market in the second half of
2008, and the new conditions imposed by the Spanish Law
RD 1578/2008, have required a quick response from the
Group to face the new strategies and openings in other
international markets in which it could apply the
experience and knowledge it has acquired in recent years.
In 2008, a subsidiary was created, Helios
Inversiones y Promocion Solar, serving as a vehicle to
respond to the possibilities of project development. With it,
the Group is able to respond to its customers' needs for
projects that are more involved than just construction, and
to offer the Group's significant support through investment
in their capital. At the same time, the opportunity to
construct, manage and maintain our own installations
offers us great possibilities to employ new technologies.
Through Helios, we participate in the company
Zinertia, promoting projects for photovoltaic roofing, with
a capacity for investment and construction in order to
exploit the photovoltaic market sector that falls under the
regulated rate for roofing.
In addition, Helios Inversiones y Promocion Solar
participates in Siberia Solar, a company that supports a
10 MW installation in Valdecaballeros (Badajoz) and whose
construction will begin this year, in 2009.
Es Pagos Solar Farm in Porreres
(Mallorca).
Regarding territorial expansion, though the Elecnor
Group has already been involved in intensive work mainly
through its subsidiary Atersa, it has strengthened its
presence in various ways in emerging markets, such as
Italy, Greece and the United States. In Italy, where the
increase in market volume is reminiscent of the initial years
of the Spanish market, it has set up a representative office,
in Milan, that enables the Group to provide better service
to its customers both nationally and locally.
2008 ANNUAL REPORT
43
RENEWABLE ENERGIES
In other countries such as the U.S. or Greece,
agreements with local representatives have been reached
that allow for improved monitoring of the conditions in
these promising markets. At the same time, thanks to the
Group's extensive international presence, it has embarked
on various specific opportunities in other countries in
Africa, Asia and the Americas, defined by unique projects.
Solar Farm in
Almodóvar del
Campo (Ciudad
Real).
In terms of Atersa, its established plan is to
continue offering comprehensive Photovoltaic Solar Energy
solutions and to be at the forefront of the different areas
of the sector, producing a wide array of the equipment
that is needed to configure any solar electricity project,
from modules with monocrystalline or polycrystalline
silicon cells to specific electronics for these kinds of
applications.
Atersa finished the 2008 fiscal year with marketed
energy of 111 MWp, which signifies a growth of 33.7%
with respect to the 83 MWp in 2007. The business volume
in 2008 increased by 24.8% over 2007.
RENEWABLE ENERGIES
Of the 111 MWp marketed, more than 55%
corresponds to the national and international distribution
market, and the rest, in collaboration with Elecnor, is
destined for large energy projects financed through
structures such as the "Project Finance" for private
investors. The Elecnor Group and Atersa's large projects in
recent years are some of the most relevant on an
international scale. All this, together with a clear goal of
exporting, ensures this subsidiary maintains its leadership
position in the market.
In 2008, many important projects and provisions
were carried out, among which we can point out:
• Rural electrification in Benín: Atersa participated in
an electrification project, with photovoltaic solar
energy, for various buildings that make up the
Assistance Centre, as well as the facilities for various
points of public lighting with automatic street lamps
in Fô-Boüré (Benín). This project forms part of the
activities of the Energy Foundation Without Borders,
of which Atersa is a sponsor.
• International exportation of different photovoltaic
systems, such as the PV System Ökofen in Germany,
which consists of an Atersa photovoltaic roof cover
and facade.
• Supply of special panels, such as transparent Tedlar
panels, black panels, etc., including work for
architectonic integration, both nationally and
internationally. Included among these are the licensee
Sarsa Bagen in Barcelona and various applications in
France.
• Power plants with network connection include: 17
MWn in Cieza-Moratalla (Murcia), 2 MWn with a
single-axis solar tracker in Añover de Tajo (Toledo)
and 2.1 MWn in Huercal Overa (Almeria).
Finally, in the month of April 2008, the Almussafes
plant was inaugurated by the President of the Valencia
Government, Francisco Camps. This plant has increased its
productivity through a second stage of automatisation
with next-generation robots, reaching a capacity of more
than 100 MWp, which places Atersa as one of the primary
generators in Europe. This is also significant in terms of
employment: there were 312 average positions in 2008,
between direct and indirect employment. The subsequent
stages for complete automatisation will be implemented
until reaching a production capacity of more than 300
MWp in the short term.
In terms of thermoelectric solar energy, 2008 was
an important year for the sector, confirming the enormous
potential of this technology's use, with the exemplary
plant Andasol already in its start-up phase, initial
construction for more plants, and a significant number of
development projects that have now reached a stage of
preparation that ensure they will soon be underway once
the financing is concluded. Considering this, the goal of
500 MW, as planned in the 2005-2010 Renewable Energy
Plan and included in the RD 661/2007, is well below the
realistic expectations for this kind of energy facility in the
short-term.
Elecnor signed a technology agreement with the
Israeli company Ener-t which allows us to draw upon the
experience resulting from plants built by Luz company in
Kramer Junction, California in the 1980s. This agreement,
in conjunction with our own technical capacities and
economic resources, makes Elecnor one of the few
independent EPC contractors that boasts design services
backed with technical and economic support. Due to this,
Elecnor has become one of the leading EPC contractors in
the sector, having been invited to participate in projects by
a significant number of developers.
In 2008, Elecnor advanced various plants that
generate a total of 550 MW, having accomplished the
following:
2008 ANNUAL REPORT
45
Kim's Chocolates N.V. Factory in
Tienen (Belgium). Installation of
photovoltaic roof composed of 2,982
Atersa solar modules.
• A framework concession for construction of four
50 MW plants located in Morón de la Frontera
(Seville), Olivenza (Badajoz), Medellín (Badajoz)
and Badajoz. Construction on the first two is
planned to commence in the first quarter of 2009.
Elecnor actively participates together with the
developer in the process of due diligence and
financial closing.
• A concession, in consortium, for the construction of
two 50 MW plants located in Alcázar de San Juan
(Ciudad Real). Elecnor actively participates together
with the developer in the process of due diligence
and financial closing, and in addition assumes a
minority share in the company that owns the plant,
once the closure is completed.
• Concession of a preliminary engineering contract and
pre-concession for EPC construction of a 50 MW
plant in Saucedilla (Caceres).
In addition, Elecnor's participation in property
development can be underscored. In 2008, a number of
opportunities were analysed, with the following outcomes:
• Elecnor's incorporation as a majority shareholder in
the development company for the ASTEXOL 2
project, a 50 MW plant in the municipal district of
Badajoz. Elecnor is participating in the final stage of
permits and authorisations for this project, closing
the supply contracts for the principal equipment and
leading negotiations with financial institutions. It is
hoped that construction on the plant will commence
in June 2009.
• Beginning development together with Ascia Renova
for two thermal solar plants in the municipal districts
of Manzanares and Alcázar de San Juan (both in
Ciudad Real).
• Negotiations for Elecnor's incorporation in the Lebrija
project, within the framework pre-agreement with
the renewables development group.
RENEWABLE ENERGIES
HYDROELECTRIC POWER PLANTS
In the field of hydroelectric power plants, Elecnor
participated in the development and construction of a
number of power plants, offering the capacity to carry out
turnkey projects and operational activities, as well as
maintenance throughout all stages of the process.
In the last year, and especially in the international
arena, it has developed large hydroelectric projects with
turnkey conditions, among which we can highlight:
• In Venezuela, the turnkey construction of the 30
MWA hydroelectric plant in Masparro for Cedafe
continues at a good pace, figuring detailed
engineering, penstocks and the transmission line,
plus electromechanical supply and assembly.
• In addition, this year work began on the
Hydroelectric Power Plant in Cambambe, Angola, for
supply of auxiliary equipment for the plant and
equipping the 220 kW exterior park for the
substation.
• Operations and maintenance, since its launch in
2003, of the Nacaome 30 MWA Hydroelectric Power
Plant.
• Pre-feasibility study for hydroelectric exploitation
projects for the Sociedad Mesoamericana S.A.
(SEMSA), resulting from the pre-design of the 15
MWA Hydroelectric Plant in Jilamito, Honduras, and
the hydraulic study of exploitations in Miangul and
Escondido, also for SEMSA.
• Pre-feasibility study for the generation of
hydroelectric power in the Grande Siale and Arenal
rivers, also in Honduras, for Energías Limpias.
In the sector of mini-hydraulic plants, Elecnor was
awarded the commission for the turnkey construction of
the Sierra Brava Power Plant, for the Hydrographic
Confederation of the Guadiana River, which will be a plant
at the base of the dam, generating 3.5 MW.
Masparro
Hydroelectric
Power Plant
(Venezuela).
2008 ANNUAL REPORT
47
Image of Marte Exomars project
robot, in which DEIMOS collaborated
on the design and engineering
(source: ESA).
TECHNOLOGY AND IT SYSTEMS
The Group participates in this sector through three
different business areas, which encompass the activities of
Cosinor, Elecnor Seguridad, and the four companies that
make up the Grupo Deimos (Deimos Space, Deimos
Aplicaciones Tecnológicas, Deimos Imaging and Deimos
Engenharia).
The business areas implicated in these are
Aerospace and Defence, Energy and the Environment, and
Systems and Networks. In the first, the principal actors are
Deimos Space, Deimos Engenharia and Deimos Imaging,
through their respective business units devoted to Space,
and including the Flight Segment, Ground Segment,
Remote Sensing, and Defence.
The area of Energy and the Environment is
fundamentally carried out by Cosinor, while Systems and
Networks form the Technology Transfer Unit of Deimos
Space, Deimos Aplicaciones Tecnológicas, Cosinor and
Elecnor Seguridad, focused on Software, Industry,
Transport, Real Estate, Positioning, Telecommunication,
Networks and Security markets.
To highlight the Elecnor Group's specific activities in
this area in 2008, we will briefly examine the projects of
each of these companies:
Deimos Space is fundamentally concerned with
space programmes in Europe, in which the principal actor
is the European Space Agency (ESA), of which Spain is a
founding member. This organisation is funded primarily
by contributions from member states and its programmes
encompass 55% of the institutional demand in Europe. In
addition, the role of the European Union (EU) in
alternative financing for space programmes is growing
notably: The European Commission dedicated 5 billion
euro to space programmes for the period from 2007 to
2013, either through the EU Seventh Framework
Programme, through the continued activities begun
under the Galileo satellite navigation programme, or
through the programme for Global Monitoring for
Environment and Security (GMES).
Also, ESA held its Ministerial Conference this year
in The Hague. This meeting, which is held every three
years, resulted in the consolidation of participating states'
commitments to the current ESA programmes, as well as
initiating new activities in areas of special interest for the
Company, such as the programme for space monitoring.
All this, together with the priorities laid out by the EU in
terms of the field of applications (particularly for Galileo
and GMES), leads to a scenario of stable growth for
Company in the next three years, given that many of the
approved budgetary priorities were in areas where the
Company has experience and potential, with strong
alliances with the group of companies of which Deimos
Space is the parent company. As for space programmes,
the following should be underscored:
TECHNOLOGY AND IT SYSTEMS
• The programme for interplanetary exploration, which
has given the Company a significant role in the study
of future missions for planetary exploration. In this
way, Deimos is playing an essential part in the design
of Exomars, the next European mission to Mars, and
in the preliminary studies for future missions to the
moon (Next).
• The general studies and technology programme has
continued to offer contracts in the fields of
engineering and mission analysis, one of the
traditional niches of the company. Also of note are
the studies for design of the new European launcher
Aldebarán and contributing design for the new
scientific mission of ESA and Meteosat: Cross Scale,
Euclid, Meteosat Post-EPS, etc.
• Embarking on the C/D in-orbit-validation phase of
the Galileo navigation programme, which continues
to be a significant part of the Company's business.
Deimos continues to serve as the principal contractor
for three of the highest level components for the
Galileo ground segment: the Raw Data Generator
(RDG), the Mission Support Facility (MSF), which are
responsible for the precise calculation of the
satellites' orbits and synchronization of the system
clocks, and the Galileo Message Generation Facility
(MGF), responsible for calculating and distributing
the satellites' navigation messages that are received
by the end users of the system.
• The ESA framework programme for Earth
observation, in which the Company offers
accumulated experience that makes it one of the
leaders in fields such as mission planning. As part of
this programme, Deimos has developed an important
part of the operations systems critical for all the ESA
satellites: Cryosat, SMOS, GOCE, Swarm, Earth Care
and Aeolus.
• The Spanish System for Earth Observation, carried
out by ESA, in which the Company led the
preliminary phase study for the ground segment.
Deimos has played a very pertinent role in both the
optical satellite (Ingenio) and the radar satellite (Paz).
In regard to Earth observation programmes, the
subsidiary Deimos Imaging was specifically created to
pursue the goal of vertical integration in the value chain
related to Earth observation, starting with the flight
segment (including the provision and use of a satellite), to
the ground segment and finally the user segment. The
Company has continued to offer strong support to this
subsidiary in 2008, given that the Deimos Imaging project
offers important synergy with the activities in which the
Cryosat, ESA satellite
for the study of the ice
layer, an important
contribution by DEIMOS
(source: ESA).
parent company has recognised experience, such as
systems engineering and flight and ground segment
elements, all of which are aimed at the 2009 launch of the
Deimos-1 satellite.
Other business opportunities are related to
technology transfer programmes, focused on applying
developments from the space industry in other sectors.
Deimos Space has maintained its involvement in systems
development and turnkey applications for the
telecommunications, mobility, transport, industry and
environment sectors. Thus, the Company has placed its
confidence in research and development in these areas,
according to its strategy for diversification. The most
important accomplishment in 2008 in this area was
becoming a leader in "Virtual Spain," a project of the
Strategic National Consortiums in Technical Research
(CENIT) of the Ministry of Industry, with a research budget
of more than 25 million euro and directed to a team of
players such as the National Geographic Intitution, Indra
and other small and medium enterprises with good
technological experience. The aim of this project is the
study, development and design of technology, protocols,
2008 ANNUAL REPORT
49
CENAT Electricity
Plant in new
terminal area. El
Prat de Llobregat
Airport
(Barcelona).
standards, structure, and in general, the bases for making
a 3D interface available for the contents and services
found on the Internet.
real-time Information Systems that is positioned as a
national leader in remote control for irrigation and
photovoltaic plants.
To conclude, the 2008 fiscal year has seen Deimos
Space consolidate its growth while increasing its business
figures by 10.3% with respect to the previous year. This
figure is even more significant if we consider that the
average workforce has stayed practically constant,
meaning that growth is exclusively due to an increase in
productivity, resulting in a workforce with greater
experience and capable of taking on more complex work
with greater added value. In effect, this year has brought
the Company recognition as one of the principal Spanish
companies in the space sector, fundamentally due to its
contribution in the areas of satellite navigation, Earth
observation, systems engineering, and activities for
technology transfer.
In 2008, Cosinor once again combined its system
development in traditional sectors with the launch of new
products --developed internally by the company-- which
are the fruit of continuous investment in R&D&IT, thus
allowing the company to significantly diversify the fields in
which it does business.
For its part, Cosinor, a subsidiary specialised in
In the airport sector, some of the accomplishments
include the completion of two electrical control systems for
Aena at the Malaga Airport, in the first stage; systems
integration for electrical control at Madrid Baraja, and the
electrical systems update at the Las Palmas Airport in
Grand Canary Island. In addition, development of the
monitoring system for the New Terminal Area Power Plant
(CENAT) and the integration of electrical systems at the
Barcelona Airport are still underway.
TECHNOLOGY AND IT SYSTEMS
Within the environmental sector, Cosinor is
positioned as a leading player in Spain for Water Control
Systems. Within this field, we would like to highlight the
launch of remote control irrigation of the Navarra Canal -one of the largest projects of its kind in Spain-- in the third
and fourth section, with the fifth in the assembly stage.
Also completed were the first three operational systems for
water treatment plants included in the Aragón Special Plan
for Waste Water Purification, zone 4-6. In addition, initial
work for the automatisation of locks on the Aragon and
Catalonia Canal has begun; this project is forecast to be
completed in three years.
In the area of renewable energy, seeing intense
growth in the last few years, various systems for
monitoring and operation at 9 photovoltaic plants has
begun, including those in Trujillo, Jumilla, Guadarranque
(Cádiz) y Zuera (Zaragoza), through remote units and
software developed by the company. Another
comprehensive supervision system was implemented in 4
parks for Sunpower, integrating the plant's security
system.
In addition, assembly was completed for the solar
field at the Thermosolar Plant in Puertollano, and is now in
service: Cosinar was responsible for the positioning and
supervision of the parabolic cylinders, through its own
controls and those of the associated hydraulic system.
Thus, it has established itself in this area, with an eye to
participating as a distinguished provider for the sector in
the coming years.
In the overseas market, it has implemented systems
for electrical distribution network controls in the central
and southern zones for Emel Chile, as well as the electrical
network management system for the public mining
company Codelco, also in Chile. In addition, remote
control for the electrical network in Luanda, Angola, was
also developed and initiated.
In terms of the parent company, Elecnor, we can
point out its entry into a framework agreement for the
adaption of the Data Processing Centre (DPC) for Aena, as
well as contracts with the DPCs in Santander, Jerez de la
Frontera, and recently being commissioned for the DPC in
the new terminal at the Alicante Airport, which, due to its
size, is of great importance.
Also noteworthy is the supply, installation and
launch of the Automatic Incident Detection System (D.A.I)
for a section of the "Ronda Litoral," the southern Ring
Road in Barcelona.
This new system aims to improve the effectiveness,
speed and precision for the detection of traffic incidents in
the Ronda Literal in Barcelona, through the installation of
both fixed and moving cameras, with automatic incident
detection and new traffic flow counters.
Another important initiative this year, resulting
from Elecnor's goal to collaborate with the academic
community, was the project known internally as Project
Alba.
Alba is the name of the Sincrotron Light Facility
that began to function in 2009 in Cerdanyola del Vallès,
Barcelona. This next-generation source functions like a
gigantic microscope, enabling discoveries of the secrets of
atoms and molecules. It will provide services to researchers
and high-tech companies, in fields as diverse as industry,
physics, chemistry, medicine or biology.
The scope of the Sincrotron Alba project includes
the supply, installation, and implementation of the public
address, intercom and structured cabling systems.
Within the area of singular structures, Elecnor has a
history of turnkey projects for telecommunications
installations, where energy efficiency is an essential part of
our installations, given Elecnor's commitment to
sustainable development and the Environment. Also worth
mentioning in this section are the general facilities for
Security, Television, Public Address systems and Shared
Telecommunications Infrastructure in the Águilas Plaza
Shopping Centres, located in Águilas in Almenara, Lorca.
In the first of these, in addition to the mentioned
installations, we also provided the monitoring associated
with them.
As in previous years, the Full-Service Security sector
has grown significantly. Elecnor Seguridad, a Group
subsidiary, offers integrated systems including perimeter
security, fire protection, access control for both people and
vehicles, CCTV, intruder detection, control centres and
associated systems.
Among these, some of the most representative
projects include the CCTV for the University of Vallodolid,
access control to the baggage carousels from the check-in
area in the T1, T2, and T3 Terminals at the Madrid-Barajas
Airport, the CCTV at the La Coruña Airport, and structured
cabling control of the track for the Formula 1 urban circuit
in Valencia.
Furthermore, Elecnor Seguridad has carried out
installation of perimeter security at various power plants;
among the more important in terms of their size are the
photovoltaic plants at Argasol, Lorca and Caudete de las
Fuentes.
2008 ANNUAL REPORT
51
Paracatú 525 kW
substation
(Brazil).
Sos del Rey
Católico WWTP
(Zaragoza).
Pichilemu spa
(Chile).
Lighting.
CONCESSIONS
Elecnor has continued in the last few years on a path of
increasing concessions related to its business activities,
thanks to its experience in the construction and operation
of infrastructures and its growing capacity for financing,
significantly advanced since the formation of the Group's
2006-2010 Strategic Plan.
At the same time, in 2008 Elecnor was given the
concession, in consortium with another company, for the
transmission line for Mantaro-Caraveli-Montalvo with 500
kW, and the line for Machupicchu-Cotaruse with 220 kW,
as well as the associated substations, comprising a length
of 964 km.
To encourage business concessions, primarily in the
areas of electrical energy transmission systems, solar
generation and the environment, Elecnor is undergoing an
organisational restructuring with the goal to create a
holding company for the Group's concessional assets,
which would also be responsible for their operation and
maintenance.
In the electric sector, other important concessions
include those in various municipalities in Chile for the
supply, installation and maintenance of public lighting.
Currently, these assets are shares in concessionary
companies for electrical energy transmission in Brazil;
Elecnor participates in 15 concessions, alone or in
consortium, of which 10 are in operation, another 2 will
be shortly and 3, those that were conceded in 2008, are in
the construction phase.
The total length of these transmission lines reaches
6,600 km. Of this, 2,300 km are directly attributable to
Elecnor, with input and output at 44 substations, 16 of our
own, with a joint transformation capacity of 13,000 MWA.
And with regard to the Environment, an operation
was begun in 2008 for the Waste Water Treatment Plant
for the Aragon Waste Water Company (SADAR), making
Elecnor the concession holder for the "Project, construction
and operation for a period of 20 years of 10 waste water
treatment plants through the Special Purification Plan of
the Government of Aragon, corresponding to the
populated areas along the Gallego river basin." In 2007,
the Aragon Company for Treatment Plants (SADEP) was
created, in which our subsidiary, Hidroambiente,
participates; it began construction of 9 additional treatment
plans conceded by the Aragon Water Institute.
Also of mention is the operation of the Logistic
Centre for Waste Water Treatment in Marbella, Malaga.
2008 ANNUAL REPORT
53
L'Erable Wind
Farm (Canada).
INTERNATIONAL
In F.Y. 2008, the Group continued its activities in
international markets with operations through the parent
company Elecnor, as well as national and international
subsidiaries.
Of particular note, due to the ensuing product
diversification, is the concession for an important contract for
transport and pumping of potable water (160 km and 16 MW
of pumping) for the Algerian public agency A.D.E. This
contract is an important step to operate in markets for these
kinds of infrastructures, in Algeria as well as in other countries.
As a result of our commercial focus, as explained in
the 2007 Annual Report, two important projects have
materialised this year that are concessional operations, one
for an electrical transmission network in Peru and another
for wind energy in Quebec. In addition, we received three
new commissions for electrical transmission in Brazil,
greatly increasing the Group's presence in that country.
On the other hand, Elecnor continued to pursue the
regular development of projects in its traditional fields:
Mexico, Central America, and the Dominican Republic;
specifically in the latter, a Transmission Line project for 345
kW known as the "Electric Highway." Also, construction
continued in Venezuela on the Masparro Hydroelectric
Power Plant and new contracts were approved for electrical
transmission. In addition, there are projects in Brasil,
Argentina, Uruguay and Chile.
In Africa, Elecnor continues to develop projects in
Morocco, Algeria (the new 400 kW Transmission Line for
Sonelgaz), the Congo, Ghana and Angola (three new
contracts for electrical networks).
Finally, it continued its commercial activities in
various countries; of special interest was one in the U.S.,
where the first permits for construction and operation of
two wind farms were obtained; in China, where the new
fairground project in Beijing was successfully completed; as
well as in India, the United Arab Emirates, Mozambique
and South Africa. Elecnor firmly believes that these projects
will come to fruition in the coming years, enabling the
Group to expand its geographic scope as well as diversify
its activities.
To continue, we offer here a more detailed
description of the Elecnor Group's work overseas, both
through Elecnor itself, as well as the subsidiaries it has in
various countries.
ALGERIA
In 2008, important operations in Algeria included the
concession for the pumping network and stations for the
SoukTleta desalinasation plant's connection to the potable
water network, which encompassed the design, goods
supply, services and construction. Elecnor took on the
following work:
• Construction of 80 km of ductile foundry conduction
pipe.
• Steel conduit pipe (DN 1400 2.7 km).
• Polyethylene conduit pipe of various measurements
with a length of 50 km.
• Six deposits that hold 26,500 m_.
• Four water pumping stations with a total of 16.1
MWA.
INTERNATIONAL
• Completion of the 400 kW line SFT Tilghmet-Djelfa
with a length of 300 km.
ARGENTINA
The ElecnorGroup has developed its activities in Argentina
over more than three decades, finally creating a subsidiary
there, Elecnor de Argentina in 1991, in order to carry out
projects and installations undertaken by Teléfonica.
Later, these business activities expanded to include
the Water, Gas and Electricity sectors. At the same time,
the number of customers at the Company grew, and it
began to collaborate with other businesses such as Gas
Natural Ban, Edesur, Edenor, Epen, and Aguas Argentinas.
Currently, following this diversification strategy, it
works on projects of varying natures, aiming to participate
in new activities.
In 2008, aside from the traditional activities of Voltage
Work with the principal oil companies in the country and those
for domestic and foreign Telefonica plants, we can highlight
the termination of the Banfield Substation project with 132
kW for Edesur, and the completion of the Photovoltaic Energy
Projects in the provinces of Catamarca and Corrientes, part of
the Renewable Energy Projects for Rural Markets (PERMER).
ANGOLA
In 2008, Elecnor launched the first control centre in
Luanda, the capital of Angola, for EDEL-E.P., from which
the 12 different centres of the main EDEL-E.P. network are
supervised and controlled, among them substations and
transformer units.
In addition, generation projects for transmission and
distribution are in process; some of the important ones
include the transmission system for Capanda-Lucala-Viana,
with 300 km of 400 kW transmission line, 28 km of 220
kW line, and four new substations, as well as extension of
an existing one.
• Luziania substation with 500 kW and ten 45.3 MWAr
reactors.
• Paracatú 4 substation with 2 transformer banks
500/138/13.8 kW of 3 x 100 MVA and four 45.3
MWAr reactors.
• Emborgaçao substation with 500 kW.
• Samambaia substation with 500 kW and four 45.3
MWAr reactors.
Throughout 2008, it has undertaken other
substations that were not finished before year end, but are
expected to be completed in the first half of 2009.
In addition, Elecnor signed two new contracts with
Aneel for substations in Venda das Pedras, Sao Simao,
Itaguaçu and Barra dos Coqueiros, which will total more
than 1,800 MWA of transformation.
In the area of transmission lines, we continued
consortium projects for the following:
• the 930 km Samuel-Vilhena and Vilhena-Jaurú lines
with 230 kW.
• the 719 km Sao Simao-Marimbondo-Riberao PretoPocos de Caldas and Jaguará-Estreito-Riberao Preto
line with 500 kW.
• the 702 km Emborgaçao-Nova Ponte-Itumbiara-Sao
Gotardo-Estreito line with 500 kW.
• the 202 km Paracatú-Pirapora line with 500 kW.
Furthermore, in 2008, our subsidiary, Elecnor do
Brasil, had a significant role in the Gas market, as in
previous years, above all for private clients such as Gas
Brasiliano (Grupo ENI), Comgas (Shell and BG) and Gas
Natural.
The most important projects of 2008 were the
internal installation for gas and technical assistance in the
city of Sao Paulo for the company Comgas, as well as the
construction of a 70 km gas pipeline of 12 and 8 inches,
that connects the cities of Marilia and Guaiçara, in the state
of Sao Paulo, for the company Gas Brasiliano.
CENTRAL AMERICA
BRAZIL
In 2008, Elecnor finished a turnkey project in Brazil that
included systems studies, engineering, civil works,
electromechanical assembly and start-up of the following
substations:
In 2008, the Elecnor Group celebrated 30 years working in
Central America. Initially, its work was carried out directly,
and exclusively, by the parent company, Elecnor. Recently,
however, a specific subsidiary, Elecnor Centroamericana
(Elecen), began operations to complement Elecnor's
activities.
• Serra da Mesa II substation with 500 kW and four
45.3 MWAr reactors.
In 2008, a project for the design, supply,
construction, assembly, cabling, trials and launch of the
2008 ANNUAL REPORT
55
Villena-Jaurú 230
kW Line (Brazil).
Jalpatagua substation in Guatemala was finished for the
National Electricity Institute (INDE).
At the moment, Guatemala is carrying out the
2008-2018 Transport System Expansion Plan, in which the
Government plans to invest a significant amount in
electrical infrastructure, which is promising for our work in
this country.
Elecnor has been active in Honduras for 20 years.
Now, with Elecen, it has diversified the offer of services and
its capacities, from the traditional ones of generation,
distribution and energy transformation to new sectors, such
as civil works or the supply of concrete for streets in
different communities.
In addition, Elecen was granted the sole contract of
an institutional nature issued by the state electricity
company (ENEE-Empresa Nacional de Energía Eléctrica) in
the last three years, which included the construction of a
138 kW /34.5 kW substation in the Naco valley, the
Chichicaste and Erandique substations with 69 / 34.5 kW,
and the expansion of the San Pedro Sala Sur substation,
with 138 kW, in association with the Danish JGH company,
and financed by the Nordic Development Fund.
In this period, various preparations were made for
pre-feasibility studies for hydroelectric exploitation projects
for the Sociedad Mesoamericana (SEMSA), as an aspect of
our management and promotion of turnkey projects.
Participation in such a variety of fields has allowed
Elecnor and Elecen to strengthen our position as leading
companies in electricity projects in Honduras, as well as
becoming leaders for the hydraulic exploitation for
electricity generation.
Other areas in which Elecnor has continued its
business activity successfully is in the operation and
maintenance of the Hydroelectric Power Plant in Nacaome,
with 30 MWA, launched in 2003 for the Secretary of Public
Works, Transport and Housing (SOPTRAVI).
CHILE
In the Chilean market, our subsidiary Elecnor Chile
fundamentally works in the electricity sector, and in a
particularly concentrated way, in public lighting, carrying
out a number of projects in different municipalities with
financing provided by both the municipality and Elecnor
itself.
Jalpatagua 230
kW Substation
(Guatemala).
Jalpatagua 230
kW Substation
(Guatemala).
Finally, Elecnor continues to invest in the Ibener company
that exploits hydroelectric power plant for more than 120 MW in
Puechén and Mampil, located along the Duqueco River.
These projects, for electromechanical assembly,
include the following: Puyo Substation for Transelectric; for
the Empresa Eléctrica Ambato, a subtransmission line of 69
kW for Puyo and Transelectric Substations that includes the
supply of 18m and 20m posts for la Empresa Eléctrica el
Oro; the substransmission line for substations La Iberia– La
Primavera, with supply of 18m and 20m posts as well as
cables, bushings, fittings and line construction.
ECUADOR
MEXICO
Since its creation 34 years ago, Elecdor has significantly
contributed to electricity development in Ecuador, both in
the supply of posts for state-owned electricity companies as
well as for private companies.
In the last fiscal year, it carried out projects for
Transelectric, the principal player in Ecuador's electricity
sector, such as electromechanical assembly for substations
and transmission lines of 138 and 230 kW.
In 2008, Elecnor Mexico began a project for the Mexican
Institute of Social Security, for the "Completion of the
expansion and renovation of the surgery rooms, intensive
care, emergency ramp, and electrical substation at the ObGyn hospital." This work is located in the city of
Guadalajara in the state of Jalisco, and is part of the
modernisation the Mexican government is implementing in
its clinics and hospitals for state medical care for workers at
affiliated private companies.
In 2008, Elecdor kept up its intense rhythm of post
supply, thanks to the proliferation of projects in the
company. The factories, in Quito as well as Guayaquil,
worked overtime to keep up with demand.
In November 2008, Elecnor Mexico also began the
"Construction of the Administrative Agency building,"
again for the Mexican Institute for Social Security.” This
building is located in the city of Colima, in the state of
At the same time, Elecnor Chile holds the
concession from 8 municipalities for the supply, installation
and maintenance of public lighting for periods of between
six and eleven years.
2008 ANNUAL REPORT
57
INTERNATIONAL
Colima, and is part of the Social Security Institute’s
expansion of administrative infrastructure for the collection
and supervision of economic resources received from
private companies affiliated with this institute.
In the energy sector, the temporary suspension
continues of the public works contemplated in the unitprice and fixed term contract for the substitution and
rehabilitation of underground piping of the fuel oil line by
which Pemex supplies fuel oil to the Federal Electricity
Commission's Manzanillo Thermoelectric Power Plant.
In the airport sector, all of the construction work
was completed for meter banks in the shops at the
Hermosillo Airport for the Grupo Aeroportuario del Pacífico
(GAP). This work fundamentally consisted of developing
basic and detailed engineering to change the operating
configuration from a ring network to a radial network, in
accordance with the Federal Electrical Commission's (CFE)
specifications.
Finally, in the area of communications, work was
completed for "the construction of the telephone network
for the private telephone company Telefonos de Mexico,"
through the subsidiary Procisa. This project consisted in the
substitution of fibre optics in the existing urban cable ducts
in Mexico City, which provide the domestic telephone
service, with the goal of offering its users simultaneous
video, Internet and telephone services through the use of
fibre optics. It was implemented in the northern, central
and southern zones of Mexico City.
PERU
In April 2008, Elecnor was awarded, through the Isonor
Consortium, the concession for the design, financing,
goods and service supply, construction, operation and
maintenance of various electrical lines and substations that
will be detailed later; the project is expected to begin in
2009.
Electrical lines:
• Construction of approximately 760 km of electrical
line with 550 kW, between the substations Mantaro
Campo Armiño and Montalvo, and with a
transmission capacity of 600 MW.
• Construction of approximately 204 km of a 220 Kw
line, between the 220 kW Machupicchu substation
and the 220 kW Cotaruse substation, with a
transmission capacity of 250 MW.
Electrical Substations:
• Substation Campo Armiño with 220 kW. Expansion of
the existing 220 kW substation consisting of two line
cells, bar reinforcement and installations.
• Construction of a substation in Mantaro for 550 kW.
550 kW Bar system, a bench of 230/500 kW singlephase transformers for 750 MWA, line cells for 500
kW and a position for a line reactor.
• Substation Montalvo with 220 kW. Expansion of the
existing substation through expanding the bar system
and two new line positions for 220 kW.
• Construction of a substation in Monealvo for 550 kW.
Construction of bar systems for 500 kW bar systems,
line cells for 500 kW, a bench of 220/500 singlephase bench for 750 MWA, a transformer line cell of
220 kW and a position for a line reactor.
• Construction of a substation Caravelí for 550 kW.
Construction of a 500 kW bar system, two 500 kW
line cells, two positions for line reactors.
• Substation at Machupicchu with 220 kW.
Construction for a 138/220 kW transformer position
for 100 MWA, a simple 220 kW bar system, two 220
kW line cells and a 40 MWAr reactor.
• Substation Cotaruse with 220 kW. Construction of
two 220 kW line cells, two reactor positions for 220
kW and 20 MVAr.
URUGUAY
Montelecnor is a company through which the Elecnor
Group has developed its activities in Uruguay since 1998. In
the first ten years, it acted primarily as a contracting
company, working with the main service distributors that
operate in Uruguay, such as UTE, OSE, ANTEL and
CONECTA. It also gave its services to different Official
Entities.
In 2008, Montelecnor began work on the following
projects:
• Responding to the needs of the Electricity in Northern
Uruguay, the 30 kW Tomas Gomensoro-Paso Farias
line in the Department of Artigas, and the 60 kW
Tacuarembó-Ansina line in the Department of
Tacuarembó.
• Project execution and construction for the
"Provisional access control buildings, lighting for
provisional access and for the perimeter path" for the
Free Trade Zone Punta Pereira, for the company ENCE.
• Installation of approximately 50 km of polyethylene
piping for the renovation of the old cast-iron gas
network in the Old City of Montevideo, for the
Consortium Oas-Areco.
INTERNATIONAL
• Creation of a pedestrian area in the San José de Mayo
city centre in the Department of San José, for the San
José City Hall.
• Regularisation of the Santa Teresita Development in
the Department of Canelones, for the Integration
Programme for Irregular Developments (P.I.A.I.).
• Construction of a building for the Data Processing
Centre for ANTEL.
Work began in past years was completed
throughout 2008. In addition, new contracts were agreed
upon, above all with the National Administration for Power
Stations and Electrical Transmissions (UTE), the
Administration for State Sanitation (OSE) and for the
National Administration of Telecommunications (ANTEL).
VENEZUELA
Last year, Elecnor concluded the 150 km Calabozo-San
Fernando II line for 230 kW, as well as civil works, complete
supply, detailed engineering, assembly, trials and start-up of
the 230 kW yard of the Calabozo substation. Furthermore,
it prepared the terrain, civil works, complete supply,
detailed engineering, assembly, trials and launch of the 230
T San Fernando II substation, as well as the expansion,
including the fibre optics telecommunications system for
the Calabozo-San Fernando II.
In addition, the 230 km line for 115 kW was
completed for the Monagas Project, including the civil
works, complete supply, detailed engineering, assembly,
trials and launch for a total of 8 substations, including the
telecommunications system, located in the states of
Monagas and Delta Amacuro, as well as the substation
Juana La Avanzadora (Indio Norte)-Temblador Nueva and
one in Cerro Nuevo.
For its part, Elecven, one of the Elecnor subsidiaries
in Venezuela, participated in projects on an important scale
in the electricity sector in 2008. For example, it installed the
115 kW S/E SP-S/E CCO substation transmission line for the
Venezuelan petroleum company, PDVSA, located in Ciudad
Ojeda on the East coast of the Maracaibo Lake, as part of
the energy supply project pertinent to the Western
Cryogenic Complex (CCO).
CCO will optimise processing of natural gas in the
region, through a process of extraction, fragmentation and
distribution of this important hydrocarbon, for Domestic,
Electric, Industrial and Petrochemical use, and for the
Paraguana Refining Centre. This investment, which will
benefit the Petrochemical Industry, as well as the Electricity,
Industrial, Domestic and Social Development sectors for the
communities neighbouring the Cryogenic Plant, is a longterm project that expects to administer 950 million cubic
feet of gas per day.
This year, Elecven started work again for C.A.
Electricidad in Caracas with the construction of a vertical
cut-off wall to contain the bank of the northern hillside at
Tower nº 10, which forms part of the multi-circuit
Transmission Line with 69 kW, for Substations Junquito and
Montalban, located in Monte Sinai.
In December 2008, the 1,000 m_ building for the
Palos Grandes Outpatient Facility was completed for the
Chacao City Government, as part of the Chacao health
project carried out by the institution.
In addition, Elecven continued to develop a long
term project of medium and high-voltage distribution in the
States of Monagas and Delta Amacuro, which is expected
to be completed midway through 2009.
Elecven is preparing to begin work for Edelca in
2009, part of the Tocoma electricity production project,
which consists of the relocation and maintenance of
various sections of 230 and 400 kW transmission lines.
Rasacaven, the other Venezuelan subsidiary,
through which the Group develops its activities in the
petroleum industry, is involved on other areas, such as civil
works, electricity installations and instrumentation, plant
start-ups and construction of electrical lines and
substations.
Throughout 2008, it participated in the principal
construction projects for state-owned Petróleos de
Venezuela (PDVSA), such as the expansion of the catalytic
cracking flow unit and maintenance of the Medium
Conversion Area of the Cardon Refinery, located in the
Paraguana Refinery Centre.
In this way, Rasacaven has emerged as a leading
company in the Venezuelan petroleum industry, ensuring it
will participate, both now and in the future, in the most
important PDVSA projects. This includes construction and
assembly for the Deep Conversion Project at the Puerto de la
Cruz Refinery for processing heavy and extra heavy crude oil.
2008 ANNUAL REPORT
59
Framing robot.
Atersa Factory in
Almussafes
(Valencia).
research, development and innovation
Throughout 2008, the Elecnor Group has continued to
develop different projects with the goal of increasing the
added value of its services. At the same time, it has
remained at the forefront of Information Technology for all
levels of the Group's organisation.
