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11.14.2007

Befesa’s earnings after tax increase 114.5 percent in the first nine months of the year

Barakaldo, November 14, 2007. – Befesa’s results at the close of the third quarter have experienced notable growth compared to the same period last year. Sales have increased 49.3 percent and earnings after tax by 114.5 percent. During this period, has been achieved the change of name of the f the companies from the BUS AB Group adopting the Befesa name, fact that ends the integration process of this group acquired at the end of 2006. Furthermore, Befesa has signed an agreement with Qualitas Equity Partners to integrate its aluminum waste recycling activities into a joint company. The transaction is subject to the corresponding authorization from the Competition authorities.

Befesa’s consolidated sales at close of the third quarter of 2007 have reached 543.9 million euro, a 49.3 percent increase on the previous year’s figure.

The operating result (EBITDA) reached 76.4 million euro, a 135.8 percent increase on the 32.4 million euro the previous year.

The result after tax attributable to the dominant company has been 25.1 million euro, a 114.5 percent increase on the 11.7 million euro the previous year.

The evolution by Business Unit at the close of the third quarter is as follows:

  • Aluminum Waste Recycling. Accumulated sales during the year were 167.7 million euro as against 170.3 million euro the previous year. This variation is due, mainly, to the reduction in price of aluminum. To date, 213,000 tons of aluminum wastes have been treated, a 1.4 percent increase.
  • Steel and Galvanization Waste Recycling. Sales to the end of the third quarter were 191.4 million euro, as against 37.8 million euro for the same period last year. If the 131.7 million euro contribution to sales by BUS is not taken into account the increase is 58 percent, which is mainly fruit of the increase in production capacity as a result of the construction and installation of a new furnace at the Asua-Erandio plant (Biscay), which came into operation in September 2006.
  • Industrial Waste Management. This Business Unit has achieved 93.1 million euro sales as against 82.2 million euro the previous year, which represents a 13.2 percent increase.
  • Water. The accumulated sales figure of this Business Unit to close of the third quarter is 91.7 million euro, a 23.8 percent increase on the 74.1 million euro the previous year. This is a consequence of the execution of desalination contracts abroad.

The start up of the new furnace at Befesa Valera’s plant, located in Gravelines (northern France), was a significant event in this quarter. The investment in this project has been 18 million euro and it has allowed exploitation of synergies with another furnace that already existed at the plant. The two furnaces, together with another similar furnace Befesa has at its plant in Sweden, are capable of treating 185,000 tons of stainless steel powder per year.

In addition, Befesa has signed an agreement to integrate its aluminum business with Qualitas who will contribute the recently acquired company Aluminio Catalan (Alcasa), which will result in a company with annual billing around the 350 million euro mark, allowing it to rank third in the European aluminum waste recycling market.

According to Befesa’s chairman, Javier Molina, "The evolution of Befesa’s results has been excellent, fruit of the steel and galvanization waste recycling business and the worthy performance of all our other activities. The integration with Qualitas (Alcasa), once authorized by the competition authorities, will allow us to consolidate our position as a leading industrial waste recycling company in Europe."

The activity of Befesa, Abengoa’s environmental services subsidiary, focuses on providing environmental services to industry and the construction of environmental infrastructures. It is a listed company and closed the 2006 financial year with treasury stock of more than 813 million euro. (www.befesa.es).