Operator: Welcome to the Spie 2026 Q3 Revenue Presentation. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answer session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now, I will hand the conference over to Markus Holzke, CEO, to begin today's conference. Please go ahead.
Markus Holzke: Good morning, everyone, and thank you for joining us today for our nine-month revenue call. I am with Jérôme Vanhove, our Group CFO, and Alexandra Bournazel, our Head of Investor Relations. Spie delivered a very strong performance in the first nine months of 2026, with accelerating organic growth and M&A contribution, culminating in an exceptional Q3. We successfully executed our bolt-on acquisition strategy, further strengthening our high-value technical service offering and our local footprint across Europe. Despite an increasingly volatile macroeconomic and political environment, we continue to benefit from powerful long-term drivers and remain focused on the most attractive growth segments in our markets. To begin, I would like to share a few recent contract examples that reflect our strong positioning. Let's start with Germany.
Markus Holzke: In Germany, Spie is modernizing the electrical and control systems at Block 4 of Uniper's Staudinger Power Station, a critical asset for grid stability and security of supply in the Rhine-Main region. This project showcases Spie's expertise in modernizing critical power infrastructure while maintaining plant operations throughout the project. Importantly, the upgrade will also lay the foundations of the site's transition towards low-carbon technologies and greater grid flexibility. With the acquisition of SGS, we have now even the capabilities to deliver the installation of the full technical scope of a gas-fired power plant, further strengthening our positioning as Germany will deploy new gas-fired generation capacity.
Markus Holzke: Moving to France. In France, Spie Building Solutions is supporting the transformation of a critical data center for the French Customs Administration, combining our climate and electrical engineering expertise to make it both more energy efficient and more resilient. The project targets the power usage effectiveness of below 1.33, which would make the data center one of the most energy efficient of its kind in France, while ensuring continuity of operations throughout the transformation. This is a good illustration of how Spie combines technical expertise and environmental performance to support the energy transition of data centers, a strategic market for the Spie Group.
Markus Holzke: In the Netherlands, Spie has been awarded a contract by the Municipality of Zwolle for the electrical and mechanical maintenance of 14 movable bridges. The agreement took effect in July 2026 for an initial term of 2 and a half years, with options for 3 one-year extensions. By combining electrical and mechanical expertise, Spie provides an integrated approach to enhance the reliability, safety, and durability of this critical infrastructure. In Poland, SPIE Energy Poland S.A. has been selected to lead a consortium in order to deliver the first section of a strategic 400 kV transmission line. Our scope covers around 50 kilometers of the 125-kilometer line, which will help connect Baltic Sea offshore wind farms to Poland's national power grid.
Markus Holzke: These offshore wind farms are expected to reach a combined capacity of close to 18 gigawatts, making grid infrastructure a key enabler of Poland's energy transition. Our installation work have already been started in H2, with completion targeted for 2029. This project is a strong illustration of the growth opportunities we see in high voltage, particularly around grid expansion and the integration of renewable energy in Poland. Now moving to the key 9-month takeaways. Revenue growth was up +7%, including 2.3% organic growth and a 4.8% contribution from bolt-on acquisitions.
Markus Holzke: Organic growth accelerated throughout the period and reached an exceptional +4.7% in Q3. The contribution from bolt-on acquisitions also accelerated, reaching EUR 362 million, including 4 months of contribution from ROFA in Germany as the largest contributor. Based on this very strong performance, we confirm our full year 2026 guidance. Regarding the key financial highlights, overall, revenue over the first 9 months reached EUR 8 billion and 43 million. Just in the Q3, revenue was up +13.7%, including +4.7% organic growth. This is a very clear acceleration compared with 1.2% in H1. We also continue to successfully execute our bolt-on acquisition strategy. Since the beginning of the year, we have announced 7 acquisitions representing close to EUR 800 million of annual revenue, including SAR Anlagenbau, which we announced last Wednesday. Looking now at the performance by geography.