PROJECT MANAGEMENT SYSTEM (PMS)
In 2007, an IT tool was developed that was called the
Project Management System (PMS), for the management
of work, offers, suppliers and requests. PMS was custommade using a relational database and a document
manager.
In 2008, we continued to analyse and develop this
tool, as well as its progressive implementation in Elecnor
offices.
The PMS structure will serve as a model both for
applications currently in development as well as future
ones. This structure is composed of a database, a data
model and it shares a corporate users manager with all
other applications. In this way, we can develop future
applications independently, using this as a work-base.
At the same time, we have continued to develop and
integrate two new applications that utilize the PMS, which
are the Commercial Management System and the
Integrated Management System for Environment, Quality,
and Occupational Risk Prevention.
INNOVATION COMMITTEE
Created in 2007 in response to the Strategic Plan approved
in 2006, and directly dependent on Elecnor Management
at the highest level. The objectives of this committee are
the following:
• Review advances in projects related to innovation at
Elecnor.
• Decide upon innovation goals in the different areas
of business contemplated in the Strategic Plan.
• Define the general guidelines for the Innovation
Management System and Strategy Follow-up at
Elecnor.
• Design a process for communication and implement
of the Innovation Management System.
In 2008, we began to develop the first innovation
projects that resulted from this committee's meetings.
ATERSA
Among the developments offered by this subsidiary, we'd
like to point out the following:
• Datasol Local and USB-net: Software for data
acquisition in photovoltaic plants.
• METV30: Highly precise and stable meter sensor for
solar radiation.
• LEDs Lamps: New format of LEDS that is more
efficient than fluorescent.
• TFT: Software for the presentation of installation and
network connection data.
• LEO 10: Advanced load regulator for independent
photovoltaic installations.
In terms of research activities, the following stand out:
• Appraisal of LED lights, in collaboration with AIDO.
• Quality study of the electrical network in photovoltaic
facilities, carried out in collaboration with the Electric
Technology Institute (ITE).
• Studies related to new three-phase technology and
new electronic components.
• Research into the field of new thin-layer technology.
DEIMOS SPACE
Projects undertaken as part of the EU Seventh Framework
Agreement:
• The SEMSORGRID project is aimed at utilising
onthologies and GRID computation applied to multinodule sensor networks, employed in different
instances of application, such as floods or fires.
Deimos Space's contribution to this project centres
on its leadership in one of the work packages,
focusing on the development of an early-prevention
application for fires using the technologies
mentioned above.
Projects carried out as part of the National Plans for
R&D:
• The EGLOBE system intends to construct a virtual
world with geospatial information provided and
maintained by base map suppliers: public institutions
and private companies. The principal areas of R&D
for this project are: Advanced User Interfaces for 4D,
Augmented Reality with Ubiquitous Computing
Devices, Virtualisation of Redundant Systems for
Information Storage and creation of interactive virtual
communities between user groups.
2008 ANNUAL REPORT
61
RESEARCH, DEVELOPMENT AND INNOVATION
• The project VIRTUAL SPAIN is a consequence of the
previous project and is one of the most ambitious
R&D projects taken on by Deimos Space. Its objective
is to study, develop, design and fine-tune the
technologies, protocols, standards, structure, and in
general, the bases that will allow the use of a 3D
interface for the content and services found on the
Internet. This doesn't include three dimensional
mapping that can be navigated, but rather all kinds
of objects that can be placed on or under it:
buildings, shops, monuments, people. 3D Internet
would not replace traditional access to the Internet,
but would complement it, inspiring evolution of the
Web and integrating the next generation of map
contents and services.
With the "Virtual Spain" project, it would be
possible for the geographic information to be
harmonised for all of Europe, as long as it is of high
quality and is easily accessible for use at a local,
regional, national or international level. Thus, Spain
could become the world leader in a field that will
have enormous impact in the future.
With a four-year projection, this project will be
carried out by a consortium of seven companies and
10 prestigious national research centres, led by
Deimos Space.
• The BAIP2020 project arises from the need to adopt
a comprehensive technological focus to apply to
next-generation fishing boats; it is a multi-disciplinary
project that will include multiple technological
aspects. Deimos Space's contribution to the project is
focused on three research areas:
- On-board system for telemedicine.
- Electronic log system for the boat.
- Detection system for groups of fish through
satellite imagining.
• The goal of Deimos Space in its participation in the
SESAMO project was the study of interoperability
between satellite communications systems and
different wireless networks with the hope to offer
necessary access to any kind of land network for
mobile systems and users.
• The MESEAS project is focused on obtaining technical
capacities in the area of telemedicine, specifically in
the study of protocol use for short distance wireless
communication of biomedical information using
sensors for an intermediary device, as well as the
study of mobiles devices for use in telemedicine and
the viability of sensor network use for medical
applications.
• The project CARING CARS intends to improve
security in cars through the creation of an open
structure of sensor networks, that enable, among
other things, a better use of current sensors, as well
as the integration of our services, such as medical
assistance.
• ENTASVE project: Deimos Space considers this a
strategic activity for the spatial monitoring systems,
since it already counts on a significant technological
base in this field, thanks to its participation in studies
for ESA. In this area, it has presented a new project
meant to strengthen certain technological aspects of
the field, specifically:
- Defining ideal orbits in order to locate space
telescopes devoted to observation of space
garbage and targeted strategies that are most
appropriate to effectively fulfil that goal
- Obtaining precise atmospheric models that allow
us to determine the short-term variations of
atmospheric density from dynamic information
observed by the orbiting colony
- Developing algorithms that effectively determine
the most important parameter to determine the
dynamic of spatial objects
- Developing algorithms to determine the original
orbit of an orbiting object, observed with angular
measurements taken from a space satellite
• The goal of the PLAREN project is to develop
advanced algorithms that allow integration of the
same receptor for GPS signals, Galileo and EGNOS,
implement them for a HW platform that is developed
in real time and test them in different user contexts,
both for ground segments and eventually for spatial
applications. At the commercial and strategic level,
the primary goal is to identify the key new
technologies on which we would like to focus our
investment efforts in the field of satellite navigation
receivers to reach a leadership position in the
simulator segment and in the area of GNSS receiver
validation.
• The GEMA project intends to study in detail, the
conditions, capacity and technology necessary to
control massive and mixed fleets of unmanned aerial
vehicles (UAV), taking into account the operational
conditions and profiles of real missions. At a
commercial and strategic level, the principal goal is to
identify the key technologies where we would like to
focus our investment effort to bring our aeronautical
industry in line with the advances made by the most
prominent countries in the UAV sector,
fundamentally in key components such as Mission
Control and Planning, with an eye for interoperability
RESEARCH, DEVELOPMENT AND INNOVATION
and complete integration of manned and unmanned
systems.
• The ALDEBARAN project aims to develop a flight
demonstrator, focused on the activities needed to
prepare for future launch vehicles. Deimos Space's
role is focused on Mission Analysis and preliminary
design of the Guiding, Navigation and Control
system.
• The OCEO project has two goals. The first is to
develop a study of mission analysis, with the aim of
improving the position of a new Earth observational
satellite in relation to the already-existing satellite
constellation. The second is to develop a mission
planning system which will essentially make efficient
use of all the resources available through the
constellation, not only for the flight segment, but
also the ground segment.
Projects undertaken for the Regional R&D Plans
(IMADE):
• The ALZPIE project has meant that Deimos Space has
acquired a knowledge of processing medical images
based on magnetic resonance, which gives it the
foundation for future creation of entirely functional
tools, not only in the detection of Alzheimer's, but
also in multiple medical disciplines where image
processing is used.
• The AUTOPIE project researches the application of
protocol based on the IEEE standard 802.11p for the
transport sector, meaning it can be employed as it is
being developed to the full degree. Some of the
important parts of the knowledge gained regarding
the protocol are interaction with other
communication protocols, the scope, the band width,
the established time for communication and delays,
the sensitivity of interference in different scenarios
and the security of the signal.
COSINOR
• Positioning and control of parabolic cylinders in
thermosolar plants: It has developed a controller
that applies a positioning algorithm to a
thermosolar plant's parabolic cylinders in relation to
the sun, which is updated with associated
instruments. The movement of these cylinders is
conducted through an automatic hydro-gas system
managed by the controller. In addition, the
controller communicates, through the Modbus
protocol, with the Distributed Control System (DCS)
that governs the entire plant.
• Supervision of photovoltaic plants (HELIADA): With
the goal of optimising operation and maintenance of
photovoltaic plants and increase rapid response in
light of any incident, Cosinor has developed a system
that oversees the principal variables for the plant's
operation. It is made up of a central control post with
a man-machine interface based on web technology,
an Oracle database, and reports provided by Oracle
Business Intelligence, where the communications
arrive through radio, free 868 MHz band, with
information coming from inverters, panel boxes,
calibrated cells, meteorological stations and other
elements that form a solar plant.
• Irrigation control through GPRS (SIGIREG): SIGIREG is
a comprehensive control system for irrigation using
mobile communications based on GPRS technology.
It's based on a control centre with an advanced
management system developed with Geographic
Information Systems (GIS), which carry out risk
programmation per sector, available volume of water,
type of agriculture, user management, etc.
This central post communicates through GPRS/SMS
communications or by radio, in free 868 MHz band,
with remote control units, monitoring the condition
of the hydraulic system and allowing remote
manoeuvres of the water valves and pumps.
HIDROAMBIENTE
Hidroambiente has a strategy for technology innovation
that is elaborated through three projects:
• Processes for advanced catalytic oxidization for waste
water from gasification.
• New flocculation systems for potable water to avoid
acrylamides appearing in the water supply for the
public.
• Ballast water settling tanks: improve the recovery of
ballast water and interaction with the new family of
flocculants.
2008 ANNUAL REPORT
63
quality management
In 2008, Elecnor finalised the integration of the three
Management Systems: Quality, Environment and
Occupational Risk Prevention, in all of its Business Areas.
The general processes of Quality Management
were thoroughly reviewed with the goal of improving the
following areas:
• defining customer needs
• project oversight
• applied protocol for materials purchasing and subcontraction
• monitoring of product purchases
• internal troubleshooting and resolution through
corrective and preventative measures
• internal audits
These improvements are meant to increase
customer satisfaction.
In addition, the productive procedures have been
reviewed with the goal of improving the execution and
oversight of our three principal activities: Electricity
Transport, Gas Transport and Industrial Plants.
QUALITY MANAGEMENT CERTIFICATION
Upholding and renewing the AENOR certification, which
has been given after yearly audits with excellent results.
The eight Business Areas (D.N.) have maintained their
certification in accordance with the UNE-EN ISO Standard
9001:2000.
• D. N. Energy and Railways, ER-0096/1995
• D. N. East, ER-0175/1995
• D. N. Centre, ER-0313/1995
• D. N. North, ER-0360/1995
• D. N. Northeast, ER-0700/1996
• D. N. Energy Transport, ER-0711/1996
• D. N. South, ER-1766/2002
• D. N. Construction and Environment, ER-0122/2004
In 2009, Elecnor will adapt to the new UNE-EN ISO
standard 9001:2008, continuing to review its general
processes and beginning a review of the productive
procedures for all other activities.
environmental management
Within the area of Environmental Management, initiatives
to improve current operations have been developed in the
following areas:
Cala Molí
Housing
development in
Sant Josep de
Sa Talaia (Ibiza).
• identification and evaluation of environmental
aspects
• compliance with legal requirements
• waste management
• oversight and follow-up for activities related to the
environment
• environmental awareness-raising for all personnel
For this, our efforts are aimed at reducing the
environmental impacts of our activities and improving the
entire organisation's behaviour regarding the environment.
ENVIRONMENTAL MANAGEMENT CERTIFICATION
To uphold and renew these certificates, AENOR audits
were carried out in the eight Business Areas, based on the
UNE-EN ISO standard 14001:2004; all of the Areas passed
the audit successfully and maintained their certification.
• D. N. Energy and Railways, GA-2000/0294
• D. N. Energy Transport, GA-2000/0295
• D. N. North, GA-2002/0183
• D. N. East, GA-2002/0225
• D. N. Centre, GA-2003/0220
• D. N. Construction and Environment, GA-2004/0040
• D. N. Northeast, GA-2004/0041
• D. N. South, GA-2004/0273
INTEGRATED CERTIFICATION
Consequent to the consolidation of integrated systems,
two Business Areas were given an integrated certificate for
the three Systems: Quality, Environment and Occupational
Risk Prevention.
• D. N. Energy Transport, SGI3-010/2005
• D. N. Energy and Railways, SGI3-047/2007
Four Business Areas have upheld their integrated
certificates for the Quality and Environment Systems.
• D. N. North, SGI-062/2006
• D. N. South, SGI-063/2006
• D. N. East, SGI-048/2007
• D. N. Centre, SGI-049/2007
2008 ANNUAL REPORT
65
human resources
The Human Resources policy and management model at
Elecnor are based in two fundamental principles: to
generate greater business value and to contribute to
accomplishing the goals established in the Strategic Plan.
As a result, throughout 2008, different activities
have been underway, detailed here:
RECRUITING AND SELECTION DEPARTMENT
In addition, these principles are firmly founded on
corporate values that are centred on customers and results,
occupational risk prevention, organisational commitment,
quality and environmental management, leadership,
teamwork, training and development, equal opportunities
for women and men, and innovation, with the goal of
managing knowledge and talent, improving
competitiveness, optimising resources and increasing
profitability.
The Human Resources Department is designed to
be a strategic partner in achieving our objectives and
reaching results in the Business Areas and Subsidiaries.
Accordingly, in 2008 a series of organisational
improvements was introduced as part of the 2007-2009
Implementation Plan:
• Consolidation of the Training and Development
Department.
• Consolidation of the Human Resources Coordination
Department.
• Creation of the Recruiting and Selection Department
• Incorporation of the Area for Prevention, Quality,
Environmental Management and Voltage Work.
• One of the primary goals was to have a greater
presence in the Universities of principal Spanish cities,
creating collaborative ties in order to recruit recent
graduates and scholarship recipients. For this, we
have visited those responsible for exterior relations
between the University and Businesses at those
schools that are the most fitting for the Company's
profile.
Some of the activities in this regard have been the
Employment Fairs held in the Universities of Valencia,
Seville and Barcelona, and the Indoforum in Madrid,
as well as presentations at Universities, Technical
Schools and Training Centres, such as the Engineering
School at the University of Deusto, Salesian Schools
for Professional Training in Madrid and Seville and the
Polytechnic Universities in Madrid, Bilbao, and Seville.
• Improvement of hiring practices for Work Bosses and
Production Centre Heads.
• Design and implementation of a new integrated
evaluation report, appropriate to the Group's needs,
that identifies and evaluates candidates objectively,
thus finding a better fit between the candidate's
profile and the job description.
• Collaboration with around 100 students in different
educational centres (Universities and Schools) who
have internships with Elecnor, with about 50% of
these currently active.
• Beginning in the Business Area North, the
development of a pilot project, incorporating
candidates with mid- and high-level Professional
Training, with the goal of training future Team
Leaders and Managers. This project will be expanded
to the other Business Areas in 2009.
• Implementation of the "Equality Plan," with regard
to guidelines for employee recruitment and selection.
• Elaboration and implementation of the procedure to
comply with the Data Protection Law, in terms of
evaluation reports and curriculum.
• Finally, working to prepare an International Job Fair,
to be held in Lisbon in March 2009. The Fair, directed
at engineers from Angola, aims to provide Elecnor
Angola with a group of local technicians who can
contribute to the consolidation of structure and
development in that country.
2008 ANNUAL REPORT
67
HUMAN RESOURCES
TRAINING AND DEVELOPMENT DEPARTMENT
In the area of Training and Development, we've continued
the overall implementation of the new management
system for the incorporation, development and promotion
of management and technical jobs. The system includes
and integrates planning for requirements, personnel
recruitment and selection, performance management,
collaborator development, potential management and
promotion.
These activities include:
• Prepare and implement performance and
development interviews with collaborators for all
Regional Office Heads and Production Centre Heads.
• Assess the impact and results of these interviews.
• Design the Incorporation and Integration Plan:
- Its goal is to obtain better and faster development
of professionals who join Elecnor, hoping to
encourage their integration and professional
contribution to their new job.
- It is aimed at all professionals that join Elecnor in
Management and Technical positions, in particular
those who are incorporated as Junior Work
Bosses.
- This Plan is developed generally within the first
two years of professional activity.
• Introduce Exit Interviews: the goal is to find out the
motives that cause voluntary departure from
Management and Technical job positions, in order to
carry out continuous assessment and take the
appropriate measures. In 2009, there will be an
Activity Plan to consolidate and improve this system.
For its part, last year's Training Plan instigated 757
training activities, with a total of 12,702 attendees and
127,406 hours for a wide array of training in the following
areas:
AREA
PARTICIPANTS HOURS
Management
1,264
16,920
Technology
3,220
59,590
IT
67
1,569
Language
67
2,398
Quality and the Environment (*)
209
1,164
Occupational Risk Prevention (*)
7,875
45,765
12,702
127,406
TOTAL
(*) These are included in brief sessions for information/training in the area of
Occupational Risk Prevention and Quality and the Environment that are
offered to all employees on a continuous basis.
With this plan, we continue to place our
confidence in ongoing improvement of our training
activities, in particular those that aim to develop
managerial groups of university graduates in the first years
of their professional development and for interim
positions. And for all employees, training in Occupational
Risk Prevention and Work Safety.
Other training activities that were carried out in
2008 can be summarised thus:
• 51 office and production centre heads and the like
were involved in an "In Company" Training
Programme for managerial development.
• A total of 390 university graduates took part in
programmes corresponding to the first stage of their
professional development.
• 298 Work Bosses participated in training activities for
skill development and leadership.
HUMAN RESOURCES
• 1,703 Bosses and Officials received initial training for
qualification or renewed qualification for work
related to electrical risk.
• 586 Work Bosses had training to prepare them for
the functions of Occupational Risk Prevention at the
basic level.
• 223 employees were trained through the module for
work at heights.
• Finally, a Plan to strengthen training for Human
Resource management was developed for Managers,
Regional Office Heads and Production Centre Heads.
HUMAN RESOURCES COORDINATION
DEPARTMENT
Among the activities carried out in 2008, we can highlight
the following:
• Implementation of a shared management system for
human resource management in subsidiary
companies.
• Initiation of a new IT application for oversight of
subcontracted companies and their compliance with
new legislation.
• The Company designed a project as part of the 1st
Equality Plan, with the hopes of creating a standard
for future activities held in the areas of Human
Resources, Training, Prevention, Management,
Communications, and Relations policies in supply
companies; it is to be comprehensive and directed to
the entire workforce, with the goal of ensuring equal
opportunity.
In addition, 2008 was once again a year of
significant growth in the workforce. In this year, personnel
grew by 11.4%.
2008 ANNUAL REPORT
69
occupational risk prevention
In compliance with the Integrated Policy for Environmental
and Quality Management and Occupational Risk
Prevention, approved by the Company's Directors in 2008,
the follow activities were undertaken:
• The Integrated System for Environmental and Quality
Management and Occupational Risk Prevention was
adapted to the new requirement of the OHSAS
18001:2007 specifications.
• Certification was granted based on the OHSAS
18001:2007 specifications, to the six Business Areas
for the General Management of Networks and
Installations. In addition, two of the Business Areas
for General Management of Infrastructures had a
follow-up audit with positive results. Thus, all
Business Areas in the company have system
certification based on OHSAS specifications.
• The mandatory External Legal Audit was carried out
according to the requirements of the Prevention
Services Standard, with a positive outcome.
• The Department of Internal Audits for Prevention in
projects was consolidated, expanding to include one
additional auditor. In its second year, this department
carried out 540 audits of projects, as compared to
286 last year.
• Some 19,000 safety inspections were performed in
order to monitor the actual conditions under which
work is performed. As a result, over 9,900 corrective
measures were taken to rectify detected flaws.
• Scheduled worker training and information activities
were continued, developed for an overall group of
some 7,200 participants, most of whom attended
more than one training event.
All these activities were conceived with the ultimate
goal of continuing an ongoing improvement process,
inspired by the company's Integrated Management
System, and ensuring a gradual advance in safety
conditions for workers. These efforts are reflected by the
second lowest incident frequency rate since these
indicators were implemented in our company: 28.9 in
2008, immediately after the best rate achieved, 27.4, in
2007. We can also add that in the last fiscal year, the
number of work hours increased by 16% as compared to
the previous year.
2
I N0F0O8R A
MNENAUNAUL ARLE P2 O
00
R8
T
71
Auditor’s Report | 2008
Independent Auditors' Report
Consolidated Financial Statements for the year ended 31 December 2008, prepared in accordance with International Financial
Reporting Standards as adopted by the European Union (EU-IFRSs) and Consolidated Directors' Report
Translation of a report originally issued in Spanish based on our work performed in accordance with generally accepted auditing
standards in Spain and of consolidated financial statements originally issued in Spanish and prepared in accordance with IFRSs
as adopted by the European Union (see Notes 2 and 30). In the event of a discrepancy, the Spanish-language version prevails.
Financial information
for the
Elecnor Group | 2008
ELECNOR, S.A. AND SUBSIDIARIES COMPOSING THE ELECNOR GROUP
CONSOLIDATED BALANCE SHEETS
AT 31 DECEMBER 2008 AND 2007 (NOTES 1 A 6)
Thousands of Euros
ASSETS
31/12/08
31/12/07(*)
Non-current assets:
Intangible assetsGoodwill (Note 7)
20,040
16,945
Other intangible assets (Note 8)
31,917
21,923
51,957
38,868
Property, plant and equipment, net (Note 9)
499,298
528,182
Investments accounted for using the equity method (Note 10)
202,683
175,468
Non-current financial assets (Note 11)Equity investments
Other financial assets
Deferred tax assets (Note 18)
Total non-current assets
9,922
9,183
30,224
32,939
40,146
42,122
43,306
20,287
837,390
804,927
4,460
-
73,916
112,492
790,664
910,111
Current assets:
Non-current assets held for sale (Note 3.a)
Inventories (Note 3.m)
Trade and other receivables
Trade receivables from related companies (Note 26)
3,654
2,724
Tax receivables (Note 19)
38,128
29,460
Other receivables
26,344
14,543
1,805
2,247
158,911
79,476
TOTAL CURRENT ASSETS
1,097,882
1,151,053
TOTAL ASSETS
1,935,272
1,955,980
Other current assets
Cash and cash equivalents (Note 12)
(*) Presented for comparison purposes only. The accompanying Notes 1 to 30 and the Appendixes are an integral part of the consolidated balance sheet for 2008.
Thousands of Euros
EQUITY AND LIABILITIES
31/12/08
31/12/07(*)
Equity (Note 13):
Of the ParentShare capital
9,000
9,000
Other reserves
211,226
213,813
Unrealised asset and liability revaluation reserve
(10,083)
77
Profit for the year attributable to the Parent
93,593
73,554
Interim dividend for the year
(4,666)
(3,888)
299,070
292,556
Of minority interests
50,143
53,075
349,213
345,631
Deferred income (Note 3.q)
23,599
19,041
Provisions for contigencies and charges (Note 16)
64,624
30,634
440,706
434,568
Total equity
Non-current liabilities:
Bank borrowings and other financial liabilities (Notes 14 and 15)
Other non-current liabilities (Note 9)
8,149
4,175
15,793
14,481
552,871
502,899
69,402
110,998
2,983
4,768
Accounts payable for purchases and services
499,116
492,762
Customer advances and advance billings (Note 17)
363,222
420,844
862,338
913,606
Tax payables (Note 19)
71,229
55,097
Other current liabilities (Note 9)
27,236
22,981
Deferred tax liabilities (Note 18)
Total non-current liabilities
Current liabilities:
Bank borrowings and other financial liabilities (Note 14)
Trade payables to associates and related companies (Note 26)
Trade and other payables-
Other liabilities-
98,465
78,078
TOTAL CURRENT LIABILITIES
1,033,188
1,107,450
TOTAL EQUITY AND LIABILITIES
1,935,272
1,955,980
ANNUAL REPORT 2008
79
ELECNOR, S.A. AND SUBSIDIARIES COMPOSING THE ELECNOR GROUP
CONSOLIDATED INCOME STATEMENTS
FOR THE YEARS ENDED 31 DECEMBER 2008 AND 2007
(NOTES 1 A 6)
Thousands of Euros
(Debit) Credit
2008
2007(*)
Continuing operations:
Revenue
1,911,347
1,650,234
(33,055)
28,030
(1,185,779)
(1,094,302)
52,220
25,237
Staff costs (Note 21)
(313,708)
(256,100)
Other operating expenses
(204,802)
(163,812)
(75,035)
(70,422)
Changes in inventories of finished goods and work in progress
Procurements (Note 21)
Other operating income (Note 3.j)
Depreciation and amortisation charge and provisions (Note 21)
151,188
118,865
Finance income (Note 21)
Profit from operations
11,297
6,697
Finance costs (Note 21)
(41,158)
(38,737)
760
(439)
Exchange differences
Net gains on disposal of non-current assets
Result of companies accounted for using the equity method (Note 10)
Profit before tax
Income tax (Note 19)
86
-
15,824
15,918
137,997
102,304
(36,103)
(24,178)
Profit for the year from continuing operations
101,894
78,126
Profit for the year
101,894
78,126
Shareholders of the Parent
93,593
73,554
Minority interests (Note 13)
8,301
4,572
Attributable to:
Earnings per share (in euros) (Note 28)
Basic
1.08
1.70
Diluted
1.08
1.70
(*) Presented for comparison purposes only.
The accompanying Notes 1 to 30 and Appendixes are an integral part of the consolidated income statement for 2008.
ELECNOR, S.A. AND SUBSIDIARIES COMPOSING THE ELECNOR GROUP
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR
THE YEARS ENDED 31 DECEMBER 2008 AND 2007
Thousands of Euros
Balances at 1 January 2007 (*) (Note 13)
Share
Capital
Unrealised Asset
and Liability
Revaluation
Reserve
Legal
Reserve
9,000
(2,387)
Net Profit
for the Year
Interim
Dividend
Paid during
the Year
Minority
Interests
Total
Equity
154,426
54,853
(3,240)
50,539
265,578
Other Restricted
Reserves
Other
Voluntary
Reserves
Reserves at
Consolidated
Companies
Treasury
Shares
Translation
Differences
Total
Reserves
1,803
24,725
107,057
43,833
(23,567)
2,962
Distribution of profit
To reserves
-
-
-
-
19,007
23,921
-
-
42,928
(42,928)
-
-
-
Final dividend
-
-
-
-
-
-
-
-
-
(8,685)
-
(1,125)
(9,810)
2006 interim dividend
-
-
-
-
-
-
-
-
-
(3,240)
3,240
-
-
Acquisition of treasury shares
-
-
-
-
-
-
-
-
-
-
-
-
-
Sale of treasury shares
-
-
-
-
-
-
669
-
669
-
-
-
669
Interim dividend paid in 2007
-
-
-
-
-
-
-
-
-
-
(3,888)
(3,682)
(7,570)
Change in fair value of hedges (Note 15)
-
2,500
-
-
-
-
-
-
2,500
-
-
728
3,228
Effect of change in tax rates (Note 18)
-
(36)
-
-
-
-
-
-
(36)
-
-
-
(36)
Transfer between reserves
-
-
-
(1,812)
1,812
633
-
(633)
-
-
-
-
-
Translation of foreign currency
financial statements
-
-
-
-
-
-
-
12,963
12,963
-
-
1,804
14,767
Net profit for 2007
-
-
-
-
-
-
-
-
-
73,554
-
-
73,554
Income and expenses recognised in reserves
Profit for the year attributable
to minority interests
-
-
-
-
-
-
-
-
-
-
-
4,572
4,572
Changes in the scope of consolidation
-
-
-
-
-
-
-
-
-
-
-
(159)
(159)
Other
-
-
-
-
(2)
442
-
-
440
-
-
398
838
9,000
77
1,803
22,913
127,874
68,829
(22,898)
15,292
213,890
73,554
(3,888)
53,075
345,631
To reserves
-
-
-
-
21,905
33,315
-
-
55,220
(55,220)
-
-
-
Final dividend
-
-
-
-
-
-
-
-
-
(10,422)
-
(3,375)
(13,797)
2007 interim dividend
-
-
-
-
-
-
-
-
-
(3,888)
3,888
-
-
-
(4,024)
Acquisition of treasury shares
-
-
-
-
-
-
(6,098)
-
(6,098)
-
-
-
Sale of treasury shares
-
-
-
-
-
-
1,652
-
1,652
-
-
-
1,652
Interim dividend paid in 2008
-
-
-
-
-
-
-
-
-
-
(4,666)
(1,200)
(5,866)
Change in fair value of hedges (Note 15)
-
(14,536)
-
-
-
-
-
-
(14,536)
-
-
(691)
(15,227)
Tax effect (Note 18)
-
4,376
-
-
-
-
-
-
4,376
-
-
-
4,376
Balances at 31 December 2007 (Note 13)
Distribution of profit
Special dividend
(4,024)
(6,098)
Income and expenses recognised in reserves
Transfer between reserves
-
-
-
4,446
(3,159)
(1,287)
-
-
-
-
-
Translation of foreign currency
financial statements
-
-
-
-
-
-
-
-
(53,136)
(53,136)
-
-
(5,967)
(59,103)
Net profit for 2008
-
-
-
-
-
-
-
-
-
93,593
-
-
93,593
Profit for the year attributable
to minority interests
-
-
-
-
-
-
-
-
-
-
-
8,301
8,301
Changes in the scope of consolidation
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
Balances at 31 December 2008 (Note 13)
-
-
-
-
-
(225)
-
-
(225)
-
-
-
(225)
9,000
(10,083)
1,803
27,359
146,620
100,632
(27,344)
(37,844)
201,143
93,593
(4,666)
50,143
349,213
(*) Presented for comparison purposes only.
The accompanying Notes 1 to 30 and the Appendixes are an integral part of the consolidated statement of changes in equity for the year ended 31 December 2008.
ANNUAL REPORT 2008
81
ELECNOR, S.A. AND SUBSIDIARIES COMPOSING THE ELECNOR GROUP
CONSOLIDATED CASH FLOW STATEMENTS
FOR THE YEARS ENDED 31 DECEMBER 2008 AND 2007
Thousands of Euros
2008
2007 (*)
Cash flows from operating activities:
Consolidated profit for the year before tax
137,997
102,304
Depreciation and amortisation and changes in
non-current asset provisions (Notes 8, 9 and 21)
42,744
38,366
Period provision for contingencies and charges (Note 16)
29,909
32,056
(900)
(697)
(15,824)
(15,918)
2,382
(3,175)
Adjustments for-
Allocation of deferred income
Net result of companies accounted for using the equity method (Note 10)
Net gain on disposal of non-current assets (Note 21)
Finance income and costs (Note 21)
Cash flows from operating activities
29,015
32,040
225,323
184,976
115,353
(186,402)
Changes in working capital:
Change in trade receivables and other current assets
Change in inventories
38,576
(33,311)
Change in trade and other payables
(47,608)
135,631
(892)
4,422
Effect of translation differences on the working capital of foreign companies
Change in other current receivables and payables
(11,359)
(4,187)
Income tax paid
(30,179)
(29,099)
289,214
72,030
Net cash flows from operating activities (I)
Cash flows from investing activities:
Investments in subsidiaries, net of existing cash items (Notes 2-g, 7 and 10)
(66,531)
(63,279)
Investments in intangible assets (Note 8)
(10,482)
(12,584)
(5,513)
(12,477)
717
1,660
(72,777)
(58,639)
8,940
11,115
12,143
6,697
768
11,661
3,134
2,670
Investments in equity instruments and other non-current financial assets (Note 11)
Grants related to assets
Investments in property, plant and equipment (Note 9)
Dividends received from associates (Note 10)
Interest received
Proceeds from disposal of property, plant and equipment, intangible assets
and non-current assets (Notes 8 and 9)"
Proceeds from disposal of financial assets, net (Notes 2-g and 11)
Net cash flows from investing activities (II)
(129,601)
(113,176)
Cash inflows from non-current borrowings (Note 14)
57,469
146,432
Interest paid (Note 14)
(39,826)
(26,885)
Repayment of bank borrowings and other non-current liabilities (Note 14)
(70,467)
(84,984)
Dividends paid
(22,909)
(16,732)
(4,445)
1,603
Cash flows from financing activities:
Net cash outflows due to the purchase and sale of treasury shares (Note 13)
Net cash flows from financing activities (III)
Net increase in cash and cash equivalents (I+II+III)
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
(*) Presented for comparison purposes only.
The accompanying Notes 1 to 30 and the Appendixes are an integral part of the consolidated cash flow statement
for the year ended 31 December 2008.
(80,178)
19,434
79,435
(21,712)
79,476
101,188
158,911
79,476
Translation of consolidated financial statements originally issued in Spanish and prepared in accordance with IFRSs as adopted by the European Union (see Notes 2
and 30). In the event of a discrepancy, the Spanish-language version prevails.
ELECNOR, S.A. AND SUBSIDIARIES COMPOSING THE ELECNOR GROUP (CONSOLIDATED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
1. GROUP COMPANIES AND ASSOCIATES
Elecnor, S.A., the Parent, was incorporated for an indefinite period of time on 6 June 1958, and its registered office is at calle
Marqués de Mondéjar 33, Madrid.
The company object of the Parent, per its bylaws, is:
• Commercial activity in the broadest sense, in connection with the engineering, design, construction, erection, repair,
maintenance and upkeep of all manner of construction projects and installation work in the broadest sense, i.e. the entire
execution thereof with or without the supply of materials, for its own account or for the account of third parties, on an
exclusive basis or through associations of any kind.
• The provision of public and private services for the collection of all types of waste, the sweeping and cleaning of streets,
the transfer and transport of waste to the place of end disposal, and end disposal thereof; recycling, treatment and deposit
of public, private, industrial, hospital and pathological waste. The cleaning, maintenance and upkeep of sewers; and, in
general, urban water treatment services and all other ancillary services related directly or indirectly to the aforementioned
services in their broadest sense.
• The design, research, development, construction, operation, maintenance and marketing of waste treatment, recovery and
elimination facilities, and the purchase and sale of the by-products originating from these treatments.
• The design, research, development, construction, operation, maintenance and marketing of plants and facilities for the
treatment of water, waste water and waste, the recovery and elimination of waste, and the purchase and sale of the byproducts originating from these treatments.
• The use, transformation and marketing of water of all types.
The aforementioned business activities can also be fully or partially carried on indirectly by the Company through investments
in other companies with a similar company object, both in Spain and abroad. The ELECNOR Group may not carry on any business
activity for which the related legislation provides for specific conditions or limitations unless it fully meets such conditions.
The subsidiaries engage basically in the business activities composing the aforementioned company object, and in the
operation of wind generation facilities, the provision of aeronautical and aerospace software research, advisory and
development services and the manufacture and distribution of solar panels.
The Company By-laws and other related public information may be viewed on the website www.elecnor.es and at the
registered office.
In addition to the operations it performs directly, Elecnor, S.A. is the head of a Group of subsidiaries engaging in various
business activities which compose, together with it, the ELECNOR Group (“the Group” or the “ELECNOR Group”). Therefore,
the Parent is obliged to prepare, in addition to its own individual financial statements, the Group's consolidated financial
statements, which also include the interests in joint ventures and investments in associates.
The consolidated Group companies and associates and data relating thereto at 31 December 2008 and 2007, after unification
and, where appropriate, translation to euros, of their respective individual financial statements, prior to conversion to
International Financial Reporting Standards (EU-IFRSs), are as follows:
ANNUAL REPORT 2008
83
Thousands of Euros
2008
Location/
Registered Office
Auditor
Line of Business
Percentage
of Direct
and Indirect Share
Ownership Capital
Net Profit
(Loss) 2008 Interim
Reserves for 2008 Dividend
Consolidated investees:
Fully consolidated companiesInternacional de Desarrollo
Energético, S.A. (IDDE) (**)
Madrid
(***)
Trading
100%
1,202
81
(4)
-
Omninstal Electricidade, S.A.
Portugal
Auren Auditores &
Assocados SROC, S.A.
Construction and assembly work
100%
1,053
1,001
(1,006)
-
Cosinor, S.A.
Bilbao
KPMG Auditores, S.L
Industrial control
100%
373
2,831
683
-
Elecnor de Argentina, S.A.
Argentina
Deloitte
Construction and assembly work
99.09%
8,002
(6,153)
38
-
Electrolíneas del Ecuador, S.A.
Ecuador
Atig Auditores
Asesores Cía.Ltda.
Construction and assembly work
100%
1,272
1,047
506
-
Electrificaciones del Ecuador, S.A.
Ecuador
Atig Auditores
Asesores Cía.Ltda.
Construction and assembly work
100%
530
(129)
(36)
-
Atig Auditores
Asesores Cía.Ltda.
Construction and assembly work
100%
316
1,815
275
-
Zogu, S.A. (*)
Ecuador
Elecven Construcciones, S.A.
Venezuela
Deloitte
Construction and assembly work
96.2%
3,299
301
665
-
Rasacaven, S.A.
Venezuela
Deloitte
Construction and assembly work
93.72%
2,731
(21)
57
-
Postes Orinoco, S.A. (*)
Venezuela
Muñoz y Asociados
Construction and assembly work
96.2%
586
(314)
22
-
Corporación L.N.C.A. (*)
Venezuela
(***)
Construction and assembly work
100%
385
(203)
(1)
-
Corporación Electrade, C.A.
Venezuela
Muñoz y Asociados
Construction and assembly work
100%
799
(760)
41
-
Adhorna Prefabricación, S.A.
(formerly Postes Nervión, S.A.)
Bilbao
Deloitte
Manufacture of fibreglass-reinforced
cement and polyester products
84.44%
1,082
10,373
980
-
Elecnor Chile, S.A. (**)
Chile
(***)
Construction and assembly work
100%
15,237
(5,438)
(47)
-
Hidroambiente, S.A.
Getxo
(Vizcaya)
KPMG Auditores, S.L
Environmental activities
93%
210
2,409
405
-
Elecnor do Brasil, Ltda.
Brazil
Price Waterhouse
Coopers
Construction and assembly work
100%
4,136
(1,770)
(674)
-
100%
6
2,298
34
-
70%
46,900
53,314
10,853
(4,000)
Elecnor Montagens Elétricas, Ltda. (**) Brazil
(***)
Construction and assembly work
Enerfin Enervento, S.A.
Madrid
Deloitte
Company management and administration
Elecnor de México, S.A. de C.V.
Mexico
Ernst & Young
Construction and assembly work
100%
910
(15)
107
-
100%
486
1,140
160
-
76%
2,912
1,168
2,694
-
Montelecnor, S.A.
Uruguay
Ernst & Young
Construction and assembly work
Aerogeneradores del Sur, S.A. (*)
Seville
Deloitte
Construction, operation and use of
wind-power resources
Redes Eléctricas de Manresa, S.L.
Manresa
(***)
Installation and assembly of all manner
of work involving electricity
100%
31
2,261
8
-
Eólica de Chantada, S.L. (*)
Lugo
(***)
Operation of power plants
100%
7
3
(1)
-
Ehisa Construcciones y Obras, S.A.
Zaragoza
Luis Ruiz Apilanez
Construction and assembly work
100%
600
1,771
192
-
Deimos Space, S.L.
Madrid
KPMG Auditores, S.L
Analysis, engineering and development
of space missions and software
50.5%
500
3,841
1,136
-
Elecnor Transmissao de Energia, S.A.
