Thank you. Good afternoon, everyone, and thank you for joining us today.

With me today are Neil Bruce, President and CEO; and Sylvain Girard, Executive Vice President and CFO. Our earnings announcement was released this morning, and we have posted a slide presentation on the Investors section of our website.

If you are not using today's webcast, please ensure to open the presentation as we will refer to it during this call. The recording of today's call and webcast will also be available on our website within 24 hours.

[Operator Instructions] I would also like to draw your attention to Slide 2 of the presentation. Information in this presentation and remarks made by the speakers today will contain statements about expected future events and financial results that are forward-looking and, therefore, subject to risks and uncertainties.

These forward-looking statements represent our expectation as of today and, accordingly, are subject to change. We disclaim any obligation to update any forward-looking statements except as required by law.

A description of the risk factors that may affect future results is contained in the company's MD&A available on our website and in our filings with the Canadian Securities Administrators. During today's call, we will also discuss certain non-IFRS financial numbers.

You can find reconciliation of these numbers with comparable IFRS measures in the presentation and in our MD&A. With that, I will turn the conference over to Neil Bruce.

Neil?

Thank you, Denis, and good afternoon, everyone. Instead of me going through the slides, let me cover a few topics before Sylvain covers the financials.

First, a quick summary of the 2018 takeaways. I would like to stress that 2018 had its fair share of positive news.

Unfortunately, these stories have been completely overshadowed by the unacceptable news regarding one of our mining projects in South America. There have also been headwinds in terms of overall volatility within the Oil & Gas sector.

These headwinds have been amplified by geopolitical issues, which began in August and continued throughout the year and which are impacting some of our prospects going forward. No doubt, these are two important issues.

However, I would like to talk about some of the really good work done by the talented people at SNC-Lavalin. First, Infrastructure, Nuclear and EDPM are performing well.

In fact, EDPM recorded an industry-leading margin of 11.2% in the quarter. Second, in 2018, the company was ranked number three international design firm in the world, and we're incredibly proud of our progress on this front.

Third, we were the cochair of the World Economic Forum's Partnership Against Corruption Initiative, and I'm personally incredibly proud about the work that we do in this area. As we head for 2019, we are disappointed that we're starting a bit further back for the year than what our original expectations were, but we have to note the positives.

We have a strong backlog of $14.9 billion. In Q4 of 2018, we booked $2.2 billion of new work and have many really interesting quality projects.

We also gave guidance, which is $2 to $2.20 for the adjusted diluted EPS from E&C and $3 to $3.20 for the adjusted consolidated diluted EPS. We have a clear capital allocation strategy and there is no need for us to raise any form of equity.

From this perspective, I think there's a lot to look forward to and there is good news in terms of where we're going in 2019. Let's now talk about the Mining & Metallurgy project.

We are incredibly disappointing -- disappointed with the situation. Ultimately, the project management did not appropriately adhere to the terms and conditions of the contract and this impacted the overall project forecast.

Basically, we were accepting commitments within the supply chain prior to getting concurrents on the agreement with our customer. It is a matter that exposes the company to the differential between what's agreed with the customer and what we've actually agreed with our supply chain.

We have gone through the circumstances in absolute detail, conducted peer reviews, examined risk control mechanisms, changed personnel, added oversight and double-checked everything. We are certain that this is an isolated case.

Ian Edwards, our new COO, and I have met with the customer personally, following further negotiations and discussions. I've agreed to settle the dispute through an accelerated arbitration process.

We also made the decision that our Mining & Metallurgy segment will cease to bid on lump-sum EPC contracts, and we reinforced our risk controls vigorously internally. There is no known evidence that any similar issues exist on any other projects.

We acted quickly and decisively and transformed. We are confident that this is a one-off situation across our business.

We expect that anything that we need to cover over time should come back as a positive contribution. Now moving to Oil & Gas.

There are a couple of things going on in the Oil & Gas sector. First, if you look at funding acquired on Oil & Gas back in 2014, oil prices were higher than they have been over the last few years.

They have picked up a little bit in the last year, but prices remain volatile. Customers are taking a bit longer for project approvals and their capital allocation strategy.

Secondly, we are also involved in contracts where there have been larger length of time changes and that makes it sometimes difficult to recognize revenue in a specific quarter. And thirdly, we have geopolitical piece.

We disclosed back in August the potential effects of the Canadian-Saudi relationship issue. I am confident that this does not affect the work that we do today and the backlog that we currently have in terms of completed work, but it does place major uncertainty right now into the future prospects.

However, we are fully committed to the Saudi market and supporting our valued Saudi customers. When you take the forward-looking prospects and you roll them into your overall accounting and financial models, that's the reason that we took a goodwill impairment within the Oil & Gas business, a level of uncertainty over further prospects.

This has been built into our 2019 guidance. That being said, there have been a number of good contract wins and developments in Q4.