Markus Holzke: At constant exchange rates, revenue grew 7% over the first 9 months, with organic growth led by Northwestern Europe and Germany. Germany grew by 10.4%, supported notably by ROFA integration and a high level of activity in Q3, underpinned by strong structural demand. Northwestern Europe grew by 6.3%, with an outstanding organic growth of +12.5% in Q3. Central Europe grew by 15.1%, driven by sustained M&A activity, notably the integration of BLOCK Group. France grew by +1.6%, with +0.3% organic growth in Q3, confirming that Q2 marked the trough. Global Services Energy benefited from the integration of Worley Power Services, while oil and gas activities remained impacted by challenging market conditions. Overall, this performance once again demonstrates the strength and balance of our decentralized multi-technical model. Looking now deeper into the geographies, and starting with Germany.
Markus Holzke: Germany delivered a strong performance over the first 9 months. For high voltage and city networks and grids, following the catch-up of the weather-related disruptions at the beginning of the year, volume remains strong in electrical transmission and distribution networks. Also, the high voltage order backlog is at a record high level. Technical Facility Management really stood out with excellent contract retention, new contract wins, and growing demand for energy efficiency and decarbonization solution. Building Solutions remain supported by data centers, defense, and tunnel infrastructure. Industry Services delivered solid growth, while ICS continued to strengthen its position in cybersecurity. External growth contributed 7.7%, mainly reflecting four months of ROFA alongside the 2025 acquisitions.
Markus Holzke: Moving to France. In France, organic growth of +0.3% in Q3 confirmed that Q2 marked the trough, reflecting a resilient level of activity over the first nine months. Four of our six divisions continued to perform well in terms of growth. Technical Facility Management remained a key growth engine, with a ramp-up of several nationwide multi-year contracts. Industry remained robust, supported by energy transition projects, notably photovoltaic power plants and battery energy storage systems. ICS maintained solid growth, while nuclear services posted a very strong performance. Growth remained constrained in city networks as fiber rollout programs gradually come to an end and activity shifts towards recurring maintenance. In Building Solutions, revenue is still contracting while we see encouraging order intake, notably in data centers, healthcare facilities, and defense.
Markus Holzke: Finally, the Artemys acquisition contributed 2% to revenue growth over the period. Northwestern Europe. Northwestern Europe delivered an outstanding performance in Q3, with organic growth accelerating +12.5%, bringing nine months organic growth for 5.3%. In the Netherlands, this sharp acceleration was mainly driven by high voltage, as several substations and transmission line projects entered intense execution phases.
Markus Holzke: Building Solutions also contributed strongly in Q3 as several projects moved into production. ICS maintained good momentum, supported by data centers, while Industry Services remained resilient, with electrification and high-tech manufacturing offsetting weaker petrochemical activity. In Belgium, performance was again very strong, driven by high voltage and battery energy storage systems, despite a demanding comparison base in 2025. Finally, acquisitions contributed 1.3% to revenue growth, reflecting the 2025 acquisitions of Rovitech and Voets & Donkers. Moving to Central Europe. Central Europe delivered a strong organic growth of 5.8% in Q3, despite a demanding comparison base of close to 10% in Q3 2025, bringing nine months organic growth to 1.9%. This performance still partly benefited from the catch-up following the adverse weather conditions at the beginning of the year. Just a few highlights.
Markus Holzke: In Poland and Slovakia, high voltage continued to benefit from grid expansion and energy transition investments, as illustrated by the Polish transmission line project presented earlier. In Austria, growth remains supported by tunnel infrastructure and battery energy storage systems. The order book continued to build, providing strong visibility across the region. Finally, acquisitions made a significant 12% contribution to growth, notably BLOCK Group in the Czech Republic. Global Services Energy remained under pressure, with organic growth of -6.7% recorded over the first nine months. In oil and gas, market conditions are becoming more challenging, particularly in Sub-Saharan Africa, where increasing local competition is reinforcing our disciplined and selective commercial approach. In the Middle East, activity was disrupted in certain areas following the outbreak of the conflict with Iran. This situation continues to be monitored closely.
Markus Holzke: At the same time, Worley Power Services contributed +8% to revenue growth over the first 9 months. Its integration is strengthening our positioning in power generation, particularly in wind, battery energy storage systems, and photovoltaic. Now I come to a highlight. You are now very familiar with our SHARE FOR YOU, our annual employee shareholding plan, which we launched during Q3. This new plan was the 10th edition and proved once again a great success. More than 27,000 employees from 18 countries subscribed, including more than 6,000 first-time investors. Following this plan, employees, including management, are invested to hold around 9.2% compared with 8.4% at the end of H1 2026. Involving our employees in the Spie entrepreneurial adventure is very important to us and a key factor of our success.