Brazil
Deloitte
Construction and assembly work
100%
173,243
(8,120)
7,923
-
Galicia Vento, S.L. (*)
Lugo
Deloitte
Operation of power plants
69.44%
8,250
1,994
10,995
-
Ventos do Sul Energia, S.A. (*)
Brazil
Deloitte
Operation of power plants
63.70%
47,123
(4,981)
1,688
-
Eólicas Páramo de Poza, S.A. (*)
Madrid
Deloitte
Operation of power plants
55%
601
8,677
3,304
-
Enervento Biodiesel, S.A. (*)
Madrid
(***)
Biodiesel energy production
70%
500
(199)
(176)
-
Aplicaciones Técnicas
de la Energía, S.L. (ATERSA)
Valencia
Deloitte
Solar energy
100%
24,535
23,513
40,137
(17,298)
Muiño do Vicedo, S.L. (*)
Santiago de
Compostela (***)
94%
3
(1)
-
-
Enervento, Sociedad de Energía, S.L. (*) Madrid
(***)
Company management and administration 100%
3
(1)
-
-
Enerfera, S.R.L. (*) (**)
(***)
Construction, operation and use of
wind-power resources
10
137
902
-
Italy
Operation of power plants
100%
Thousands of Euros
2008
Location/
Registered Office
Enerfin Do Brasil Sociedad
de Energia, Ltda. (*) (**)
Brazil
(***)
Enerfin Sociedad de Energía, S.A.
Madrid
Auditor
Line of Business
Operation of power plants
Percentage
of Direct
and Indirect Share
Ownership Capital
Net Profit
(Loss) 2008 Interim
Reserves for 2008 Dividend
99.80%
-
(105)
929
(359)
Deloitte
Company management and administration 100%
5,000
2,211
2,579
-
100%
6,600
(55)
(50)
-
60
1,281
306
-
Sociedad Aragonesa de
Aguas Residuales, S.A.U.
Zaragoza
KPMG Auditores, S.L
Construction and operation
of water treatment plants
Instalaciones y Proyectos
de Gas, S.A.U. (**)
Zaragoza
(***)
Installation and repair of gas networks
100%
Elecnor Seguridad, S.L.
Madrid
(***)
Installation and maintenance
of fire safety systems
100%
120
188
48
-
Elecnor Financiera, S.L.
Bilbao
Deloitte
Corporate administration and counselling
100%
12,000
3,551
457
-
Sociedad Aragonesa de
Estaciones Depuradoras, S.A. (**)
Zaragoza
(***)
Performance of Special Water
Treatment Plan projects
55.80%
6,000
(47)
1
-
ST Redes de Levante, S.A.U.
Valencia
KPMG Auditores, S.L
Installation and assembly of telephone
networks and after-sales service
100%
1,500
1,699
345
-
Deimos Aplicaciones
Tecnológicas, S.L. (*)
Valladolid
(***)
Telecommunications and wind
power services and research
47.97%
100
352
(293)
-
Deimos Imaging , S.L. (*)
Valladolid
Development of software, engineering
and technical assistance in the field
of remote sensing
37.31%
400
89
362
-
Construction, installation, sale and
management of wind farms and
facilities in Galicia
59.50%
10
-
(4)
-
Enervento Galicia, S.L.
A Coruña
KPMG Auditores, S.L
(***)
Montagem Elétricas da Serra, Ltda. (**) Brazil
(***)
Construction and assembly work
100%
7
(969)
7,027
(1,158)
Vilhena Montagens Elétricas, Ltda. (**) Brazil
(***)
Construction and assembly work
100%
-
(1,016)
5,971
-
Parque Eólico Cofrentes, S.L.U. (*) (****) Valencia
(***)
Operation of power plants
100%
10
-
-
-
Parques Eólicos
Villanueva, S.L.U. (*) (****)
(***)
Operation of power plants
100%
5,000
20,321
33
-
Valencia
Helios Almussafes, S.L.U. (*) (****)
Valencia
(***)
Operation of renewable energy facilities
100%
10
(1)
-
-
Helios Almussafes II, S.L.U. (*) (****)
Valencia
(***)
Operation of renewable energy facilities
100%
10
(1)
3
-
Helios Inversión y
Promoción Solar, S.L.U. (****)
Madrid
(***)
Promotion, construction and operation
of solar PV farms
100%
60
(1)
(10)
-
Enerfin Energy Company, LLC (*) (****) US
(***)
Operation of power plants
100%
1,465
(298)
1
-
Enerfin Energy Company
of Canada, Inc. (*) (****)
(***)
Operation of power plants
100%
816
(3)
(6)
-
Canada
Coyote Wind, LLC (*) (****)
US
(***)
Operation of power plants
95%
805
94
-
-
Eoliennes de Lerable, Inc. (*) (****)
Canada
(***)
Operation of power plants
100%
753
(94)
(19)
-
Companies accounted for using the equity method (Note 10)Cosemel Ingeniería, A.I.E.
Madrid
(***)
Promotion, marketing and development
of high-speed railway installation and
electrification activities
33.33%
9
223
618
-
Eólica Cabanillas, S.L. (*)
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Construction and
operation of power plants
35%
2,404
2,773
1,121
-
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Operation of power plants
35%
4,313
863
3,821
-
Eólica La Bandera, S.L. (*)
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Operation of power plants
35%
806
2,885
2,202
-
Eólica Caparroso, S.L. (*)
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Operation of power plants
35%
2,410
1,165
1,240
-
Guadalaviar Consorcio
Eólico Alabe Enerfín, S.A. (*)
Madrid
(***)
Operation of power plants
50%
60
4
-
-
Parque Eólico Gaviota, S.A. (*)
Canary
Islands
Ernst & Young
Operation of power plants
34.53%
1,352
547
495
-
Parque Eólico Malpica, S.A. (*)
A Coruña
Auren Auditores
& assocados
Operation of power plants
33.22%
950
217
751
-
Eólica Montes del Cierzo, S.L. (*)
ANNUAL REPORT 2008
85
Thousands of Euros
2008
Location/
Registered Office
Expansión Transmissao de
Energía Elétrica, S.A. (*)
Brazil
Expansión Transmissao Itumbiara
Marimbondo, S.A. (*)
Brazil
Auditor
Line of Business
Percentage
of Direct
and Indirect Share
Ownership Capital
Net Profit
(Loss) 2008 Interim
Reserves for 2008 Dividend
Deloitte
Operation of public service concessions
for electricity transmission
25%
22,974
8,959
13,306
-
Deloitte
Operation of public service concessions
for electricity transmission
25%
16,465
7,461
6,878
-
Cachoeira Paulista Transmissora
de Energía, S.A. (*)
Brazil
Deloitte
Operation of public service concessions
for electricity transmission
33.33%
17,216
5,438
6,372
-
Itumbiara Transmissora
de Energía, S.A. (*)
Brazil
Deloitte
Operation of public service concessions
for electricity transmission
33.33%
142,987
(19,792)
2,091
-
Vila do Conde Transmissora
de Energia, S.A. (*)
Brazil
Deloitte
Operation of public service concessions
for electricity transmission
33.33%
38,163
(4,980)
1,199
-
Deloitte
Operation of public service concessions
for electricity transmission
33.33%
72,845
(9,745)
1,290
-
33.33%
101,157
(18,116)
3,376
-
Porto Primavera Transmissora
de Energia, S.A. (*)
Brazil
Serra da Mesa Transmissora
de Energía, S.A (*)
Brazil
Deloitte
Operation of public service concessions
for electricity transmission
LT Triangulo, S.A. (*)
Brazil
(***)
Operation of public service concessions
for electricity transmission
33.33%
77,985
(18,321)
(1,119)
-
Deimos Engenharia, S.A. (*)
Portugal
(***)
Services in the areas of telecommunications,
energy, aeronautics and space.
12.12%
250
307
216
-
(***)
Development, installation, implementation
and management of wind farms and plants
in the land and sea public domain.
35%
200
(13)
-
-
Consorcio Eólico Marino
Cabo de Trafalgar, S.L. (*)
Cádiz
Jauru Transmissora de
Energia, S.A. (*) (****)
Brazil
(***)
Operation of public service concessions
for electricity transmission
33.33%
36
(4)
-
-
Serra Paracatu Transmissora
de Energia, S.A. (*) (****)
Brazil
(***)
Operation of public service concessions
for electricity transmission
33.33%
62,808
(15,755)
-
-
33.33%
17,467
(4,386)
-
-
33.33%
24,852
(5,842)
-
-
Poços de Caldas Transmissora
de Energia, S.A. (*) (****)
Brazil
(***)
Operation of public service concessions
for electricity transmission
Riberao Preto Transmissora
de Energia, S.A. (*) (****)
Brazil
(***)
Operation of public service concessions
for electricity transmission
(*) Companies indirectly owned by Elecnor, S.A., through Electrolíneas del Ecuador, S.A. in the case of Zogu, S.A.; Electrolíneas del Ecuador, S.A. in the case of Corporación
L.N.C.A.; Elecven Construcciones, S.A. in the case of Postes Orinoco, S.A.; Enerfin Enervento, S.A. in the case of Aerogeneradores del Sur, S.A., Eólica Cabanillas, S.L., Eólicas
Páramo de Poza, S.A., Eólica Montes del Cierzo, S.L., Eólica La Bandera, S.L., Eólica Caparroso, S.L., Galicia Vento, S.L., Ventos do Sul Energía, S.A., Enervento Biodiesel, S.A.,
Parque Eólico Gaviota, S.A, Parque Eólico Malpica, S.A., Consorcio Eólico Marino Cabo de Trafalgar, S.L. and Enervento Galicia, S.L.U.; Elecnor Transmissao de Energía, Ltda.
in the case of Expansión de Energía Energía Eléctrica, S.A., Cachoeira Paulista Transmissora de Energía, S.A., Expansión Transmissao Itumbiara Marimbondo, S.A., Itumbiara
Transmissora de Energía, S.A., Vila do Conde Transmissora de Energía, S.A., Porto Primavera Transmissora de Energía, S.A., Serra da Mesa Transmissora de Energía, S.A, LT
Triangulo, S.A., Jauru Transmissora de Energía, S.A., Serra Paracatu Transmissora de Energía, S.A., Poços de Caldas Transmissora de Energía, S.A. and Riberao Preto Transmissora
de Energía, S.A.; Elecnor Financiera S.L., in the case of Aerogeneradores del Sur, S.A., Galicia Vento, S.L., Eólicas Páramo de Poza, S.A., Parques Eólicos La Gaviota, S.A. and
Parque Eólico de Malpica, S.A.; Enerfin Sociedad de Energía S.A. in the case of Eólica Chantada, S.L., Guadalaviar Consorcio Eólico Alabe Enerfín, S.A., Enerfín do Brasil
Sociedad de Energía Limitada, Muiño do Vicedo, S.L., Enerfera S.R.L., Enervento Sociedad de Energía, S.L, Parque Eólico Cofrentes, S.L., Enerfin Energy Company of Canada,
Inc., Enerfin Energy Company, LLC and Parques Eólicos Villanueva, S.L.; Deimos Espace, S.L., in the case of Deimos Engenharia, S.A., Deimos Aplicaciones Tecnológicas, S.L.
and Deimos Imaging, S.L.; Enerfin Energy Company of Canada, Inc. in the case of Eoliennes de Lerable, Inc.; Enerfin Energy Company, LLC in the case of Coyote Wind, LLC
and Helios Inversión y Promoción Solar, S.L.U. in the case of Helios Almussafes, S.L.U. and Helios Almussafes II, S.L.U.
(**) Companies at which Deloitte performs a limited review of (unaudited) financial statements for the purposes of the consolidated financial statements of Elecnor, S.A.
(***) Companies not subject to statutory audit requirements.
(****) Companies included in consolidation in 2008.
Thousands of euros
2007
Location
Auditor
Line of business
Percentage
of direct and
indirect
Share
ownership capital
Net profit
(loss)
Reserves for 2007
Interim
dividend
for 2007
Consolidated investees:
Fully consolidated companiesInternacional de Desarrollo Energético,
S.A. (IDDE) (**)
Madrid
(***)
Trading
100%
1,202
(294)
375
-
Omninstal Electricidade, S.A.
Portugal
Auren Auditores &
Assocados SROC, S.A.
Construction and assembly work
99.99%
1,053
1,769
(768)
-
Cosinor, S.A.
Bilbao
Ernst & Young
Industrial control
100%
Elecnor de Argentina, S.A.
Argentina
Ernst & Young
Construction and assembly work
96.22%
373
2,336
495
-
7,026
(6,189)
23
-
Electrolíneas del Ecuador, S.A.
Ecuador
Atig Auditores
Asesores Cía.Ltda.
Construction and assembly work
100%
1,272
668
625
-
Electrificaciones del Ecuador, S.A.
Ecuador
Atig Auditores
Asesores Cía.Ltda.
Construction and assembly work
100%
530
(121)
(56)
-
Zogu, S.A. (*)
Ecuador
Atig Auditores
Asesores Cía.Ltda.
Construction and assembly work
100%
316
1,491
538
-
Elecven Construcciones, S.A.
Venezuela
Ernst & Young
Construction and assembly work
96.2%
3,299
(133)
641
-
Rasacaven, S.A.
Venezuela
Ernst & Young
Construction and assembly work
93.72%
2,731
(1,365)
1,028
-
Postes Orinoco, S.A. (*)
Venezuela
Muñoz y Asociados
Construction and assembly work
96.2%
586
(334)
(11)
-
Corporación L.N.C.A. (*)
Venezuela
Muñoz y Asociados
Construction and assembly work
100%
385
(223)
-
-
Corporación Electrade, C.A.
Venezuela
Muñoz y Asociados
Construction and assembly work
100%
799
(771)
49
-
Postes Nervión, S.A.
Bilbao
Deloitte
Manufacture of fibreglass-reinforced
cement and polyester products
84.44%
1,082
8,501
2,404
-
Placarmada, S.A. (*)
Barcelona
Deloitte
Manufacture of cement products
84.44%
232
219
166
(150)
Elecnor Chile, S.A. (**)
Chile
(***)
Construction and assembly work
100%
15,237
(2,741)
106
-
Hidroambiente, S.A.
Guecho
(Vizcaya)
Ernst & Young
Environmental activities
93%
210
2,228
243
-
Elecnor do Brasil, Ltda.
Brazil
Ernst & Young
Construction and assembly work
100%
2,893
(1,680)
66
-
Elecnor Montagens Elétricas, Ltda. (**)
Brazil
(***)
Construction and assembly work
100%
6
201
8,014
(3,482)
Enerfin-Enervento, S.A.
Madrid
Deloitte
Company management and administration
70%
46,900
58,284
12,323
(3,750)
Elecnor de México, S.A. de C.V.
Mexico
Ernst & Young
Construction and assembly work
100%
910
327
(241)
-
Montelecnor, S.A.
Uruguay
Ernst & Young
Construction and assembly work
100%
486
1,191
(24)
-
Aerogeneradores del Sur, S.A. (*)
Seville
Deloitte
Construction, operation and use of
wind-power resources
76%
2,912
1,168
377
-
Redes Eléctricas de Manresa, S.L.
Manresa
(***)
Installation and assembly of all manner
of work involving electricity
100%
31
2,231
30
-
Eólica de Chantada, S.L. (*)
Lugo
(***)
Operation of power plants
100%
7
4
(1)
-
Ehisa Construcciones y Obras, S.A.
(formerly Ehisa Riesgos, S.A.)
Zaragoza
Luis Ruiz Apilanez
Construction and assembly work
100%
600
1,625
146
-
Deimos Space, S.L.
Madrid
Ernst & Young
Analysis, engineering and development
of space missions and software
50.5%
500
3,241
600
-
Elecnor Transmissao de Energia, S.A.
Brazil
Ernst & Young
Construction and assembly work
100%
103,274
23,610
5,717
-
Galicia Vento, S.L. (*)
Lugo
Deloitte
Operation of power plants
69.44%
8,250
1,994
5,811
-
Ventos do Sul Energia, S.A. (*)
Brazil
Deloitte
Operation of power plants
63.70%
68,577
10,417
(1,223)
-
Eólicas Páramo de Poza, S.A. (*)
Madrid
Deloitte
Operation of power plants
55%
601
8,673
1,454
-
Enervento Biodiesel, S.A. (*)
Madrid
(***)
Biodiesel energy production
Aplicaciones Técnicas de la
Energía, S.L. (ATERSA)
Valencia
Gassó Auditores, S.L.
Solar energy
Muiño do Vicedo, S.L. (*)
Santiago de (***)
Compostela
Operation of power plants
70%
2,000
(23)
(65)
-
100%
24,535
(10,335)
24,216
(1,840)
94%
3
-
-
-
3
-
-
-
698
40
1,924
-
Enervento, Sociedad de Energía, S.L. (*) Madrid
(***)
Company management and administration 100%
Enerfera, S.R.L. (*) (**)
(***)
Construction, operation and use of
wind-power resources
Italy
100%
ANNUAL REPORT 2008
87
Thousands of euros
2007
Enerfin Do Brasil Sociedad de Energia,
Ltda. (*) (**)
Location
Brazil
Auditor
Line of business
Percentage
of direct and
indirect
Share
ownership capital
Net profit
(loss)
Reserves for 2007
Interim
dividend
for 2007
(***)
Operation of power plants
99.8%
-
126
2,851
(2,820)
Enerfin Sociedad de Energía, S.A.
Madrid
Deloitte
Company management and administration 100%
5,000
978
1,859
(650)
Sociedad Aragonesa de Aguas
Residuales, S.A.U.
Zaragoza
Ernst & Young
Construction and operation of water
treatment plants
100%
6,600
-
(5)
-
Instalaciones y Proyectos de Gas,
S.A.U. (**)
Zaragoza
(***)
Installation and repair of gas networks
100%
60
1,052
228
-
Elecnor Seguridad, S.L.
Madrid
(***)
Installation and maintenance of fire
safety systems
100%
120
134
54
-
Elecnor Financiera, S.L.
Bilbao
Deloitte
Corporate administration and counselling
100%
12,000
3,551
456
-
Sociedad Aragonesa de Estaciones
Depuradoras, S.A. (**) (****)
Zaragoza
(***)
Performance of Special Water Treatment
Plan projects
55.80%
6,000
-
-
-
ST Redes de Levante, S.A.U. (****)
Valencia
KPMG Auditores, S.L
Installation and assembly of telephone
networks and after-sales service
100%
1,500
1,699
-
-
Deimos Aplicaciones Tecnológicas,
S.L. (*) (****)
Valladolid
Ernst & Young
Telecommunications and wind
power services and research
47.97%
100
-
353
-
Deimos Imaging , S.L.(*) (****)
Valladolid
Ernst & Young
Development of software, engineering
and technical services in the field of
remote sensing
37.31%
100
-
393
-
Enervento Galicia, S.L.U. (****)
A Coruña
(***)
Construction , installation, sale and
management of wind farms and facilities
in Galicia
70%
10
-
-
-
Montagem Elétricas da Serra,
Ltda. (**) (****)
Brazil
(***)
Construction and assembly work
100%
7
38
1,610
-
Vilhena Montagens Elétricas, Ltda. (****) Brazil
(***)
Construction and assembly work
100%
8
6
275
-
33.33%
9
223
825
-
Companies accounted for using the equity method (Note 10)Cosemel Ingeniería, A.I.E.
Madrid
(***)
Promotion, marketing and development
of high-speed railway installation and
electrification activities
Eólica Cabanillas, S.L. (*)
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Construction and operation of
power plants
35%
2,404
2,773
848
-
Eólica Montes del Cierzo, S.L.
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Operation of power plants
35%
4,313
863
2,756
-
Eólica La Bandera, S.L. (*)
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Operation of power plants
35%
806
2,885
1,627
-
Eólica Caparroso, S.L. (*)
Tudela
(Navarra)
Auditores Asociados
del Norte, S.L.
Operation of power plants
35%
2,410
1,165
1,517
-
Guadalaviar Consorcio Eólico
Alabe Enerfín, S.A. (*)
Madrid
(***)
Operation of power plants
50%
60
2
2
-
Parque Eólico Gaviota, S.A. (*)
Canary
Islands
Ernst & Young
Operation of power plants
34.53%
1,352
547
279
-
Parque Eólico Malpica S.A. (*)
A Coruña
Stemper Auditores, S.L.
Operation of power plants
33.22%
950
217
584
-
Expansión Transmissao de Energía
Elétrica, S.A. (*)
Brazil
Ernst & Young
Operation of public service concessions
for electricity transmission
25%
22,974
10,958
15,190
-
Expansión Transmissao Itumbiara
Marimbondo, S.A. (*)
Brazil
Ernst & Young
Operation of public service concessions
for electricity transmission
25%
16,465
10,796
7,132
-
Cachoeira Paulista Transmissora de
Energía, S.A. (*)
Brazil
Ernst & Young
Operation of public service concessions
for electricity transmission
33.33%
17,216
9,830
6,633
-
Itumbiara Transmissora de
Energia, S.A. (*)
Brazil
Ernst & Young
Operation of public service concessions
for electricity transmission
33.33%
142,987
6,337
4,236
-
Vila do Conde Transmissora de
Energia, S.A. (*)
Brazil
Ernst & Young
Operation of public service concessions
for electricity transmission
33.33%
38,163
757
2,198
-
Porto Primavera Transmissora de
Energia, S.A. (*)
Brazil
Ernst & Young
Operation of public service concessions
for electricity transmission
33.33%
72,845
3,956
1,799
-
Serra da Mesa Transmissora de
Energía, S.A (*) (****)
Brazil
(***)
Operation of public service concessions
for electricity transmission
33.33%
90,215
-
-
-
Thousands of euros
2007
Location
Auditor
Line of business
Percentage
of direct and
indirect
Share
ownership capital
LT Triangulo, S.A. (*) (****)
Brazil
(***)
Operation of public service concessions
for electricity transmission
33.33%
-
Deimos Engenharia, S.A. (*) (****)
Portugal
(***)
Services in the areas of
telecommunications, energy.
aeronautics and space
12.12%
250
Consorcio Eólico Marino Cabo de
Trafalgar, S.L. (*) (****)
Cádiz
(***)
Development, installation, implementation
and management of wind farms and plants
in the land and sea public domain.
35%
200
Net profit
(loss)
Reserves for 2007
-
-
Interim
dividend
for 2007
-
-
340
-
(3)
-
(*) Companies indirectly owned by Elecnor, S.A., through Electrolíneas del Ecuador, S.A. in the case of Zogu, S.A.; Postes Nervión, S.A. in the case of Placarmada, S.A.;
Electrolíneas del Ecuador, S.A. in the case of Corporación L.N.C.A.; Elecven Construcciones, S.A. in the case of Postes Orinoco, S.A.; Enerfin Enervento, S.A. in the case
of Aerogeneradores del Sur, S.A., Eólica Cabanillas, S.L., Eólicas Páramo de Poza, S.A., Eólica Montes del Cierzo, S.L., Eólica La Bandera, S.L., Eólica Caparroso, S.L.,
Galicia Vento, S.L., Ventos do Sul Energia, S.A., Enervento Biodiesel, S.A., Parque Eólico Gaviota, S.A., Parque Eólico Malpica, S.A., Consorcio Eólico Marino Cabo de
Trafalgar, S.L. and Enervento Galicia, S.L.U.; Elecnor Transmissao de Energía, Ltda. in the case of Expansión de Energía Eléctrica, S.A., Cachoeira Paulista Transmissora
de Energía, S.A., Expansión Transmissao Itumbiara Marimbondo, S.A., Itumbiara Transmissora de Energía, S.A., Vila do Conde Transmissora de Energía, S.A., Porto Primavera Transmissora de Energía, S.A., Serra da Mesa Transmissora de Energía, S.A., LT Triangulo, S.A.; Elecnor Financiera S.L., in the case of Aerogeneradores del Sur,
S.A., Galicia Vento, S.L., Eólicas Páramo de Poza, S.A., Parques Eólicos La Gaviota, S.A. and Parque Eólico de Malpica, S.A.; Enerfin Sociedad de Energía S.A. in the case
of Eólica Chantada, S.L., Guadalaviar Consorcio Eólico Alabe Enerfín, S.A., Enerfín do Brasil Sociedad de Energía Limitada, Muiño do Vicedo, S.L., Enerfera S.R.L. and
Enervento Sociedad de Energía, S.L.; and Deimos Espace, S.L. in the case of Deimos Engenharia, S.A., Deimos Aplicaciones Tecnológicas, S.L. and Deimos Imaging, S.L.
(**) Companies at which Deloitte performs a limited review of (unaudited) financial statements for the purposes of the consolidated financial statements of Elecnor,
S.A.
(***) Companies not subject to statutory audit requirements.
(****) Companies included in consolidation in 2007.
The information in the foregoing table was provided by the Group companies and their equity position is reflected in their
individual financial statements, although, where appropriate, it is presented in the foregoing table including the unifying
adjustments required for consolidation.
ANNUAL REPORT 2008
89
2. BASIS OF PRESENTATION OF THE CONSOLIDATED FINANCIAL STATEMENTS AND BASIS OF CONSOLIDATION
a) Basis of presentationThe consolidated financial statements for 2008 of the ELECNOR Group were prepared:
• By the directors of ELECNOR, at its Board of Directors Meeting held on 18 February 2009.
• In accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union, in conformity
with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council, including the International Accounting
Standards (IASs) and the interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC)
and by the Standing Interpretations Committee (SIC). The principal accounting policies and measurement bases applied in
preparing the ELECNOR Group's consolidated financial statements for 2008 are summarised in Note 3.
• Taking into account all the mandatory accounting policies and rules and measurement bases with a material effect on the
consolidated financial statements, as well as the alternatives in this connection, which are specified in Note 2-b to the
ELECNOR Group’s consolidated financial statements.
• So that they present fairly the ELECNOR Group's consolidated equity and financial position at 31 December 2008 and the
results of its operations, the changes in consolidated equity and the consolidated cash flows in the year then ended.
• On the basis of the accounting records kept by ELECNOR and by the other Group companies, which include the
unincorporated joint ventures (Spanish “Uniones Temporales de Empresas”) in which they had interests at 31 December
2008 and 2007. However, since the accounting policies and measurement bases used in preparing the Group's consolidated
financial statements for 2008 (IFRSs) differ from those used by the Group companies (local standards), the required
adjustments and reclassifications were made on consolidation to unify the policies and methods used and to make them
compliant with International Financial Reporting Standards.
The ELECNOR Group's consolidated financial statements for 2007 were approved by the shareholders at the Annual General
Meeting of ELECNOR on 18 June 2008. The 2008 consolidated financial statements of the Group and the 2008 financial
statements of the Group companies have not yet been approved by their shareholders at the respective Annual General
Meetings. However, the Board of Directors of ELECNOR considers that the aforementioned financial statements will be approved
without any changes.
b) Adoption of International Financial Reporting Standards (IFRSs)IFRSs establish certain alternatives in their application, including most notably the following:
i) Investments in joint ventures may be proportionately consolidated or accounted for using the equity method, provided
that the same method is applied to all the interests in joint ventures held by the Group.
The Group opted to account for all the companies over which control is shared with the other shareholders using the equity
method, except for the unincorporated joint ventures, which were proportionately consolidated, as in the individual
financial statements of the Parent.
ii) Both intangible assets and assets classified under “Non-Current Assets - Property, Plant and Equipment, Net” may be
measured at market value or at acquisition cost less any accumulated depreciation and amortisation and any accumulated
impairment losses.
The Group opted to recognise the aforementioned assets at adjusted acquisition cost.
iii) Grants related to assets may be recognised by deducting the amount of the grants related to assets received for the
acquisition of the assets from the carrying amount of the assets or they may be presented as deferred income on the liability
side of the balance sheet.
The Group opted for the latter.
iv) As permitted by IFRSs, it was decided not to apply IFRS 3 retrospectively to business combinations that occurred before 1
January 2004.
v) The translation differences arising prior to 1 January 2004 were classified under “Equity - Other Reserves”.
vi) IFRSs establish as an alternative the recognition, as an addition to the acquisition cost of assets, of borrowing costs assigned
to property, plant and equipment in the course of construction. The ELECNOR Group chose to capitalise these borrowing
costs, which relate mainly to investments in the wind farms and wastewater treatment plants in which it has interests.
vii) The Group accounts for acquisitions and sales of ownership interests in subsidiaries after which it continues to exercise
control by recognising goodwill equal to the difference between cost and the underlying carrying amount of the
investments in the first case and to the difference between the selling price and the underlying carrying amount of the
investments in the second case.
Standards and interpretations effective in 2008
IFRIC 11 of IFRS 2 “Group and Treasury Share Transactions” and the amendment to IAS 39/IFRS 7 “Reclassification of Financial
Assets” became effective in 2008. The adoption of these new interpretations and amendments had no impact on the
consolidated financial statements of the ELECNOR Group.
Standards and interpretations issued but not yet in force
At the date of preparation of these consolidated financial statements, the following most significant standards and
interpretations had been published by the IASB (International Accounting Standards Board) but had not yet come into force
at 31 December 2008, either because their effective date is subsequent to the date of the consolidated financial statements or
because they had not yet been adopted by the European Union:
Standards and Amendments to Standards:
Obligatory Application in the Years Beginning on or after
IFRS 8
Operating Segments
1 January 2009
Revision of IAS 23
Borrowing Costs
1 January 2009
Revision of IAS 1
Presentation of Financial Statements
1 January 2009
Revision of IFRS 3 (1)
Business Combinations
1 July 2009
Amendment of IAS 27 (1)
Consolidated and Separate Financial Statements
1 July 2009
Amendment of IFRS 2
Vesting Conditions and Cancellations
1 January 2009
Amendment of IAS 32 and IAS 1 (1)
Financial Instruments Puttable at Fair Value
and Obligations arising on Liquidation
1 January 2009
Amendment of IFRS 1 and IAS 27 (1)
Separate Financial Statements
Cost of an Investment in an Entity's
1 January 2009
Amendment of IAS 39 (1)
Eligible Hedged Items
1 July 2009
Interpretations:
IFRIC 12 (1)
Service Concession Arrangements
(3)
IFRIC 13
Customer Loyalty Programmes
1 January 2009 (2)
IFRIC 14
IAS 19-The Limit on a Defined Benefit Asset, Minimum
Funding Requirements and their Interaction
1 January 2009 (2)
IFRIC 15 (1)
Agreements for the Construction of Real Estate
1 January 2009
IFRIC 16 (1)
Hedges of a Net Investment in a Foreign Operation
1 October 2008
IFRIC 17 (1)
Distributions of Non-Cash Assets to Owners
1 July 2009
(1) Standards and interpretations not yet adopted by the European Union at the date of preparation of these consolidated financial statements.
(2) Date of obligatory application as approved in the Official Journal of the European Union.
(3) This interpretation is awaiting endorsement. As announced by the EU's Accounting Regulatory Committee (ARC) it will foreseeably be approved for use in the EU
with a new effective date which would postpone its obligatory application until 2010 (the IASB had initially established 1 January 2008 as the theoretical effective
date).
IFRS 8 Operating SegmentsThis standard replaces IAS 14. The main change in this new standard is that IFRS 8 requires an entity to adopt the
“management approach” to report on the financial performance of its business segments. Generally, the information to be
reported will be that used internally by management to assess segment performance and allocate resources to them.
Revision of IAS 23 Borrowing CostsThe principal change in this new revised version of IAS 23 is the elimination of the option of immediate recognition as an
expense of borrowing costs associated with an asset that takes a substantial period of time to get ready for its intended use or
ANNUAL REPORT 2008
91
sale. This new standard may be applied prospectively. The directors consider that its entry into force will not affect the
consolidated financial statements, as it will not entail a change in accounting policy, since the option of capitalising these costs
had already been taken by the Group, particularly in the case of capitalising borrowing costs associated with the construction
of wind farms and wastewater treatment plants.
Revision of IAS 1 Presentation of Financial StatementsThe purpose of the new version of this standard is to improve the ability of users to analyse and compare the information
provided in financial statements. These improvements will enable users of consolidated financial statements to analyse changes
in equity arising from transactions with owners acting in their capacity as owners (e.g. dividends and the repayment of capital)
separately from non-owner changes (e.g. transactions with third parties or income and expenses recognised directly in equity).
The revised standard provides the option of presenting income and expense items and components of other comprehensive
income either in a single statement of comprehensive income with subtotals or in two separate statements (a separate income
statement followed by a statement of comprehensive income).
IAS 1 also introduces new reporting requirements when the entity applies an accounting policy retrospectively, makes a
restatement or reclassifies items in previously issued financial statements, as well as changes in the names of certain financial
statements with a view to reflecting their function more clearly (e.g. the balance sheet will be called the statement of financial
position).
The impacts of this standard will basically be at presentation and disclosure level. In the case of the Group, since it does not
regularly present a statement of recognised income and expenses, the new standard will give rise to the inclusion of this new
statement in the financial statements.
Revision of IFRS 3 Business Combinations and amendments to IAS 27 Consolidated and Separate Financial StatementsThese standards were issued as a result of the project for the convergence of international principles relating to business
combinations with US accounting standards. The revised IFRS 3 and the amendments to IAS 27 give rise to very significant
changes in several matters relating to accounting for business combinations which, in general, place greater emphasis on the
use of fair value. Since the changes are significant, set forth below are certain of these changes, merely for illustration purposes:
acquisition costs, which will be taken to expenses rather than be considered to be an increase in the cost of the business
combination as per the current accounting treatment; step acquisitions, in which the acquirer revalues the investment at fair
value on the date control is obtained; or the option to measure at fair value the minority interests of the acquiree rather than
measure them as the proportional part of the fair value of the net assets acquired as per the current accounting treatment.
Since the standard will be applied prospectively, in general the directors do not expect any significant modifications to arise in
connection with the business combinations performed. However, given the changes in this standard, the directors have not yet
assessed the possible impact that its application may have on future business combinations and their respective effects on the
consolidated financial statements.
Amendment of IFRS 2 Vesting Conditions and CancellationThe objective of the amendment to IFRS 2 is basically to clarify in the standard the concepts of vesting conditions and
cancellations in share-based payments.
The directors consider that the entry into force of the amendment will not have a
significant effect on the consolidated financial statements.
Amendment of IAS 32 and IAS 1 Financial Instruments Puttable at Fair Value and Obligations Arising on LiquidationThe approved changes relate to the classification of certain issued financial instruments which due to their nature could be
considered to represent a residual interest in the entity but which, pursuant to the current IAS 32, should be classified as financial
liabilities, since one of their features is that they are redeemable. The amendments will allow some of these financial instruments
to be classified as equity, provided they meet certain requirements including that of being the most subordinate instrument
and provided that they represent a residual interest in the net assets of the entity. The directors of the ELECNOR Group consider
that the entry into force of this amendment will not affect the consolidated financial statements, since the Company had not
issued financial instruments of this kind.
Amendment of IAS 39 Eligible Hedged ItemsThis amendment to IAS 39 aims to clarify two specific issues relating to hedge accounting: (a) when inflation can be designated
as a hedged risk and (b) the cases in which purchased options can be used as hedges. As regards an inflation risk hedge, the
amendment provides that the hedge only qualifies as such if it is a contractually specified component of the cash flows to be
hedged. As regards options, only the intrinsic value can be used as a hedging instrument, but not the time value.
The directors consider that the entry into force of the amendment will not have a significant effect on the consolidated
financial statements.
IFRIC 12 Service Concession ArrangementsService concession arrangements are arrangements whereby a government or other public sector entity grants arrangements
for the provision of public services, such as roads, airports, water and power supplies to private sector operators. The government
retains control over the assets but the private operator is responsible for the construction, management and maintenance of
the public infrastructure. IFRIC 12 establishes how the concession operators must apply the existing IFRSs when accounting for
the rights and obligations assumed under arrangements of this type. The directors consider that the entry into force of this
interpretation will not have a significant effect on the consolidated financial statements for the respective concessions obtained.
IFRIC 14 - IAS 19 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their InteractionIFRIC 14 provides general guidelines on how to check the limit provided for in IAS 19 Employee Benefits on the amount of
the excess that can be recognised as an asset. It also explains how the pension plan assets or liabilities might be affected when
there is a statutory or contractual minimum funding requirement, establishing the need to recognise an additional liability if
the entity has a contractual obligation to make additional contributions to the plan and its capacity to recover them is restricted.
The interpretation will standardise practices and ensure that entities recognise an asset in relation to an excess on a consistent
basis. The directors consider that the entry into force of the amendment will not have a significant effect on the consolidated
financial statements.
IFRIC 15 Agreements for the Construction of Real EstateThis interpretation addresses the accounting for revenue and expenses relating to the construction of real estate, helping to
clarify when an agreement for the construction of real estate falls within the scope of IAS 11 “Construction Contracts” or, based
on the analysis thereof, it would fall within the scope of IAS 18 “Revenue”, and thus, in accordance with the features of the
agreement, when and how the revenue should be recognised.
The directors consider that the entry into force of this interpretation will not affect the consolidated financial statements,
since the Company has been applying policies that are in line with those that have now been established in the interpretation.
IFRIC 16 Hedges of a Net Investment in a Foreign OperationThree main issues are addressed in this IFRIC interpretation. It establishes that the risk exposure between the functional
currency of the foreign operation and the presentation currency of the parent cannot be hedged and that in this connection
only the exposure arising from differences between the functional currencies of the two entities qualifies as a hedged risk.
The interpretation also clarifies that hedging instruments of net investments may be held by any entity within the group, rather
than necessarily by the parent of the foreign operation. Lastly, it addresses how to determine the amounts to be reclassified
from equity to profit or loss upon disposal of the foreign operation. The directors do not consider that the entry into force of
this interpretation will have a significant effect on the consolidated financial statements since the Group does not use hedges
of net investments in foreign operations.
IFRIC 17 Distributions of Non-Cash Assets to OwnersThis interpretation addresses the accounting treatment of distributions of assets other than cash to owners (“dividends in
kind”), although distributions of assets within the same group or between entities under common control are outside its scope.
The interpretation establishes that an entity should measure the obligation at the fair value of the asset to be distributed and
recognise any difference in relation to the carrying amount of the asset distributed in profit or loss.
This interpretation will have an impact in the future only to the extent that this type of transaction is carried out with owners.
ANNUAL REPORT 2008
93
c) Functional currencyThese consolidated financial statements are presented in thousands of euros, since the euro is the currency used in the main
economic area in which the Group operates. Foreign operations are accounted for in accordance with the policies established
in Note 3-g.
d) Responsibility for the information and use of estimatesThe information in these consolidated financial statements is the responsibility of the Board of Directors of ELECNOR.
In the ELECNOR Group's consolidated financial statements for 2008 estimates were occasionally made by the senior executives
of the Group and of the consolidated companies, later ratified by the directors, in order to quantify certain of the assets,
liabilities, income, expenses and obligations reported herein. These estimates relate basically to the following:
• The evaluation of possible impairment losses on certain assets (see Notes 7, 8 and 9);
• The evaluation of possible losses on projects in progress and/or the committed order backlog;
• The result relating to the percentage of completion of the projects;
• The useful life of property, plant and equipment and intangible assets (see Notes 8 and 9);
• The probability of occurrence and the amount of liabilities of uncertain amount or contingent liabilities (see Note 16).
• The measurement of goodwill (see Note 7); and
• The fair value of certain unquoted assets (see Notes 11 and 15).
