9M2014 REPORT TABLE OF CONTENTS MANAGEMENT REPORT 03 01 | MARTIFER GROUP 05 Highlights 06 Key Financial Indicators 06 Main Events 07 02 | FINANCIAL PERFORMANCE 11 Introductory Note 12 Result Analysis 12 Total Revenues 12 EBITDA 13 Capex 14 Capital Structure Analysis 14 03 | ANALYSIS BY SEGMENT 17 Metallic Constructions 18 RE Developer 19 04 | MARTIFER SHARE PERFORMANCE 21 INTERIM CONSOLIDATED FINANCIAL INFORMATION 25 05 | INTERIM CONSOLIDATED FINANCIAL STATEMENTS 27 06 | NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS 33 PAGE 2 9M2014 REPORT MANAGEMENT REPORT PAGE 4 9M2014 REPORT 01 Martifer Group 01 | MARTIFER GROUP HIGHLIGHTS Total Revenues in 9M14 was 158 M€ Growth on operational performance, reflected on the 35 % increase in EBITDA (on a comparable basis) to 8.5 M€ Consolidated EBITDA Margin of 5 % in 9M14, comparing with 3 % in 9M13, +2.7 p.p. (on a comparable basis) Net Profit of the continued operations strongly influenced by the reinforcement of provisions and impairment losses as well as financial expenses of 49.6 M€ Consolidated Net Profit attributable to shareholders of -60.3 M€, influenced by the net profit of discontinued operations of -13.4 M€ Consolidated Net Debt reduction to 296 M€, a 39 M€ decrease compared with 2013 MAIN FINANCIAL INDICATORS M€ sep-14 sep-13 Var. (%) Revenues 158.2 234.0 -32% EBITDA 8.5 6.3 35% EBITDA Margin 5% 3% 2.7 pp EBIT -35.1 -25.6 -37% EBIT Margin -22% -11% -11.2 pp Financial Results -17.1 -19.4 12% Profit before taxes -52.1 -45.0 -16% Profit after taxes on continued operations -54.4 -50.2 -8% Discontinued operations’ Result -24.6 1.5 n.m. Net Profit -79.0 -48.7 -62% Attributable to non-controlling interests -18.7 1.5 n.m. Attributable to shareholders -60.3 -50.2 -20% PAGE 6 9M2014 REPORT JANUARY 2014 West Sea signs contract for the Sub-concession of Estaleiros Navais de Viana do Castelo Following an international public tender, Martifer Energy Systems and Navalria, subsidiaries of the Martifer Group, were awarded with the sub-concession for “private use of public domain and of the areas allocated to the dominial concession” attributed to the company Estaleiros Navais de Viana do Castelo (ENVC). Martifer Group, via its new subsidiary West Sea – Estaleiros Navais, Lda., aims to develop its activity in the national and international markets and implement, in the areas included in the ENVC sub-concession, a shipbuilding and repair project, which is expected to create 400 new work places throughout the next three years. With this sub-concession, Martifer Group increases its capacity for the shipbuilding and repair. The contract was signed in January 2014. Martifer Solar USA INC and Martifer Aurora LLC begin the voluntary process for Chapter 11 On 21 January 2014 the affiliates Martifer Solar USA INC and Martifer Aurora Solar LLC started voluntary restructuring processes under Chapter 11 (US Bankruptcy Code). FEBRUARY 2014 Martifer Renewables concludes the sale of Rosa dos Ventos On 27 of February, Martifer Renewables has concluded, through its subsidiary Martifer Renováveis Geração de Energia e Participações, S.A., controlled at 55%, the sale of 100% shares in the company Rosa dos Ventos Geração e Comercialização de Energia, by the $R70.3m total amount to the Brazilian company CPFL. Rosa dos Ventos Geração e Comercialização de Energia SA owns the wind farm with 14.7 MW of energy capacity. The sale agreement by both entities has been established on 18 June 2013. MARCH 2014 Martifer concludes two new ships for Douro Azul Navalria, Martifer‘s subsidiary, concluded, in March, the construction of the two hotel ships Viking Hemming and Viking Torgil, for the company Douro Azul. The ships, which will operate cruises in the Douro River, were built in one year and have a distinctive feature: a round shaped bow that allows the creation of an exterior deck with capacity for 42 passengers. Martifer Metallic Constructions restructures debt Martifer Metallic Constructions completed the conversion of part of its debt from short term to medium and long term. 9M2014 REPORT PAGE 7 APRIL 2014 Martifer Metallic Constructions increases equity Martifer Metallic Constructions increased, via Martifer SGPS’ main shareholders, its equity in around 28 million euros. Martifer Solar and Adenium Energy Capital awarded PPA for 10 MW PV plant in Jordan Martifer Solar and Adenium Energy Capital were awarded a Power Purchase Agreement (PPA) with the national utility of Jordan, NEPCO (National Electric Power Company) for a 10 MW AC solar PV plant. Martifer Solar has been selected as the lead developer and will provide engineering, procurement and construction (EPC) services. Following the connection of the plant, Martifer Solar will be responsible for the related operations and maintenance (O&M) service. The project will be developed with Adenium Energy, which will finance it in around USD$ 26 million. Martifer