Markus Holzke: Final results will be announced in December, and we will renew our anti-dilutive share buyback program in early 2027. Now, I hand over to Jérôme.
Jérôme Vanhove: Thank you, Markus, and good morning, everyone. I will start with our revenue bridge, which provides a breakdown of our 7% revenue increase over the first 9 months of the year. As already pointed out, organic growth contributed 2.3%, accelerating throughout the period to reach an exceptional 4.7% in the Q3. This partially reflected intensive execution in Northwestern Europe this quarter, where organic growth reached 12.5%. Our bolt-on acquisitions contributed 4.8%, or the equivalent of EUR 362 million revenue, mainly reflecting, on the one hand, the acquisitions completed in 2026, notably the 4 months contribution of ROFA in Germany, and on the other hand, the acquisitions completed in 2025. The SGS acquisition was completed in September 2026 and did not contribute to the 9 months revenue presented today. It will start to contribute from the Q4 onwards.
Jérôme Vanhove: As already mentioned in previous quarters, the internal transfer of former Robur non-German operations were neutral at group level. This was transferred to Global Services Energy and Central Europe to a lower extent. Finally, minor disposals of non-strategic activities, including a small elevator business in the Netherlands and a residential building solution activity in France, which altogether had a very limited impact of -0.1%. Foreign exchange had a limited negative impact of -0.1%, mainly reflecting movement in the euro-US dollar exchange rate. Moving to M&A, let me now turn to the bolt-on M&A activity, where we continue to deliver strong execution in Q3. We announced 7 acquisitions since the beginning of the year, representing close to EUR 800 million of annual revenue, and further strengthening our technical capabilities and local footprint across Europe.
Jérôme Vanhove: Germany accounted for the largest part of this activity, namely with ROFA and SGS, significantly scaling up our industrial activities and platform in our largest market. We also continued to expand our footprint in Central Europe through targeted acquisitions in Czech Republic, Slovakia, and Switzerland. The momentum continued in Q3 with two further acquisitions. CLAUSER in France, strengthens our position in industrial maintenance and high-power electrical installations, bringing around 100 employees with long-standing expertise in aluminum production and processing. Most recently, as announced on the last Wednesday, SAR Anlagenbau announced yesterday then, further expands our exposure to attractive infrastructure and industrial automation markets in Austria and Germany, bringing around 230 highly skilled employees to the group.
Jérôme Vanhove: The integration of all our acquisitions is progressing well and in line with plan, while our pipeline remains active and well-diversified across highly fragmented markets. All our acquisitions are self-financed. We remain firmly focused on maintaining a sound leverage profile in line with our financial policy. Maintaining this financial discipline also means proactively managing our debt maturities and our level of liquidity on the balance sheet. This leads us to the successful refinancing of our EUR 400 million ORNANE convertible bond due in January 2028. As such, in September, we successfully placed a sustainability-linked bond of EUR 500 million with a 5.5-year maturity and associated to a coupon of 4.78%. Despite the challenging debt environment, this operation reflects strong investor demand and our continued access to debt capital markets.
Jérôme Vanhove: The use of proceeds was mainly dedicated to the refinancing of our ORNANE. To this extent, we first launched a repurchase invitation in cash, and then we exercised the issuer's soft call fully in shares for the balancing amount. In total, and as a consequence, EUR 400 million of outstanding ORNANEs were redeemed in cash, and around 3.5 million new shares were issued. This represents a final dilution of 2% with an underlying average conversion share price of around EUR 43.80. This refinancing extends our debt maturity profile now until March 2032. As of today, 100% of our debt remains sustainability-linked and our liquidity permanently exceeding EUR 1.5 billion. This provide ample financial flexibility to support our development strategy, notably our bolt-on M&A strategy. Thank you for your attention. I now hand back to Markus.