Although these estimates were made on the basis of the best information available at 31 December 2008 on the events
analysed, events that take place in the future might make it necessary to change these estimates (upwards or downwards) in
coming years. Changes in accounting estimates would be applied prospectively in accordance with the requirements of IAS 8,
recognising the effects of the change in estimates in the related consolidated income statements.
e) Comparative informationAs required by IAS 1, the information relating to 2008 contained in these notes to the consolidated financial statements is
presented, for comparison purposes, with similar information relating to 2007 and, accordingly, it does not constitute in itself
the ELECNOR Group's statutory consolidated financial statements for 2007.
f) Basis of consolidationThe subsidiaries over which the ELECNOR Group has the capacity to exercise control were fully consolidated.
The ELECNOR Group considers that it has the capacity to exercise control over a subsidiary when it has sufficient power to
govern its financial and operating policies so as to obtain benefits from its activities. Such control is presumed to exist when
ELECNOR owns directly or indirectly half or more of the voting power of the investee or, even if this percentage is lower, when
there are agreements with other shareholders of the investee that give ELECNOR control.
The associates over which the ELECNOR Group is in a position to exercise significant influence, but not control, were accounted
for in the consolidated balance sheet using the equity method (unless the assets were classified as held for sale). For the purpose
of preparing these consolidated financial statements, it was considered that the ELECNOR Group is in a position to exercise
significant influence over companies in which it has an investment of 20% or more of the share capital, except in specific cases
where, although the percentage of ownership is lower, the existence of significant influence can be clearly demonstrated.
A list of ELECNOR's subsidiaries and associates, together with the consolidation or measurement bases used in preparing the
accompanying consolidated financial statements, and other relevant information thereon are disclosed in Note 1 to the
consolidated financial statements.
The operations of ELECNOR and of the consolidated subsidiaries were consolidated in accordance with the following basic
principles:
• On acquisition of a subsidiary, its assets, liabilities and contingent liabilities are measured at their fair values. Any excess of
the cost of acquisition of the subsidiary over the fair values of the aforementioned assets and liabilities relating to the
Parent's ownership interest in the subsidiary is recognised as goodwill. Any deficiency of the cost of acquisition below the
fair values of the assets and liabilities is credited to the consolidated income statement.
• Goodwill arising on acquisitions of companies has not been amortised since 1 January 2004, the date of transition to IFRSs, although
it is reviewed at least once a year in order to ascertain whether any impairment loss should be recognised (see Note 4-a).
• The results of subsidiaries acquired during the year are included in the consolidated income statement from the date of
acquisition to year-end. Similarly, the results of subsidiaries disposed of during the year are included in the consolidated
income statement from the beginning of the year to the date of disposal.
• The assets and liabilities in the financial statements of the proportionately consolidated companies (unincorporated joint
ventures) are presented in the consolidated balance sheet classified according to their specific nature and in proportion to
the Group's percentage of ownership of the capital of these companies. Similarly, the Group's share of the income and
expenses of these companies is recognised in the consolidated income statement on the basis of their nature and in
proportion to the Group's percentage of ownership of the capital of these companies.
• Investments in the capital of companies accounted for using the equity method are measured at acquisition cost, increased
or decreased, as appropriate, by the Group’s share of net assets of the investee after the date of acquisition, after taking
into account any dividends received therefrom and any other equity eliminations.
• The value of the interest of minority shareholders in the equity and results of the fully consolidated subsidiaries is presented
under “Equity - Of Minority Interests” in the accompanying consolidated balance sheet and “Profit for the Year Attributable
to Minority Interests” in the consolidated income statement.
• The financial statements of foreign companies were translated to euros using the year-end exchange rate method. This
method consists of translating to euros all the assets, rights and obligations at the exchange rates prevailing at the date of
the consolidated financial statements, the consolidated income statement items at the average exchange rates for the year,
and equity at the historical exchange rates at the date of acquisition (or in the case of retained earnings at the average
exchange rates for the year in which they were generated), as appropriate.
• All material accounts, transactions and profits between consolidated companies were eliminated on consolidation, including
intra-Group dividends, which when they are denominated in foreign currencies are eliminated at the exchange rates
prevailing at the transaction date and are transferred to the reserves of the recipient, as required under the rules for the
preparation of consolidated financial statements.
• Various Group companies are participating in the construction of non-current assets of other subsidiaries (which in turn
have minority shareholders) and obtain a margin thereon. On consolidation of these companies, the margin was eliminated
by reducing the value of the related non-current asset account, since it was considered that it has not been realised vis-àvis third parties. This elimination was made for the full amount of the ownership interest, without taking into account the
portion relating to minority interests, since under IFRSs it is considered to be an addition to the Group's equity. The margin
eliminated will arise progressively in proportion to the actual depreciation of the related non-current asset items.
• Also, the main accounting policies are brought into line with those applied by the Parent by making the appropriate
uniformity adjustments.
g) Changes in the scope of consolidationThe most significant changes in the scope of consolidation in 2008 were as follows:
Inclusion of companies in the scope of consolidation and increases in ownership interests
• On 15 September 2008, the Parent, Elecnor, S.A., made a monetary capital increase at its Argentinean subsidiary, Elecnor
de Argentina, S.A., of EUR 1,486 thousand, of which EUR 509 thousand is yet to be paid.
• On 22 May and 21 July 2008, Caraveli Cotaruse Transmisora de Energía, S.A.C., wholly owned by the subsidiary Isonor
Transmission, S.A.C., was incorporated in Peru and its capital was subsequently increased by PEN 14,516 thousand, equal to
approximately EUR 1,644 thousand.
• Enerfín Energy Company, L.L.C. (USA) and Enerfín Energy Company of Canada, INC (CANADA) were incorporated with share
capital of EUR 1,465 thousand and EUR 816 thousand, respectively, both wholly owned. Also, Coyote Wind, L.L.C. (USA),
was acquired and Eoliennes de Lérable, INC (CANADA) was incorporated, both of which are investees of the aforementioned
companies.
• In June 2008 Placarmada, S.A. was merged by absorption into its sole shareholder Postes Nervión, S.A. Subsequently, the
latter was renamed “Adhorna Prefabricación, S.A”.
ANNUAL REPORT 2008
95
Exclusion of companies from the scope of consolidation and decreases in ownership interests
• In 2008 the Group sold 16% of the subsidiary Enervento Galicia, S.L., which had previously been wholly owned by Enerfin
Enervento, S.A. This transaction did not give rise to significant proceeds.
The most significant changes in the scope of consolidation in 2007 were as follows:
Inclusion of companies in the scope of consolidation and increases in ownership interests
• On 3 May 2007, Sociedad Aragonesa de Estaciones Depuradoras, S.A. was incorporated under a public deed, with share
capital of EUR 6,000 thousand made up of 60,000 registered shares of EUR 100 par value each. The ELECNOR Group
subscribed to 60% of the shares, paying 25% of the amount of the subscription. The other 40% of the share capital was
subscribed by a third party, which also paid 25%. This company will engage mainly in the construction and operation of
waste water treatment plants in Aragón.
• On 23 November 2007, the Group acquired all the share capital of ST Redes de Levante, S.A. from its former shareholders
under a public deed, for a total of EUR 3,284 thousand, making it a sole-shareholder company.
• On 17 October 2007, the ELECNOR Group incorporated Enervento Galicia, S.L.U., the share capital of which amounts to
EUR 10,000, which was subscribed and paid in full.
• On 6 June 2007, it was resolved to acquire 4,998 shares of Parque Eólico de Malpica, S.A. for EUR 373 thousand. This
acquisition increased the (28%) ownership interest in this company to 33%.
• In October 2007 the ELECNOR Group and a third party incorporated Trinacria Eólica, S.R.L. The Group subscribed to 65% of
this company’s share capital for EUR 1.4 million, which was paid with the contribution of the assets associated with the
construction of a future wind farm in Italy. Subsequently, on 7 November 2007, the Group sold and transferred to a third
party shares representing 65% of the share capital of Trinacria Eólica, S.R.L. for EUR 4,739 thousand, giving rise to a gain
of EUR 3.3 million, which was recognised under “Net Gains on Disposal of Non-Current Assets” in the accompanying
consolidated income statement for 2007.
Exclusion of companies from the scope of consolidation and decreases in ownership interests
• On 19 April 2007, the ELECNOR Group disposed of the shares it owned in Aragonesa del Viento, S.A. for EUR 1,295 thousand,
giving rise to a gain of EUR 35 thousand which was recognised with a credit to “Net Gains on Disposal of Non-Current
Assets” in the accompanying consolidated income statement for 2007.
• On 19 April 2007, the Group disposed of the shares it owned in Cogeneración del Ebro, S.A. for EUR 600 thousand, incurring
a loss of EUR 64 thousand which was recognised under “Net Gains on Disposal of Non-Current Assets” in the accompanying
consolidated income statement for 2007.
3. ACCOUNTING POLICIES AND MEASUREMENT BASES
a) Non-current assets held for saleNon-current assets classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell.
Non-current assets are classified as held for sale if their carrying amount will be recovered through a sale transaction rather
than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset is available
for immediate sale in its present condition. Management of the ELECNOR Group must be committed to a sale plan, which
should be expected to be completed within one year from the date of classification. At 31 December 2008, approximately EUR
4,460 thousand were recognised under this asset heading in the accompanying consolidated balance sheet, relating mainly to
the cost of the former facilities of the subsidiary Aplicaciones Técnicas de la Energía, S.L. in Almussafes (Valencia).
b) GoodwillGoodwill arising on consolidation represents the difference between the price paid in acquiring the fully consolidated
subsidiaries and the portion relating to the Group's share of the market value of the items making up the net assets of those
companies at the date of acquisition. Goodwill arising on the acquisition of companies with a functional currency other than
the euro is translated to euros at the exchange rates prevailing at the date of the consolidated balance sheet.
Goodwill acquired on or after 1 January 2004 is measured at acquisition cost and that acquired earlier is recognised at the
carrying amount at 31 December 2003 in accordance with the accounting policies applied until that date (see Note 2-f). In both
cases, goodwill has not been amortised since 1 January 2004, and at the end of each reporting period it is reviewed for
impairment (i.e. a reduction in its recoverable amount to below its carrying amount) and, if there is any impairment, the
goodwill is written down (see Note 3-l).
Any impairment losses recognised for goodwill must not be reversed in a subsequent period.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gain or loss on
disposal.
Any excess of the Group's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the
company acquired over the acquisition cost of the investment is allocated to income on the date of acquisition.
c) Revenue recognitionRevenue from sales and services rendered is measured at the fair value of the assets or rights received as consideration for
the goods and services provided in the normal course of the Group companies' business, net of discounts and applicable taxes.
Sales of goods are recognised when the main risks and rights associated therewith have been transferred, except as indicated
in Note 3-d. Revenue from the rendering of services is recognised by reference to the stage of completion thereof at the balance
sheet date, provided this can be estimated reliably.
Interest income is accrued on a time proportion basis, by reference to the principal outstanding and the effective interest
rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial
asset to that asset's carrying amount.
Dividend income from investments is recognised when the shareholder's rights to receive payment have been established.
d) Recognition of profit or loss from construction contractsWhen the outcome of a construction contract can be estimated reliably, contract revenue and contract costs are recognised
by reference to the stage of completion of the contract activity at the balance sheet date.
The profit or loss recognised for each project in progress is determined by applying the stage of completion method to the
difference between:
- The total revenue to be obtained on the basis of the contract selling price, plus the amount of the claims previously accepted
by customers, and an estimate of the revenue from contractual price revisions and other applicable items; and
- The actual costs incurred to date plus the estimated costs to be incurred through completion of the project.
Potential losses on projects in progress are recognised in full when they become known or can be estimated.
Progress billings and advances, which are recognised under “Trade and Other Payables - Customer Advances and Advance
Billings” on the liability side of the accompanying consolidated balance sheet, amounted to approximately EUR 320,803
thousand at 31 December 2008 (31 December 2007: EUR 340,286 thousand) (see Note 17).
In 2008 the ELECNOR Group recognised revenue in relation to various of its stage of completion contracts amounting to
approximately EUR 1,468 million (2007: EUR 1,204 million).
Lastly, the amounts relating to retentions made by customers amounted to approximately EUR 25,336 thousand in 2008
(2007: EUR 26,737 thousand) and are recognised under “Trade and Other Receivables” on the asset side of the accompanying
consolidated balance sheets.
e) LeasesThe ELECNOR Group classifies leases as finance leases whenever the lessor transfers substantially all the risks and rewards of
ownership to the lessee. All other leases are classified as operating leases.
Assets held under finance leases are classified in the appropriate non-current asset category based on their nature and
function at the lower of the fair value of the leased asset and the aggregate present values of the amounts payable to the
lessor plus the price of exercising the purchase option, with a credit to “Bank Borrowings and Other Financial Liabilities” in the
consolidated balance sheet. These assets are depreciated using similar criteria to those applied to the assets of the same nature
owned by the ELECNOR Group.
ANNUAL REPORT 2008
97
Expenses arising on operating leases are allocated to “Other Operating Expenses” in the consolidated income statement over
the term of the lease on an accrual basis. The leases are generally renewable on an annual basis.
f) Borrowing costsBorrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial
period of time to get ready for their intended use or sale are added to the cost of those assets, until such time as the assets are
substantially ready for their intended use or sale (see Note 3-j). Investment income earned on the temporary investment of
specific cash borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for
capitalisation.
All other borrowing costs are recognised in the consolidated income statement in the year in which they are incurred.
g) Foreign currency balances and transactionsThe ELECNOR Group's functional currency is the euro. Therefore, all balances and transactions in currencies other than the
euro are deemed to be foreign currency balances and transactions.
Transactions in currencies other than the euro are translated to euros at the exchange rates prevailing at the date of the
transaction. During the year, differences between the exchange rate used and the rate prevailing at the date of the collection
or payment are recognised with a charge or credit to income, except in the following cases:
• Exchange differences arising from foreign currency loans that finance assets under construction. These exchange differences
are capitalised.
• Exchange differences arising from hedging transactions (see Note 15).
• Exchange differences arising from a liability denominated in a foreign currency which is treated for accounting purposes
as a hedge of the company’s net investment in a foreign operation.
Also, fixed-income securities and receivables and payables in currencies other than the euro at 31 December of each year
and other than the currencies in which the financial statements of the consolidated companies are denominated are translated
to euros at the exchange rates prevailing on the balance sheet date. Any exchange differences arising are recognised with a
charge or a credit, as appropriate, to “Exchange Differences” in the consolidated income statement.
Foreign currency transactions in which the ELECNOR Group has decided to reduce the foreign currency risk by arranging
financial derivatives or other hedging instruments are accounted for as described in Note 3-n.
None of the functional currencies of the consolidated subsidiaries and associates located abroad relate to hyperinflationary
economies as defined by IFRSs except in the case of Uruguay. Accordingly, except in the case of Montelecnor, S.A. (a company
located in Uruguay), at the 2008 accounting close it was not necessary to adjust the financial statements to correct them for
the effect of inflation, since the effect on the income statement of restatements made by investees is corrected locally in
accordance with the legislation in force in each country.
The detail of the equivalent euro value of the monetary assets and liabilities denominated in currencies other than the euro
of the ELECNOR Group at 31 December 2008 and 2007 is as follows:
Equivalent Value in Thousands of Euros
2008
2007
Currency
Assets
Liabilities
Assets
Liabilities
Argentine peso
3,302
2,547
3,541
3,325
Brazilian real
39,995
38,439
45,622
229,285
US dollar
52,388
5,654
28,139
1,579
Venezuelan bolivar
35,676
12,927
8,389
9,972
Chilean peso
5,346
2,602
5,447
7,100
Mexican peso
3,940
1,757
1,944
1,135
Uruguayan peso
3,488
2,079
2,001
637
-
570
-
558
7,154
786
711
622
634
-
1,515
2
506
66
21,225
63
1,517
156
7,633
147
Moroccan dirham
Algerian dinar
Honduran lempira
Angolan kwanza
Dominican peso
Other
84
438
710
581
Total
154,030
68,021
126,877
255,006
The detail of the main foreign currency balances is as follows:
Equivalent Value in Thousands of Euros
2008
Nature of the Balances
Assets
Accounts receivable
96,555
Cash and cash equivalents
Accounts payable
financial liabilities (Note 14)
Total
2007
Liabilities
Assets
Liabilities
-
107,052
-
57,475
-
19,825
-
-
48,143
-
50,082
-
19,878
-
204,924
154,030
68,021
126,877
255,006
h) Current/Non-current classificationDebts are classified as non-current or current on the basis of the projected period to maturity, disposal or settlement.
Therefore, debts due to be settled within more than 12 months from the balance sheet date are classified as non-current items.
i) Income taxThe expense for Spanish corporation tax and similar taxes applicable to the foreign consolidated companies is recognised in
the consolidated income statement unless it arises from a transaction the results of which are recognised directly in equity, in
which case the related tax is also recognised in equity.
The income tax expense is accounted for using the balance sheet liability method. This method consists of determining
deferred tax assets and liabilities on the basis of the differences between the carrying amounts of assets and liabilities and
their tax base, using the tax rates that can objectively be expected to apply when the assets are realised and the liabilities are
settled (see Notes 18 and 19). In this connection, Law 35/2006, of 28 November, on personal income tax and partially amending
the Spanish Corporation Tax, Non-Resident Income Tax and Wealth Tax Laws, provided, inter alia, for the reduction over two
years of the standard income tax rate, which until 31 December 2006 had been 35%, as follows:
ANNUAL REPORT 2008
99
Tax Periods Beginning on or after
Tax Rate
1 January 2007
32.5%
1 January 2008
30%
Deferred tax assets and liabilities arising from direct charges or credits to equity accounts are also accounted for with a charge
or credit to equity.
Deferred tax liabilities are recognised for all taxable temporary differences, unless the temporary difference arises from the
initial recognition of goodwill, goodwill for which amortisation is not deductible for tax purposes, or from the initial recognition
(except in the case of a business combination) of other assets and liabilities in a transaction that affects neither accounting
profit nor taxable profit.
The ELECNOR Group recognises deferred tax assets to the extent that it is considered probable that there will be sufficient
taxable profits in the future against which the deferred tax assets can be utilised.
Also, double taxation tax credits and other tax credits and tax relief earned as a result of economic events occurring in the
year are deducted from the income tax expense, unless there are doubts as to whether they can be realised.
Under IFRSs, deferred taxes are classified as non-current assets or liabilities even if they are expected to be realised in the
next 12 months.
The income tax expense represents the sum of the current tax expense and the changes in the deferred tax assets and liabilities
that are not recognised in equity (see Notes 18 and 19).
The deferred tax assets and liabilities recognised are reassessed at each balance sheet date in order to ascertain whether
they still exist, and the appropriate adjustments are made on the basis of the findings of the analyses performed.
j) Property, plant and equipmentProperty, plant and equipment, which are all for own use, are stated in the consolidated balance sheet at acquisition cost
less any accumulated depreciation and any recognised impairment losses. However, prior to 1 January 2004, the ELECNOR Group
revalued certain items of property, plant and equipment as permitted by the applicable legislation. The ELECNOR Group, in
conformity with IFRSs, treated the amount of these revaluations as part of the cost of these assets because it considered that
the revaluations reflected the effect of inflation (see Note 2-b).
The costs of expansion, modernisation or improvements leading to increased productivity, capacity or efficiency or to a
lengthening of the useful lives of the assets are capitalised. Repairs that do not lead to a lengthening of the useful life of the
assets and maintenance expenses are charged to the income statement for the year in which they are incurred.
The capitalised costs include the borrowing costs incurred in the construction period in construction work lasting for more
than one year. Total capitalised borrowing costs included under “Property, Plant and Equipment, Net - Buildings, Plant and
Machinery” on the asset side of the accompanying consolidated balance sheet at 31 December 2008 and 2007 were not
significant since most of the wind farms were already being operated prior to these years.
Group work on non-current assets is recognised at accumulated cost (external costs plus in-house costs, determined on the
basis of in-house warehouse materials consumption, and manufacturing costs allocated using hourly absorption rates similar
to those used for the measurement of inventories). In 2008 approximately EUR 44,972 thousand were recognised in this
connection, under “Other Operating Income” in the consolidated income statement, relating mostly to the construction of
wind farms and water treatment plants. This income amounted to approximately EUR 17,976 thousand in 2007, and related
mainly to the construction of water treatment plants.
The ELECNOR Group generally depreciates its property, plant and equipment using the straight-line method, distributing the
cost of the assets over the following years of estimated useful life:
Average Years of Estimated Useful Life
Buildings
33-50
Plant and machinery (*)
10-20
Hand and machine tools
3-10
Furniture and fittings
3-10
Computer hardware
3-5
Transport equipment
2-10
Other items of property, plant and equipment
3-10
(*) Including the machinery and fixtures allocated to wind power projects, basically wind generators, which are depreciated over 15 and 20 years.
In addition to this depreciation, in the case of the "Hand and Machine Tools" recognised under “Property, Plant and
Equipment”, the Group makes an annual adjustment on the basis of a physical count with a charge to "Other Operating
Expenses" in the accompanying consolidated income statement, and the related amount is derecognised directly from noncurrent assets. The write-down thus made amounted to approximately EUR 2,383 thousand in 2008, which is recognised under
this heading in the accompanying consolidated income statement (see Note 9). The amount recognised in 2007 in this
connection amounted to approximately EUR 2,146 thousand. The result of applying this policy does not differ significantly
from that which would result from depreciating the cost of these assets on a straight-line basis over their years of estimated
useful life.
The Parent's directors consider that the carrying amount of the assets does not exceed their recoverable amount, which is
calculated on the basis of the future cash flows that the assets will generate (see Note 3-l).
Since the ELECNOR Group does not have to incur significant costs in relation to the closure of its facilities, the accompanying
consolidated balance sheet does not include any provision in this connection.
k) Other intangible assetsThe other intangible assets are identifiable non-monetary assets without physical substance which arise as a result of a legal
transaction or which are developed internally by the Group companies. They are recognised initially at acquisition or production
cost and are subsequently measured at cost less any accumulated amortisation and any accumulated impairment losses.
Internally generated intangible assets - Development expenditure
Expenditure on research activities is recognised as an expense in the year in which it is incurred.
In accordance with IFRSs, the ELECNOR Group recognises as an internally generated intangible asset expenses incurred in
projects that meet the following conditions:
• The expenditure is specifically identified and controlled by project and its distribution over time is clearly defined.
• The directors have well-founded reasons for believing that there are no doubts as to the technical success or the economic
and commercial viability of the projects, on the basis of their stage of completion and the related backlogs.
• The development cost of the asset, which includes, where applicable, the ELECNOR Group's staff costs relating to employees
working on these projects, can be measured reliably.
Internally generated intangible assets are amortised on a straight-line basis over their useful lives.
Where no internally generated intangible asset can be recognised, development expenditure is recognised as an expense in
the year in which it is incurred.
Patents, licences and other
These items are recognised at acquisition cost and are amortised on a straight-line basis over their useful life, which is
generally five years.
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101
Administrative concessions
The amounts recognised by the ELECNOR Group in connection with administrative concessions relate to the cost incurred in
the construction that is being carried out on the assets required for the operation of the concessions awarded in respect of
various water treatment plants in Aragón, increased by a margin percentage similar to that obtained by the Group in similar
construction projects. Accordingly, at 31 December 2008 total costs incurred in this respect, plus the aforementioned margin,
were recognised under "Intangible Assets" in the accompanying consolidated balance sheet at that date.
These costs are recognised as intangible assets since it is considered that the investments will be recovered through the
variable income flows from operating the concession and since there is no unconditional contractual right to receive a fixed
amount from the concession grantor.
They will be amortised on a straight-line basis over the life of the concessions (established at 20 years). In 2008 seven of the
nineteen water treatment plants that are expected to be built in Aragón came into service. The Elecnor Group expects the
building of the remaining water treatment plants to be completed in 2009.
Computer software
The acquisition and development costs incurred in relation to the basic computer systems used in the ELECNOR Group's
management are recognised with a charge to “Intangible Assets - Other Intangible Assets, Net” in the consolidated balance
sheet. Computer system maintenance costs are recognised with a charge to the consolidated income statement for the year in
which they are incurred.
Computer software is amortised on a straight-line basis over five years from the entry into service of each application.
l) Asset impairmentAt each balance sheet date, the ELECNOR Group reviews the non-current assets to determine whether there is any indication
that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss (if any). Where the asset itself does not generate cash flows that are
independent from other assets, the ELECNOR Group estimates the recoverable amount of the cash-generating unit to which
the asset belongs.
Also, at each balance sheet date the Group analyses the possible impairment of the goodwill and intangible assets that have
not yet come into service or that have an indefinite useful life, if any. In 2008 and 2007 there were no significant impairment
losses.
Recoverable amount is the higher of fair value less costs to sell and value in use, which is taken to be the present value of
the estimated future cash flows. In assessing value in use, the assumptions used include discount rates, growth rates and
expected changes in selling prices and costs. The directors estimate the pre-tax discount rates that reflect the time value of
money and the risks specific to the cash-generating unit, which are between 11.4% and 17.14% (before taking into
consideration any tax effect). The growth rates and the changes in selling prices and costs are based on in-house and industry
forecasts and experience and future expectations, respectively, and in no case do they exceed 10%. Also, the Elecnor Group
carries out the related sensitivity analyses on its projection studies, modifying the variables that have most impact on cash
flows; specifically, discount rates and expected growth figures. The results obtained from these sensitivity analyses did not
disclose any possible impairment.
If the recoverable amount of an asset is less than its carrying amount, an impairment loss is recognised for the difference
with a charge to “Depreciation and Amortisation Charge and Impairment Losses” in the consolidated income statement.
Impairment losses recognised for an asset in prior years are reversed with a credit to the aforementioned heading when there
is a change in the estimates concerning the recoverable amount of the asset, increasing the carrying amount of the asset, but
so that the increased carrying amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognised, except in the case of the impairment of goodwill, which is not reversible.
m) Inventories“Inventories” in the consolidated balance sheet includes the assets that the ELECNOR Group:
• Holds for sale in the ordinary course of its business;
• Has in the course of production, construction or development to this end, except for construction in progress for which
revenue is recognised as indicated in Note 3-d; or
• Expects to consume in the production process or in the provision of services.
Raw materials and other supplies are measured at average cost of acquisition plus the estimated purchase and storage costs,
which does not differ materially from the costs actually incurred.
Semifinished goods and work in progress are measured on the basis of the cost incurred (materials, labour, subcontracting
costs and other direct and indirect costs allocable to the work in progress), as follows:
- Materials assigned to each project, at acquisition cost.
- Labour, at the standard cost of the actual hours incurred, which does not differ significantly from actual cost.
- Subcontracting costs and other direct costs, at acquisition cost.
- Indirect costs relating to production: on the basis of an absorption rate applied to the completed production.
Semifinished and finished goods are stated at the lower of fair value (net realisable value) or average production cost, which
is calculated as the specific cost of supplies and services procurements plus the applicable portion of direct and indirect labour
costs and general manufacturing expenses. Other warehouse materials are measured at the lower of average acquisition cost
and market value.
Obsolete, defective or slow-moving inventories have been reduced to realisable value. Net realisable value is the estimated
selling price less the estimated costs of completion and all the costs to be incurred in selling.
The detail of “Inventories” of the Elecnor Group for 2008 and 2007 is as follows:
Thousands of Euros
31/12/08
Raw materials and other supplies
31/12/07
21,462
24,033
591
13,628
Semi-finished and finished goods
28,920
44,443
Advances to suppliers
22,943
30,388
73,916
112,492
Merchandise inventories
n) Financial instrumentsFinancial assets
Financial assets are initially recognised at acquisition cost, including transaction costs.
The ELECNOR Group classifies its current and non-current financial assets in four categories:
• Held-for-trading financial assets. Assets acquired with the intention of generating a profit from short-term fluctuations in
their prices or from differences between their purchase and sale prices, and financial derivatives that qualify for fair value
hedge accounting. The assets included in this category are stated in the consolidated balance sheet at fair value, and the
gains and losses from changes in fair value are recognised in the net profit or loss for the year.
The fair value of a financial asset on a given date is taken to be the price that would be paid for it on an organised,
transparent and deep market (“quoted price” or “market price”). If this market price cannot be determined objectively
and reliably for a given financial instrument, its fair value is estimated on the basis of the price established in recent
transactions involving similar instruments or of the discounted present value of all the future cash flows (collections or
payments).
• Held-to-maturity financial assets. These are financial assets with fixed or determinable payments and fixed maturity that
the ELECNOR Group has the positive intention and ability to hold from the date of purchase to the date of maturity. Heldto-maturity investments are measured at amortised cost, and the interest income is recognised in profit or loss on the basis
of the effective interest rate.
The amortised cost is understood to be the initial cost minus principal repayments, plus or minus, as appropriate, the
ANNUAL REPORT 2008
103
cumulative amortisation, using the effective interest rate method, of any difference between that initial amount and the
maturity amount, and minus any reduction for impairment or uncollectibility.
The effective interest rate is taken to be the discount rate that, at the acquisition date of the asset, exactly matches the initial
carrying amount of a financial instrument to all its estimated cash flows of all kinds through its residual life.
• Originated loans and receivables. Financial assets originated by the companies in exchange for supplying cash, goods or
services directly to a debtor. These financial assets are measured at amortised cost.
• Available-for-sale financial assets. These are all the financial assets that are not included in any of the aforementioned three
categories and relate substantially in full to equity securities. These assets are also presented in the consolidated balance
sheet at market value, which in the case of unlisted companies, is obtained using alternative methods, such as comparison
with similar transactions or, if sufficient information is available, by discounting expected future cash flows. Changes in this
market value are recognised with a charge or credit to “Unrealised Asset and Liability Revaluation Reserve” in the
consolidated balance sheet until these investments are disposed of, when the accumulated balance of this heading relating
to these investments is allocated in full to the consolidated income statement.
Investments in the share capital of unlisted companies whose market value cannot be measured reliably are measured at
acquisition cost.
Management of the ELECNOR Group decides on the most appropriate classification for each asset on acquisition and reviews
the classification at each balance sheet date.
In accordance with IAS 39, the various financial assets owned by the ELECNOR Group are analysed on a regular basis to
determine whether a financial asset or a group of financial assets has become impaired. If so, an impairment loss is recognised
in the ELECNOR Group’s consolidated financial statements. If the aforementioned impairment arises in an available-for-sale
financial asset, the loss is recognised directly in equity. Otherwise, the impairment loss is recognised in the consolidated income
statement.
The ELECNOR Group derecognises financial assets if the contractual rights to receive a cash flow from the assets have expired
or if the assets are sold or transferred to another company, transferring all the risks and rewards associated with those assets.
Impairment of financial assets
Except for the financial assets classified as at fair value through profit or loss, the financial assets are analysed by ELECNOR
Group management in order to test them for impairment periodically and at least at the end of each reporting period. A
financial asset is impaired if there is objective evidence that the estimated future cash flows of the asset have been affected as
a result of one or more events that occurred after the initial recognition of the financial asset.
For the other financial assets, the ELECNOR Group considers the following to be objective indicators of impairment:
• Financial difficulty of the issuer or significant counterparty.
• Shortfall or delays in payment.
• Probability that the borrower will enter bankruptcy or other financial reorganisation.
The Company recognises an allowance for doubtful debts to cover debts of customers in an irregular situation involving
delayed payments, non-trading bankruptcy, insolvency and other causes, following an itemised analysis of the recoverability
of the accounts receivable.
The balances in this connection at 31 December 2008 and 2007 amounted to approximately EUR 11,701 thousand and EUR
14,083 thousand, respectively, and are recognised as a reduction of the balance of “Trade and Other Receivables” in the
accompanying consolidated balance sheets.
Collection rights under factoring arrangements
The ELECNOR Group classifies the balances maturing at short term in relation to the collection rights assigned without
recourse to the factor, net of the cash drawdowns made at 31 December 2008, under “Trade and Other Receivables” and the
balances maturing at long term, if any, under “Non-Current Financial Assets – Other Financial Assets” in the accompanying
consolidated balance sheet at that date. At 31 December 2008, the assigned collection rights amounted to approximately EUR
25 million, approximately EUR 22 million in cash having been drawn down against the collection rights assigned at that date.
At 31 December 2007, collection rights of approximately EUR 25 million had been assigned, although no cash had been drawn
down against them.
The Group derecognises the collection rights assigned (factored) and drawn down, since the rewards, rights and risks
associated with these accounts receivable are contractually transferred to the factor, and, specifically, the factor assumes the
related bad debt risk.
Cash and cash equivalents
“Cash and Cash Equivalents” in the consolidated balance sheet includes cash, demand deposits and other highly liquid shortterm investments that can be realised in cash quickly and are not subject to a risk of changes in value.
Debentures, bonds and bank borrowings
Loans, debentures and other interest-bearing items are initially recognised at the amount received, net of direct issue costs,
i.e., equal to the subsequent application of the amortised cost method using the effective interest rate. Borrowing costs are
recognised on an accrual basis in the consolidated income statement using the effective interest rate method and they are
aggregated to the carrying amount of the financial instrument to the extent that they are not settled in the year in which they
arise. Also, obligations under finance leases are recognised at the present value of the lease payments under “Bank Borrowings
and Other Financial Liabilities” in the consolidated balance sheet.
Trade payables
Trade payables are not interest bearing and are stated at their nominal value. Approximately EUR 499,116 thousand and
EUR 492,762 thousand had been recognised in this connection at 31 December 2008 and 2007, respectively.
Derivative financial instruments and hedge accounting
The Group's activities expose it mainly to the financial risks of changes in foreign exchange rates and interest rates. To hedge
these exposures, the ELECNOR Group uses foreign currency hedges, cross currency swaps and interest rate swaps for hedging
purposes.
Financial derivatives are initially recognised at acquisition cost in the consolidated balance sheet and the required valuation
adjustments are subsequently made to reflect their fair value at all times. Gains and losses arising from these changes are
recognised in the consolidated income statement, unless the derivative has been designated as a hedge which is highly effective,
in which case it is recognised as follows:
• In the case of fair value hedges, if any, changes in the fair value of the derivative financial instruments designated as hedges
and changes in the fair value of a hedged item due to the hedged risk are recognised with a charge or credit, as appropriate,
to the consolidated income statement.
• In the case of cash flow hedges, if any, the changes in the fair value of the hedging derivatives are recognised, in respect
of the ineffective portion of the hedges, in the consolidated income statement, and the effective portion is recognised
under “Unrealised Asset and Liability Revaluation Reserve” and “Translation Differences”, as appropriate, in the
consolidated balance sheet. The accumulated loss or gain under these headings is recognised in the consolidated income
statement in the same period as that in which the hedged item affects net profit or loss or in the year it is disposed of.
If a hedge of a firm commitment or forecasted transaction results in the recognition of a non-financial asset or a nonfinancial liability, this balance is taken into account in the initial measurement of the asset or liability arising from the
hedged transaction. If a hedge of a firm commitment or forecasted transaction does not result in the recognition of a nonfinancial asset or a non-financial liability, the amounts credited or charged, respectively, to “Unrealised Asset and Liability
Revaluation Reserve” in the consolidated balance sheet are recognised in the consolidated income statement in the same
period as that in which the hedged item affects the net profit or loss.
The ELECNOR Group periodically tests the effectiveness of its hedges, and the related tests are performed prospectively
and retrospectively. All hedging transactions are submitted for approval to the Board of Director’s of the Group company
in question and are documented and signed by the corresponding financial manager, as required by IAS 39.
• When hedge accounting is discontinued, any cumulative loss or gain at that date recognised under “Unrealised Asset and
Liability Revaluation Reserve” is retained under that heading until the hedged transaction occurs, at which time the loss or
gain on the transaction will be adjusted. If a hedged transaction is no longer expected to occur, the gain or loss recognised
under the aforementioned heading is transferred to profit or loss.
ANNUAL REPORT 2008
105
Derivatives embedded in other financial instruments, if any, are treated as separate derivatives when their characteristics
and risks are not closely related to those of the host contracts and the host contracts are not carried at fair value with unrealised
gains or losses reported with a charge or a credit to the consolidated income statement.
The fair value of the various financial instruments is calculated as follows (see Note 15):
• The market value of derivatives listed on an organised market is their market price at year-end.
• To measure derivatives not traded on an organised market, the ELECNOR Group uses assumptions based on year-end market
conditions. Specifically, the market value of interest rate swaps is calculated by discounting at a market interest rate the
difference between the swap rates, and the market value of foreign currency forward contracts is determined by discounting
the estimated future cash flows using the forward rates existing at year-end. In both cases, these measurements are verified
against those provided by the banks.
This procedure is also used, where appropriate, to determine the fair value of loans and receivables arising from cross
currency swaps, through which the Group and the related bank exchange the flows from a loan in euros for the flows from
another loan in US dollars, with any resulting difference being settled on maturity. At year-end, the Group translates the
loan into US dollars (plus the accrued interest) at the year-end exchange rate and compares it with the loan in euros (plus
the accrued interest), and the net value (i.e. the difference) is recognised under “Other Current Assets”, “Non-Current
Financial Assets” or “Bank Borrowings and Other Financial Liabilities”, depending on whether the difference is positive or
negative and on the maturity thereof, giving rise to an exchange difference income or expense item as the balancing entry.
The financial assets and liabilities recognised as a result of the measurement at fair value of the aforementioned hedging
instruments gave rise to additions to “Non-Current Financial Assets” and “Bank Borrowings and Other Financial Liabilities”,
as indicated in Note 15.
ñ) Treasury sharesThe treasury shares held by the ELECNOR Group at year-end, which amounted to approximately EUR 27,344 thousand, are
recognised at cost of acquisition and are deducted from “Equity - Other Reserves” in the consolidated balance sheet. At 31
December 2008, they represented 4.1% (31 December 2007: 3.75%) of the issued share capital at that date (see Note 13).
The gains and losses obtained by the ELECNOR Group on the disposal of treasury shares are recognised with a charge or a
credit to “Equity - Other Reserves” in the accompanying consolidated balance sheet.
o) ProvisionsThe Group recognises provisions for the estimated amount required to suitably meet its liability, whether it be legal or
constructive, probable or certain, arising from contingencies, litigation in process or obligations, which arise as a result of past
events, for which it is more probable than not that an outflow of resources will be required, provided that it is possible to
make a reasonable estimate of the amount in question. Provisions are recognised when the liability or obligation arises (see
Note 16) with a charge to the relevant heading in the consolidated income statement based on the nature of the obligation,
for the present value of the provision when the effect of discounting the obligation is material.
Therefore, the ELECNOR Group's consolidated financial statements include all the material provisions with respect to which
it is considered that it is more likely than not that the obligation will have to be settled. Any contingent liabilities (possible
obligations that arise from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one
or more future events not wholly within the control of the Group) that might exist are not recognised in the consolidated
financial statements, but rather are disclosed (see Note 16).
p) Termination benefitsUnder current labour legislation, the companies are required to pay termination benefits to employees terminated under
certain conditions.
The directors do not expect any significant dismissals or terminations to arise in the future and, accordingly, no provision
was recorded in this connection in the accompanying consolidated balance sheet.
q) Government grantsNon-refundable grants related to assets awarded by official bodies are recognised at the time of the award for the amount
awarded under “Deferred Income” in non-current liabilities and will be allocated to profit or loss each year in proportion to
the accounting depreciation taken in the period on the financed assets.
At 31 December 2008, the ELECNOR Group had received grants related to assets amounting to approximately EUR 4.2 million.
These grants were awarded by the Castilla y León Autonomous Community Government to the subsidiary Deimos Imaging, S.L.
in relation to a project to construct a satellite that is under way. The ELECNOR Group will start to recognise this grant in income
when the construction project is completed and the associated assets start to be depreciated.