Solar concludes the construction of a 78.4 MW PV portfolio for Lightsource Renewable Energy in the UK Martifer Solar concluded a 78.4 MW portfolio of photovoltaic plants in the United Kingdom. The utility-scale combined capacity consists of five plants, which are located in the counties of Cambridgeshire, Devon, Nottingham and Swindon, and was built for Lightsource Renewable Energy. Martifer SGPS, S.A. Annual General Meeting On 28 April 2014, Martifer SGPS, S.A. Annual meeting took place, with a participation of 79.85 % of its total share capital, having all the proposals in the Agenda present in the Call Notice been approved by unanimity. MAY 2014 WEST SEA takes possession of the Establishment of the Sub-concession On 2 May 2014, the company West Sea - Estaleiros Navais, Lda, a part of the Martifer Group, took possession of the Sub- concession, following the “Sub-concession for private use of public domain and of the areas allocated to the dominial concession” attributed to the company Estaleiros Navais de Viana do Castelo (ENVC). JUNE 2014 Martifer Renewables signs conditional sale agreement of the Gizalki wind farm to the Ikea Group A conditional sale agreement was celebrated, in which the IKEA Group will finance the development of the Gizalki wind farm (36 MW), in Poland, which is ready to build. The sale of the Gizalki project will only be concluded after its construction and connection to the grid. The sale of these assets is included in the asset rotation policy, implemented by Martifer Renewables’ management team, RE Developer business area of the Martifer Group. PAGE 8 9M2014 REPORT JULY 2014 Most of assets of Martifer Solar USA INC sold to BayWa On 1st July, the development of the Chapter 11 process, initiated by Martifer Solar USA INC in January, led to the court of Nevada to approve the sale of most assets of Martifer Solar USA, Inc. to the proponent BayWa by 7.6 million USD. The result of the sale is framed with the book value of assets. Martifer Solar prevails with 8 MW PV plant in Ukraine Martifer Solar concluded a new 8 MW PV plant, named Shargorod, in the Vinnytsia region, in Ukraine. Ventinveste SA signs deal with Ferrostaal GmbH In July 2014, the company Âncora Wind – Energia Eólica, S.A., aimed to establish the partnership between Ventinveste, S.A. and Ferrostaal, GmbH for the development of wind projects with a total of 171 MW, included in the Ventinveste Consortium. The construction should begin after the financial closing, which is expected by the end of 2014. AUGUST 2014 Martifer SGPS agrees the transfer of its shareholding held in Nutre SGPS Martifer SGPS has decided, during the first semester of 2014, to sell the participation held in Nutre SGPS, SA. During the 3rd quarter of 2014, following a proposal of investment presented by Orchadia, S.A. group, it was agreed the transference of the shares held in Nutre SGPS, SA. The transfer is still subject to the accomplishment of several conditions (including, amongst others, decisions of Public and Governmental Authorities). The amount of the transfer is in line with the value of the financial investment. SEPTEMBER 2014 Martifer SGPS decides to focus the Group’s activity in metallic construction (Steel structures, Aluminium and glass façades, Oil & Gas infrastructures and Naval Industry) Martifer SGPS decided in September, to focus the Group’s activity in Metallic construction (Steel structures, Aluminium and glass façades, Oil & Gas infrastructures and Naval Industry) and fulfil the active sale plan of its 55 % share on Martifer Solar. As the sale is highly likely, Martifer Solar’s assets and liabilities were classified as “non current assets held for sale” and “liabilities associated to non current assets held for sale”, respectively, being Martifer Solar Net Profit presented as “discontinued operations’ result”. 9M2014 REPORT PAGE 9 PAGE 10 9M2014 REPORT 02 Financial Performance 02 | FINANCIAL PERFORMANCE INTRODUCTORY NOTE In September 2014, the Group started to classify the solar business unit (composed by Martifer Solar, SA and its subsidiaries) as a non current asset held for sale. This change resulted from the fact that it is currently in process a sale plan for Martifer SGPS’s economic interest (currently 55 %) on Martifer Solar. Since the requirements of IFRS 5 were fulfilled, the contribution to Martifer’s consolidated results, coming from this segment, is presented in an autonomous line in the Consolidated P&L and the values YoY were adjusted to allow comparison. The contribution of assets and liabilities of the operational unit classified as held for sale are also presented in separated lines from the Group’s remaining consolidated assets and liabilities on 30 September 2014. The breakdown of these contributions is included in the Notes to Interim Consolidated Financial Statements (Note 20). RESULTS ANALYSIS M€ Sep-14 Sep-13 Var.