Markus Holzke: Yeah. Thank you, Jérôme. Let me now move to our outlook for 2026. Based on this very strong performance, we are pleased to reaffirm our 2026 outlook. We expect a strong total growth driven by further organic growth and active bolt-on M&A. We expect continued expansion of our EBITA margin. Finally, as every year, we intend to maintain a dividend payout of around 40% of adjusted net income. Thank you very much for your attention this morning, and as we like to say at Spie, it remains a great time to be a European electrical engineer. With Jérôme, we are now ready to take your questions.
Operator: Thank you. Ladies and gentlemen, if you wish to ask a question, please dial pound key 5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please press pound key 6. The next question comes from David Cerdan from Kepler Cheuvreux. Please go ahead.
David Cerdan: Yeah. Good morning. This is David Cerdan from Kepler Cheuvreux. I have a couple of questions. I will go directly. First question is regarding Northwestern Europe. Do you think that 12.5% like-for-like in Q3 is sustainable? If I am right, there are some exceptional. So can you give us maybe the trajectory for Q4? This will be very helpful. Second question is regarding Germany. Do you see some tangible benefit from the German infrastructure stimulus program in your order intake, and can you give us maybe some numbers? Third question is regarding France, and this will be my last question. So what do you think about the trend? Are you more confident for 2027 in term of organic growth for France? Thank you.
Markus Holzke: Yeah. Thank you, David. Well, starting with Northwestern Europe, as we said, very exceptional 12.5% organic growth in both countries, Netherlands and Belgium. As we said and stated that this was due to a high production level of projects with an extraordinary phasing effect. We consider this more like exceptional and not sustainable. We will come down to normal levels in Q4. Germany, we do not guide by order intake, but we see tangible impacts in our order intake of the infrastructure package. France, finally, we do confirm that we see a better trend in 2027, as we always stated, that we are more confident than in this year.
David Cerdan: Just maybe to rebound on your answer regarding Q4 for Benelux. So you said that it should be back to normal level, so does it mean go back to something close to 9 months?
Markus Holzke: Yeah. I think that is a good proxy.
David Cerdan: Thank you.
Operator: The next question comes from Aleksander Peterc from Bernstein. Please go ahead.
Aleksander Peterc: Yes, good morning, and thank you for taking my question. I just have two. The first one is on France. You did already note that the backdrop for 2027 is a little bit better. I would just like to understand how sustainable this return to growth is that we saw in Q3. Would you say that Q2 was really just a blip and will now have at least flat to slight growth for the foreseeable future? There is a lot of uncertainty, obviously, on France, so that is why I would like you to frame this a little bit for us. And the second question is, can you give us an early view of the potentially positive contribution of recent acquisitions that carry above group average margins?
Aleksander Peterc: I think that before you said you were not sure of the seasonality of the margin of the newly acquired businesses in the second half. I would just like to understand if you have a better view now on this. Thank you.
Markus Holzke: Yeah. Thanks a lot, Aleksander. I can share those two questions with Jérôme. I will tackle the first one. On France, we always said this year that we have up and downs from quarter to quarter, but we still want to have a performance better than last year, but still with a minus in front of the organic growth. For 2027, we expect that we cross the mark to positive. Whether this is sustainable, from our business positioning, we hope so. Order intake also improved, but you cannot really predict the economic, macroeconomic, and political environment. There are a lot of uncertainties, but we are more positive than we have been.
Jérôme Vanhove: Yeah. On the contribution from M&A, you rightly pointed out, Alex, that in the first year of integration, especially because this is pro rata temporis, the contribution in terms of EBITA margin might be sensitive to seasonal profit recognition. As such, we have essentially ROFA, which we announced already is trading with a high single-digit EBITA margin. That will contribute only for 7 months, so a caveat on that. Worley Power Services was much more in the mid-single digit in terms of EBITA margin. Finally, SGS, also coming with an attractive expected relative margin on the group, a very high single digit, will contribute only for 4 months. All this being said, a bit early to say, but we are not expecting a sizable relative impact from M&A on margin as from 2026 because of that.
Aleksander Peterc: Okay. Thank you very much. This is very helpful.
Operator: The next question comes from Eric Lemarié from CIC Market Solutions. Please go ahead.
