null Talgo increased revenue by 21,3percent and obtained 487 million euros in 2020

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09 Mar 2021

Talgo increased revenue by 21,3% and obtained 487 million euros in 2020

  • Talgo also registered an increase in revenues of up to 20.3% in the fourth quarter, compared to the previous quarter, which reflects a recovery and an increase in industrial activity following the impact of the Covid-19.
  • Talgo has adopted contingency plans and significant cost savings across the company to limit the economic impact of the Covid-19.
  • The company has a robust backlog (3.18 bn) with excellent visibility of industrial activity for the coming years. Talgo is in an optimal financial situation to successfully execute the projects.
  • The objectives for 2021 aim at continuing with the proper execution of the projects in the portfolio to use financial resources efficiently and to grow selectively, whereby ensuring the sustainability of the business over the long term.


Talgo S.A., a leading company in the design, manufacture and maintenance of high-speed light trains, registered a net turnover of 487,1 million euros in 2020, 21,3% more than the 401.7 million euros registered in the same period of the previous year.  Likewise, revenues were up by 20.3% during the fourth quarter of 2020, compared with previous quarter. Revenue growth was driven by an increase in industrial activity, as a result of the successful operational measures implemented to normalize the manufacturing pace.

The company registered an adjusted EBITDA of 34.2 million euros in 2020, compared to 75.2 million euros in the previous year. This downturn in EBITDA reflects the extraordinary situation caused by the economic context derived from the impact of Covid-19. However, the recovery of adjusted Ebitda margins in the second half of the year (from 0% in the second quarter to 7% in the fourth quarter), resulting from the increase in industrial activity and the partial recovery of maintenance activity, as well as the increase in cost-saving measures, confirms the strong capacity of the business to recover normalized profitability as soon as interurban mobility returns to normal.

Talgo has a strong backlog of 3.18 billion euros, generating long-term revenue visibility and ensuring industrial activity for the period 2020-2024 (already visible in the fourth quarter of 2020), and ensuring long-term stability. It is worth highlighting that Talgo’s portfolio at the end of 2020 was at an all time high in terms of international diversification by number of projects, representing 80% of the manufacturing backlog. Thus, the high quality of the backlog and the exhaustive cost control will allow the company to continue to recover its margins in the next months.

With regard to its portfolio projects currently under execution, the Renfe-Avril project, in which Talgo is manufacturing 30 trains and will be responsible for their maintenance for 30 years, is progressing well, with the first deliveries scheduled from 2021. In terms of maintenance activity, the current manufacturing portfolio with associated maintenance already awarded guarantees strong growth of the installed base for the coming years, expecting to reach 3,700 units by 2023.

In this sense, Talgo has a sound financial profile with an outstanding capacity to successfully execute the projects in its portfolio and finance the company's growth over the next years. At the end of 2020, the company had a net financial debt of 48 million euros, resulting in a comfortable cash position of 228 million euros with long-term maturities. The company also has fully available credit lines of up to 150 million euros.

In terms of shareholder remuneration, the Share Buy-back Programme was finalised in May 2020. As a result of the programme executed between November 2018 and March 2020, 74 million euros was invested in the acquisition of 13 million own shares (9.6% of the share capital). In addition, the first redemption of 9.6 million shares, representing 7.0% of the share capital, was completed during 2020. Once all the shares acquired under the programme have been cancelled, shareholders will benefit from an 11% increase in their stake in the company and higher profit per share.

These results confirm the capacity of Talgo’s and the high flexibility of its business model to successfully adapt its cost structure to adverse and changing environments, as well as the success of comprehensive measures to ensure employee safety and improve productivity, and the efficient management of the supply chain and logistics, which has ensured the proper execution of projects during the extraordinary situation generated by the pandemic.

Measures for an accelerated recovery

In response to the health emergency and in order to limit the temporary impact of the operational disruption caused by the Covid-19 outbreak, Talgo has adopted since March 2020 contingency plans and significant cost savings across the company and its various business units to limit the economic impact of Covid-19. The objective has been to ensure the continuity of the industrial activity by maintaining its commitment to customers, preserve the operating margins of the projects and protect its workers, in full compliance with the indications of the Ministry of Health and competent authorities in Spain.

Among other measures in line with the current situation, it is worth highlighting the decision of the Chairman, the CEO and the other members of the Company's Board of Directors to reduce their salaries by 50% for the period March-December 2020. In addition, the Company has implemented the remote working mode for the different office functions, which has allowed it to give continuity to other activities related to the development of the projects, such as the Project Engineering, Purchasing and Commercial activities, among others.

Talgo's commitment to the fight against the Covid-19

Talgo's commitment to the fight against the Covid-19 has been clearly reflected in actions since the Covid-19 outbreak such as Talgo's transformation, pro-bono and in record time, of several Talgo S-730 trains for possible use by RENFE as medical trains.

Talgo has also worked to incorporate health and safety solutions into its fleets, aiming at minimizing the risks of mass exposure for passengers, thus ensuring health conditions and non-exposure.

Additionally, in July 2020, Talgo donated the amount of the 2020 edition of its emblematic "Talgo Award for Women’s Professional Excellence in Engineering" to the platform of the Spanish National Research Council (CSIC), which is coordinating the efforts for the development of a vaccine against Covid-19.

2021 Outlook

The objectives for 2021 aim at continuing with the proper execution of the projects in the portfolio to use financial resources efficiently and to grow selectively, whereby ensuring the sustainability of the business over the long term.

By 2021, Talgo expects strong revenue growth, driven by intense manufacturing activity and a progressive recovery in maintenance activity, with order book execution of up to 35%-37% in the period 2021-2022. In line with its commitment to sustained and selective growth, the company maintains a target of achieving an average book-to-bill ratio of more than 1.2x for the period 2020-2021.

In terms of profitability, the company forecasts an adjusted Ebitda of c. 10%-12% for 2021, derived from a gradual recovery in profitability, subject to mobility restrictions and their impact on the group’s maintenance activity.

Also in 2021, Talgo foresees a net investment cycle in terms of WC to finance projects underway, prioritising the efficient and optimal use of available financing capacity. It also foresees an investment in Capex for 2021 of up to 25 million euros, of which 14 million euros correspond to R&D activities.

Regarding shareholder remuneration, Talgo will make the second redemption of shares from the Repurchase Programme, scheduled for 2021, for a total of 3.6 million shares representing 2.8% of the share capital.

Finally, in line with its commitment to sustainable and socially responsible management and ESG, Talgo will present its first Annual S&R Report in 2021, in accordance with GRI standards.


Note to editors:

Talgo S.A., is the leading Company in the design, manufacture and maintenance of high-speed light trains with an industrial presence in seven countries: Spain, Germany, Kazakhstan, Uzbekistan, Russia, Saudi Arabia and the United States. The Company is recognized worldwide for its innovative capacity, unique and distinctive technology and reliability. Talgo is the train supplier for the "Haramain" high-speed rail project between Mecca and Medina in Saudi Arabia.

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