Reverse factoring, policy and disclosure of amounts involved

Ferrovial S.A. – Annual report – 31 December 2020

Industry: construction

4.3. SHORT-TERM TRADE AND OTHER PAYABLES (extract)

The detail of “short-term trade and other receivables” at 31 December 2020 and 2019 is as follows:

a) Trade payables

The detail of the trade payables at 31 December 2020 and 2019 is as follows:

The line item “trade payables” increased by EUR 62 million compared to the balance recognised at 31 December 2019. Excluding the foreign exchange effect and scope changes, trade payables increased by EUR 119 million, primarily in the Construction Division. As regards trade payables subject to reverse factoring, that is balances pending payment to suppliers under reverse factoring arrangements (Note 1.2.3.3 on accounting policies) these increased by EUR 41 million, the balance changing from EUR 172 million at 31 December 2019 to EUR 215 million in December 2020.

1.3.3.3. Other line items in the balance sheet and income statement (extract)

Trade payables

“Trade payables” include the balances payable to suppliers under reverse factoring arrangements with banks.

These balances are classified as trade payables and the related payments as cash flows from operating activities, since the payments are made to the banks under the same conditions as those agreed with the supplier, the company bound by the obligation to make payment does not agree an extension with the banks beyond the due dates agreed with the supplier, and there are no special guarantees to secure the payments to be made.