Eric Lemarié: Yes. Good morning, and thanks for taking my question. I got three, if I may. First, regarding the Q4 organic growth, should we expect How do you see so far the Q4 organic growth? Do you expect an acceleration or slowdown compared to Q3 dynamic? A second question on the 4.7% organic growth reported in Q3. Could you tell us maybe what was the pricing contribution within this growth? The last question, following the comments on M&A impact on margin, should we expect I guess we should expect a positive impact from M&A on EBITA margin in 2027, but could you maybe, I don't know, help us to quantify that?
Markus Holzke: Yes. Thank you for your questions. As for the previous ones, I also share with Jérôme the questions. I begin with the Q4 organic, and can we expect a Q4 like Q3? I think that's the major question.
Eric Lemarié: Yes, yes. Actually.
Markus Holzke: Yes. We did not provide quantified organic growth guidance for 2026, and also not in terms of the quarter. Well, Q3 was very strong, but we would have to look at it with a little bit of caution of extrapolating those effects to Q4. When we go by region, Q3 in France supports our view that Q2 was likely the lowest point of the year. However, overall, our message remains unchanged. As I said already, we have a resilient year in 2026 still being negative, and we expect a positive growth in 2027. Q4 will also not be a major game-changer here. On Germany, Q4 faces, first of all, a very demanding comparison base of 6.1%, which we had in Q4 2025.
Markus Holzke: On Central Europe, the catch-up initiated in Q2 continued in Q3, but is not necessarily extended to Q4, implying a return to more normal growth levels. Northwestern Europe, Q3 benefited from favorable project phasing, notably in high voltage and Spie Building Solutions. On GSE, the market conditions are becoming more challenging for the oil and gas environment. That is what we wanted to point out, especially in Sub-Saharan Africa. Just to give you one example of what we mean with disciplined approach, a very big international player sold their offshore platform to a local company, and this local company is looking at high competition amongst us and local players. For us, this is a clear no-go to stay in such areas.
Markus Holzke: This leads to an erosion in margins first, in process standards second, and leading to very bad health and safe situations. All in all, this is not a place for us to stay. This is given my answer of not extrapolating the Q3 to a Q4. You want to tackle the EBITA percentage contribution on M&A, Jérôme?
Jérôme Vanhove: Happy to do so. Eric, I will not start guiding on an EBITA margin for next year. Bear with me. This being said, I think you can do a bit of math. We already have EUR 800 million of annual turnover being acquired, of which at least EUR 600 million, I am considering predominantly ROFA and SGS, where we announced already that they would be performing with high single digits, so a bit above where the group would land already at the end of the year. Inevitably, we can expect for next year couple of bps of relative impact from M&A. But I would let you modeling all of that. I will not guide more precisely on that.
Eric Lemarié: Thank you. What was the pricing effect within the organic growth of 4.7% in Q3?
Markus Holzke: Sorry, can you repeat the question?
Eric Lemarié: You mean, I was wondering whether you can maybe share with us the pricing effect within the growth in Q3?
Markus Holzke: Generally, we say that 50% is pricing and 50% is the rest.
Eric Lemarié: Thank you.
Operator: The next question comes from Annelies Vermeulen from Morgan Stanley. Please go ahead.
Annelies Vermeulen: Hi, good morning. I have two questions, please. Just to follow up on France, and specifically for Q4, have you seen any disruption to your activities from some of the protest activity in France, and could that impact the Q4 organic? Secondly, just to follow up on the margins as well, and sorry if I missed it, I think at the H1, you said you were confident of margins being at least 20 bps plus year on year in the second half. Is that still the case, or could that be a bit better given the growth acceleration you have seen in Q3 and as you have digested some of those acquisitions? Thank you.
Markus Holzke: Yeah. Thanks a lot for your questions. On the situation in France, with the protests we have seen, no disruption. No impact on our business reported. On the second question regarding the 20 basis points, what we said at H1 level is that historically, when we reached a certain level, we tend to stay on that level. What we first gained, we never want to give up.
Annelies Vermeulen: Okay. Sounds great. Thank you.
Operator: The next question comes from Tim Ramskill from BofA. Please go ahead.
