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05.14.2008

Results, 1st Quarter 2008

Asua-Erandio, May 14, 2008. Befesa’s results at the close of the first quarter have increased notably on those for the same period the previous year. The sales figure has increased 9.9 percent and earnings after tax 220.5 percent. During this period, Befesa has formalized the sale, for 44.4 million euro, of the site on which its desulphurization plant is located. This is part of the Sefranito Special Interior Reform Plan (PERI in Spanish) for the municipality of Baracaldo (Biscay). The plant is actually operating and the site is to be handed over within a period that guarantees transfer of the activity to a new location. This transaction has had an effect on the results for the period.

Befesa’s consolidated sales at the close of the first quarter 2008 were 213.5 million euro, a 9.9 percent increase on the previous year.

The operating result (EBITDA) was 70.8 million euro, a 168.2 percent increase on the 26.4 million euro for the same period the previous year. If the sale of the site of Befesa Desulfuración were not taken into consideration, the increase in the result compared to the first quarter of 2007 would be 17 percent.

The result after tax attributable to the parent company is 26.6 million euro, which is a 220.5 percent increase on the 8.3 million euro in the first quarter of 2007. If the sale of the desulphurization plant site is not taken into account, the increase is 16.9 percent.

The evolution by Business Unit at the close of the first quarter 2008 is as follows:

  • Aluminum Waste Recycling. The accumulated sales in the first three months were 70.7 million euro, an 11.7 percent increase on the previous year’s 63.3 million euro. During the period, some 90,000 tons of aluminum-content wastes have been treated, which is equivalent to an 18 percent increase on the previous year.
  • Steel and Galvanization Waste Recycling. Sales in the first quarter were 74.2 euro million, compared to 63.8 million euro for the same period the previous year. This is a 16.3 percent increase. The 170,000 tons of steel and galvanization wastes managed represent a 12 percent increase on those treated last year.
  • Industrial Waste Management. This Business Unit has achieved sales of 33.5 million euro as against 32.4 million euro the previous year. The 310,000 tons managed at the close of the quarter represent a 2.3 percent increase compared to the same period in 2007.
  • Water. This Business Unit’s sales at the close of the first quarter were 35.1 million euro as against 34.8 million euro last year. This is a consequence of the execution of the desalination contracts awarded abroad.

In this quarter, Befesa has been awarded significant projects such as the more than 9 million euro contract to execute the enlargement and upgrading of Jerez de la Frontera (Cadiz, Spain) Wastewater Treatment Plant (WWTP). The contract was awarded by Empresa de Gestión Medioambiental, S.A. (Egmasa). The state-owned company Depurbaix has also awarded Befesa, the preparation of the project and execution of the construction works for the desalination plant for part of the discharge treated in Baix Llobregat wastewater treatment station. The contract value is more than 13 million euro.

Furthermore, in the first quarter, the Steel and Galvanization Waste Recycling Business Unit signed several steel dust supply agreements, thus assuring its plants will operate at full capacity. An example is the agreement signed with Outokumpu to treat, in the Befesa Valera plant in Gravelines (France), some 30,000 tons of historic stock of filter dust from its stainless steel plant in Tornio (Finland).

And lastly, Befesa Aluminum Waste Recycling has signed a 120 million euro long-term non-recourse financing contract to refinance the acquisition of Alcasa (Aluminio Catalan), attend to its cash-flow needs and obtain funds to embark on new growth opportunities.

According to Befesa’s chairman, Javier Molina, "I am very pleased with the increase in all the magnitudes of Befesa which demonstrates that, even without taking the effect of the sale of the desulphurization plant site into account, that the bases established for our growth are solid, and even more so when we consider the difficult economic environment we are operating in".

The activity of Befesa, Abengoa’s environmental services subsidiary, focuses on providing environmental services for industry and construction of environmental infrastructures. It is a listed company that closed the 2007 financial year with share capitalization of more than 550 million euro. (www.befesa.com).