Grants related to income are allocated to income in the year in which the related expenses are incurred. “Other Operating
Income” in the consolidated income statements for 2008 and 2007 includes approximately EUR 3,482 thousand and EUR 2,465
thousand, respectively, in this connection. Most of the grants related to income received by the ELECNOR Group in 2008 related
to the costs borne by Deimos Space, S.L. and its subsidiaries in the performance of their activities.
r) Equity instrumentsEquity instruments issued by the ELECNOR Group companies are recognised in equity at the proceeds received, net of direct
issue costs.
s) Consolidated statement of changes in equityThe applicable regulations establish that certain categories of assets and liabilities must be recognised at fair value through
equity. The amounts recognised in equity, known as valuation adjustments, are included in the Group’s equity net of the related
tax effect, which was recognised as deferred tax assets or liabilities, as appropriate. The consolidated statement of changes in
equity presents the changes that have arisen in the year in valuation adjustments, plus the results generated in the year
plus/minus, as appropriate, the adjustments made for changes in accounting policies or due to prior years’ errors. The changes
in capital and reserves during the year are also included.
t) Consolidated cash flow statementsThe following terms are used in the consolidated cash flow statements, which were prepared using the indirect method,
with the meanings specified:
• Cash flows. Inflows and outflows of cash and cash equivalents, which are short-term, highly liquid investments that are
subject to an insignificant risk of changes in value.
• Operating activities. The principal revenue-producing activities of the ELECNOR Group companies and other activities that
are not investing or financing activities.
• Investing activities. The acquisition and disposal of long-term assets and other investments not included in cash and cash
equivalents.
• Financing activities. Activities that result in changes in the size and composition of the equity and borrowings that are not
operating activities.
u) Earnings per shareBasic earnings per share are calculated by dividing the net profit for the year attributable to the ELECNOR Group by the
weighted average number of ordinary shares outstanding during the year, excluding the average number of ELECNOR shares
held in the year.
Diluted earnings per share are calculated by dividing the profit or loss for the year attributable to ordinary shareholders by
the weighted average number of ordinary shares outstanding during the year, adjusted by the weighted average number of
ordinary shares that would have been outstanding assuming the conversion of all the potential ordinary shares into ordinary
shares of the Company.
ANNUAL REPORT 2008
107
At 31 December 2008 and 2007, basic earnings per share coincided with diluted earnings per share, since there were no
potential shares outstanding during the years then ended.
v) DividendsThe interim dividend approved by the Board of Directors in 2008 is presented as a deduction from the Group's equity.
However, the final dividend proposed by the Board of Directors of ELECNOR to the shareholders at the Annual General Meeting
is not deducted from equity until it has been approved by the latter.
4. FINANCIAL RISK MANAGEMENT POLICIES
The ELECNOR Group is exposed to certain financial risks that it manages by grouping together risk identification,
measurement, concentration limitation and supervision systems. The ELECNOR Corporate Division and the business units
coordinate the management and limitation of financial risks. The financial risk management activities are approved at the
highest executive level, in accordance with the established rules, policies and procedures.
a) Market risk (mainly foreign currency risk)This risk arises as a result of the international transactions carried out by the ELECNOR Group in the ordinary course of its
business. Certain of its revenues and procurement costs are denominated in US dollars, or in a currency whose value is closely
linked to that of the US dollar or which relates to an economy that is highly dependent on the US dollar, although a variable
portion of the expenses may be denominated in euros. Therefore, fluctuations in the value of financial instruments denominated
in currencies other than the euro as a result of foreign operations due to exchange rate fluctuations could affect the Group's
future earnings (see Note 3-g).
In order to manage and minimise this risk, the ELECNOR Group uses hedging strategies, since its objective is to generate
profits only through its ordinary business, and not by speculating in relation to exchange rate fluctuations.
The ELECNOR Group assigns a portion of the future cash flows to hedge the net exposure in US dollars at short term on the
basis of the firm backlog.
Each Business Division evaluates the risk arising from the exchange rate on a transaction or a project and if it is considered
necessary to hedge the exposure to foreign currency risk, authorisation is requested from the Group’s Corporate Finance
Division, which in turn submits it through the corresponding note to the Board of Directors of the Parent which will ultimately
have to decide whether or not to approve the related hedging transaction.
The instruments used to establish this hedging are basically debt tied to the currency in which collections under the contract
are made, foreign currency hedges and swaps, through which the ELECNOR Group and the bank exchange flows from a loan
in euros for flows from another loan in US dollars.
b) Interest rate riskInterest rate fluctuations change the fair value of assets and liabilities that bear interest at fixed rates and the future flows
from assets and liabilities tied to floating interest rates. The ELECNOR Group has arranged borrowings to enable it to carry on
its operations, mainly in connection with the development, construction and subsequent operation of wind farms, which it
does under a project financing arrangement. Under financing of this nature, in the case of wind farms located in Spain, interest
rate risk must be hedged contractually through the arrangement of interest rate hedging instruments.
Borrowings are arranged nominally at a floating rate tied mainly to Euribor (euro zone) and Libor, using, where appropriate,
hedging instruments to minimise the risk on long-term financing. The hedging instruments, which are specifically assigned to
debt instruments and are limited to the same nominal value as the latter and the same maturity dates as the hedged items,
relate basically to IRSs, the aim of which is to convert loans originally arranged at floating rates to fixed rates. Note 14 contains
disclosures on the sensitivity of debt to interest rate fluctuations.
c) Liquidity riskThe ELECNOR Group holds cash and highly liquid non-speculative short-term instruments, such as Treasury bills under nonoptional reverse repurchase agreement and very short-term deposits, through leading banks, in order to be able to meet its
future commitments, and arranges committed credit facilities of a sufficient amount to cover its projected needs. In this regard,
at 2008 year-end the Group had unused committed credit facilities amounting to approximately EUR 220,102 thousand (2007
year-end: approximately EUR 224,418 thousand) (see Note 14).
d) Credit riskThe ELECNOR Group's credit risk is primarily attributable to its trade receivables, to the extent that a counterparty or customer
does not meet its contractual obligations. Therefore, products and services are only sold to customers with an appropriate
credit track record. Although the Group’s customers have good credit rating, the general downturn in the economic and
financial situation, the effect of which started to be felt in the first half of 2008, made it advisable for the Parent to take out
a credit insurance policy. This policy has been in force since May 2008 and was arranged for a term of one year, insuring a sum
of EUR 5 million. Also, instruments such as factoring without recourse arrangements are used, whereby the related collection
risk is transferred to the related factors.
Additionally, in the case of international sales to non-recurring customers, mechanisms such as irrevocable letters of credit
and insurance policies are used to ensure collection. Also, the financial solvency of customers is analysed and specific terms and
conditions are included in contracts aimed at guaranteeing payment of the stipulated price.
In the case of the wind farms, the power produced, in accordance with the legislative framework for the electricity industry
in force, is sold to the electricity distributor in each area, which generally belongs to corporate groups of acknowledged solvency.
Ventos do Sul Energia, S.A. (Brazil) had entered into a 12-year agreement for the sale of the electricity it produces to the
Brazilian electricity distributor.
The ELECNOR Group carries out periodic analyses of its exposure to credit risk, recognising the corresponding provisions (see
Note 3-n).
5. DISTRIBUTION OF PROFIT
At its meeting in March 2009, as in prior years, the Board of Directors of ELECNOR, S.A. (Parent of the ELECNOR Group) will
propose the distribution of 2008 profit and will therefore establish the portion thereof that will be paid as a final dividend and
that which will be allocated to voluntary reserves.
In this connection the Parent’s Board of Directors at its meeting on 19 November 2008 approved the distribution of an interim
dividend of approximately EUR 4,666 thousand out of 2008 profit, which had not yet been paid at 31 December 2008 and is
recognised under "Other Liabilities - Other Current Liabilities" and "Trade Payables to Associates and Related Companies”
under liabilities (see Note 26) and as a reduction in equity under "Interim Dividend for the Year" in the accompanying
consolidated balance sheet. This dividend was paid in full at the beginning of 2009.
ANNUAL REPORT 2008
109
The provisional accounting statement prepared by the Parent in accordance with legal requirements (Article 216 of the Consolidated
Spanish Companies Law) evidencing the existence of sufficient liquidity for the distribution of the dividend was as follows:
WORKING CAPITAL POSITION AT 31 OCTOBER 2008
(Excluding inventories, prepayments and accrued income and accrued expenses and deferred income)
Thousands of Euros
Realisable values Trade receivables
Other accounts
714,773
60,317
775,090
Current liabilities Payable to suppliers
387,405
Short-term loans
24,832
Other accounts
82,087
494,324
Total net working capital
280,766
Liquidity available at 31 October 2008Cash on hand and at banks (including foreign currency)
Total liquidity available
45,149
45,149
Gross interim dividend proposed(EUR 0.05184 on 90,000,000 shares)
4,666
% of net profit at 31 October 2008
10.59%
% of working capital + liquidity available
1.43%
6. SEGMENT REPORTING
In order to improve the public information prepared and reported by companies and, specifically, to help users of financial
statements to better understand an entity's past performance, better assess an entity's risks and returns and to make more
informed judgements about an entity as a whole, IAS 14 regulates segment reporting.
The main criteria applied when defining the segment information of the ELECNOR Group included in the accompanying
consolidated financial statements are as follows:
a) Primary segmentsTaking into account the bases for determining primary segments under IFRSs, the ELECNOR Group took the primary segments
to be geographical segments, since it considers that its organisational and management structure and its internal system for
reporting to the managing and executive bodies are such that the risks and returns are predominantly affected by the fact
that its operations are carried on in different countries or geographical areas and, therefore, secondary importance was attached
to the information segmented by product groups and related services. Accordingly, the primary segments are made up of the
ELECNOR Group's identifiable components that are subject to risks and returns that are different from those of components
operating in other economic environments.
Consequently, based on its historical experience, the Group identified the existence of two primary segments, which are
considered to meet the internal consistency requirements as regards the similarity of economic and political conditions or the
risks associated with applicable legislation, exchange rates or proximity of operations and which are differentiated from the
other segments for the same reasons: Spain and Abroad.
Assets and liabilities of general use and the income and expenses arising therefrom were not attributed to the other segments.
Similarly, the reconciling items arising from the comparison of the result of integrating the financial statements of the various
business segments (which were established on the basis of management criteria) with the consolidated financial statements of the
ELECNOR Group were not allocated. These items are included under the heading “Corporate Unit” in the information shown below.
Segment information about these primary segments is presented below:
a) The breakdown, by segment, of consolidated revenue for the years ended 31 December 2008 and 2007 is as follows:
Thousands of Euros
Segment
2008
Spain
Abroad
Revenue
2007
1,498,557
1,337,920
412,790
312,314
1,911,347
1,650,234
b) The breakdown, by segment, of the contribution to the profit after tax for the years ended 31 December 2008 and 2007
is as follows:
Thousands of Euros
Segment
2008
2007
Spain (**)
140,264
104,130
60,253
58,394
(106,924)
(88,970)
93,593
73,554
Abroad (***)
Corporate unit (*)
Profit for the year attributable to the Parent
(*) Including basically “Finance Costs and Income”, “Net Gains on Disposal of Non-Current Assets” and “Income Tax”.
(**) Including profit of companies accounted for using the equity method amounting to EUR 6,390 thousand and EUR 5,301 thousand in 2008 and 2007, respectively.
(***) Including profit of companies accounted for using the equity method amounting to EUR 9,434 thousand and EUR 10,617 thousand in 2008 and 2007, respectively.
c) The detail of the assets and liabilities by segment at 31 December 2008 and 2007 is as follows:
Thousands of Euros
Spain
Abroad
Corporate Unit
Total at
31/12/08
299,045
189,412
10,841
499,298
AssetsProperty, plant and equipment
Intangible assets
48,052
3,131
774
51,957
Deferred tax assets
28,208
14,715
383
43,306
Inventories
62,992
10,896
28
73,916
697,921
162,674
-
860,595
Investments accounted for using
the equity method
21,985
180,698
-
202,683
Non-current financial assets
21,475
17,816
855
40,146
4,081
-
379
4,460
-
-
158,911
158,911
1,183,759
579,342
172,171
1,935,272
284,163
154,331
-
438,494
57,568
6,902
154
64,624
5,187
18,412
-
23,599
6,115
4,152
94
10,361
12,120
3,673
-
15,793
40,910
25,896
2,596
69,402
709,608
244,903
9,275
963,786
Accounts receivable
Non-current assets held for sale
Other assets (*)
Total assets
Liabilities and equityNon-current bank borrowings and
other financial liabilities
Provisions for contingencies and charges
Deferred income
Other non-current liabilities
Deferred tax liabilities
Current bank borrowings and other financial liabilities
Current non-financial liabilities
Other liabilities and equity
Total liabilities and equity
-
-
349,213
349,213
1,115,671
458,269
361,332
1,935,272
(*) Including mainly “Cash and Cash Equivalents”.
ANNUAL REPORT 2008
111
Thousands of Euros
Spain
Abroad
Corporate Unit
Total at
31/12/08
272,689
244,573
10,920
528,182
38,412
57
399
38,868
9,101
11,186
-
20,287
AssetsProperty, plant and equipment
Intangible assets
Deferred tax assets
Inventories
103,150
7,498
1,844
112,492
Accounts receivable
698,226
256,505
4,354
959,085
Investments accounted for using the equity method
19,180
156,288
-
175,468
Non-current financial assets
24,295
17,827
-
42,122
Other assets (*)
-
-
79,476
79,476
1,165,053
693,934
96,993
1,955,980
Non-current bank borrowings and other
financial liabilities
252,024
182,544
-
434,568
Provisions for contingencies and charges
27,961
2,521
152
30,634
4,187
14,555
299
19,041
(195)
543
3,827
4,175
Deferred tax liabilities
12,169
2,312
-
14,481
Current bank borrowings and other
financial liabilities
87,377
20,667
2,954
110,998
805,429
178,346
12,677
996,452
-
-
345,631
345,631
1,188,952
401,488
365,540
1,955,980
Total assets
Liabilities and equity-
Deferred income
Other non-current liabilities
Current non-financial liabilities
Other liabilities and equity
Total liabilities and equity
(*) Including mainly “Cash and Cash Equivalents”.
d) The detail of the total cost incurred in the acquisition of property, plant and equipment and other non-current intangible
assets in the years ended 31 December 2008 and 2007 is as follows:
Thousands of Euros
Segment
Spain
2008
2007
71,910
53,807
Abroad
8,931
8,649
Corporate unit
1,223
9,910
82,064
72,366
Total
e) The breakdown, by segment, of the depreciation and amortisation charge in 2008 and 2007 is as follows:
Thousands of Euros
Segment
2008
2007
Spain
27,068
23,510
Abroad
14,944
14,302
732
554
42,744
38,366
Corporate unit
Total
Broadly speaking, the geographical location of the ELECNOR Group’s customers does not differ significantly from the
geographical location of the assets of the primary segments considered.
b) Secondary segmentsThe secondary segments were established by business segments or areas which differ on the basis of the products or services
provided. In 2007 the ELECNOR Group changed the secondary segments, since Group management modified the management
information that it uses, in accordance with the size that certain business areas were gaining, thereby making a new
classification of the segments. The secondary segments are described below:
• Electricity
• Facilities
• Gas
• Renewable Energy and Industry
• Railways
• Construction and Water
• Telecommunications Infrastructure
• Telecommunications Systems
• Maintenance
The generation of electricity (within the Renewable Energy and Industry segment) using wind farms is one of the lines of
business of the ELECNOR Group which is carried on through the dependent subgroups of which Enerfín Enervento, S.A., Enerfín
Sociedad de Energía, S.A. and Elecnor Financiera, S.L. are the parents.
The electricity generation business of the ELECNOR Group's Spanish subsidiaries is regulated by Electricity Industry Law
54/1997, of 27 November, and by the subsequent implementing regulations.
Royal Decree 436/2004, of 12 March, was published on 27 March 2004. This Royal Decree established the methodology for
updating, systematising and consolidating the legal and economic regime governing the production of electricity under the
special regime. This Royal Decree established two remuneration options for facilities producing electricity under the special
regime. The first consists of the sale of the power produced to the electricity distributor at a fixed price consisting of a
percentage of the average electricity tariff defined in Article 2 of Royal Decree 1432/2002, of 27 December, which is between
90% and 80% throughout the life of the facility. The second consists of the sale of the power in the wholesale market at the
market price plus an incentive and a premium of 10% and 40%, respectively, of the average electricity tariff.
This regime came into force on 28 March 2004, and there is a transitional period until 1 January 2007 for facilities subject to
Royal Decree 2818/1998, during which the new economic regime would not apply to them unless they decided otherwise by
expressly waiving their entitlement to the previous regime, which they could not choose to apply again once such a decision
had been taken. The Group did not avail itself of this transitional regime.
Royal Decree 661/2007, of 25 May, regulating the production of electricity under the special regime, was published on 26
May 2007. This Royal Decree established two remuneration options for facilities producing electricity under the special regime.
The first option is based on the sale of all the power produced to the electricity distributor at a fixed price not tied to the
average electricity tariff. The second option consists of selling the energy on the electricity production market, receiving the
market price plus a premium, with a mechanism whereby the remuneration of the premium varies depending on the market
price, setting minimum and maximum limits for the end price to be received by the producer.
This regime came into force on 1 January 2008, and there is a transitional period until 31 December 2012 for facilities subject
to Royal Decree 436/2004, during which the new economic regime will not apply to them unless they decide otherwise by
expressly waiving their entitlement to the previous regime. The Directorate-General of Energy Policy and Mines must be
informed of the choice of the economic regime before 1 January 2009.
By virtue of the provisions of aforementioned Royal Decree 436/2004, of 12 March, which governed the activities of all the
Spanish subsidiaries of the ENERFÍN ENERVENTO Subgroup and those of Elecnor Financiera, S.L. until 2008, the Group opted to
sell the power produced by the various wind farms on the electricity production market. Availing itself of the transitional
provision established in the aforementioned Royal Decree 661/2007, of 25 May, the Group opted to continue applying the
regime established under the former Royal Decree during the transitional period. Therefore, their revenue is currently obtained
from three different sources. On the one hand, revenue from power sales and variances settled and billed to OMEL (Operador
del Mercado Ibérico de Energía - Polo Español, S.A.) and MEFF (Mercado Español de Futuros Financieros), respectively, and, on
the other, the regulated revenue (premium, incentive and supplementary payments) settled and billed to the distributor with
which the related facilities are connected, as established by the aforementioned Royal Decree in this connection.
ANNUAL REPORT 2008
113
Also, Ventos do Sul Energía, S.A. is empowered under the “Programa de Incentivo às Fontes Alternativas de Energía EléctricaPROINFA” programme and has the authorisation of Agencia Nacional de Energía Eléctrica- ANEEL (National Electricity Agency)
to act as an independent power producer, and has entered into an agreement for the sale of the power produced at its three
wind farms to Electrobrás - Centrais Electricas Brasileiras.
Segment information about these secondary segments is presented below:
a) The breakdown of revenue by type of business at 31 December 2008 and 2007 is as follows:
Thousands of Euros
Amount at
31/12/08
Type of Business
%
Amount at
31/12/07
%
Electricity
628,095
32.8%
533,300
32.4%
Facilities
181,071
9.5%
175,894
10.6%
Gas
Renewable Energy and Industry
77,620
4.1%
62,044
3.8%
685,740
35.9%
561,686
34.0%
Railways
Construction and Water
40,584
2.1%
59,214
3.6%
150,652
7.9%
136,606
8.3%
Telecommunications Infrastructure
89,691
4.7%
67,713
4.1%
Telecommunications Systems
25,024
1.3%
20,502
1.2%
Maintenance
32,870
1,911,347
1.7%
100%
33,275
2.0%
1,650,234
100%
b) The breakdown of total property, plant and equipment, net, by type of business at 31 December 2008 and 2007 is as
follows:
Thousands of Euros
Balance at
31/12/08
Balance at
31/12/07
Electricity
38,844
35,103
Facilities
7,334
6,111
Type of Business
Gas
Renewable Energy and Industry
2,466
2,007
428,532
466,297
Railways
2,966
1,871
Construction and Water
5,494
4,754
Telecommunications Infrastructure
3,441
2,402
Telecommunications Systems
8,676
8,233
Maintenance
1,545
1,404
499,298
528,182
c) The breakdown of total investments in property, plant and equipment, by type of business, at 31 December 2008 and 2007
is as follows:
Thousands of Euros
Type of Business
2008
2007
Electricity
11,546
16,498
Facilities
2,827
3,198
820
1,028
51,064
28,562
482
1,016
Gas
Renewable Energy and Industry
Railways
Construction and Water
1,945
2,461
Telecommunications Infrastructure
1,542
1,152
660
4,281
Telecommunications Systems
Maintenance
696
755
71,582
58,951
7. GOODWILL
The detail, by company, of the balance of “Intangible Assets - Goodwill” in the consolidated balance sheets for 2008 and
2007 and of the changes therein in those years is as follows:
Thousands of Euros
Balance at
31/12/06
Change in
Scope of
Consolidation
(Nota 2.g)
Disposals
(Nota 2.g)
-
-
Balance at
31/12/07
Additions
(Nota 2.g)
Balance at
31/12/08
Fully consolidated companies:
- Deimos Space, S.L.
158
158
-
158
- Ehisa Construcciones y Obras, S.A.
1,932
-
-
1,932
-
1,932
- Eólicas Páramo de Poza, S.A.
1,104
-
-
1,104
-
1,104
- Galicia Vento, S.L.
8,702
-
-
8,702
-
8,702
- Aerogeneradores del Sur, S.A.
3,630
-
-
3,630
-
3,630
- Hidroambiente, S.A.
388
-
-
388
-
388
- Instalaciones y Proyectos de Gas, S.A.U
841
190
-
1,031
-
1,031
-
-
-
-
3,095
3,095
16,755
190
-
16,945
3,095
20,040
- Coyote Wind, LLC.
The goodwill arising from the acquisition of companies accounted for using the equity method forms an integral part of the
value at which these companies are carried under “Investments Accounted for Using the Equity Method” in the consolidated
balance sheet of the ELECNOR Group (see Note 10).
As indicated in Note 3-b, at each balance sheet date the Group reviews goodwill for impairment. The recoverable amount of
the cash-generating units associated with the aforementioned goodwill was measured by reference to the value in use. Such
value in use was calculated based on cash flow projections (approved by management) which represent the best estimates and
also on certain assumptions regarding the discount and growth rates of the residual values which the Group's executives
consider to be reasonable.
ANNUAL REPORT 2008
115
8. OTHER INTANGIBLE ASSETS
The changes in “Other Intangible Assets” in the consolidated balance sheets in 2008 and 2007 were as follows:
Thousands of Euros
Development
Expenditure
Intellectual
Property
Computer
Software
Administrative
Concessions
Total
Cost Balance at 01/01/07
400
14
2,815
756
3,985
Additions/Disposals (net) due to change
in the scope of consolidation
-
1
19
135
155
Additions
2
2
500
12,080
12,584
Disposals
-
-
(24)
-
(24)
Transfers
49
10
(49)
8,123
8,133
Balance at 31/12/07
451
27
3,261
21,094
24,833
Additions
147
10
910
9,415
10,482
Disposals
(253)
-
(24)
-
(277)
Transfers
-
-
1
-
1
345
37
4,148
30,509
35,039
2,222
21
2,605
Balance at 31/12/08
Accumulated amortisation Balance at 01/01/07
354
8
Additions/Disposals (net) due to change
in the scope of consolidation
-
1
9
-
10
Charge for the year (Note 21)
-
-
307
2
309
Disposals
-
-
(34)
-
(34)
Transfers
Balance at 31/12/07
Charge for the year (Note 21)
Disposals
Transfers
-
10
-
10
20
354
19
2,504
33
2,910
3
16
385
84
488
(253)
-
(24)
-
(277)
-
-
1
-
1
Balance at 31/12/08
104
35
2,866
117
3,122
Total other intangible assets, net
241
2
1,282
30,392
31,917
“Administrative Concessions” includes approximately EUR 30,382 thousand relating to the administrative concessions granted
by the Aragón Water Institute. Under these concessions, the ELECNOR Group will operate certain water treatment plants
obtaining future revenue on the basis of the volume of cubic metres of water treated. Seven of the nineteen water treatment
plants that were being built at 31 December 2007 were being operated at 31 December 2008. The Elecnor Group expects the
water treatment plants under construction in 2008 to be brought into operation in 2009 and 2010.
Fully amortised intangible assets in use at 31 December 2008 and 2007 amounted to approximately EUR 3,496 thousand and
EUR 3,355 thousand, respectively.
9. PROPERTY, PLANT AND EQUIPMENT
The changes in “Property, Plant and Equipment” in the consolidated balance sheets in 2008 and 2007 were as follows:
Thousands of Euros
Property,
Other Items Plant and
of Property, Equipment in
Hand and Furniture and Computer Transport Plant and the Course of
Machine Tools Equipment Hardware Equipment Equipment Construction Total
Land
Buildings,
Plant and
Machinery
11,593
561,119
11,534
4,853
6,266
9,169
627
5,781
610,942
-
258
379
168
219
20
44
3,401
4,489
Additions
16,967
26,710
3,272
694
1,206
1,345
2,077
6,680
58,951
Disposals
(41)
(2,675)
(3,483)
(95)
(388)
(328)
(181)
(637)
(7,828)
Transfers
COST:
Balance at 1 January 2007
Changes in the scope of
consolidation (Note 2-g)
(4,596)
(3,885)
(122)
(290)
(97)
(3,555)
(134)
(5,039)
(17,718)
Translation differences (Note 13)
(17)
19,715
(25)
11
27
(193)
(1)
2
19,519
Balance at 31 December 2007
23,906
601,242
11,555
5,341
7,233
6,458
2,432
10,188
668,355
Changes in the scope of
consolidation (Note 2-g)
-
-
-
-
-
-
-
-
-
798
23,525
3,567
720
983
1,485
709
39,795
71,582
Disposals
-
(5,120)
(2,155)
(76)
(330)
(775)
(12)
-
(8,468)
Transfers
(2,787)
(599)
7
(9)
-
35
(292)
(4,040)
(7,685)
Translation differences (Note 13)
19
(51,493)
49
(42)
(98)
59
(8)
(71)
(51,585)
Balance at 31 December 2008
21,936
567,555
13,023
5,934
7,788
7,262
2,829
45,872
672,199
Balance at 1 January 2007
-
86,240
5,653
3,264
4,822
7,947
229
-
108,155
Changes in the scope of
consolidation (Note 2-g)
-
113
279
120
97
20
12
-
641
Charge for the year
-
41,724
562
314
809
691
139
-
44,239
Disposals
-
(1,878)
(1,271)
(85)
(384)
(290)
(149)
-
(4,057)
(4,305)
(202)
(350)
(145)
(4,347)
74
-
(9,275)
Additions
ACCUMULATED DEPRECIATION:
Transfers
Translation differences (Note 13)
-
579
(18)
(1)
21
(109)
(2)
-
470
Balance at 31 December 2007
-
122,473
5,003
3,262
5,220
3,912
303
-
140,173
Changes in the scope of
consolidation (Note 2-g)
-
-
-
-
-
-
-
-
-
Charge for the year
-
39,299
613
360
1,026
814
144
-
42,256
Disposals
-
(4,536)
(18)
(76)
(344)
(343)
(1)
-
(5,318)
Transfers
-
(622)
1
(1)
-
-
-
-
(622)
Translation differences (Note 13)
-
(3,575)
21
(15)
(83)
64
-
-
(3,588)
Balance at 31 December 2008
-
153,039
5,620
3,530
5,819
4,447
446
-
172,901
21,936
414,516
7,403
2,404
1,969
2,815
2,383
45,872
499,298
Carrying amount at 31
December 2008
ANNUAL REPORT 2008
117
“Buildings, Plant and Machinery” includes mainly the gross carrying amount and accumulated depreciation of wind farms
in operation built in prior years. In 2008 construction for Parques Eólicos de Villanueva, S.L.U. commenced, giving rise to an
increase of approximately EUR 35,458 thousand in "Property, Plant and Equipment”. The Elecnor Group schedules construction
completion for mid-2009. The other wind farms owned by the ELECNOR Group were in operation at 31 December 2008. The
wind generators of the Spanish wind farms are under warranty for two years from their reception date and those of the
Brazilian wind farms are under warranty for three years.
In addition, the ELECNOR Group is constructing a communications satellite through its subsidiary Deimos Imaging, S.L., having
invested approximately EUR 7.7 million to date, of which approximately EUR 420 thousand relate to 2008. The ELECNOR Group
received a grant related to assets in connection with this project (see Note 3-q).
Lastly, the Elecnor Group made various investments in machinery and plant required to implement its construction projects
amounting to approximately EUR 13.6 million.
On 12 June 2007, Elecnor, S.A. leased certain offices located in Bilbao under a finance lease for EUR 9 million. The term of
the lease is 240 months and will therefore end in 2027 with the final lease payment, which will correspond to the exercise of
the purchase option. Elecnor, S.A.’s directors do not have any doubt that the purchase option will be exercised. Previously,
Elecnor, S.A. had used these offices under an operating lease.
In 2007 the ELECNOR Group acquired land and industrial buildings in Valencia for approximately EUR 13.2 million, which are
used for solar module assembly work and storage (see Note 14).
At 31 December 2008, the property, plant and equipment securing certain bank loans relating mainly to the wind power
projects undertaken by Group companies amounted to approximately EUR 424 million (see Note 14).
The offices used by the Group in carrying on its business activities, except for those leased in 2007 under the aforementioned
finance lease, are mostly rented.
The Group’s fully depreciated property, plant and equipment in use amounted to approximately EUR 36,083 thousand and
EUR 33,242 thousand at 31 December 2008 and 2007, respectively. EUR 22,223 thousand and EUR 21,718 thousand, respectively,
of these amounts related to the Parent. The detail, by nature, of this item at 31 December 2008 and 2007 is as follows:
Thousands of Euros
Buildings, plant and machinery
Furniture and fittings
Computer hardware
Transport equipment
2008
2007
19,134
18,639
126
923
2,033
1,907
930
249
22,223
21,718
At 31 December 2008 and 2007, certain property, plant and equipment items included approximately EUR 12,273 thousand and
EUR 12,396 thousand, respectively, relating to the carrying amount of various ELECNOR Group assets held under finance leases. At
31 December 2008, the ELECNOR Group was using the following items of property, plant and equipment held under finance leases:
Thousands of Euros
Lessee
Machinery
Adhorna Prefabricación, S.A.
Original Cost
Excluding
Purchase
Option
1,380
Principal
Paid
Principal
Outstanding (*)
(Note 14)
Value of
Purchase
Option
567
829
4
Tools
Adhorna Prefabricación, S.A
97
23
76
26
Transport equipment
Adhorna Prefabricación, S.A.
165
100
71
2
Facilities
Adhorna Prefabricación, S.A.
2,058
478
1,615
36
Furniture
Adhorna Prefabricación, S.A
89
23
68
2
Land and buildings
Elecnor, S.A.
8,232
404
8,599
900
12,021
1,595
11,258
970
(*) The principal outstanding shown in the foregoing table does not include the amount of the interest added to each payment.
At 31 December 2008, approximately EUR 1,567 thousand (31 December 2007: EUR 5.4 million), arising from the acquisition
of non-current assets remained outstanding, and this amount is recognised under “Other Non-Current Liabilities” and “Other
Current Liabilities” on the liability side of the accompanying consolidated balance sheet.
The Group takes out insurance policies to cover the possible risks to which its property, plant and equipment are subject and
the claims that might be filed against it for carrying on its business activities. These policies are considered to adequately cover
the related risks.
10. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
The detail of the ELECNOR Group's investments in associates at 31 December 2008 and 2007, which were accounted for using
the equity method (see Note 2-f), is as follows:
Thousands of Euros
Company
2008
2007
Eólica Cabanillas, S.L.
5,034
4,426
Eólica Montes del Cierzo, S.L.
6,435
5,247
Eólica La Bandera, S.L.
4,188
3,632
Eólica Caparroso, S.L.
2,713
2,625
399
352
Cosemel Ingeniería, A.I.E.
Deimos Engenharia, S.A.
180
141
Consorcio Eólico Marino Cabo de Trafalgar, S.L.
105
105
Guadalaviar Consorcio Eólico Alabe Enerfín, S.A.
32
32
Parques Eólicos Gaviota, S.A.
1,436
1,356
Parque Eólico de Malpica, S.A.
1,474
1,400
Expansión - Transmissao de Energía Elétrica, S.A.
11,311
12,281
Cachoeira Paulista Transmissora de Energía, S.A.
9,672
11,227
Expansión - Transmissao Itumbiara Marimbondo, S.A.
7,702
8,598
Porto Primavera Transmissora de Energía, S.A.
21,461
26,200
Vila do Conde Transmissora de Energía, S.A.
11,460
13,706
Itumbiara Transmissora de Energía, S.A.
41,758
51,187
Serra da Mesa Transmissora de Energia, S.A.
28,802
30,331
LT Triángulo, S.A.
22,141
2,622
Serra Paracatu Transmissora de Energía, S.A.
15,683
-
Riberao Preto Transmissora de Energía, S.A.
6,336
-
Poços de Caldas Transmissora de Energía, S.A.
4,361
-
202,683
175,468
ANNUAL REPORT 2008
119
The gross changes in 2008 and 2007 in this consolidated balance sheet item were as follows:
Thousands of Euros
Beginning balance
2008
2007
175,468
104,354
Profit for the year
15,824
15,918
Capital increases
64,427
47,645
-
16,021
(44,096)
615
-
22
Other additions
Translation differences
Changes in hedging instruments (*)
Dividends
(8,940)
(11,115)
Other disposals
-
(758)
Changes in the scope of consolidation
-
2,766
202,683
175,468
Ending balance
(*) Relating to interest rate swaps used as hedging instruments.
In 2008 the Elecnor Group, together with its other shareholders, subscribed various capital increases at its 33.33%-owned
concession-holder subsidiaries: Serra da Mesa Transsmisora de Energía, S.A., LT Triángulo, S.A., Serra Paracatu Transmissora de
Energía, S.A., Poços de Caldas Transmissora de Energía, S.A., Riberao Preto Transmissora de Energía, S.A, Pedras Transmissora
de Energía, S.A. and Coqueiros Transmissora de Energía, S.A., for BRL 10,000 thousand, BRL 65,000 thousand, BRL 49,500
thousand, BRL 64,500 thousand, BRL 49,500 thousand, BRL 281 thousand and BRL 1,049 thousand, totalling EUR 98,778
thousand. At 31 December 2008, EUR 34,458 thousand had not yet been paid (see Note 2-g).
In 2008 the depreciation of the Brazilian real against the euro reduced the equity of the Brazilian companies accounted for
using the equity method in the process of translation of their financial statements to the Group's functional currency (see Notes
2-c and 2-f).
In 2007, a 33.33% interest in Serra da Mesa Transmissora de Energía, S.A. and LT Triángulo, S.A. was acquired for
approximately EUR 2.8 million.
A security interest in the Group’s investments in the wind farms of Eólica Cabanillas, S.L., Eólica Montes del Cierzo, S.L., Eólica La
Bandera, S.L., Eólica Caparroso, S.L., Parque Eólico Malpica, S.A. and Parque Eólico Gaviota, S.A. has been given to the related banks
to secure performance of all the payment obligations under the loans that these companies have arranged, in general, under a
project financing arrangement. The Parent’s directors consider that these obligations are being met normally (see Note 14).
Note 1 includes a list of the investments in associates together with the most significant legal and financial information on
them.
11. OTHER NON-CURRENT FINANCIAL ASSETS
The detail of the non-current financial assets other than the investments in companies accounted for using the equity method
is as follows:
Thousands of Euros
Other Financial Assets
Net
Equity
Investments
Derivative
Financial
Instruments
(Note 15)
Long-term
Loans
Loans to
Employees
Customer
Financing
Other
Assets
Total
9,496
986
6,402
266
-
17,790
34,940
Additions
60
1,737
808
24
-
11,585
14,214
Disposals
(32)
-
(2,863)
(95)
-
(1,701)
(4,691)
-
104
(104)
-
-
(8)
-
-
Balance at 1 January 2007
Transfers
Translation differences
Changes in the scope of consolidation
(8)
(333)
-
(2,000)
-
-
Balance at 31 December 2007
9,183
2,723
2,451
91
-
Additions
1,838
-
789
-
-
4,724
7,351
Disposals
-
(2,723)
(225)
(91)
-
(2,818)
(5,857)
Transfers
(2,333)
27,674
42,122
-
-
(1,418)
-
1,418
-
-
Translation differences
(1,099)
-
-
-
-
(2,371)
(3,470)
Balance at 31 December 2008
9,922
-
1,597
-
1,418
27,209
40,146
a) Equity investmentsThe most significant data on the most representative equity investments in companies not included in the scope of
consolidation at 31 December 2008 and 2007 are shown in Appendix I.
The fair value of the investments under this heading was determined using in-house estimates made by the Group since
there are no quoted prices on an organised market.
The main change in 2008 relates to a capital increase at Isonor Transmission, S.A.C. made on 19 July 2008 for EUR 1,644
thousand, which was fully paid at 31 December 2008 (see Note 2-g). Also, Pedras Transmissora de Energía, Ltda and Coqueiros
Transmissora de Energía, Ltda. were incorporated with a contribution of EUR 417 thousand, at 2008 year-end.
The translation differences arose from the ownership interest held by the subsidiary Elecnor Chile, S.A. in IBENER, due to the
depreciation of the Chilean peso against the euro.
The main changes in 2007 arose as a result of the inclusion in the ELECNOR Group’s consolidation of various ownership
interests that it held in companies in the Deimos subgroup.
b) Long-term loans“Long-Term Loans” in the accompanying consolidated balance sheet at 31 December 2008 relates mainly to various loans
granted to non-ELECNOR Group companies and to a loan of EUR 870 thousand granted in 2007 to Eólicas Montes del Cierzo,
S.L. (see Note 26).
In 2007 long-term loans amounting to approximately EUR 2.8 million were repaid. Of this total amount, EUR 2.4 million
related to two loans granted in 2003 by the subsidiary Elecven Construcciones, S.A. to the non-consolidated company Electrade
Investments, Ltda., which repaid them in 2007.
The Parent's directors consider that none of the aforementioned loans will be repaid at short term and, therefore, they are
classified as non-current assets in the accompanying consolidated balance sheet, and there are no doubts that they will be
recovered.
c) Other non-current financial assetsAt 31 December 2008, “Other Non-Current Financial Assets” mainly included approximately EUR 3,606 thousand, EUR 2,500
thousand, EUR 7,564 thousand and EUR 9,500 thousand relating to the “Debt Servicing Reserve Account” that the subsidiaries
Eólicas Páramo de Poza, S.A., Aerogeneradores del Sur, S.A., Galicia Vento S.L. and Ventos Do Sul Energía, S.A., respectively,
have to maintain in a bank deposit pursuant to the financing agreements entered into by them (see Note 14). The remainder
relates to basic guarantees for the operation of the wind farms Eólicas Páramo de Poza S.A., Galicia Vento, S.L. and
ANNUAL REPORT 2008
121
Aerogeneradores del Sur, S.A. for approximately EUR 31 thousand, EUR 168 thousand and EUR 34 thousand, respectively.
Lastly, the ELECNOR Group recognises under this heading the various guarantees provided in connection with the operating
leases for several offices and commercial premises located in Spain and abroad.