Tim Ramskill: Thanks. Good morning. I have three questions, please. Maybe just sticking with the performance in Northwest Europe, you made a number of observations about comp effects in Q4, et cetera. Again, I appreciate you already told us that the performance there was exceptional, but also the comparator in Q4 does get quite a bit easier. Maybe could you just comment specifically on that comp effect? Just coming back to France, perhaps more broadly, given, I guess we all face a number of inbound queries from investors around political sensitivities. Maybe just some comments around your public sector exposure, certainty of pricing there, any kind of contractual terms that give you confidence regardless of what happens with the political environment in France in 2027.
Tim Ramskill: My final question is, again, you make a number of observations in both your prepared remarks today and in the statement about backlog dynamics in particular geographies and segments. But if you look at it overall at a group level and your overall backlog, how would you say things are shaping up now versus 12 months ago? Thank you.
Markus Holzke: Well, starting with Northwestern Europe, you already gave your answer on Q4, that Q3 was benefiting as well from a lower comparison base, and then the project phasing. That is why we expect also Q4 more down to a normalized level. On France, well, the political environment, I do not want to judge on that. It is producing a lot of uncertainty. When we look at our business in France, we firstly have an exposure of roughly 18% to the public sector. Then our portfolio in France is, especially with the public clients, very diversified with many municipalities all across the country, with long-term maintenance contracts and for mission-critical assets in hospitals, in authorities, and so on. We do not expect any disruption of those political things which are going to happen.
Markus Holzke: Regarding the backlog, well, generally we can say throughout all geographies, we are well-orientated, and we see a strong growth dynamic. Maybe when we can distinguish the geographies besides the GSE, which is clearly giving us, with a disciplined approach and our strategy implementation, a negative situation.
Tim Ramskill: Just a quick follow-up on GSE. Again, just to sort of help us understand the things you wanted to call out. You obviously mentioned it has got a little more challenging in certain pockets. I guess actually your performance in Q3 was a little bit better than Q2. The points you are alluding to, are they more relevant for Q4 and beyond, or did they start to have an influence in the Q3 that we have seen reported today? Thanks.
Markus Holzke: Well, I think for us it is important to, especially in the regions where we operate, to keep high standards, on the one hand for our employees, on the other hand for the company. That means in terms of margins, but also in terms of compliance. For me, it is key that we move into such countries with the big ones, with the big international players. That can cause some revenue disruptions, ups and downs, which we now more see in a more down phase. That does not mean that the up phases do not come, but that is what we see at the moment.
Tim Ramskill: Sorry, but that is worse into Q4 relative to Q3, because as I say, Q3 was actually better than Q2.
Markus Holzke: Yeah. Q3 on the GSE portfolio was in the end like in the quarters we had, like H1. It is a little bit weaker, but all in all, we expect more the impact coming in Q4, where we see the impact of this disciplined approach. The example I gave you, this is a real example of a contract we do not have anymore, and this is directly flowing or showing an impact in our revenue.
Tim Ramskill: Perfect. Thank you very much.
Operator: The next question comes from Rory McKenzie from UBS. Please go ahead.
Rory McKenzie: Morning, all. Just 2 questions from me, please. Firstly, I wanted to ask about the technical FM businesses. Across a lot of regions, actually, you call out strength and new contract wins. Can you just talk more about the kind of offering you have here, why you think you are winning good share in that market, and what you are getting kind of payback on from previous investments? Secondly, I wanted to ask about actually a relatively small acquisition you announced this week, SAR Anlagenbau. It sounds a great fit, but given that it is exposed to electrical engineering and automation for infrastructure, that is pretty much every buzzword that I think people are looking to invest in.
Rory McKenzie: Can you just give us any insights into the competitive process for that acquisition? Are you meeting any more competition in the market as you are looking to kind of buy small assets? Just how maybe some of the excitement around European infrastructure is translating into your M&A hopes? Thank you.
Markus Holzke: Yeah. Okay. Let us talk about Technical Facility Management, and that is a really great question because I can point out how happy we are about this business. It is really giving us a lot of visibility with contracts 3 to 5 years or even longer on maintenance contracts. On top of that, we can seek for a lot of synergies to other operational divisions, notably Spie Building Solutions or industry services. We have a strong position in Technical Facility Management in France, in Germany, in the Netherlands, but also in Poland. We are one of the leaders, and this business is all very technically orientated. As we move along the technical value chain, we moved predominantly more also to industrial clients, and we have a great synergy to our industrial division.
