...June 7, 2024 We expect HIT and Sanef will perform solidly in 2024-2026. This reflects inflation-linked tariffs, which in 2024 led to a 2.79% tariff increase for Sanef and 3.08% for SAPN, and our forecast of 0.8%-1.4% traffic growth through to 2026. We expect traffic will be supported by the economic environment in France and neighboring countries, notwithstanding the first-quarter weaker traffic performance (-0.8% traffic in the first four months of the year compared to 2023) due to farmers protesting in France and adverse weather conditions. The new tax on long-distance transport infrastructure introduced in 2024 should be neutral for HIT and Sanef's deleveraging plans. This tax amounts to 4.6% of revenues and the first 120 million of revenues of each concession are exempt. We anticipate it could result in aggregated payments of about 750 million-800 million as per our base case calculations until the maturity of both concessions, reducing free operating cash flow (FOCF) as a result. However,...