12. CURRENT FINANCIAL ASSETS - CASH AND CASH EQUIVALENTS
The detail of “Cash and Cash Equivalents” in the accompanying consolidated balance sheet is as follows:
Thousands of Euros
2008
2007
Short-term deposits
10,246
1,911
Fixed-income securities and other assets
36,984
38,019
3,425
8,219
108,256
31,327
158,911
79,476
Other short-term loans and other
Cash
The ending balances of “Short-Term Deposits” and “Fixed-Income Securities and Other Assets” in the foregoing table relate
mainly to treasury bills acquired under non-optional fixed-date reverse repurchase agreements and to deposits, all at short
term, which earn interest at a market rate. On maturity, the related amounts are reinvested in assets of a similar nature and
term based on cash needs at any given time.
13. EQUITY OF THE PARENT
a) Share capitalThe shareholders at the Parent’s Annual General Meeting of 18 June 2008 approved the splitting of all the outstanding shares
representing the share capital at a proportion of two new shares for each old share, through the reduction of the par value of
all shares from EUR 0.20 to EUR 0.10, thus giving a total of 90,000,000 shares, so that the share capital figure remains unchanged.
The effective date established for this resolution was 15 September 2008.
Following this transaction, the share capital of Elecnor, S.A. was represented by 90,000,000 fully subscribed and paid ordinary
bearer shares of EUR 0.10 par value each.
The shares of Elecnor, S.A. are listed on the stock market (Bilbao, Madrid -Spanish Stock Market Interconnection System-,
Barcelona and Valencia).
At 31 December 2008 and 2007, the Parent's shareholder structure was as follows:
% of Ownership
Cantiles XXI, S.L.
Caixa de Aforros de Vigo, Ourense e Pontevedra (Caixanova)
Other (*)
51.00%
6.33%
42.67%
100.00%
(*) All with a percentage of ownership of less than 5%. Also including the Parent's treasury shares representing 4.1% of the share capital.
b) Unrealised asset and liability revaluation reserveThe changes in this reserve in 2008 and 2007 were as follows:
Thousands of Euros
31/12/06
Change
in Fair
Value
31/12/07
3,250
1,240
Change
in Fair
Value
31/12/08
Fully consolidated companies Cash flow hedges:
Interest rate swaps
(2,010)
Foreign currency hedges
(1,303)
244
(1,059)
(6,823)
(7,882)
(3,313)
3,494
181
(14,586)
(14,405)
1,143
(1,197)
(54)
4,376
4,322
(2,170)
2,297
127
(10,210)
(10,083)
Deferred taxes arising on revaluation
of unrealised assets and liabilities
Total revaluation reserves of fully
consolidated companies
Companies accounted for using the
equity method
Total revaluation reserves
(217)
167
(2,387)
2,464
(7,763)
(50)
50
77
(10,160)
(6,523)
(10,083)
c) Other reservesThe detail of the balance of “Other Reserves” in the consolidated balance sheet is as follows:
Thousands of Euros
2008
2007
1,803
1,803
15
15
27,344
22,898
29,162
24,716
Restricted reserves Legal reserve
Reserve for redenomination of capital in euros
Reserve for treasury shares (Note 3-ñ)
Other reserves
146,620
127,874
Reserves of the Parent
175,782
152,590
Reserves of consolidated companies (*)
100,632
68,829
Translation differences
(37,844)
15,292
Treasury shares
(27,344)
(22,898)
(*) Including consolidation adjustments and adjustments to IFRSs.
Legal reserveUnder the Consolidated Spanish Companies Law, 10% of net profit for each year must be transferred to the legal reserve
until the balance of this reserve reaches at least 20% of the share capital. The legal reserve has reached the stipulated level.
The legal reserve can be used to increase capital provided that the remaining reserve balance does not fall below 10% of the
increased share capital amount. Otherwise, until the legal reserve exceeds 20% of share capital, it can only be used to offset
losses, provided that sufficient other reserves are not available for this purpose.
ANNUAL REPORT 2008
123
Consolidation reservesThe detail, by company, of the balance of "Reserves at Consolidated Companies" at 31 December 2008 and 2007 is as follows:
Thousands of Euros
Company or Group of Companies
2008
2007
Fully consolidated companiesInternacional de Desarrollo Energético, S.A. (IDDE)
Omninstal Electricidade, S.A.
217
(158)
(2,674)
(1,877)
Cosinor, S.A.
(322)
173
Elecnor Seguridad, S.L.
188
134
Elecnor de Argentina, S.A.
(2,150)
(6,564)
Instalaciones y Proyectos de Gas, S.A.U
323
63
Electrolíneas del Ecuador, S.A.
869
1,033
Electrificaciones del Ecuador, S.A.
(416)
277
Zogu, S.A.
714
1,478
Elecven Construcciones, S.A.
9,585
2,971
Rasacaven, S.A.
4,039
581
Postes Orinoco, S.A.
288
(577)
Corporación L.N.C.A.
502
(32)
Corporación Electrade, C.A.
65
(138)
Adhorna Prefabricados, S.A. (formerly Postes Nervión, S.A.) 6,120
5,234
Galicia Vento, S.L.
Placarmada, S.A.
Enerfín Enervento, S.A.
Elecnor Chile, S.A.
(433)
(431)
-
3
24,127
32,259
(767)
(3,627)
Hidroambiente, S.A.
1,548
1,321
Elecnor do Brasil, Ltda.
1,157
(5,261)
243
214
1,444
753
(55)
(50)
Redes Eléctricas de Manresa, S.L.
Montelecnor, S.A.
Sociedad Aragonesa de Aguas Residuales, S.A.U.
Sociedad Aragonesa de Estaciones Depuradoras, S.A.
Deimos Space, S.L.
(26)
(56)
1,463
1,159
Deimos Aplicaciones Tecnológicas, S.L.
169
-
Ehisa Construcciones y Obras, S.A.
511
354
Deimos Imaging, S.L.
145
-
18,772
11,878
Elecnor Montagens Elétricas, Ltda.
402
(1,974)
Montagem Elétricas da Serra, Ltda.
(1,953)
-
Vilhena Montagens Elétricas, Ltda.
180
-
(8,675)
(8,581)
179
507
Elecnor Transmissao de Energía, S.A.
Elecnor de México, S.A. de C.V.
Eólicas Páramo de Poza, S.A.
Ventos Do Sul Energía, S.A.
Aplicaciones Técnicas de la Energía, S.L.
Aerogeneradores del Sur, S.A.
Enerfera, S.R.L.
(784)
(5)
32,450
10,019
108
62
49
(37)
Eólica de Chantada, S.A.
3
4
Enervento Biodiesel, S.A.
(139)
(104)
Enerfín do Brasil, Ltda.
(4,576)
109
Elecnor Financiera, S.L.
5,596
3,990
Thousands of Euros
Company or Group of Companies
2008
2007
Enerfín Sociedad de Energía, S.A.
3,949
1,006
Companies accounted for using the equity methodEólica Cabanillas, S.L.
(501)
70
Eólica Montes del Cierzo, S.L.
(345)
(290)
Guadalaviar C.E. A.E, S.A.
2
1
Eólica La Bandera, S.L.
(418)
(479)
Eólica Caparroso, S.L.
(42)
(43)
Parque Eólico Malpica, S.A.
(169)
(267)
Parques Eólicos Gaviota, S.A.
(177)
(93)
Deimos Engenharia, S.A.
37
-
2,198
150
Expansión Transmissao Itumbiara Marimbondo, S.A.
1,909
1,022
Cachoeira Paulista Transmissora de Energía, S.A.
1,292
590
Expansión Transmissao do Energía Elétrica, S.A.
Itumbiara Transmissora de Energía, S.A.
704
(71)
Vila do Conde Transmissora de Energía, S.A.
287
(356)
Porto Primavera Transmissora de Energía, S.A.
370
66
Serra da Mesa Transmissora de Energia, S.A.
(1)
-
Jauru Transmissora de Energía, S.A.
1
-
Cosemel Ingeniería, A.I.E.
Consolidation adjustments
-
74
3,050
22,345
100,632
68,829
d) Treasury sharesBy virtue of the resolutions adopted successively at the Annual General Meetings of Elecnor, S.A. in recent years, various
treasury shares of the aforementioned company were acquired with a view to their gradual disposal in the market. Specifically,
in June 2008 the shareholders at the Annual General Meeting resolved to authorise the acquisition of shares issued by the
Parent, either by the Parent itself or by Group companies, up to a limit of 5% of the share capital (see Note 3-ñ), provided that
the purchase price was not 30% higher or lower than the market price of the shares.
At 31 December 2008 and 2007, the Company held treasury shares amounting to approximately EUR 27,344 thousand and
EUR 22,898 thousand, respectively, recognised as a reduction in “Equity - Other Reserves”.
The detail of the treasury shares and of the changes therein in 2008 is as follows:
No. of Shares
Treasury shares at 31 December 2007
Acquisition of treasury shares
Sale of treasury shares
Splitting of shares
Treasury shares at 31 December 2008
1,688,795
261,044
(79,166)
1,819,254
3,689,927
In 2008 the Company sold 79,166 treasury shares for an aggregate amount of approximately EUR 1,652 thousand.
All the treasury shares held by the Company at 31 December 2008 and 2007 represented 4.1% and 3.75%, respectively, of
the share capital of Elecnor, S.A. at those dates.
At 31 December 2008 and 2007, a restricted reserve for treasury shares had been recorded for the amount of the Elecnor,
S.A. treasury shares held at those dates.
ANNUAL REPORT 2008
125
e) Minority interestsThe detail of “Equity - Of Minority Interests” on the liability side of the accompanying consolidated balance sheets at 31
December 2008 and 2007 is as follows:
Thousands of Euros
2008
2007
Eólicas Páramo de Poza, S.A.
3,976
3,011
Galicia Vento, S.L.
3,012
797
Elecven Construcciones, S.A.
112
176
Rasacaven, S.A.
124
122
Postes Orinoco, S.A.
(43)
-
Adhorna Prefabricados, S.A.
1,882
1,843
Sociedad Aragonesa de Estaciones Depuradoras, S.A.
2,319
600
Placarmada, S.A.
-
3
154
188
2,519
2,497
40
23
484
129
30
-
Hidroambiente, S.A.
Deimos Space, S.L.
Deimos Aplicaciones Tecnológicas, S.L.
Deimos Imaging, S.L.
Deimos Engenharia, S.A.
Elecnor Argentina, S.A.
Ventos Do Sul Energía, S.A.
(38)
32
2,670
6,711
Aerogeneradores del Sur, S.A.
Enerfin-Enervento, S.A.
296
-
32,674
36,943
(113)
-
Enervento Biodiesel, S.A.
Coyote Wind, LLC.
45
-
50,143
53,075
The detail of the changes in 2008 and 2007 in this consolidated balance sheet item was as follows:
Thousands of Euros
Thousands of Euros
Balance at 1 January 2007
- Profit for the year
- Change in fair value of hedging instruments (1)
50,539
4,572
728
- Translation differences (2)
1,804
- Dividends paid
(4,807)
- Changes in the scope of consolidation (Note 2-g)
- Other changes
Balance at 31 December 2007
- Profit for the year
- Change in fair value of hedging instruments (1)
(159)
398
53,075
8,301
(691)
- Dividends paid
(4,575)
- Translation differences (2)
(5,967)
Balance at 31 December 2008
(1) Relating to the changes in the value of the hedging swaps used by the ELECNOR Group (see Note 15).
(2) Relating mainly to the translation differences arising at Ventos do Sul Energía, S.A.
50,143
14. BANK BORROWINGS AND OTHER FINANCIAL LIABILITIES
Key to the Group’s strategy is its policy of maximum financial prudence. The target capital structure is defined by this
commitment to solvency and the aim of maximising shareholder returns.
However, certain projects, mainly the construction of wind farms and their related electric interconnection lines and
substations, owned by the Group, are mainly financed with syndicated loans under project financing arrangements. Under
these loans the subsidiaries that are owners of the aforementioned wind farms accept certain restrictions on the distribution
of dividends, which is conditional on certain requirements being met, such as the creation of a reserve account for debt servicing.
Also, these subsidiaries must achieve a given debt/equity ratio and a given equity structure.
The target capital structure, excluding the effect of the aforementioned wind farm projects, is quantified at the following
ratio of net bank borrowings to equity:
Net bank borrowings
Net bank borrowings + Equity
Net bank borrowings include the following line items in the consolidated balance sheet (having eliminated the effect of net
bank borrowings related to the wind farms):
Thousands of Euros
2008
2007
141,031
94,898
Current liabilities – Bank borrowings and
other financial liabilities
37,003
90,453
Non-current financial assets - Other financial assets
(5,440)
(4,520)
Non-current liabilities – Bank borrowings and
other financial liabilities
Cash and cash equivalents
(101,894)
(55,009)
70,700
125,822
Net bank borrowings and other financial liabilities
The changes in this ratio are analysed on a permanent basis and prospective estimates thereof are also made as a key
restrictive factor to be taken into account in the Group's investments strategy and dividends policy. At 31 December 2008 and
2007, this ratio stood at approximately 17% and 26%, respectively.
The detail of “Bank Borrowings and Other Financial Liabilities” under the non-current and current liability headings of the
accompanying consolidated balance sheets at 31 December 2008 and 2007 is as follows:
Thousands of Euros
31/12/08
Non-Current Maturity
Syndicated loans and credit facilities
Syndicated loans - Wind farms
Credit facility – VAT
Derivative hedging instruments (Note 15)
31/12/07
Current Maturity
Non-Current Maturity
Current Maturity
94,989
299
61,377
-
297,463
32,399
339,670
20,545
7,474
993
-
1,959
10,448
5,666
2,624
-
Unsecured loans
4,775
-
7,607
3,097
Mortgage loans
12,564
383
13,101
-
2,000
22,726
-
60,193
Unmatured bills and notes
-
6,127
-
9,125
Accrued interest payable
-
508
-
14,529
Unsecured credit facilities
Obligations under finance leases (Note 9)
Total
10,993
301
10,189
1,550
440,706
69,402
434,568
110,998
ANNUAL REPORT 2008
127
The non-current portion of the loans and credit facilities in 2008 and 2007 (excluding derivative hedging instruments) falls
due as follows (in thousands of euros):
Debts Maturing in
31/12/08
2010
41,077
2011
39,144
2012
63,556
2013
57,400
2014 and subsequent years
235,226
Total
436,403
Debts Maturing in
31/12/07
2009
9,272
2010
35,315
2011
38,238
2012
60,751
2013 and subsequent years
288,368
Total
431,944
Syndicated loans and credit facilitiesOn 5 May 2005, the Parent arranged multicurrency bank financing aimed mainly at financing the construction of 811 km of
electricity network between the cities of Cuiba and Itumbiara in Brazil. This financing is subdivided into two tranches: tranche
A relates to a long-term multicurrency syndicated loan of EUR 25,000 thousand; and tranche B relates to a long-term
multicurrency credit facility with a maximum drawable limit of EUR 25,000 thousand. At 31 December 2008, the Company had
not drawn down any amount against the credit facility. This financing arrangement bears interest at Euribor plus a spread,
which is tied to the level of the Net Bank Borrowings to (EBITDA + Project dividends) ratio.
The syndicated loan and the amount drawn down, if any, against the syndicated credit facility will be repaid in full on
maturity, on 5 May 2012.
On 29 June 2006, the Parent arranged multicurrency bank financing with the same conditions and characteristics as the 2005
syndicated loan, for the purpose of financing the development of projects consisting of the construction of electricity grids in
Brazil, with the only difference being that the loan and the amount drawn down against the syndicated credit facility, if any,
will be repaid in full on maturity on 29 June 2013. At 2008 year-end, as in the case of the 2005 financing, the Company had
used tranche A relating to the loan in full and had not drawn down any amount against the tranche B credit facility.
The Parent arranged four interest rate swaps, with a nominal amount of EUR 12.5 million each with various banks in order
to hedge against a possible rise in the interest rates on the two syndicated loans received. The maturity and interest settlement
dates of the swaps coincide with those of the loan agreements to which they are assigned (see Note 15).
The two agreements bore interest of approximately EUR 2,887 thousand in 2008 (2007: EUR 2,356 thousand), prior to taking
into consideration the effect of the hedges, which the Group recognised under “Finance Costs” in the accompanying 2008
consolidated income statement (see Note 21).
The Parent has undertaken to maintain over the term of the two bank financing agreements the interest coverage ratio (net
bank borrowings and the debt/adjusted equity) and the debt/equity ratio (net bank borrowings/EBITDA + project dividends)
established in the agreements for each year-end (calculated on the basis of the consolidated data of the Elecnor Group), noncompliance with which could constitute grounds for termination of the agreements. At 31 December 2008, the conditions for being
able to continue to classify this financing on the basis of the initially foreseen maturities were being met. All the aforementioned
ratios must be calculated excluding the figures relating to the wind farms (projects financed with non-recourse financing).
Syndicated loans - Wind farmsAt 31 December 2008, the bank borrowings under this heading related mainly to the balances drawn down against the
syndicated loans that Aerogeneradores del Sur, S.A., Eólicas Páramo de Poza, S.A., Galicia Vento, S.L., Ventos do Sul Energía
S.A. and Parques Eólicos de Villanueva, S.L.U. had arranged with several banks amounting to EUR 36,443 thousand, EUR 40,292
thousand, EUR 91,509 thousand, EUR 142,502 thousand and EUR 32,087 thousand (including accrued interest payable),
respectively, under a project financing arrangement. These loans were granted to finance the construction of wind farms and
the related electric interconnection lines and substations owned by these companies.
The equivalent limit of the syndicated loan in Brazilian reais granted to Ventos do Sul Energía, S.A., of which Elecnor, S.A. is
the guarantor, is BRL 462,728 thousand. At 31 December 2007, this loan had been drawn down in full.
The syndicated loans will be repaid in 25, 26, 25 and 37 consecutive half-yearly repayments in the case of the loans granted
to the subsidiaries Eólicas Páramo de Poza, S.A., Aerogeneradores del Sur, S.A., Galicia Vento S.L and Parques Eólicos de
Villanueva, S.L.U., respectively, and in 144 monthly repayments in the case of the loan granted to Ventos Do Sul Energía, S.A.
The first repayment was made in 2003 in the case of the subsidiary Eólicas Páramo de Poza, S.A., in 2005 in the case of the
subsidiary Aerogeneradores del Sur, S.A. and in 2006 in the case of the subsidiary Galicia Vento, S.L. The subsidiary Parques
Eólicos de Villanueva, S.L.U. will make its first repayment in 2010. The first repayment of the loan to the subsidiary Ventos do
Sul Energía, S.A. was made in 2007, once the grace period had elapsed.
The Spanish syndicated loans bear interest at six-month EURIBOR plus a market spread, which may vary subsequently on the
basis of the audited principal debt service coverage ratio. In the case of the loan obtained in Brazilian reais by the subsidiary
Ventos do Sul Energía, S.A., the applicable interest rate is the result of adding a market spread to Brazil’s long-term floating
interest rate (“T.J.L.P”). In order to mitigate interest rate risk on their respective syndicated loans, Eólicas Páramos de Poza,
S.A., Aerogeneradores del Sur, S.A. and Galicia Vento, S.L. have arranged interest rate swaps with various banks at average
fixed rates of 5.0%, 4.2% and 4.5%, respectively, which hedge substantially all the outstanding debt of each of the subsidiaries
(see Note 15).
Pursuant to the related financing deeds, the annual principal debt servicing ratio for the project finance syndicated loans of
the Spanish subsidiaries must be above a given value throughout the term of the loans, calculated basically as the ratio of the
cash flow available for debt servicing in a 12-month period to the debt serviced in that same period, as defined in the loan
agreements. Also, these companies must achieve a given debt/equity ratio and a given equity structure.
Within two years from the start-up of the wind farm, the Spanish subsidiaries are also obliged to set up a debt servicing
reserve account (in the form of a bank deposit) for the amount specifically determined in the related financing agreements
(see Note 11). Also, they have to arrange interest rate hedges, at the request of the agent bank, for a minimum of 65% of the
amount of the loan and with a minimum term of nine years. To comply with this requirement, the aforementioned swaps were
arranged. Ventos do Sul Energía, S.A., must also achieve certain debt coverage ratios within certain limits, and must deposit in
a reserve account a monetary amount that covers at least three monthly principal and interest payment instalments. The
covenants of Ventos do Sul Energía, S.A. came into force in 2008 and compliance therewith has not given rise to any problems,
in the opinion of the Parent's directors.
To secure each of the syndicated loans of the Spanish companies, the Group constituted a security interest in the shares of
the subsidiaries and, additionally, in the indemnification, compensation and, or penalties that might become payable to Eólicas
Páramo de Poza, S.A., Aerogeneradores del Sur, S.A., Galicia Vento, S.L. and Parques Eólicos de Villanueva, S.L.U. in connection
with the construction and operating management contracts and in all the cash accounts of the aforementioned wind power
companies. In relation to Ventos do Sul Energía, S.A., the Company arranged a security trust agreement over property, plant
and equipment with the related banks.
Also, the subsidiaries have certain limitations in relation to these loans consisting basically of restrictions on the disposal of
their property, plant and equipment and on the payment of dividends. These obligations depend on compliance with certain
conditions, such as ongoing fulfilment of the debt service coverage ratio established in the financing loan deeds and setting
up a debt servicing reserve account (see Note 11). The aforementioned conditions were met by all the Spanish companies and,
therefore, they were authorised to pay the dividends declared in 2008 and prior years.
The directors consider that all the conditions established in relation to the syndicated loans arranged are being met and that
project financing will be serviced with normality using the revenue generated by the business activity of each wind power
project.
Also, with a view to financing the repayment of a portion of the share capital to its shareholders the subsidiary Ventos do
Sul Energía, S.A. received a loan of EUR 25 million in 2008, bearing interest at 12-month Euribor plus a spread and with maturity
established at 30 September 2022.
ANNUAL REPORT 2008
129
Credit facility - VATIn previous years, Sociedad Aragonesa de Aguas Residuales, S.A.U. received a VAT-related credit facility amounting to EUR
4,000 thousand, against which approximately EUR 993 thousand had been drawn down at 31 December 2008.
In 2008 Parques Eólicas de Villanueva, S.L.U. received a VAT-related credit facility amounting to EUR 15,600 thousand, against
which approximately EUR 7,474 thousand had been drawn down at 31 December 2008.
Other financingIn 2007 the Elecnor Group arranged a mortgage loan in order to acquire an industrial building in Valencia in which to carry
on its solar panel manufacturing business (see Note 9). The unmatured balance of this loan amounted to approximately EUR
12,527 thousand at 31 December 2008.
Also, at 31 December 2008, Elecnor, S.A had twelve credit lines outstanding with various banks with a maximum total limit
of EUR 195 million, against which at 31 December 2008 EUR 1,238 thousand had been drawn down. The credit lines bear
average interest of EURIBOR/LIBOR plus a market spread, with annual maturity, automatically extendable in most cases. Also,
certain credit lines and draft discounting lines are held through the unincorporated joint ventures in which the Group has
interests, with a total limit of approximately EUR 31.5 million.
Taken as a whole, at 31 December 2008, the Group had unused unsecured credit lines totalling approximately EUR 220,102
thousand (31 December 2007: approximately EUR 224,418 thousand) (see Note 4-c).
At 31 December 2008, the ELECNOR Group did not have any bank borrowings at fixed interest rates, except for the hedges
described in Note 15.
Also, the sensitivity of the non-current borrowings to interest rate fluctuations is scantly material (see Note 4-b), since, except
for the syndicated loan of Ventos do Sul Energía, S.A., interest rate hedges have been arranged for all the other borrowings.
In the case of Ventos do Sul Energía, S.A., an upward or downward change of 0.25% in the interest rate would have an impact
on the annual borrowing costs of approximately EUR 440 thousand. A 2.5% increase in the Brazilian real/euro exchange rate
(the loans held by the Group in a currency other than the euro are denominated in Brazilian reais) would represent an annual
decrease in borrowing costs of approximately EUR 498 thousand, while a drop would increase borrowing costs by approximately
EUR 498 thousand.
15. DERIVATIVE FINANCIAL INSTRUMENTS
The ELECNOR Group uses derivative financial instruments to hedge the risks to which its future activities, transactions and
cash flows are exposed, mainly foreign currency and interest rate risk. The detail of the balances that reflect the measurement
of derivatives in the consolidated balance sheets at 31 December 2008 and 2007 is as follows:
Thousands of Euros
2008
Assets
(Note 11)
2007
Liabilities
(Note 14)
Assets
(Note 11)
Liabilities
(Nota 14)
8,234
1,636
478
-
7,880
1,087
2,146
-
16,114
2,723
2,624
INTEREST RATE HEDGES
Cash flow hedges:
Interest rate swap (Note 14)
-
FOREIGN CURRENCY HEDGES:
Cash flow hedges:
Foreign currency hedge
At 31 December 2008 and 2007, the ELECNOR Group did not have any derivatives that did not qualify for hedge accounting
and it did not have any such derivative during those years.
Foreign currency hedgesThe ELECNOR Group uses derivatives as foreign currency hedges mainly to mitigate the possible adverse effect of exchange
rate fluctuations on future cash flows relating to transactions of three types:
• Payments relating to supply agreements denominated in US dollars.
• Payments under construction contracts performed abroad and denominated in US dollars.
• Collections under construction contracts performed abroad and denominated in US dollars.
At 31 December 2008 and 2007, the total nominal value of the liabilities on which foreign currency hedges had been arranged
was as follows:
Thousands of Euros
Currency
US dollars
2008
150,243
2007
129,759
Of the total nominal amounts hedged in 2008, USD 131,297 thousand relate to US dollar purchase hedges to hedge future
payment flows in US dollars and USD 18,946 thousand relate to US dollar sale hedges to hedge future collections in US dollars.
The foreign currency hedges mature in 2009 and 2010, coinciding with the actual flow of payments and collections that they
are hedging, and the risk of changes in the expected cash flows is very low since there are agreements which indicate the
related payment and collection schedules.
In addition, in 2008 the Parent arranged various foreign currency hedges with different maturities to hedge various capital
increases performed by its Brazilian subsidiary Elecnor Transmissao de Energía, S.A. at Brazilian companies accounted for using
the equity method (see Note 10). The hedges arranged amounted to a nominal amount of BRL 232 million, of which BRL 154
million, with maturity in 2009, had not yet matured at 2008 year-end. The settlements made in 2008 gave rise to a negative
difference of EUR 1.1 million at the Elecnor Group in 2008, which was recognised as an increase in the cost of the subsidiary.
In 2008 and 2007, no transactions took place or were planned for which initially a hedge accounting policy was adopted
when accounting for the derivatives but which is now not expected to be implemented.
In 2008 and 2007 there was no ineffectiveness in the cash flow hedges of assets and liabilities denominated in US dollars.
Interest rateAlso, the ELECNOR Group performs interest rate hedging transactions in accordance with its risk management policy. The
purpose of these transactions is to mitigate the effect that changes in interest rates could have on future cash flows from
certain long-term credit facilities and loans tied to floating interest rates, generally associated with the financing obtained by
the wind farms, which cover the full amount thereof and for the whole term thereof. At 31 December 2008 and 2007, the total
nominal value of the liabilities on which interest rate hedges had been arranged was as follows:
Thousands of Euros
Type of Hedge
Cash flows - Interest rate swap
2008
235,493
2007
229,481
The interest rate swaps have the same nominal amount as the outstanding principals of the hedged loans and the same
maturity as the interest settlements on the loans that they are hedging.
As in the case of the foreign currency hedges, in 2008 and 2007 no transactions took place or were planned for which initially
a hedge accounting policy was adopted when accounting for the derivatives but which is now not expected to be implemented.
ANNUAL REPORT 2008
131
16. PROVISIONS FOR CONTINGENCIES AND CHARGES
The detail of “Non-Current Liabilities - Provisions for Contingencies and Charges” in the accompanying consolidated balance
sheets and of the changes therein in 2008 and 2007 is as follows:
Thousands of Euros
Provisions for
Litigation and
Other Claims
Balance at 1 January 2007
Period provisions charged to income
Reversal of excessive provisions
Warranty
Provisions
Total Provisions
for Contingencies
and Charges
2,890
-
2,890
541
28,251
28,792
(14)
(480)
(494)
(554)
-
(554)
Balance at 31 December 2007
2,863
27,771
30,634
Period provisions charged to income
4,361
29,629
33,990
Balance at 31 December 2008
7,224
57,400
64,624
Provisions used
The ELECNOR Group recognises provisions for the amount required to meet its liability, whether it be legal or constructive,
probable or certain, arising from contingencies, litigation in process or obligations that arise as a result of past events, for which
it is more probable than not that an outflow of resources will be required, provided that it is possible to make a reasonable
estimate of the amounts in question.
The Group estimates the amount of the liabilities arising from litigation and similar events. Although the Group considers
that the outflows of resources will take place in the next few years, it cannot predict when the litigation will end and, therefore,
it does not make an estimate of the specific dates of the outflows as it considers that the effect of any discount in this connection
would not be material.
Since 2007 year-end the Elecnor Group has delivered various solar power production plants (solar PV farms). During the
period from the date of award of the Provisional Acceptance Certificate of the solar PV farm and the following three years –
when the customer will execute the Final Acceptance Certificate- the ELECNOR Group provides the customer with a warranty
relating to the quality of the materials, the photovoltaic modules, and particularly that the electricity production of each PV
facility will reach a certain level of kWh in certain irradiation and temperature conditions during the aforementioned warranty
period. Should actual metered production fall below the guaranteed level, the contract price will be reduced, with the
concomitant obligation of the contractor, i.e. the ELECNOR Group, to pay the owner the stipulated amount of the
aforementioned penalty, which is established taking into account the percentage of the decrease in actual production with
respect to the guaranteed level and the contract price. The ELECNOR Group had recognised a provision of approximately EUR
57.4 million at 2008 year-end to cover the aforementioned penalty risk, which is recognised under “Non-Current Liabilities Provisions for Contingencies and Charges” in the accompanying consolidated balance sheet. The amount of the provision was
calculated on the basis of the best estimate made by the directors of the ELECNOR Group at 31 December 2008 of production
losses with respect to the production guaranteed for each PV facility and for each solar farm taken as a whole.
Lastly, at 31 December 2008, most of the remaining amount recognised was covering legal, employment and court-related
proceedings of the subsidiaries Elecnor do Brasil, Ltda., Elecnor de Argentina, S.A. and Elecven Construcciones, S.A.
At 31 December 2008, the Elecnor Group had a contingent liability in relation to the claim filed against the subsidiary Galicia
Vento, S.L. as follows:
• In previous years, “Monte Vecinal en Mano Común Faro de Argozón” filed a claim against the Galicia Autonomous
Community Government and ENERFIN Enervento, S.A. (an ELECNOR Group company) in relation to the Chantada wind farm
owned by Galicia Vento, S.L. (also a subsidiary of the ELECNOR Group) at the Galicia High Court in connection with the
condemnation proceeding for the wind farm located on the land of “Monte Vecinal en Mano Común Faro de Argozón”.
On 31 January 2007, the Galicia High Court handed down a decision rendering void the condemnation and ordered Galicia
Vento, S.L., the owner of the wind farm, to dismantle the turbines situated on the land and to return the land to its original
state prior to the construction of the wind farm. This decision has been appealed against at the Supreme Court. The Galicia
Autonomous Community Government, co-defendant in the proceedings, has also filed a cassation appeal defending the
argument put forward by the ELECNOR Group. The Group's internal legal department and a prestigious law firm that
prepared the related appeal to file with the Supreme Court state that the cassation appeal is highly likely to be successful,
since the decision appealed against has serious formal defects and defects in substance. The Galicia Autonomous Community
Government is obliged to maintain the appeal, and, therefore, the hypothetical and highly unlikely upholding of the
judgment by the Supreme Court would lead to the unlimited liability of the government, which would ultimately be obliged
to compensate the ELECNOR Group for the damage or loss caused by the removal of the wind generators that were installed
in the past on the basis of the licences and permits granted by the Galicia Autonomous Community Government. Therefore,
the ELECNOR Group has not recognised any provision in relation to this claim.
• There are also certain litigation proceedings in progress at various foreign subsidiaries, mainly in Brazil, which in the opinion
of the Parent’s directors will not give rise to material liabilities for the Group.
17. CUSTOMER ADVANCES AND PREBILLINGS
The detail of these items under “Trade and Other Payables” in the accompanying consolidated balance sheets is as follows:
Thousands of Euros
2008
Prebillings (Note 3-d)
Customer advances
320,803
2007
340,286
42,419
80,558
363,222
420,844
The prebillings consist of progress billings issued pursuant to the timing conditions stipulated in the contracts for projects
currently in progress.
The customer advances relate basically to prepayments by customers before commencement of performance of the related
contracts. These advances are discounted from the billings made during the performance of the contracts.
18. LONG-TERM DEFERRED TAX ASSETS AND LIABILITIES
The difference between the tax charge allocated and that which will have to be allocated to each year, which is presented
under “Non-Current Assets - Deferred Tax Assets” and “Non-Current Liabilities - Deferred Tax Liabilities”, as appropriate, in
the consolidated balance sheet, arose mainly as a result of the following:
• Temporary differences between the carrying amounts of certain assets and liabilities and their tax base arising when making
the reconciling adjustments to IFRSs in the financial statements for 2008 and 2007. The most significant differences relate
to those arising from the effects of applying IAS 39 in the measurement of the Group's hedging instruments at 31 December
2008 and 2007.
• Temporary differences arising from intra-Group profits that are eliminated on consolidation of the ELECNOR Group (see
Note 2-f).
• Temporary differences arising from the elimination of the investment valuation allowances that the Group recognises on
consolidation.
• Temporary differences arising from the accounting treatment of the capital increase with share premium performed at
Enerfín Enervento, S.A in 2005, which entailed the recognition of the related increase in equity in the consolidated income
statement of the ELECNOR Group.
• Temporary differences arising from differences in the recognition of certain provisions for accounting and tax purposes.
• Recognition of tax assets for tax loss carryforwards.
ANNUAL REPORT 2008
133
The detail of “Deferred Tax Assets” and “Deferred Tax Liabilities” in the accompanying consolidated balance sheet and of
the changes therein in 2008 and 2007 is as follows:
Euros
01/01/07
Charge/
Credit to
Income
Charge/Credit
to Asset and
Liability
Changes in
Revaluation the Scope of
Reserve Consolidation Other
Transfers
(*)
31/12/07
Charge/
Credit to
Income
Charge/
Credit to
Asset and
Liability
Revaluation
Transfers
Reserve Other
(*)
31/12/08
Deferred tax assets:
Measurement of derivative
financial instruments
Allocation to income of
capitalised start-up costs
Elimination of intra-Group
profits (**)
Tax assets
1,770
-
(983)
-
-
-
787
(556)
4,091
-
-
4,322
232
(94)
-
-
-
-
138
(138)
-
-
-
-
8,900
14
-
-
-
(525)
8,389
679
-
-
-
9,068
-
(18)
-
14
5,022
1,319
6,337
-
1,090
(2,464)
-
4,963
Non-deductible provisions and other
deferred tax assets (Note 16)
1,122
-
-
-
4,590
(1,122)
4,590
-
- 22,056
(1,693)
24,953
12,024
(98)
(983)
14
9,612
(328)
20,241
(15)
5,181 19,592
(1,693)
43,306
Deferred tax liabilities:
Measurement of derivative
financial instruments
312
-
505
-
-
-
817
-
(817)
-
-
-
Exchange gains
333
(279)
-
-
-
-
54
(54)
-
-
-
-
Revaluation of non-current assets
654
(114)
-
-
-
90
630
-
-
-
-
630
10,364
222
-
-
-
-
10,586
-
-
-
(941)
9,645
2,926
(442)
-
-
-
(90)
2,394
-
-
-
-
2,394
-
-
-
2,925
199
3,124
14,481
(54)
(817)
2,925
(742)
15,793
Disposal of Enerfin
Enervento, S.A.
Investment valuation allowances
Other deferred tax liabilities
14,589
(613)
505
-
-
-
(*) Including transfers between items and transfers to “Current Assets - Tax Receivables” in the consolidated balance sheet at 31 December 2008 and 2007.
(**) Arising mainly from the construction of wind farms. This amount will be reversed to income over the useful.
The ELECNOR Group recognises deferred tax assets to the extent that their future realisation or utilisation is sufficiently
assured. Deferred tax liabilities are recognised for all taxable temporary differences, unless, in general, the temporary difference
arises from the initial recognition of goodwill.
At 31 December 2008, the subsidiary Ventos Do Sul Energía, S.A. had recognised tax assets of approximately EUR 6,029
thousand, relating to tax losses for 2008 and 2007, amounting to approximately EUR 401 thousand and EUR 501 thousand, and
to tax credits earned in 2008 and 2007 as a result of carrying on wind power production activities, which amounted to
approximately EUR 5,628 thousand and EUR 4,089 thousand.
The deferred tax assets and liabilities recognised are reassessed at each balance sheet date in order to ascertain whether
they still exist, and the appropriate adjustments are made on the basis of the findings of the analyses performed.
19. TAX RECEIVABLES AND PAYABLES
The detail of “Current Assets - Tax Receivables” and “Other Payables - Tax Payables” on the asset and liability sides,
respectively, of the consolidated balance sheets at 31 December 2008 and 2007 is as follows:
Thousands of Euros
2008
2007
19,378
6,623
Tax receivablesVAT refundable
Tax withholdings and prepayments
Unused tax credits and tax relief
Income tax refundable
Sundry tax receivables (*)
Social security taxes refundable
Total
4,662
3,957
-
4,301
444
2,426
13,595
12,146
49
7
38,128
29,460
18,678
25,268
4,112
5,177
Tax payablesVAT payable
Tax withholdings payable
Income tax payable
28,817
6,774
Other tax payables (*)
13,256
12,173
Accrued social security taxes payable
Total
6,366
5,705
71,229
55,097
(*) Mainly from the unincorporated joint ventures.
The Parent files tax returns pursuant to the regulations provided for by Legislative Royal Decree 4/2004, of 5 March, approving
Consolidated Corporation Tax Law 43/1995, of 27 December, and the related implementing regulations.
The Parent has the years since 2005 open for review by the tax authorities for the main taxes applicable to it. In general, the
main Group companies have the years established in the local legislation in each case (ranging from three to five years) open
for review for the main taxes applicable to them.
The income tax expense for 2008 and 2007 was determined as follows:
Thousands of Euros
Consolidated profit before tax
2008
2007
137,997
102,304
Non-deductible expenses
7,051
7,662
Non-computable income
(315)
(5,502)
(15,824)
(15,918)
Net loss of companies accounted
for using the equity method (Note 10)
Tax losses
Adjusted accounting profit
Gross tax calculated at the tax rate in force
in each country (*)
Tax credits relating to incentives and other
Adjustment of prior year income tax expense
Income tax expense incurred
(1,052)
(752)
127,857
87,794
36,619
27,224
(234)
(2,195)
(282)
(851)
36,103
24,178
(*) The fully consolidated foreign subsidiaries calculate the income tax expense and the tax charges for the various taxes applicable to them in conformity with the
legislation of, and at the tax rates in force in, their respective countries.
Also, in order to calculate the income tax expense for 2008 and 2007 based on the applicable regulations, in addition to the
various income tax rates applicable, applied to profit before tax adjusted by the permanent differences from the taxable profit,
various tax credits amounting to approximately EUR 13,685 thousand and EUR 2,195 thousand, respectively, to encourage the
performance of certain activities taken by the Group were taken into account. After taking into account the unused tax credits
earned in 2008 and prior years, the Group companies had unused tax credits of approximately EUR 6,109 thousand available
for deduction in future years (2007 year-end: EUR 4,311 thousand).