Markus Holzke: In a lot of cases, we are winning contracts or being able to retain the contracts we have with an addition of industrial services coming from the industry divisions. This is the case in Germany, this is the case in France, but also in the Netherlands. So, it is a great contributor, and we are very happy with that kind of business. Performance plays a role. Our customers are explicitly giving us a very good feedback, and we have a lot of emphasize to permanently collect the feedback of our customers and do improvement workshops and bring improvements in the field. So, this is the reason why this kind of business is really doing very well.
Rory McKenzie: And just to follow up on that point, is there a particular acceleration in demand for, I guess, the energy efficiency side of your offering? I know that that is something you have invested in with previous acquisitions as well. Do you think that that is where you have got somewhat of a unique stance in parts of these markets?
Markus Holzke: Yeah, absolutely. That is the key issue of all the contracts. A lot of them are performance-based in terms of energy efficiency, and that is a key element of the demand as well. You are right. Done with Technical Facility Management for you?
Rory McKenzie: Yeah, that was it. Thank you.
Markus Holzke: I will switch over to SAR Anlagenbau. SAR Anlagenbau was a one-on-one situation. We were able to create on the back of the good relationships our management had to the management of SAR Anlagenbau, and they are well-connected in their markets. SAR Anlagenbau is really strengthening our approach to have a broader, technically orientated value chain in Austria, but also to have a lot of synergies, because this kind of business is not so far away from the existing business, especially when it comes to infrastructure projects or projects in the industry. We enlarge only our competence spectrum, so we can benefit from cross-selling synergies because we sometimes serve the same customers.
Markus Holzke: We now have an enlarged portfolio to sell, and we have also an additional customer base we can tap on, and have a vice versa cross-selling opportunity. Very good situation here. And then we're on
Rory McKenzie: I'm sure it'll be
Markus Holzke: Sorry?
Rory McKenzie: Yeah, sorry. I was going to say, I'm sure it'll be a great fit for them and you, but do you think that owners of small engineering businesses are having rising expectations about what their businesses are worth, given the environment we're in?
Markus Holzke: You mean in terms of pricing? Well,
Rory McKenzie: Yes
Markus Holzke: I think we always have to have a reasonable discussion on it. But especially for owners who are selling their business, they do not necessarily look at the euro at the end. The price obviously has to fit, but they more seek for a home, a platform where their employees can have a home, the company and the business still exists and is enlarged, will grow. And explicitly, in SAR Anlagenbau, the owner is still holding 24% and will also ensure that the business plan will be delivered. This is also something which is gratefully seen by us, that we have a strong commitment from the management moving forward.
Rory McKenzie: Got it. Thank you very much.
Operator: The next question comes from Allen Wells from Jefferies. Please go ahead.
Allen Wells: Hey, good morning, gentlemen. Just two quick ones from me, please. Firstly, just on France. If we strip out the city networks fiber weakness and Spie Building Solutions, is it possible you could provide what underlying growth is, excluding those kind of two headwind areas? And specifically, maybe also, what was the benefit seen in Q3 from sequentially easier comps in that fiber business? I think some of the cap upside side of things ease on France. That's my first question. Secondly, just on Germany, you obviously continue to describe record high-voltage backlogs. But can you just talk about how visibility is changing at all in that business?
Allen Wells: Obviously, we see a bit of phasing changing quarter by quarter, but as we think about that backlog building, how does the visibility on that phasing and on growth into next year generally help? And maybe any comments just in terms of the pace of tendering and order intake from German grid investment? That would be really helpful as well. Thank you.
Markus Holzke: Mm-hmm. Yeah, happy to start with France. As we stated, four of the six divisions in France are growing and have a very good dynamic. The ones which are constrained are city networks and Spie Building Solutions. This is what we ongoingly have to tell you, and the reasons do not change. In city networks, it is the FTTX, which we see coming to an end in 2027 in terms of decline, then we move into the maintenance portion. So, this topic is largely behind us. In Spie Building Solutions, there is a very disciplined approach from us in this challenging market environment.
