BREAKING NEWS 01.11.2024

In a press release dated November 1st, 2024, Reway Group SpA – a leading Italian company in the rehabilitation of road, highway, and railway infrastructure – announced its main consolidated KPIs as of September 30, 2024, which confirm the robust and ongoing growth the Group has been experiencing throughout the current year.  The quarterly value of production, totaling € 29.00 million, brings the cumulative 3Q24A figure to € 145.20 million, with € 102.90 million attributable to road and highway infrastructure maintenance and rehabilitation activities, and € 42.30 million related to railway maintenance. This data highlights the Group’s continued commitment to consolidating its market position and expanding its service offerings in response to increasing demand for infrastructure maintenance and rehabilitation. It is important to note that third-quarter results are generally lower compared to other periods of the year, mainly due to the summer months, especially August, during which activities slow down significantly. A particularly notable aspect is the order backlog, which, as of September 30, 2024, has surpassed the billion-euro threshold, reaching € 1,036.00 million, an increase from € 913.30 million in the previous quarter. This growth is mainly due to the acquisition of new contracts totaling € 152.00 million. The most significant of these include: € 42.00 million related to contracts obtained by Gema for constructing a new railway interchange station in Rome’s Pigneto district; € 54.00 million for MGA’s structural rehabilitation work on several tunnels in Central-Southern Italy and Lazio, as part of an ANAS tender; € 36.00 million for the ANAS tender awarded to MGA for the structural rehabilitation of viaducts on road sections in Lazio. These strategic and long-term contracts further strengthen Reway Group’s positioning and provide revenue prospects over the next five years. Additionally, the historical record that brought the backlog to a value exceeding € 1,000.00 million reflects the Group’s ability to leverage opportunities in its core infrastructure sectors. On the financial side, the NFP rose from € 62.80 million on June 30 to € 68.70 million on September 30, 2024. This increase is primarily due to a € 7.00 million earn-out payment related to the acquisition of Gema, a transaction that has strengthened Reway Group’s presence in the railway infrastructure market. Thus, while debt has slightly increased, it is part of the broader corporate expansion process and is managed with ongoing financial leverage control. As for extraordinary operations, during the quarter, an agreement was formalized for the acquisition of a 60.0% stake in Vega Engineering Srl, with completion expected by November 2024. This strategically important acquisition will allow Reway Group to expand its services to infrastructure and civil works design, thereby increasing operational efficiency and broadening the Group’s portfolio of expertise. Additionally, on October 28, 2024, the Group approved a mandate to the Board of Directors for a capital increase of up to 10.0% of the pre-existing share capital. This mandate, valid for three years, was granted to provide the Board maximum flexibility in seizing optimal market conditions for potential agreements with strategic partners and investors. This measure aligns with an approach aimed at strengthening the Group’s financial standing and fostering new industrial synergies to achieve strategic objectives. Concurrently, the mandate will support financing ongoing operations, such as the acquisition of Vega Engineering Srl, an engineering design firm active in road and railway sectors. In conclusion, the third quarter of 2024 saw solid results for Reway Group, further strengthening the company’s leadership in the Italian road and railway infrastructure market. The growth in value of production and backlog, along with the continuous acquisition of new contracts, attests to the success of the growth strategies. With the mandate for the capital increase and the strength of the order portfolio, the Group is well-positioned to activate further synergies and acquisitions, continuing to pursue its sustainable growth and industrial development objectives. Taking into consideration the press release and the Group’s accomplishments, while awaiting the evolution of the fourth quarter, we reaffirm our estimates: target price € 8.30, rating BUY, and risk Medium.

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