ANNUAL REPORT 2008
135
The varying interpretations that can be made of current tax legislation could give rise to certain contingent liabilities which
cannot be objectively quantified. However, the Parent's directors consider that the possibility of such contingent liabilities
arising at the Group companies as a result of future tax audits is remote and that, in any case, the tax debt that might arise
therefrom would not materially affect the consolidated financial statements of the ELECNOR Group.
20. GUARANTEE COMMITMENTS TO THIRD PARTIES
At 31 December 2008 and 2007, the detail of the risk exposure relating to guarantees received and other project bid
guarantees, completion bonds and performance bonds, relating mainly to the Parent, was as follows:
Thousands of Euros
Completion bonds
2008
2007
368,367
323,043
119,688
101,937
Advances on contracts:
Current
To be cancelled
1,765
202
Performance bonds
43,620
44,439
Project bid guarantees
41,673
26,154
Other
36,535
25,873
Total
611,648
521,648
Also, Elecnor S.A. has guaranteed the project financing amounting to approximately BRL 462,728 thousand received in 2005
by the Brazilian company Ventos do Sul Energía, S.A. (owned through Enerfín Enervento, S.A.) for the construction of a wind
farm in Brazil (see Note 14). This project financing has been drawn down in full. The guarantee provided by Elecnor will expire
in 2009, once the wind farm is in operation and the lenders have verified that the use to which the financing was put coincides
with that stipulated in the related agreement.
The Parent's directors consider that the liabilities, if any, that might arise from the guarantees provided would not give rise
to significant losses in the accompanying consolidated financial statements.
21. INCOME AND EXPENSES
ProcurementsThe breakdown of “Procurements” in the 2008 and 2007 consolidated income statements is as follows:
Thousands of Euros
Purchases of raw materials and other
supplies
Changes in inventories of merchandise,
raw materials and other goods
Total
2008
2007
1,150,063
1,089,325
35,716
4,977
1,185,779
1,094,302
Staff costsThe breakdown of “Staff Costs” in the 2008 and 2007 consolidated income statements is as follows:
Thousands of Euros
2008
2007
244,383
200,477
Employer social security costs
55,395
47,215
Other employee benefit costs
13,930
8,408
313,708
256,100
Wages and salaries
Total
The average number of employees, by professional category, in 2008 and 2007 was as follows:
Average Number of Employees
Senior management (Note 25)
Management
2008
2007
4
4
89
80
1,657
1,477
Clerical staff
717
635
Middle management
490
453
3,855
3,271
602
676
Other line personnel
Supervisors
Specialists
Manual workers
737
623
Messengers, etc.
249
137
8,400
7,356
Total
Of the Group's average headcount in 2008, 3,597 had temporary employment contracts (2007: 2,943 employees).
At 31 December 2008, there were 8,299 employees, of whom 7,393 were men and 906 were women.
Depreciation and amortisation charge and provisionsThe breakdown of “Depreciation and Amortisation Charge and Provisions” in the 2008 and 2007 consolidated income
statements is as follows:
Thousands of Euros
Property, plant and equipment
depreciation charge (Note 9)
Intangible asset amortisation
charge (Note 8)
2008
2007
42,256
38,057
488
309
Changes in provisions and impairment losses
32,291
32,056
Total
75,035
70,422
In 2008 “Change in Provisions and Impairment Losses” relates basically to the recognition of warranty provisions in connection
with production and operation of the solar energy plants that the ELECNOR Group delivered in 2008 (see Note 16).
ANNUAL REPORT 2008
137
Finance incomeThe breakdown of “Finance Income” in the 2008 and 2007 consolidated income statements is as follows:
Thousands of Euros
2008
2007
Income from other marketable securities and loans
to third parties
4,887
4,293
Other finance and similar income
6,410
2,404
11,297
6,697
Total
Finance costs-
The breakdown of “Finance Costs” in the 2008 and 2007 consolidated income statements is as follows:
Thousands of Euros
Borrowing costs (*) (Note 14)
2008
2007
40,682
38,484
476
253
41,158
38,737
Other finance costs
(*) Arising mainly from wind farm project finance arrangements, Elecnor, S.A.’s syndicated loans and the interest rate swaps.
22. INTERESTS IN JOINT VENTURES - “UNINCORPORATED JOINT VENTURES”
As indicated in Note 2-a, in 2008 and 2007 the balance sheets and the income statements of the unincorporated joint ventures
in which Elecnor, S.A. or its subsidiaries hold interests were proportionately consolidated in the accompanying consolidated
financial statements, in accordance with IAS 31.
The detail of the unincorporated joint ventures, of the Group’s percentage of ownership therein at 31 December 2008 and
2007, of the amount of the construction work performed in 2008 and 2007 and of the backlog at year-end is included in
Appendix II to these consolidated financial statements.
The detail of the contribution of the unincorporated joint ventures to the various items in the accompanying consolidated
balance sheet and consolidated income statement at 31 December 2008 and 2007 is as follows:
Thousands of Euros
ASSETS
Intangible assets
Property, plant and equipment
Non-current financial assets
Inventories
Accounts receivable
Current financial assets
Cash
Accrual accounts
Total
2008
2007
5
7
114
1,468
36
25
2,114
25,990
78,723
54,933
1,729
5,000
22,505
10,646
52
94
105,278
98,163
Thousands of Euros
LIABILITIES
2008
2007
Profit (Loss) for the year
2,700
(1,092)
Non-current liabilities
-
87
Current liabilities
102,578
99,168
Total
105,278
98,163
Thousands of Euros
Income Statement
Revenue
Changes in inventories of finished goods
and work in progress
Procurements
Sundry income
Staff costs
2008
2007
76,414
67,398
44
6,033
(68,710)
(66,262)
164
719
(437)
(998)
(5,394)
(7,840)
Taxes other than income tax
(609)
(224)
Impairments losses and change in
operating allowances
698
-
Depreciation and amortisation charge
(36)
(117)
Outside services
Finance income
751
600
Finance costs
(185)
(401)
2,700
(1,092)
Total
23. BACKLOG
The breakdown, by line of business, of the backlog of the Parent, excluding the unincorporated joint ventures (see Note 22),
at 31 December 2008 and 2007 is as follows:
Thousands of Euros
By Geographical Area
2008
2007
Spain
434,505
430,146
Abroad
415,430
366,936
Total
849,935
797,082
Electricity
560,307
459,162
Facilities
28,455
83,526
Gas
30,456
14,994
Telecommunications and systems
66,873
42,488
Railways
59,265
28,017
Construction and water
53,763
66,360
5,994
2,899
By Line of Business
Maintenance
Renewable energy and industry
Total
44,822
99,636
849,935
797,082
Also, at 31 December 2008, the backlog of the subsidiaries amounted to EUR 103,323 thousand (2007: EUR 257,969 thousand)
and related basically to companies in the electricity industry.
24. REMUNERATION OF DIRECTORS
a) Remuneration and other benefits of directorsIn 2008 the members of the Parent’s Board of Directors earned remuneration amounting to EUR 4,722 thousand in all
connections, including that earned in their capacity as executives (2007: EUR 4,478 thousand).
The Parent paid approximately EUR 16.4 thousand, in connection with life insurance arranged for former or current members
of the Board of Directors.
ANNUAL REPORT 2008
139
In addition, at 31 December 2008, the Parent did not have any pension or guarantee obligations to former or current members
of the Board of Directors and no loans had been granted to them.
At 31 December 2008 and 2007, the Board of Directors of the Parent was made up of eleven members, all men.
b) Detail of investments in companies engaging in similar activities and of the performance, by the directors, as independent professionals or as employees, of similar activitiesPursuant to Article 127 ter.4 of the Spanish Companies Law, introduced by Law 26/2003, of 17 July, which amends Securities
Market Law 24/1988, of 28 July, and the Consolidated Spanish Companies Law, in order to reinforce the transparency of listed
corporations, following is a detail of the non-Group companies engaging in an activity that is identical, similar or complementary
to the activity that constitutes the company object of Elecnor S.A. in which the members of the Board of Directors hold
ownership interests, either directly or through related companies, and of the functions, if any, that they discharge thereat:
Owner
Investee
Line of Business
Ownership
Interest
Functions
Guillermo Barandiarán Alday
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
13.14%
-
Gonzalo Cervera Earle
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
1.88%
-
José María Prado García
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
2.189%
-
Cristóbal González de Aguilar Enrile
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
12.13%
-
Fernando León Domecq
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
1.89%
(*)
Juan Landecho Sarabia
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
0.50%
(*)
Rafael Prado Aranguren
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
0.42%
-
Miguel Morenés Giles
Ingeniería Estudios y Proyectos Nip, S.A.
Engineering
1.12%
-
(*) Representatives on the Boards of Directors of companies related to them.
In addition, the directors of the Parent represent it as directors of most of the Group companies.
Since 17 July 2003, the date on which Law 26/2003 came into force, the former and current members of the Board of Directors
have not performed and are not currently performing, as independent professionals or as employees outside the corporate
Group to which Elecnor, S.A. belongs, any activity that is identical, similar or complementary to the activity that constitutes the
company object of the Parent, other than the activities indicated in the foregoing table.
25. REMUNERATION OF SENIOR EXECUTIVES
Staff costs (monetary remuneration, compensation in kind, social security contributions, etc.) relating to the Parent's General
Managers and persons discharging similar duties (excluding those who are also members of the Board of Directors, whose
remuneration is detailed above) amounted to approximately EUR 1,979 thousand in 2008 (2007: EUR 1,987 thousand).
In 2008 and 2007 there were no other transactions with executives outside the normal course of business.
At 31 December 2008 and 2007, all the Parent’s General Managers were men.
26. BALANCES AND TRANSACTIONS WITH RELATED PARTIES
All material balances between consolidated companies at year-end and the effects of the transactions performed between
them during the year were eliminated on consolidation (see Note 2-f).
The transactions carried out by the Group with the investees that were not fully or proportionately consolidated in 2008
were not material.
At 31 December 2008 and 2007, the breakdown of the balances receivable from and payable to these investees, arising from
the aforementioned transactions, and of the balances with other related companies is as follows:
2008 in Thousands of Euros
Accounts Receivable
2007 in Thousands of Euros
Accounts Receivable
Non-Current
(Note 11)
Current
Accounts
Payable
Non-Current
(Note 11)
Vila Do Conde Transmissora de Energia, S.A.
-
34
-
-
103
-
Porto Primavera Transmissora de Energía, S.A.
-
17
-
-
127
-
Poços da Caldas Transmissora de Energia, S.A.
-
363
-
-
-
-
Itumbiara Transmissora de Energía, S.A.
-
152
-
-
500
-
Serra da Mesa Transmissora de Energia, S.A.
-
263
-
-
295
1,864
Cachoeira Paulista Transmissora de Energía, S.A.
-
-
-
-
-
-
Riberao Preto Transmissora de Energia, S.A.
-
97
26
-
-
-
Eólica La Bandera, S.L.
-
7
-
-
5
-
Eólica Cabanillas, S.L.
-
12
-
-
12
-
25
-
2
-
Current
Accounts
Payable
Equity method
Eólica Caparroso, S.L.
Eólica Montes del Cierzo, S.L. (Note 11)
870
14
-
808
17
-
Parque Eólico Malpica, S.A.
350
-
-
349
-
-
Guadalaviar Consorcio Eólico Alabe Enerfín, S.A.
-
808
-
-
-
-
Cosemel Ingeniería, A.I.E.
-
21
(3)
-
42
-
LT Triangulo, S.A.
-
709
-
-
366
-
Consorcio Eólico Marino Cabo de Trafalgar, S.L.
-
217
-
-
232
Other companies:
-
-
Deimos Engenharia, S.A.
-
306
346
-
623
568
Enertel, S.A. de C.V.
-
11
52
-
5
212
Electrade Investments, Ltda. (Note 11)
-
-
12
-
-
-
Consorcio Elecnor-Atersa
-
1
-
-
1
-
Deimos Aplicaciones Tecnológicas, S.L.
-
-
-
-
-
-
Empresa General de Instalaçoes Eléctricas, S.A.
-
49
63
-
55
45
Elecen, S.A. de C.V.
-
115
-
-
21
-
Atersa América, S.A.
-
127
-
-
123
-
Consorcio Elecnor - Elecen
-
-
-
-
-
-
Helios Inversión y Promoción Solar, S.L.U.
-
-
-
-
-
13
Elecnor Perú, S.A.
-
-
-
-
33
-
Ace Omninstal - Elecnor
-
100
6
-
100
6
Jauru Transmissora de Energia, S.A.
-
199
-
-
34
-
Cantiles XXI, S.L. (Note 13)
-
-
2,481
-
-
2,060
Internacional de Desarrollo de Energía, S.A.
-
-
-
-
-
-
Ehisa Construcciones y Obras, S.A.
Centro Logístico Huerta del Peñón, S.L.
Deimos Imaging, S.L.
-
-
-
-
-
-
157
7
-
186
28
-
-
-
-
-
-
-
1,377
3,654
2,983
1,343
2,724
4,768
27. AUDITORS' FEES
The fees for financial audit services provided to the various companies composing the ELECNOR Group and subsidiaries by
the principal auditor in Spain and abroad and by other Spanish entities related to the auditor during 2008 and 2007 amounted
to approximately EUR 409 thousand and EUR 249 thousand, respectively. Also, the audit fees charged by other auditors
participating in the audit of the various Group companies totalled approximately EUR 152 thousand and EUR 347 thousand,
respectively.
ANNUAL REPORT 2008
141
Also, other services were provided by the principal auditor the fees for which amounted to approximately EUR 142 thousand.
The fees for other professional services provided by the principal auditor and by other entities related to the principal auditor
in 2007 amounted to EUR 23 thousand.
28. EARNINGS PER SHARE
The basic earnings per share in 2008 and 2007 were as follows:
2008
Net attributable profit (thousands of euros)
93,593
2007
73,554
Total number of shares outstanding
90,000,000
45,000,000
Less - Treasury shares (Note 13)
(3,689,927)
(1,688,795)
Average number of shares outstanding
86,310,073
43,311,205
1.08
1.70
Basic earnings per share (euros)
At 31 December 2008 and 2007, Elecnor, S.A., the Parent of the ELECNOR Group, had not issued any financial instruments or
the like that entitle the holder to receive ordinary shares of the Company. Consequently, diluted earnings per share coincide
with basic earnings per share.
29. INFORMATION ON THE ENVIRONMENT
In view of the importance of respect for the environment to maintaining and improving the standard of living of present
and future generations, management of the Parent has been implementing best environmental practices based on compliance
with environmental legislation. With the entry into force of the UNE-EN ISO 14001 standard in 1996, the Group has incorporated
environmental management into the conduct of business of the Group, with a commitment to continuously reduce the
environmental impact of our products/services and production processes.
The expenses incurred by the Group in 2008 in connection with environmental activities were not material.
The main measures taken by the Group at its facilities and in its business activities were as follows:
Environmental management
The Group consolidated the implementation of the environmental management systems, retaining certification under the
AENOR UNE-EN ISO 14001: 2004 standard for each of the following business divisions:
• Power and Railways (GA-2000/0294)
• Power transmission (GA-2000/0295)
• North (GA-2002/0183)
• East (GA-2002/0225)
• Centre (GA-2003/0220)
• Construction and Environment (GA-2004/0030)
• Northeast (GA-2004/0031)
• South (GA-2004/0273)
Environmental activities
In 2008 various measures were taken to reduce noise pollution, minimise waste and improve its management, reduce the
consumption of paper and increase the use of recycled paper at the offices and warehouses of the various ELECNOR Group
companies, all of which has led to respect and utmost care for the environment in relation to all the business activities carried on.
Environmental contingencies
The Parent's directors consider that the environmental contingencies that might arise are sufficiently covered by the thirdparty liability insurance policies that it has taken out and the provisions recognised in this connection.
Appendix I: Detail of equity investments in 2008
Thousands of Euros
Location
Line of Business
Percentage
of Direct
and Indirect
Ownership
Carrying
Amount
Sharel
Capital
Reserves
Net Profit
(Loss) for
2008 (**)
NON-CURRENT FINANCIAL ASSETS
Investees of Elecnor, S.A.Empresa General de Instalaçoes Eléctricas, S.A.
Portugal
Inactive
100%
546
560
42
-
Electrificaciones del Norte, S.A.
Madrid
Inactive
100%
60
60
27
1
Elecred Servicios, S.A.
Madrid
Reading and registering of meters
100%
60
60
13
1
Elecdal, U.R.L. (***)
Algeria
100%
12
10
-
-
Isonor Transmisión S.A.C. (***)
Peru
Construction and assembly work
50%
-
-
Enertel, S.A. de C.V.
Mexico
Construction and assembly work
99.99%
-
42
(3)
-
Eólica de la Patagonia, S.A.
Argentina
Operation and maintenance
of wind farms
50%
-
35
(1)
-
Abecnor Subestaciones, S.A. de C.V.
Mexico
Construction and assembly work
50%
-
4
(1)
-
Subestaciones 410, S.A. de C.V.
Mexico
Construction and assembly work
33.33%
-
4
-
-
1,644
3,320
Elecnor, Inc.
US
Inactive
100%
-
68
(59)
(2)
Lineas Baja California, S.A. de C.V.
Mexico
Construction and assembly work
50%
-
4
(1)
-
Centro Logístico Huerta del Peñón, S.L.
Marbella
Operation and maintenance of
waste treatment and disposal plants
20%
1
3
154
(58)
Construction and assembly work
50%
-
4
-
-
Líneas Altamira, S.A. de C.V.
Mexico
Parque Eólico El Goro-Telde, S.L.
Las Palmas de
Gran Canaria Generation of wind energy
80%
3
(3)
-
Elecnor Perú, S.A.
Peru
Construction and assembly work
100%
-
108
(108)
(12)
Consorcio Elecnor - Atersa
Madrid
Solar energy
100%
5
4
2
-
Elecnor Centroamericana, S.A. de C.V.
Honduras
Construction and assembly work
49%
-
6
-
369
Venezuela
Inactive
100%
12
-
67
Chile
Operation of power plants
5.26%
4,733
Chantada
(Lugo)
Biomass under development
14.27%
-
56
-
-
902
429
-
481
888
Investees of Corporación Electrade, S.A.Electrade Investment, Ltda.
718,557
Investees of Elecnor Chile, S.A.Iberoamericana de Energía Ibener, S.A. (*)
142,506
(7,672)
8,678
Investees of Enerfín Sociedad de Energía, S.A.
Ecobi Uno, S.L.
Investees of Elecnor Financiera, S.L.Parc Eolic Baix Ebre, S.A.
Tarragona
Construction and subsequent
operation of wind farms
25.3%
446
Sociedad Eólica Los Lances, S.A.
Seville
Construction and subsequent
operation of wind farms
10%
618
Construction and subsequent
operation of wind farms
6.70%
Sociedad Eólica de Andalucía, S.A.
Seville
1,200
2,404
4,508
5,303
533
Investees of Elecnor Transmissao de Energía, S.A.
Pedras Transmissora de Energia, Ltda. (***)
Brazil
Operation of public service
concessions for electricity transmission
33.33%
89
-
-
-
Coqueiros Transmissora de Energia, Ltda. (***)
Brazil
Operation of public service
concessions for electricity transmission
33.33%
329
697
-
-
Brilhante Transmissora de Energia, Ltda. (***)
Brazil
Operation of public service concessions
for electricity transmission
33.33%
-
-
-
-
Development, construction and
operation of solar PV farms
4
4
(1)
-
Investees of Helios Inversión y Promoción Solar, S.L.U.
Siberia Solar, S.L. (***)
Madrid
70%
ANNUAL REPORT 2008
143
Thousands of Euros
Location
Line of Business
Percentage
of Direct
and Indirect
Ownership
Carrying
Amount
Sharel
Capital
Reserves
Net Profit
(Loss) for
2008 (**)
Zinertia Renovables, S.L. (***)
Madrid
Development, construction and
operation of solar PV farms
40%
160
400
-
(222)
Fotovoltaica La Fernandina, S.L. (***)
Badajoz
Development, construction and
operation of solar PV farms
70%
3
4
-
(12)
Mexico
Construction and assembly work
98%
-
3
-
-
Peru
Operation of public service concessions
for electricity transmission
50%
-
3,319
-
-
Investees of Zogu, S.A.
Pidirelys, S.A. de C.V.
Investees of Isonor Transmisión, S.A.C.
Caraveli Cotaruse Transmisora de Energía, S.A.C.
9,922
(*) Audited by PriceWaterhouseCoopers.
(**) Including the interim dividend.
(***) Companies incorporated in 2008.
Detail of equity investments in 2007
Thousands of Euros
Location
Line of Business
Percentage
of Direct
and Indirect
Ownership
Carrying
Amount
Sharel
Capital
Reserves
Net Profit
(Loss) for
2008 (**)
NON-CURRENT FINANCIAL ASSETS
Investees of Elecnor, S.A.Empresa General de Instalaçoes Eléctricas, S.A.
Portugal
Inactive
100%
547
560
36
-
Electrificaciones del Norte, S.A.
Madrid
Inactive
100%
60
60
17
10
Elecred Servicios, S.A.
Madrid
Reading and registering of meters
100%
60
60
3
10
Enertel, S.A. de C.V.
Mexico
Construction and assembly work
100%
40
42
(7)
4
Helios Inversión y Promoción Solar, S.L.U. (***)
Madrid
Solar energy
100%
60
Eólica de la Patagonia, S.A.
Argentina
Operation and maintenance
of wind farms
50%
18
229
(193)
(1)
Abecnor Subestaciones, S.A. de C.V.
Mexico
Construction and assembly work
50%
4
4
-
-
Subestaciones 410, S.A. de C.V.
Mexico
Construction and assembly work
33.33%
3
4
-
-
Elecnor, Inc.
US
Inactive
100%
9
65
(54)
2
Lineas Baja California, S.A. de C.V.
Mexico
Construction and assembly work
50%
3
4
(1)
-
Centro Logístico Huerta del Peñón, S.L.
Marbella
Operation and maintenance of
waste treatment and disposal plants
20%
1
3
145
(28)
Construction and assembly work
Líneas Altamira, S.A. de C.V.
Mexico
50%
1
4
-
-
Parque Eólico El Goro-Telde, S.L.
Las Palmas de
Gran Canaria Generation of wind energy
80%
2
3
(2)
-
Jauru Transmissora de Energía, Ltda..
Rio de Janeiro
(Brazil)
Construction and assembly work
100%
357
385
-
-
Madrid
Solar energy
100%
5
4
3
-
Venezuela
Inactive
100%
11
10
13
50
Chile
Operation of power plants
5.26%
5,831
14.27%
8
Consorcio Elecnor - Atersa
Investees of Corporación Electrade, S.A.Electrade Investment, Ltda.
Investees of Elecnor Chile, S.A.Iberoamericana de Energía Ibener, S.A. (*)
163,139
(16,287)
Investees of Enerfín Sociedad de Energía, S.A.
Ecobi Uno, S.L.
Chantada (Lugo) Biomass under development
56
-
6,834
Thousands of Euros
Location
Percentage
of Direct
and Indirect
Ownership
Carrying
Amount
Construction and subsequent
operation of wind farms
25.3%
415
902
463
216
Construction and subsequent
operation of wind farms
10%
591
2,404
432
567
Construction and subsequent
operation of wind farms
6.70%
1,157
4,508
3,476
1,826
Line of Business
Net Profit
(Loss) for
Reserves 2008 (**)Investees of
Sharel
Capital
Elecnor Financiera, S.L.Parc Eolic Baix Ebre, S.A.
Sociedad Eólica Los Lances, S.A.
Sociedad Eólica de Andalucía, S.A.
Tarragona
Seville
Seville
9,183
(*) Audited by PriceWaterhouseCoopers.
(**) Including the interim dividend.
(***) Companies incorporated in 2007
Appendix II: List of consolidated UTEs
Thousands of Euros
Percentage of
Unincorporated Joint Venture (UTE) Ownership
UTE Elecnor Nip IV
50.00%
Construction
Work Executed
in 2008
(7)
Backlog
-
Construction
Work Executed
in 2007
Backlog
587
1,624
UTE Guinelec
50.00%
-
-
37
-
UTE Elecnor Llanera SUP5
50.00%
485
-
1,077
-
UTE Mantenimiento AT Barajas
70.00%
2,996
1,557
2,517
-
Optifibra Consortium
28.00%
-
-
81
-
UTE Eurocat AV
22.00%
3,383
2,035
2,794
4,417
UTE Eurosub-2 AVE
22.00%
614
143
668
757
UTE Bartolomé Ramón Elecnor
50.00%
-
9
232
9
UTE Bidebi
50.00%
243
-
3,082
707
UTE Comsa Elecnor
30.00%
387
2,374
8,642
2,661
UTE El Portal Catenaria
50.00%
-
-
2,069
-
UTE Instalaciones1 Aeropuerto de Málaga 33.34%
5,821
437
2,223
4,171
UTE Estaciones Base E-GSM
50.00%
2,020
100
819
180
UTE Gavelec
50.00%
2,484
-
973
1,946
UTE Puente Mayorga
50.00%
1,097
-
-
776
UTE Vestibul Fira
58.28%
1,173
-
3,439
-
UTE Castenor III
50.00%
80
220
1,058
299
UTE Cenat Copcisa Elecnor
50.00%
9,144
12,261
1,454
18,905
UTE Terciario Guadalorce
UTE EDAR Calamocha
UTE JNG –Elecnor
60.00%
6,995
1,207
-
6,000
100.00%
231
20
264
155
50.00%
-
8
-
8
UTE EPCE
40.00%
-
88,650
675
88,650
UTE Control Aparcamiento
50.00%
1,484
1,913
936
3,398
UTE Hacienda-ETB
50.00%
68
-
3,047
21
UTE Proyecto Aranjuez
50.00%
7,988
-
3,166
7,988
UTE 11 Walqa
50.00%
-
-
2,747
-
UTE Edificio Hidrógeno
50.00%
340
-
824
244
UTE Auditorio Torrevieja
10.00%
6,491
12,348
2,246
18,839
ANNUAL REPORT 2008
145
Thousands of Euros
Percentage of
Unincorporated Joint Venture (UTE) Ownership
Construction
Work Executed
in 2008
Backlog
Construction
Work Executed
in 2007
Backlog
UTE Águilas
20.00%
25
2,439
212
2,463
UTE ParqueSur Ocio
90.00%
-
-
4,702
-
100.00%
86
-
-
86
UTE Instalaciones Palacio Real
UTE Sincotron
50.00%
118
6,675
-
6,792
UTE Enertranvi
34.00%
5,848
2,513
-
8,360
UTE Elecnor Dominion
50.00%
1,816
802
9,182
2,618
UTE Gost – Elecnor
50.00%
285
165
287
265
UTE Abast. Eje Villalba-Valdemorillo
80.00%
472
78
1,164
549
UTE Campo Arañuelo
50.00%
4,404
-
838
13,528
UTE China Exhibition Center
34.50%
1,610
711
8,139
2,322
UTE Centrales
50.00%
-
-
-
-
UTE China International
34.50%
1,902
-
8,556
3,244
UTE Palacio de Congresos de Avila
50.00%
638
487
95
1,125
UTE Eje de pista 33L/15R
50.00%
936
-
-
936
UTE Deinor
80.00%
917
100
279
842
UTE Zona 07 A
60.00%
3,652
17,771
468
21,423
UTE Edifici Conei
50.00%
1,424
626
-
1,950
UTE Muvium
30.00%
-
3,189
-
3,189
UTE Inelcy
33.34%
2,466
91
2,681
2,533
UTE Instalaciones Túnel
33.33%
276
-
122
-
UTE Elecnor – Pastor
50.00%
455
1,737
82
2,192
UTE Portusan
50.00%
802
382
-
1,374
UTE Tsa-Elecnor-Floria
22.44%
5,693
952
200
6,645
UTE Guimorcondo
33.00%
848
180
-
1,028
UTE Ibarbengoa
50.00%
10
1,830
-
1,840
UTE Rota High School
50.00%
3,700
11,926
-
15,626
UTE ASPE I
50.00%
-
-
-
-
UTE Alcañiz
100.00%
297
701
-
999
40.00%
482
2,022
-
-
UTE Remodelació Sotscentrals L3
UTE Montesol – Elecnor
50.00%
1,740
238
-
-
UTE Elecnor Osepsa
50.00%
1,050
5,562
-
-
UTE Can Colomer
50.00%
-
17,429
-
-
UTE Tecnocontrol – Elecnor
50.00%
792
1,562
-
-
UTE Villasequilla – Villacañas
21.00%
8,665
28,621
-
-
UTE Mingorria
25.00%
-
3,622
-
-
UTE Elecnor Planinter T.Sur Barcelona
75.00%
2,500
6,529
-
-
UTE Campus Justicia
50.00%
-
26,116
-
-
UTE Centro Convenciones Port Aventura
50.00%
-
5,148
-
-
UTE Avele
22.00%
3,575
94,319
-
-
UTE Avele 2
22.00%
1,711
73,881
-
-
UTE Mt Celt Barajas
60.00%
-
652
-
-
UTE Cobrelec II
50.00%
39
1,037
-
-
UTE Catenaria L6
25.00%
540
15,208
-
-
UTE Elecnor – Montreal
50.00%
-
47,173
-
-
UTE Elecnor – Horinsa
50.00%
-
1,849
-
-
Thousands of Euros
Percentage of
Unincorporated Joint Venture (UTE) Ownership
Construction
Work Executed
in 2008
Backlog
Construction
Work Executed
in 2007
Backlog
UTE Catenaria Albacete
50.00%
2,941
1,766
-
-
UTE Elecnor – Deimos
50.00%
-
380
-
-
UTE Sangiao-Elecnor
50.00%
-
-
185
-
UTE Eurosub-AVE
23.00%
-
-
-
573
UTE Eurocat Ave II
23.00%
240
-
273
200
UTE IES Sant Joan
25.00%
-
103
368
102
UTE Panasfalto-Elecnor-Moli Magallo
40.00%
-
-
-
-
UTE Semelco Sub
33.33%
-
158
-
158
UTE Elecnor-Secopsa C.S. Aldaia
50.00%
-
36
-
36
UTE Aeropuerto del Prat-Soclenor
33.33%
3
-
10,318
-
UTE Hormigones Mtz-Elecnor
Casco Antiguo
30.00%
135
10
1,555
22
UTE Urbanizadora Riodel
50.00%
851
383
4,754
1,234
UTE Efluentes Aeronaves
50.00%
1,122
90
-
906
UTE Overtal Elecnor
24.00%
-
360
-
308
UTE S´olivera Comasa Elecnor
33.33%
-
156
-
156
UTE Ibercat
27.50%
8,141
1,916
15,699
7,500
UTE Energía Línea 9
20.00%
21,008
106,414
504
127,422
UTE Aguaelecnor
20.00%
-
103
-
104
UTE La Girada II
50.00%
-
-
(128)
-
UTE Traslado Subest. Oviedo
50.00%
-
-
-
93
5.26%
-
-
-
-
UTE Mantenimiento Metro
UTE ELCOEL
40.00%
-
-
-
-
Efacec – Elecnor Consortium
50.00%
-
-
-
-
UTE Valtierra
100.00%
-
-
14
-
UTE Sector UBZ-7
50.00%
-
6,000
17
5
UTE Sampol-Elecnor
50.00%
-
-
-
-
Elecven – Elecnor Consortium
100.00%
345
-
17
-
UTE Injar-Elecnor
50.00%
-
-
-
-
UTE Macias Picavea
20.00%
778
163
388
941
UTE Edar Noia
50.00%
456
-
75
446
UTE Urbanización y 12 viviendas luz
50.00%
20
343
1,371
182
UTE Remolar
23.51%
28,365
63,621
2,797
55,986
UTE Elecnor-Teconsa
50.00%
-
323
1,750
323
UTE Noriega Elecnor
50.00%
-
-
820
-
UTE Cal Paracuellos
50.00%
61
3,555
-
3,616
UTE I. Marina
50.00%
-
-
-
-
UTE Ortiz - Elecnor - Tecma
40.00%
-
-
-
6
UTE CP3
50.00%
-
-
-
-
UTE Semelcosur
28.50%
14,040
4,338
20,749
6,400
UTE Elecnor Nip III
50.00%
449
400
371
10
UTE Pitis Pinar
66.66%
-
-
-
-
UTE Elec-Int. Levante la Asegurada
40.00%
1,891
1,871
2,116
3,762
UTE AG Urb 13
50.00%
-
3,979
-
3,979
UTE Elecnor Semi
50.00%
1,209
10,183
(7)
11,392
UTE San Vicente
33.33%
33
-
199
33
ANNUAL REPORT 2008
147
Thousands of Euros
Percentage of
Unincorporated Joint Venture (UTE) Ownership
Construction
Work Executed
in 2008
Backlog
Construction
Work Executed
in 2007
Backlog
UTE Subestación Pajares
50.00%
-
-
3
7
UTE Ripoll
20.00%
3,416
817
2,551
3,854
UTE Serrano Elecnor Cansalades
40.00%
55
124
57
124
UTE Plancel Castellón
50.00%
-
-
223
-
UTE Elecnor Gonzalez Soto
50.00%
-
508
441
508
UTE Cymiel II
50.00%
-
-
8
-
Semelco Group
33.33%
2,360
-
-
450
UTE Remodelación Aeropuerto de Málaga 55.00%
3,630
773
17,730
1,319
UTE Cobra - Elecnor – Inabensa
33.33%
-
-
436
-
UTE Installacions Eix Central
54.48%
122
-
28
-
UTE Set Cortadura
50.00%
684
-
2,468
358
UTE Terminal Alicante
20.00%
56,329
98,664
34,938
154,992
UTE Installacions Fase V
25.00%
1,065
-
5,117
912
UTE Euroasce Mantenimiento
22.50%
-
-
-
-
UTE Ripoll y Manlleu
25.00%
-
2
1,387
2
UTE Líneas Manantali
25.00%
-
-
-
-
UTE Urb S01-S11 Paracuellos
33.33%
-
57
642
57
UTE Villagonzalo Z-3
35.00%
642
-
1,090
30
UTE Llanera Elecnor Sector Tullel
50.00%
74
600
12,889
600
UTE Taraguilla
25.00%
253
498
301
750
UTE Comasa-Elecnor
50.00%
-
-
-
-
UTE Quinto
60.00%
34
143
3,902
-
UTE Solana
50.00%
-
6,665
-
6,665
UTE Venta Alta
65.00%
2,489
658
-
2,535
UTE Larrate
50.00%
-
1,073
-
-
UTE Las Torcas
50.00%
753
58
781
609
UTE Escatron
50.00%
681
345
103
1,025
UTE Loscos
50.00%
254
929
-
-
UTE Binaced
50.00%
80
4,068
-
-
UTE Blanco Elecnor
50.00%
526
47
166
51
UTE Atersa Socoin
89.05%
191
-
2,917
2,063
30. EXPLANATION ADDED FOR TRANSLATION TO ENGLISH
These consolidated financial statements are presented on the basis of IFRSs as adopted by the European Union. Certain
accounting practices applied by the Group that conform with IFRSs may not conform with other generally accepted accounting
principles.
Management
Report | 2008
ELECNOR GROUP
MANAGEMENT REPORT
DIRECTORS’ REPORT FOR THE YEAR ENDED 31 DECEMBER 2008
The years of significant growth that have characterised the present economic cycle have led us into a deep banking and
financial market crisis, culminating in a serious economic recession worldwide.
To understand these events, we have to go back to 2001. Another bubble, the dotcom bubble, had burst, and investments
became focused on property securities, flooding the liquidity markets as a result of the extremely low interest-rate policy. That
was the origin of the subprime mortgage system (high-risk floating rate mortgage loans granted to financially disadvantaged
families). Furthermore, those mortgages and other loans were pooled through a process known as securitisation, and sold to
investors across the globe in order to diversify the risks. Meanwhile, banks, through subsidiaries, decided to create special
investment funds with which to buy these junk bonds, which therefore disappeared from their balance sheets.
Consequently, in 2004, the US Federal Reserve began to raise interest rates, but only very gradually. It was only at the end of
2006 that the combination of higher interest rates and the end of the grace period on many mortgages began to affect those
who had arranged subprime loans. The Federal Reserve and other Western central banks responded to this by injecting more
liquidity into the economy.
The first clear signs of the end of the world economy’s 2001-2007 growth cycle came in mid-June 2007. Financial turmoil
erupted suddenly, causing a retraction of global liquidity. This unleashed tension on the interbank markets, which increased
their interest rates (Libor, Euribor). In the face of these events, the European Central Bank and the Federal Reserve reacted by
injecting liquidity into the market and consecutive slumps were triggered across the various markets from mid-2008 onwards.
Against the backdrop of a worldwide economic downturn, inflationary pressures were considerably reduced due to the drop
in commodity prices, particularly the sharp fall in oil prices, and the worldwide downturn itself.
To mitigate the lack of liquidity on the markets, and taking into account the low risk of incurring high levels of inflation, the
financial authorities relaxed the monetary policy. In this regard, the Federal Reserve maintained interest rates at 0 to 0.25% at
the end of the year. This measure was seconded by Japan, which lowered the interest rates to 0.1%. Also, the European Central
Bank pegged its interest rates at 2.5% at the end of 2008, and cut them by half a point to 2% at the beginning of January
2009.
After two years of worldwide economic growth of approximately 5%, it was estimated to have stood at approximately 3.6%
in 2008.
The US managed to increase its GDP by 1.3%, the lowest level of growth of the world’s leading economic power since 2001.
The decrease in GDP in quarter four of 2008 together with the drop in quarter three of 2008, confirmed the technical recession.
Also, China reported economic growth of 9%, compared with 13% in 2007. This was the lowest rate since 2001 and it is the
first time since 2003 that double-digit growth has not been recorded. In addition, India grew by approximately 7%, significantly
lower than the rate in 2007 (9.2%).
Meanwhile, the emerging economies in Latin America are witnessing how the world economic crisis is filtering through the
international trade channels, the decrease in flows of direct foreign investment, the short-term outflow of capital and the
contraction of remittances from overseas workers.
During the last quarter of 2008, there was a U-turn in the macroeconomic outlook in the Eurozone, where the focus of
concern shifted from inflation to the uncertain economic growth. This sharp turn in the outlook gave rise to a reaction by the
common monetary policy, which cut the benchmark interest rate by 1.75 basis points in the last quarter of 2008, and by the
national taxation policies, which design plans to recover and support domestic demand. In the last two quarters of 2008, there
was a slowdown in growth in both the French and German economies and annual rates stood at 0.8% and 1.3%, respectively.
The Spanish economy entered into crisis suddenly and a period of stagnation that could last several quarters is anticipated.
The combination of the domestic property bubble and the international banking crisis has proved the determining factor. The
nature and intensity of falling consumption and property business activity suggests that we are facing the breakdown of the
growth model. Contraction of business activity is being compounded by the credit crunch arising from the liquidity squeeze
and the unleveraging of the international financial system. The default scenarios of companies and households have led to
banks imposing even more stringent requirements when injecting liquidity into the markets.
In spite of the above scenario, the Spanish economy was up 1.1% in 2008 with respect to 2007. However, there was a
slowdown in the last two quarters and, as a result, Spain has technically reached levels of economic recession.