Markus Holzke: On the other hand, we experience some good growth drivers already, with notably good wins on the data center side, on projects in the healthcare sector, with clean room technology, where we reach our margin level and have a good contribution to order backlog. This is very visible, so we are quite confident moving forward. Well, we do not guide on the growth level of our divisions, but the growth is strong on the four other elements, on the four other divisions. Regarding the backlog dynamics, well, especially in Germany, energy infrastructure is one growth driver, where we see the same dynamic, not an acceleration. From my point of view, it is hard for the clients to accelerate even further.
Markus Holzke: What they do is they more like to extend the volume of the contracts in terms of size and in terms of years of implementation of projects. One example is the bundle order we received from TenneT, with several substations being conducted beyond 2030, and giving us a good visibility on utilization of our workforce moving forward, better planning capacity, better being able to bid for other tenders, to fill really qualitatively our order backlog. So, this is what we see, and this is really coming into play for us. That is very positive.
Allen Wells: Thank you. Then just specifically, just to follow up on the, can you confirm, if you cannot give me the exact number, can you confirm if there was some benefit in France from easing comps in fiber as well, and then that carries on into 2027? Or has that not started yet? That was what I was just trying to understand.
Markus Holzke: No, that did not start yet. We see the decline is a bit weaker, and we see where it might end. That is why we say that 2027 is, for us, the bottom line and the turnaround on that type of business into a maintenance portion. But it is still in Q4, a decline.
Allen Wells: Thank you.
Operator: The next question comes from James Beard from Deutsche Bank. Please go ahead.
James Beard: Yeah, thanks. Morning, guys. I have got one question on Germany. You noted that you saw solid growth in industry services despite a more challenging environment in selected end markets. I was wondering if you could give a bit more color around that. Obviously, one of the large European infrastructure players warned recently regarding Germany, so any more color there would be quite useful. Thanks.
Markus Holzke: Mm-hmm. Yeah, happy to give some light. On the one hand, you have industry, like defense industry, creating demand, and our exposure to defense industry is, for example, very low. It was not a place to be in the past in terms of growth area, and our exposure is around 1% in Germany. Every order we are winning here, and there are few, is creating already growth for us and good prospects. What is at stake? It is a combination of industry and Technical Facility Management, service and maintenance, and it starts with automation projects, and from big international players and German players in the defense industry. Then when it comes to more difficult industries,
Markus Holzke: I would like to say that to see it more from the positive side, as a service supplier, we benefit from restructuring plans of, for example, the big automotive players. As long as plants are existing, they tend to outsource services, and this is then a field for us to tap in. A lot of discussions we have to extend our services for these automotive clients, as well. It is not necessarily said that we are going into a downturn together with our clients.
Operator: The next question comes from Eric Lemarié from CIC CIB. Please go ahead.
Eric Lemarié: Yes. Hi. Two follow-up questions, if I may. Regarding Germany T&D sectors, I was wondering if the switch decided from underground cables to overhead lines changed anything for Spie. I was wondering as well whether you are penalized or not by any supply chain constraints for the T&D activity.
Markus Holzke: Mm-hmm. Yeah. First of all, for us, it is good if we have more transmission lines above ground, yeah, because we did not focus on the underground cables, yeah. That is positive, yeah. Do we see a huge growth driver? Honestly, the expectation on a huge deployment of underground cables, that was not there, yeah, in reality, because it was much too expensive, and also the public, yeah, did not react as positive as it was expected to those underground cables, yeah. So, the portion which was deployed and shall be deployed was really minimum, yeah. So, not really growth driver for us, but the decision generally is positive. Penalized by supply chain disruptions?
Markus Holzke: No, I think we saw a good trend of more robustness in the supply chains following the big supply chain disruptions, which began a few years back. All that has been settled back well. A lot of the risk is being carried by our clients, yeah. They often provide the large components to us, yeah, like the transformers or bigger high-voltage or mid-voltage components, yeah. Also here, we do not see projects being distorted by this.
Eric Lemarié: Thank you. Understood.
Operator: There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.
Markus Holzke: Yeah. Thanks a lot for those questions, and we are happy to see you again next year. Thanks a lot.
Operator: The host has ended this call. Goodbye.
