FCC (FCCSM, ISIN: ES0122060314). This is one of the first public service groups, international referencepresent in the environmental services sector, comprehensive water management, infrastructure, cement and property management.

In December 2014Carlos Slim began to control the company until it reached 80%. The president, Esther Alcocer Koplowitz, gave up her participation in exchange for debt relief.

As a result, the company recapitalized, suspended the process of selling assets, refinancing corporate debt and reorganizing the group, with control over Realia, delisting Cementos Portland, and subsequently taking control of 29% of Metrovacesa (Santander and BBVA controlled 70%).

Water focused on environmental services (47% EBITDA), including municipal solid waste management, is a national leader and has a presence in the UK and Central Europe. Management of the water cycle (27%) is based in Spain. Real Estate (11%), Construction (9%) and Cement (3%) complete its business portfolio. It has a capitalization of 4,000 million, but only 8% free-floating.

Situation

Carlos Slim seeks a tougher spending policy, a philosophy aimed at the quality and profitability of his projects, and reducing debt. Environmental solidity and water activity make it possible to compensate for the bad moment of cement due to rising energy prices. It has good cash yields and the resilience of its businesses, which offset the effect of energy costs, which should allow for increased dividends.

The environment will benefit from recovery in Central Europe and the UK, although the comparisons will be even more stark.

FCC Ámbito is a subsidiary of FCC Servicios Medio Ambiente which specializes in the comprehensive management of industrial and commercial waste, recovery of by-products and soil decontamination, managing more than 40,000 metric tons of this waste per year.
Theirs strength are leadership in Spain in Services, business resilience in times of crisis, adequate debt positions, growth in the US and the possibility of increasing dividends

What risk we found that cement is highly cyclic, and a large concentration in Spain.

Results

Sales in the first nine months of the year (55% in Spain) increased 14%, and ebitda 15%, for a 17% margin. However, net profit fell 7% due to rising energy costs and construction material prices. Finally, the acquisition of Georgia integrated water cycle operator GGU led to a 10% increase in net financial debt.

From a technical analysis point of view, we see that a deep correction has developed since summer It has formed a floor in the area of ​​€7.40. From that level you have started nA new uptrend with an initial target of €9.50, and potential for a yearly high of €11.00. We would put protective stops below €8.30: a drop in that level would finally call into question the bullish scenario.

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