Capital management policy
A fundamental part of the Elecnor Group’s strategy is to maintain a policy of financial prudence. The capital structure is
defined by the commitment to solvency and the objective of maximising shareholder returns.
Financial risk management policies
The Elecnor Group is exposed to certain financial risks that it manages by grouping together risk identification, measurement,
concentration limitation and supervision systems. The Elecnor Corporate Division and the various business units and subsidiaries
composing the Elecnor Group coordinate the management and limitation of financial risks. The financial risk management
activities are approved at the highest executive level, in accordance with the established rules, policies and procedures.
The first risk to be mitigated arises from the transactions that the Group performs on the international markets, namely
market risk due primarily to foreign currency risk. Certain of its revenues and procurement costs are denominated in US dollars,
or in a currency whose value is closely linked to that of the US dollar or which relates to an economy that is highly dependent
on the US dollar, although a variable portion of the expenses may be denominated in euros. Therefore, fluctuations in the
value of financial instruments denominated in currencies other than the euro as a result of foreign operations due to exchange
rate fluctuations could affect the Group's future earnings. In order to manage and minimise this risk, the Elecnor Group uses
hedging strategies, since its objective is to generate profits through its ordinary business, and not through speculation. The
instruments used to establish this hedging are basically debt tied to the currency in which collections under the related contract
are made, foreign currency hedges and swaps, through which the Elecnor Group and the bank exchange the flows relating to
a loan denominated in that currency. The Group performs periodic sensitivity analyses of the potential impact of changes in
the exchanges rates on its income statement.
Interest rate fluctuations change the fair value of assets and liabilities that bear interest at fixed rates and the future flows
from assets and liabilities tied to floating interest rates. The Elecnor Group has arranged borrowings mainly in connection with
the development, construction and subsequent operation of wind farms, which it does under a project financing arrangement.
Under financing of this nature, in the case of wind farms located in Spain, interest rate risk must be hedged contractually
through the arrangement of interest rate hedging instruments. Borrowings are arranged nominally at a floating rate tied to
Euribor (eurozone) and US dollar Libor, using, where appropriate, hedging instruments to minimise the risk on long-term
financing. The hedging instruments, which are specifically assigned to debt instruments and are limited to the same nominal
value as the latter and the same maturity dates as the hedged items, relate basically to IRSs, the aim of which is to convert
loans originally arranged at floating rates to fixed rates.
Also, liquidity risk is mitigated by holding cash and highly liquid non-speculative short-term instruments, such as Treasury
bills under non-optional reverse repurchase agreement and very short-term deposits in dollars, through leading banks.
The Elecnor Group’s main credit risk is attributable to its trade receivables. To mitigate this risk, the Group has arranged a
credit insurance policy and it operates with customers with an appropriate credit track record. Also, as a result of the business
activities it carries on and the industries in which it operates, it has customers with very high creditworthiness. However, in the
case of international sales to non-recurring customers, mechanisms such as irrevocable letters of credit and insurance policies
are used to ensure collection. Also, the financial solvency of customers is analysed and specific terms and conditions are included
in contracts aimed at guaranteeing payment of the stipulated price.
An economic scenario such as the present one is considered an overriding risk with respect to other financial risks. In the face
of this situation, the Elecnor Group continues to maximise all the measures that are taken to mitigate it.
Net profit for 2008
Elecnor, S.A.’s revenue totalled EUR 1,468 million, which represented growth of 7.9% with respect to 2007. This growth was
upheld primarily by the revenue contributed by the construction of various solar PV farms in Spain. The volume obtained in
2008 in this market segment consolidated the 2007 figures, which in turn represented increases of 67% compared to 2006. It
ANNUAL REPORT 2008
151
should also be taken into account that a sizeable portion of the business in the foreign market is performed through subsidiaries,
with the aim of optimising local structures, close presence in the country, etc., thereby increasing the revenue of the Elecnor
Group to the detriment of the figure contributed by the Group’s Parent.
By geographical area, the domestic market monopolises 85.6% of the total revenue of Elecnor, S.A., whilst 14.4% is earned
abroad. The domestic market increased by 6.8% with respect to 2007, whilst the international market grew by 14.9%.
The Parent’s profit after tax amounted to EUR 49.7 million, up 27.6% with respect to 2007. These positive figures arose mainly
from the projects carried out by Elecnor S.A. abroad, the performance of Elecnor’s traditional lines of business, the obtainment
of important economies of scale through the business volume achieved and the completion of various PV projects. The dividends
received from the various subsidiaries were up from EUR 22.4 million to EUR 33.4 million in 2008, that is, an increase of 48.8%.
With regard to the consolidated aggregates, the Elecnor Group obtained revenue of EUR 1,911 million compared to EUR
1,650 million in 2007, a percentage increase of 15.8%. The reasons for this rise can be found in the PV market, represented by
the subsidiary Atersa (a strategic supplier of Elecnor, S.A.), for turnkey PV farm projects, and in the increased contribution of
companies managing the Group’s various wind farms.
The Elecnor Group’s profit after tax stood at EUR 93.6 million, that is, 27.2% more than in 2007. This significant growth lies
primarily in the contributions of the Group’s Parent, Elecnor, S.A., and the subsidiary Atersa. The Group’s wind power companies
also contributed to the increase in earnings thanks mainly to the rise in the sale price of this type of power.
Lastly, the Elecnor Group is continuing to equip itself with the resources required for the ongoing improvement of its
productivity levels and, accordingly, it invested EUR 13.1 million in the improvement and renewal of equipment; an increase of
2% with respect to 2007.
Outlook for 2009
The general economic climate is worrying. Following the financial collapse, 2009 is expected to be an extremely difficult year
for the economy as a whole and even worse than 2008. The International Monetary Fund (IMF) reviewed its projections for the
world economy, downscaling those made in November considerably since GDP and world trade deteriorated in the last few
months of 2008, and acute financial pressures have persisted which constitute a huge burden for the economy. According to
the IMF, world GDP will grow by approximately 0.5% in 2009, compared to 2.2% forecast in its previous report, but is expected
to recover in 2010 to 3%.
By country, US GDP will slow down 1.6% in 2009, displaying an upward trend, of 1.6%, again in 2010. A weaker picture is
painted for the eurozone, slowing down 2% in 2009 and going up only 0.2% in 2010.
Given the declining economic conditions, it appears that the US will maintain low interest rates over a long period of time.
Although a slight recovery is expected at the end of the year, it seems that all resources will be utilised to achieve the objective
of price stability. Despite the recession in Europe, the European Central Bank will peg its interest rates at 2%, at least until
March.
As far as the commodity markets are concerned, the price of crude oil is significantly lower than the prices we have been
used to in recent years. The price of Brent oil serves as an example, approximately USD 43 per barrel at the end of January.
However, OPEC warned that it will not let the price of crude oil continue to spiral downwards.
With respect to the currency market, it appears that the euro stabilised at the start of 2009 at approximately USD 1.3,
displaying a slight downward trend. A hypothetical recovery of the US economy at the end of 2009, against a foreseeably
longer period of stagnation in Europe, would foster the appreciation of the dollar against the euro.
If we focus on Spain, the crisis shows no sign of improvement in the short term since the country is too indebted,
competitiveness has fallen and fiscal pressure and salaries have soared. Certain factors help to understand the gravity of the
crisis: the rate of unemployment has shot up and an unemployment figure of four million in 2009 is not being ruled out. The
public surplus has become a deficit. In this context, the IMF’s last estimates for Spain project a slowdown in GDP of 1.7% for
2009 and 0.1% for 2010.
In the light of these projections, the experts are calling for an extensive programme of structural reforms to expedite the
end of the Spanish economic crisis from 2009. In general, they all agree on the need to make the economy and the job market
more flexible, to liberalise certain industries and markets and to increase competition in order to make the process of economic
reactivation more robust.
The Elecnor Group is facing this difficult scenario with the conviction that it is in a favourable position to meet the challenges
and opportunities presented by the current situation. The backlog totalling EUR 953 million represents a decline of 9.6% with
respect to the backlog at 31 December 2007. This is due primarily to the contraction of the PV market. By market, the backlog
on the domestic market amounts to EUR 466 million against EUR 487 million on the international market, which represent 49%
and 51% of the total, respectively.
As was the case in 2008, the majority of the work to be performed in 2009 on the international market is scheduled through
subsidiaries, with the aim of achieving significant synergies at structural, economic and fiscal level.
Also, in the context of the Spanish market, reference must be made to the new renewable energy regulatory framework,
and particularly the PV market regulatory framework, which has given rise to a considerable slowdown in investments in this
industry.
Consequently, both Elecnor, S.A. and the Elecnor Group face a difficult 2009 with sound reasons to consolidate the revenue
and profit aggregates obtained in 2008 and, therefore, reinforce their leadership in the infrastructure and energy project
development and management industry. It will also carry on its commitment to remain at the forefront of technology and
equipment.
Adaptation to the new Spanish National Chart of Accounts
On 1 January 2008 the new Spanish National Chart of Accounts came into force, applicable to all periods starting on or after
that date.
On 16 November 2007, the new Spanish National Chart of Accounts was approved through Royal Decree 1514/2007, which
was published in the Spanish Official State Gazette on 20 November 2007.
The companies composing the Elecnor Group with registered offices in Spain implemented the processes required to make
their financial statements compliant, analyse the main impacts and train their staff.
The most significant impacts on the Group’s Parent can be summarised by the following three items: recognition of gains on
treasury share transactions in equity and not in the income statement, recognition in the year earned of gains on the
measurement of assets and liabilities denominated in currencies other than the euro and recognition in equity of the fair value
of financial derivatives of cash flow hedges, such as foreign currency hedges and IRSs.
R&D&i
In 2008, the Elecnor Group continued to develop various projects with the aim of increasing the added value of its services.
It also stayed at the forefront of Information Technologies at all the organisational levels of the Group.
Project Management System (PMS)
In 2007 the Group began to develop an IT tool called Project Management System (“PMS”) to manage projects, bids, suppliers
and orders. It comprises a relational database and a document manager tailored to the Group’s requirements.
In 2008 the Group continued the analysis and development of this tool, with a gradual roll-out across all the offices of Elecnor,
S.A.
The aim of this tool is to create a database and a unique data model to be used as a work base on which to create future
applications independently. Also, two new applications continue to be developed and integrated which use the same
applications as those developed for the PMS, such as the Sales Management System and the Integrated Environmental, Quality
and Occupational Hazard Prevention Management System.
Innovation Committee
In response to the Strategic Plan approved in 2006, a top-level Innovation Committee reporting to Elecnor management was
created in 2007, its objectives being as follows:
• To review the progress of Elecnor’s innovation-related projects.
• To select challenges for innovation in the various businesses in line with the Strategic Plan.
• To establish the framework of the innovation management system and to monitor the strategy at Elecnor.
• To design a communication and implementation process for the innovation management system.
In 2008 the Group began to carry out the first innovation projects arising from the meetings of this committee.
ANNUAL REPORT 2008
153
nitiatives taken by Atersa
The following developments carried out by this subsidiary are particularly noteworthy:
• Datasol Local and USB-net: software for the acquisition of data from PV plants.
• METV30: high-precision and high-stability sensor for the measurement of solar radiation.
• LED streetlamps: new LED format, more efficient than fluorescents.
• TFT: software for the presentation of network connection and installation information.
• LEO 10: advanced load regulator for stand-alone PV facilities.
The following research initiatives are particularly noteworthy:
• Characterisation of LED luminaires, in collaboration with the Spanish Optics Colour Imaging Technological Institute (AIDO).
• Study on the quality of the electricity grid in PV facilities, in collaboration with the Institute of Electricity Technology (ITE).
• Studies in relation to the new triphasic technologies and new electronic components.
• Research in the field of new thin-film technologies.
Initiatives taken by Deimos Space:
Projects carried out under the VII Framework Programme of the EU
• Project SEMSORGRID, which aims to use ontologies and GRID computing applied to multi-node sensor networks deployed
in different environments, such as floods and fires.
Projects carried out under the National R&D Programmes
• The EGLOBE system aims to build a virtual world with geospatial information served and maintained by the suppliers of
the map bases: public institutions and private companies.
• Project VIRTUAL SPAIN emerged as a result of the above. It is the most ambitious R&D project undertaken at Deimos Space.
Its objective is to study, develop, mature and design the technologies, protocols, standards, architectures and, in general,
the bases that will afford a 3D interface for internet content and services.
• The four-year project will be carried out by a consortium of seven companies and approximately 10 prestigious Spanish
national research centres, and will be led by Deimos Space.
• The Group has also worked on the following projects in 2008 under the framework of the National Plans: BAIP2020,
SESAMO, MESEAS, CARING CARS, ENTASVE, PLAREN, GEMA, ALDEBARAN and OCEO.
Projects performed under the framework of Regional R&D Plans (IMADE)
• Under Project ALZPIE, Deimos Space has been able to acquire knowledge on the processing of medical MRIs.
• Project AUTOPIE researches the application of IEEE 802.11p-based protocol in the transport industry.
Initiatives taken by Cosinor
• Positioning and control of parabolic cylinders at solar plants: A controller was developed that implements a sun-position
algorithm for the parabolic cylinders at a solar plant, which is updated with the associated instruments.
• Cosinor has developed a system (HELIADA) which monitors the main operating variables of PV plants and aims to optimise
the operations and maintenance of the facilities and speed up the response to incidents.
• GPRS irrigation controls (SIGIREG): SIGIREG is an integrated irrigation control system which uses mobile communications
based on GPRS technology.
Initiatives taken by Hidroambiente
Hidroambiente carried out its technology innovation strategy by means of three projects:
• Processes of advanced catalytic oxidisation for waste water from gasification.
• New drinking-water flocculation systems, preventing the appearance of any acrylamides in the public water supply.
• Ballasted floc clarifier: improved recovery of ballasts and interaction with new families of flocculants.
Share capital
In accordance with the resolutions of the shareholders at the Annual General Meeting held on 18 June 2008, the shares
outstanding were split, in the proportion of two new shares for every old share, by reducing their par value from EUR 0.20 to
EUR 0.10. Consequently, the share capital of Elecnor, S.A. is represented by 90,000,000 fully subscribed and paid shares of EUR
0.10 par value each, giving a share capital of EUR 9,000,000.
The shares of Elecnor, S.A. are listed on the Spanish Stock Market Interconnection System, the market where the shares of
Spain’s leading companies are traded and which has the highest volume of trading.
At 31 December 2008, Elecnor, S.A. had 3,689,927 treasury shares, and the balance at the beginning of the year totalled
1,688,795 shares. Prior to the share-split transaction, the Company acquired 173,334 shares and disposed of 42,875, increasing
its shares from 1,668,795 to 1,819,254. In the share split, these shares were converted into 3,638,508 shares, following which
87,710 shares were purchased and 36,291 sold, arriving at a total of 3,689,927 treasury shares at the end of the year, that is,
4.10% of the total, compared to 3.75% at 2007 year-end.
Transactions with related parties
The information relating to transactions with related parties is disclosed in the explanatory notes to the consolidated financial
statements at 31 December 2008, as required by Article 15 of Royal Decree 1362/2007.
Events after the reporting period
In the period from the 2008 balance sheet date to the date when these financial statements were formally prepared, no
events took place that could lead to a material alteration of the fair presentation of the financial statements of Elecnor, S.A.
or of the Subsidiaries composing the Elecnor Group.
Elecnor, S.A. Annual Corporate Governance Report
As legally required and based on the model circularised by the Spanish National Securities Market Commission (“CNMV”),
the Board of Directors of Elecnor, S.A. (“Elecnor”) prepared the present annual corporate governance report (“the Report”)
for the year ended 31 December 2008.
ANNUAL REPORT 2008
155
Financial Statements
for Elecnor, S.A. | 2008
ELECNOR, S.A.
BALANCE SHEETS
AT 31 DECEMBER 2008 AND 2007
Thousands of Euros
ASSETS
NON CURRENT ASSETS
Intangible Assets
Other Intangible Assets
2008
2007 (*)
388,293
276,419
859
540
57
58
802
482
Property, Plant and Equipment
49,771
42,722
Land, buildings, plant and machinery
41,521
35,409
Software
Other Items fo Property, Plant and Equipment
8,250
7,313
Investments in group companies and associates
319,359
224,851
Equity instruments
278,063
211,681
Loans to companies
41,296
13,170
Non current financial investments
2,822
3,189
Loans to third parties
1,484
611
-
1,281
Other financial assets
1,338
1,297
Deferred tax assets
15,482
5,117
807,215
880,249
380
257
16,466
36,421
2,633
1,844
Derivates
CURRENT ASSETS
Non-current assets held for sale
Inventories
Raw materials and other supplies
Advances to suppliers
Trade and other receivables
Trade receivables
13,833
34,577
745,344
803,581
698,867
774,234
Receivable from group companies and associates
11,555
8,876
Other receivables
22,510
7,406
Current income tax assets
Other receivables from Public Administrations
Investments in Group companies and associates
Loans to companies
Other financial assets
Current financial investments
Derivates
Other financial assets
Accruals
Cash and cash equivalents
Cash
Ash equivalents
TOTAL ASSETS
(*) Presented for comparison purposes only
-
1,359
12,412
11,706
1,036
9,840
328
8,427
708
1,413
3,088
2,267
-
1,087
3,088
1,180
496
154
40,405
27,729
40,120
21,197
285
6,532
1,195,508
1,156,668
Thousands of Euros
EQUITY AND LIABILITIES
EQUITY
2008
2007 (*)
197.565
177,987
CAPITAL AND RESERVESShare Capital
9,000
9,000
Issued Capital
9,000
9,000
175,782
155,216
1,803
1,803
Other reserves
173,979
153,413
Treasury shares and equity investments
(27,344)
(22,898)
Profit / loss of the year
49,652
38,900
Interim dividend
(4,666)
(3,888)
Hedging instruments
(4,859)
1,657
NON CURRENT LIABILITIES
96,442
62,585
34,554
154
Reserves
Legal and statutory reserves
UNREALISED ASSET AND LIABILITY REVALUATION RESERVE-
Provisions for contingencies and charges
Other provisions
34,554
154
Borrowings
59,388
58,334
Bank borrowings
49,691
49,612
Obligations under finance leases
8,328
8,599
Derivates
1,275
-
94
123
2,500
3,300
-
797
901,501
916,096
17,380
18,136
4,753
10,870
238
224
Other financial liabilities
Borrowings from group companies and associates
Deferred tax liabilities
CURRENT LIABILITIES
Borrowings
Bank borrowings
Obligations under finance leases
Derivates
5,666
-
Other financial liabilities
6,723
7,042
Borrowings from group companies and associates
2,858
2,226
Trade and other payables
881,263
895,712
Suppliers
405,387
365,979
Suppliers group companies and associates
13,172
36,077
Other payables
29,896
46,397
8,866
7,428
Employee benefits payable
Income tax payables
10,802
-
Other payables to Public Administrations
35,690
38,726
377,450
401,105
Customer advances
Accruals
TOTAL EQUITY AND LIABILITIES
-
22
1.195.508
1,156,668
ANNUAL REPORT 2008
159
ELECNOR, S.A.
INCOME STATEMENTS FOR THE YEARS
ENDED 31 DECEMBER 2008 AND 2007
Miles de Euros
2008
2007 (*)
CONTINUING OPERATIONS
Net turnover
1,468,494
1,360,379
Revenues
1,468,494
1,360,379
Work performed by the entity and capitalised
Procurements
Consumption of goods for resale
1,054
(1,003,369)
645
(996,971)
-
(355)
Consumption of raw materials and other consumables
(459,037)
(456,896)
Work performed by third parties
(544,332)
(539,720)
Other operating income
2,178
1,415
Ancillary income
2,178
1,415
Staff costs
(246,471)
(206,260)
Wages, salaries and other
(190,502)
(159,555)
Social security costs
(55,969)
(46,705)
Other operating expenses
(188,398)
(125,647)
External services
(144,711)
(120,966)
(3,150)
(1,861)
Taxes
Losses on, impairment of and change in trade provisions
(38,412)
(703)
Other operating expenses
(2,125)
(2,117)
Depreciation and amortisation
(8,436)
(6,831)
Impairment losses and gains/losses on disposal of non current assets
71
(106)
Gains/losses on disposals and other gains and losses
71
(106)
OPERATING PROFIT
25,123
26,624
Finance revenues
38,855
25,133
33,400
22,416
5,455
2,717
(4,483)
(4,869)
(182)
(172)
Third-party borrowings
(4,301)
(4,697)
Exchange differences
(2,322)
(332)
Impairment losses and gains/losses on disposal of financial instruments
(2,404)
(192)
Impairment ans losses
(2,404)
(192)
FINANCIAL GAINS
29,646
19,740
PROFIT BEFORE TAX
54,769
46,364
From equity investments
- In group companies and associates
- In third parties
Finance costs
Borrowings from group companies and associates
Income tax
(5,117)
(7,464)
PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS
49,652
38,900
PROFIT FOR THE YEAR
49,652
38,900
(*) Presented for comparison purposes only
Contacts | 2008
SPAIN
Paseo de la Castellana, 95, planta 17
Edificio Torre Europa - 28046 MADRID
Tfno.: 91 417 99 00 - Fax: 91 597 14 40
www.elecnor.es
elecnor@elecnor.es
ANDALUCÍA
DIRECCIÓN SUR
Parque Industrial Nuevo Calonge
Edificio Tempa S-30, 1ª planta, módulo 7
41007 SEVILLA
Tfno.: 954 36 80 76
Fax: 954 434 204
dsu@elecnor.es
ANDALUCÍA OCCIDENTAL
Polígono Industrial La Red
C/ La Red 17, Parcela F2
41500 ALCALÁ DE GUADAIRA (SEVILLA)
Tfno.: 95 563 22 83
Fax: 95 563 22 85
Delegación Construcción y M. Ambiente
Parque Industrial Sevilla
Parque Empresarial San Antonio
C/ Parsi, n.º 4, módulo 48
48016 SEVILLA
Tfno.: 95 426 03 30
Fax: 95 499 71 94
Polígono Las Quemadas
C/ Imprenta de la Alborada, Parc. 284 E
14014 CÓRDOBA
Tfno.: 957 32 59 45
Fax: 957 32 21 62
ANDALUCÍA ORIENTAL
Pol. Ind. San Luis
C/ Veracruz, 16 - Nave 33
29006 MÁLAGA
Tfno.: 952 35 50 61
Fax: 952 35 50 43
malaga.dsu@elecnor.es
Polígono Industrial Juncaril
C/ Lanjarón - Complejo Proyca, 31-32
18210 PELIGROS (GRANADA)
Tfno.: 958 49 10 79
Fax: 958 49 11 21
granada.dsu@elecnor.es
ARAGÓN
Polígono San Valero, nave 5
Carretera de Castellón, km. 4,8
50013 ZARAGOZA
Tfno.: 976 45 43 26
Fax: 976 45 43 41
Polígono Valdeconsejo
C/ Aneto, Parcela 16 C - Naves 1 y 2
50410 CUARTE DE HUERVA (ZARAGOZA)
Tfno.: 976 26 16 01
Fax: 976 26 12 57
BALEARES
CATALUÑA
Polígono Industrial Ca'n Rubiol
C/ Licorers, Parcelas 171-172 (Nave 1-2-3)
07141 MARRATXI
(PALMA DE MALLORCA)
Tfno.: 971 22 65 80
Fax: 971 22 67 36
mallorca.des@elecnor.es
DIRECCIÓN NORDESTE
Rambla de Solanes, 29-31
08940 CORNELLÁ (BARCELONA)
Tfno.: 93 413 92 00
Fax: 93 413 92 01
dne@elecnor.es
Pol. Ind. Montecristo
C/ Pou de na Maciana, nave 117
07820 SAN ANTONIO DE PORTMANY
(IBIZA)
Apartado de Correos 167 Sant Rafel
Tfno.: 971 39 69 54
Fax: 971 39 55 57
Pol. Pla d´Abastaments
C/ Falgas, 25.
17005 GERONA
Tfno.: 972 23 60 19
Fax: 972 40 23 53
elecgir@teleline.es
CANARIAS
Ctra. Santa Coloma, s/n, Nave 8
17180 VILABLAREIX (GERONA)
Tfno.: 972 40 54 36
Fax: 972 23 43 10
C/ Simón Bolívar, 21. Cruce de Melenara
35214 TELDE (GRAN CANARIA)
Tfno.: 928 70 64 39
Fax: 928 70 64 15
canarias.dsu@elecnor.es
Pol. Ind. Els Dolors - C/ Sallent, 36
08243 MANRESA (BARCELONA)
Tfno.: 93 873 20 91
Fax: 93 873 40 10
manresa.dne@elecnor.es
Polígono Industrial Marcerol Nave 2-B
Barrio El Coromoto.
38206 LA LAGUNA
(STA. CRUZ DE TENERIFE)
Tfno.: 922 62 36 35
Fax: 922 62 38 76
CANTABRIA
Polígono La Cerrada, 35 - Nave 16
39600 MALIAÑO (CANTABRIA)
Tfno.: 942 36 93 68
Fax: 942 36 93 67
CASTILLA Y LEÓN
Av. Mirabel, 2 - Bajo
47003 VALLADOLID
Tfno.: 983 35 69 66
Fax: 983 34 40 78
valladolid.dce@elecnor.es
Trav. Ctra. de Santander a Navatejera
C/ Cerrada, s/n.
24007 VILLAOBISPO DE LAS REGUERAS
(LEÓN)
Tfno.: 987 30 75 56
Fax: 987 30 75 58
Pol. Montalvo 1 - C/ Newton, Parcela 41
37188 CARBAJOSA DE LA SAGRADA
(SALAMANCA)
Tfno.: 923 18 49 65
Fax: 923 18 49 66
C/ La Bureba, 3. Naves San Miguel, 51
09007 BURGOS
Tfno: 947 48 33 37
Fax: 947 48 31 04
COMUNIDAD VALENCIANA
DIRECCIÓN ESTE
Polígono Vara de Quart
C/ Dels Pedrapiquers, 1
46014 VALENCIA
Tfno.: 96 313 45 65
Fax: 96 359 06 30
des@elecnor.es
Delegación Obra Civil Valencia
Polígono Vara de Quart
C/ Llanterners, nº 3.
46014 VALENCIA
Tfno.: 96 313 65 28
Fax: 96 379 21 00
Polígono Industrial U.A. 4
Ctra. Ocaña nº 68, calle 1
03006 ALICANTE
Tfno.: 96 510 80 00
Fax: 96 510 78 78
alicante.des@elecnor.es
Av. Hermanos Bou, nº 102 ZH
12003 CASTELLÓN
Tfno.: 96 424 43 49
Fax: 96 425 47 13
castellon.des@elecnor.es
EXTREMADURA
Pol. Ind. Nevero - Complejo Ipanexa
Parcela C 2 - Nave 1-2-3
06006 BADAJOZ
Tfno.: 924 27 05 68
Fax: 924 27 04 18
GALICIA
ASTURIAS
CASTILLA LA MANCHA
Polígono Asipo I. Calle A, naves 5 y 6
33428 CAYES (LLANERA)
Tfno.: 985 79 24 25
Fax: 985 79 23 81
asturias.dce@elecnor.es
C/ Tomelloso, 6 - A - Pol. Ind. Larache
13005 CIUDAD REAL
Tfno.: 926 21 70 94
Fax: 926 21 25 96
Polígono Industrial Icaria
Plaza Atenea, 7 - Modulo 1
15172 PERILLO-OLEIROS
(LA CORUÑA)
Tfno.: 981 63 92 34
Fax: 981 63 69 96
LA RIOJA
Polígono de la Portalada 1
C/ Portalada, nº 13
26006 LOGROÑO
Tfno.: 941 24 57 77
Fax: 941 25 36 38
MADRID
DIRECCIÓN CENTRO
C/ Maestro Alonso, 21-23, 3ª planta
28028 MADRID
Tfno.: 91 726 00 76
Fax: 91 713 08 18
dce@elecnor.es
Delegación Madrid
C/ Marqués de Mondéjar, 33
28028 MADRID
Tfno.: 91 725 10 04
Fax: 91 713 08 16
madrid.dce@elecnor.es
Delegación Telecomunicaciones
C/ Maestro Alonso, 21-23, 3ª planta
28028 MADRID
Tfno.: 91 726 00 76
Fax: 91 713 08 18
Delegación Mantenimiento
C/ Marqués de Mondéjar, 33
28028 MADRID
Tfno.: 91 725 10 04
Fax: 91 355 73 01
Delegación Instalaciones
C/ Maestro Alonso, 21-23, 2ª planta
28028 MADRID
Tfno.: 91 726 00 76
Fax: 91 713 08 17
instalaciones.dce@elecnor.es
Delegación Gas
C/ Maestro Alonso, 21-23, 1ª planta
28028 MADRID
Tfno.: 91 726 00 76
Fax: 91 304 69 02
Prevención, Calidad y Gestión Ambiental
C/ Marqués de Mondéjar, 29-31, 2ª planta
28028 MADRID
Tfno.: 91 726 54 94
Fax: 91 725 30 59
DIRECCIÓN ENERGÍA Y FERROCARRILES
C/ Alfonso XI, 6, 3ª planta
28014 MADRID
Tfno.: 91 523 90 41
Fax: 91 523 90 43/44
DIRECCIÓN CONSTRUCCIÓN Y MEDIO
AMBIENTE
C/ Bravo Murillo, 178, bajo
Edificio Tecnus
28020 MADRID
Tfno.: 91 417 10 50
Fax: 91 556 96 29
dma@elecnor.es
DIRECCIÓN DESARROLLO DE NEGOCIOS
Pza. Manuel Gómez Moreno, s/n, 5ª
Edificio Bronce
28020 MADRID
Tfno.: 91 555 04 64
Fax: 91 555 00 67
ddn@elecnor.es
GERENCIAS DE ACTIVIDAD
Paseo de la Castellana 93, planta 7
Edificio Cadagua
28046 MADRID
Tfno.: 91 417 89 85
Fax: 91 556 55 07
MURCIA
Pol. Ind. Oeste
C/ Paraguay, Parcela 13 - 4R
30169 MURCIA
Tfno.: 968 20 00 85
Fax: 968 20 00 86
murcia.des@elecnor.es
NAVARRA
Pol. Ind. Mutilva Baja
Calle O nº 11 y 12
31192 MUTILVA (NAVARRA)
Tfno.: 948 23 43 00
Fax: 948 24 05 30
DIRECCIÓN NORTE
C/ Jon Arróspide, 15
48014 BILBAO (VIZCAYA)
Tfno.: 94 489 91 00
Fax: 94 489 92 01
dno@elecnor.es
DIRECCIÓN TRANSPORTE
C/ Cardenal Gardoqui nº 1, 2º
48008 BILBAO (VIZCAYA)
Tfno.: 94 489 91 00
Fax: 94 489 92 13
dtt@elecnor.es
DIRECCIÓN ENERGÍA Y FERROCARRILES
Pza. Sagrado Corazón, 4, 2º
48011 BILBAO (VIZCAYA)
Tfno.: 94 439 54 80
Fax: 94 427 21 97
ferrocarriles@elecnor.es
Polígono Industrial de Gamarra
C/ Zubibarri, 4
01013 VITORIA (ÁLAVA)
Tfno.: 945 27 50 24
Fax: 945 25 05 16
Polígono Industrial Brunet
Av. Oria Etorbidea, 8-10, Nave 32
20160 LASARTE-ORIA (GUIPÚZCOA)
Tfno.: 943 36 62 60
Fax: 943 37 69 20
Polígono Industrial Laskurain
Barrio San Esteban, 31 - Nave 4
20400 TOLOSA (GUIPÚZCOA)
Tfno./Fax: 943 65 28 63
DOMINICAN REPUBLIC
ANGOLA
CANADA
Estrada de Catete
Campo INE (Maristas)
LUANDA
Tfno.: 244222 26 16 05
Fax: 244222 26 16 06
elecnor@netangola.com
Eoliennes de L´Erable
2075 rue University - Bureau 1015
Montréal, Québec H3A 2L1
Tfno.: 1 514 658 0934
Fax: 1 514 658 0937
HONDURAS
1, Rue Belkacem El Hafnaoui
Bir Mourad Rais
ARGEL
Tfno.: 21321 44 73 42
Fax: 21321 44 73 40
C/ Rodríguez Arias, 28-30 Bis
48011 BILBAO (VIZCAYA)
Tfno.: 94 489 91 00
Fax: 94 442 44 47
Polígono Noain-Esquiroz
C/ N, Lonja 21
31110 NOAIN (NAVARRA)
Tfno.: 948 31 64 55
Fax: 948 31 75 38
INTERNATIONAL
ALGERIA
PAÍS VASCO
Centro Comercial Mall "El Dorado"
Boulevard Morazán - 4ª Planta, Oficina 1
TEGUCIGALPA - M.D.C.
Tfno.: 504 221 07 85
Fax: 504 221 40 18
elecnor@hondudata.com
C/ Andrés Julio Aybar, 206
Edif. Málaga III, 2ª Planta
SANTO DOMINGO
Tfno.: 1809 472 48 05
Fax: 1809 472 47 36
elecnor.dom@verizon.net.do
VENEZUELA
Av. Luis Roche con 3ª transversal
Edif. Seguros Nuevo Mundo, piso 10
Urbanización Altamira
Municipio Chacao - Estado Miranda
1060 Caracas - VENEZUELA
Tfno.: 58. 212. 264 22 62
(Dirección Energía y Ferrocarriles)
Fax: 58. 212. 267 58 12
ANNUAL REPORT 2008
163
SUBSIDIARIES
SPAIN
ADHORNA PREFABRICACIÓN, S.A.
Avda. Iparraguirre, 102 A
48940 LEIOA (VIZCAYA)
Tfno.: 94 480 64 84
Fax: 94 480 50 24
comercial@adhorna.es
www.adhorna.es
ATERSA, S.L.
Embajadores, 187, 3ª planta
28045 MADRID
Tfno: 91 517 84 52
Fax: 91 474 74 67
atersa@atersa.com
www.atersa.com
Parque Juan Carlos I
Av. de la Foia, 14
46440 ALMUSSAFES (VALENCIA)
Tfno.: 902 54 51 11
Fax: 902 54 75 30
COSINOR, S.A.
C/ Jon Arróspide, 15, 1º dcha.
48014 BILBAO (VIZCAYA)
Tfno.: 94 442 35 58
Fax: 94 441 78 25
www.cosinor.es
buzon@cosinor.es
DEIMOS SPACE, S.L.
Ronda de Poniente, 19
Edificio Fiteni VI, Portal 2, 2ª Planta
28760 Tres Cantos (MADRID)
Tfno.: 91 806 34 50
Fax: 91 806 34 51
deimos@deimos-space.com
www.deimos-space.com
EHISA CONSTRUCCIONES Y OBRAS, S.A.
Doctor Aznar Molina, 15-17
50002 ZARAGOZA
Tfno.: 976 20 45 30
Fax: 976 39 12 00
ehisa@ehisa.es
www.ehisa.es
ENERFIN ENERVENTO, S.A.
Pl. Manuel Gómez Moreno, s/n, planta 5ª
Edificio Bronce
28020 MADRID
Tfno.: 91 417 09 80
Fax: 91 417 09 81
enerfin@enerfin.es
www.enerfin.es
ENERFIN SOCIEDAD DE ENERGÍA, S.A.
Pl. Manuel Gómez Moreno, s/n, planta 5ª
Edificio Bronce
28020 MADRID
Tfno.: 91 417 09 80
Fax: 91 417 09 81
enerfin@enerfin.es
www.enerfin.es
HIDROAMBIENTE, S.A.
C/ Mayor, 23, E-1º
48930 LAS ARENAS
VIZCAYA
Tfno.: 94 480 40 90
Fax: 94 480 30 76
info@hidroambiente.es
www.hidroambiente.es
IDDE, S.A.
C/ Orense, 2, 9ª Planta
28020 MADRID
Tfno.: 91 555 33 07
Fax: 91 597 20 93
elecint@elecnor.es
REDES ELECTRICAS DE MANRESA, S.L.
C/ Sallent, 36 - Polígono Els Dolors
08243 MANRESA (BARCELONA)
Tfno.: 93 873 20 91
Fax: 93 873 40 10
manresa.dne@elecnor.es
ST REDES LEVANTE S.A.U.
Camino la Lloma nº 34
46960 ALDAYA (VALENCIA)
Tfno.: 96 159 62 20
Fax: 96 151 48 66
strl@strl.net
ELECNOR DE MÉXICO S.A. DE C.V.
C/ Río Sena, 63, piso 5º
Colonia Cuauhtemoc
Delegación Cuauhtemoc
CR 06500 MEXICO D.F.
Tfno.: 5255 55 25 19 85
Fax: 5255 55 25 19 86
ELECNOR DO BRASIL LTDA.
Rua Cenno Sbrighi, 653 - Agua Branca
CEP 05036-011 - São Paulo
BRASIL
Tlfno: 5511 2139 8100
Fax: 5511 3611 9612
elecnor@elecnor.com.br
www.it.elecnor.com.br
ELECVEN, S.A.
Av. Luis Roche 3ª transv. 6ª
Piso 6º, Oficina B
Edif. Bronce-Altamira Norte
1060 Caracas - VENEZUELA
Tfno.: 58. 212. 266.28.66
Fax: 58. 212. 261.74.61
elecven@cantv.net
MONTELECNOR, S.A.
C/ Coronel Alegre 1172 (Pocitos)
11300 Montevideo - URUGUAY
Tfno./Fax: 5982 707 82 87
montelecnor@montelecnor.com.uy
PORTUGAL
OMNINSTAL ELECTRICIDADE, S.A.
Rua Consiglieri Pedroso, 71 - RC
2745-555 Queluz de Baixo
PORTUGAL
Tfno.: 35121 434 21 30
Fax: 35121 435 94 16
omn.com@elecnor.pt
AMERICA
ELECDOR, S.A.
Av. Eloy Alfaro, N32/650
Quito - ECUADOR
Tfno.: 5932 223 26 26
Fax: 5932 223 26 29
elecdor@uio.satnet.net
ELECNOR CHILE, S.A.
C/ Nevería 4631 - Ofic 202
Las Condes
Santiago de Chile
CHILE
Tfno.: 562 263 08 30
Fax: 562 263 07 80
elecnorchile@adsl.tie.cl
ELECNOR DE ARGENTINA S.A.
Alicia moreau de justo 1720 3º piso
(C1107AFJ) C.A.B.A - Buenos Aires
ARGENTINA
Tfno/Fax: 54114 341 69 00
RASACAVEN, S.A.
Urbanización Los Medanos
Alle José Leonardo Chirinos
Sector Creolandia Vía Judibana
Punto Fijo-Estado Falcón
VENEZUELA
Tfno.: 58269 247 41 91
Fax: 58269 247 51 29
rasacaven@cantv.net
ELECNOR CENTROAMERICA
Centro Comercial Mall "El Dorado"
Boulevard Morazán - 4ª Planta, Oficina 1
Tegucigalpa - M.D.C.
HONDURAS
Tfno.: 504 221 07 85
Fax: 504 221 40 18
elecnor@hondudata.com
OFICINA CONCESION PERU CARAVELI
COTARUSE TRANSMISORA DE ENERGIA
S.A.C./ CCTE
Av. República de Colombia, n.º 643
Piso 9
San Isidro - Lima
PERÚ
Tfno.: 00 511 442 0223/0222
Fax: 00 511 221 4501
ISONOR
Av. República de Colombia, n.º 643
Piso 9
San Isidro - Lima
PERÚ
Tfno.: 00 511 442 0223/0222
Fax: 00 511 221 4501