No recovery either in top line or in margins Results came below expectations with no recovery in sales vs the poor Q4 20 and with profitability continuing at very low levels. Sales declined 1% in Q4 21 vs the recovery expected by consensus. EBIT remained in the red, still impacted by COVID issues (additional EUR16m impact in Q4 according to TRE). The backlog was EUR10.5bn, with EUR4.16 order intake in the year. Watch out for debt trend Another issue, and probably where all eyes should be, is net debt. Although the company commented that Q3 Net debt (EUR93m) was temporary, and down-payments should have a positive impact on leverage in Q4, the recovery has been very small. Net debt at the end of Q4 was EUR78m, despite EUR70m improvement in working capital (including EUR40m increase in down-payments). While liquidity is high thanks to the recent loan from SEPI, it could be challenging if the financial position does not improve when the company faces the procurement phase of its large backlog. Outlook maintained Tecnicas has maintained the outlook announced in Q3 21: Sales c.EUR4bn, EBIT2% and more than EUR4bn order intake, of which c.EUR700m is already awarded. Consensus remains cautious with figures below those levels. We remain Neutral We slightly adjust our figures and maintain our TP at EUR8/s. We believe that if the company is able to deliver the expected recovery in margin, first to 2% and later to c.4%, there would be an opportunity for a rerating. However, TRE has disappointed several times in the last five years, so in our view it is worth waiting for a visible recovery before becoming more positive.