Our EDPM segment secured a contract with the U.K. Ministry of Defense as engineering delivering partner for the Defence Equipment & Support as part of the Aurora partnership.

Our Infrastructure sector implemented an earthquake early warning system on the Canada Line in BC. It is the first of its kind in Canada.

On the Clean Power front, the John Hart Generating Station operations have been transferred to the new facility. The new facility has been completed and turned on in Q4.

The Oil & Gas sector signed an agreement with Perdaman for the development of the Aurora plant in Western Australia. Argentina's Embalse reactor was brought back into service by our nuclear team, marking the end of the life extension project.

Now let's talk about the events of the last two weeks. This is not easy for me, for the management team or for any of our dedicated, hard-working employees to see SNC-Lavalin's name in the media repeatedly as it has been over the last couple of weeks.

There are a couple of things I would really like to emphasize. First, I want to categorically say that we have done nothing wrong as a company and none of our current employees have done anything wrong.

We wanted to raise awareness. We have never asked for the charges to be dropped.

We have never asked for anything to be supplemented outside the judicial system. Did we ask for the remediation agreement that was enacted by parliament to be applied in our case?

Yes. Without getting into the legal aspect of the details, we believe that ultimately, the public interest would be served through a remediation agreement.

The remediation agreement is constructed to do two things. One is to help bring individuals to justice and to make sure that the innocents, defined as being employees, the pensioners, the shareholders, the supply chain, are not harmed.

At the moment, we believe that exactly the opposite is happening. And I have to ask if this is fundamentally fair.

From that perspective, the work that we were doing in terms of meetings, and we have had meetings with opposition parties, both federally and provincially, this was an awareness campaign. We ask why shouldn't the remediation agreement apply to the company?

And our position still stands. We believe that a remediation agreement is the right way to take us forward, but we must focus on where we can make a difference.

So that is why we are now concentrating solely on defending the company through the courts. We are confident that we will get into the -- that we will get the right outcome despite the fact that this will likely end up in a tenure process.

Throughout, we will ensure that we continue to maximize shareholder value and we'll work to protect our innocent employees and stakeholders. Let me now comment on Ian Edward's appointment.

The appointment of Ian as Chief Operating Officer is something that has been in works for quite a while. Ian has done a fantastic job of taking on the Infrastructure sector when it was having difficulties a few years ago and turned it into a breakeven, and then ultimately, to a profitable sector, all while managing a lot of our large contracts in terms of risk management and execution.

We believe that Ian can bring that experience to a wider platform to drive consistent delivery, capability across the company. This is another part of our evolution as a company to ensure that we execute projects in a consistent manner, that we look to capitalize on our fantastic employees and we do not just keep talent within individual sectors.

Let me conclude by summarizing our 2019 priorities. These are clearly cash-generation, long-term sustainable organic growth in terms of what we bid and execute, and with Ian's appointment, consistent delivery across the whole business as well as taking on our whole technology and digital offerings to an even greater level.

We have some -- we have done some fantastic work in that area, but we want to make it even bigger part of our business going forward. With that, I'll turn the call over to Sylvain to go over our financial results.

Thank you, Neil, and good afternoon, everyone. I will start on Slide 8.

Our year-to-date adjusted net income from E&C and the consolidated adjusted net income was in line with our revised guidance issued on February 11, 2019, at $0.25 and $1.31 per diluted share, respectively. As disclosed in our January 2018 press release, we have recorded in Q4 a $1.2 billion noncash goodwill impairment charge relating to the Oil & Gas segment.

Total segment EBIT for Q4 2018 amounted to negative $200 million as it included a negative segment EBIT of $349 million in Mining & Metallurgy and a negative segment EBIT of $23 million in Oil & Gas. The drivers that generated these losses were all previously explained in January 28 and February 11 press releases.

The Nuclear, Infrastructure and EDPM segments had a strong quarter with segment EBIT margin of 16%, 6% and 11%, respectively. Corporate SG&A expenses amounted to $61 million for the quarter.

Note that this amount included $25 million for a Guarantee Minimum Pension equalization expense for past service costs. This is mainly related to the amendment of the pension formula to equalize benefits for men and women and to adjust for the unequal results produced by the GMP between May 1990 and April 1997.

This is a company's preliminary assessment as a ruling rendered in October 2018 by the UK High Court, and put forward a range of possible approaches that could be adopted to equalize GMPs. It is left to individual pension plan trustees and employers to determine their preferred approach.

Total revenues for Q4 2018 amounted to $2.6 billion, which is lower than Q4 2017. The variation was mainly due to lower revenues in Oil & Gas due to completion of major projects and internal power has made a strategic decision to exit this market.

This was mostly offset by an increase in infrastructure. Our 2018 revenues were composed of 74% of reimbursable and engineering service contracts and 26% of EPC fixed-price contracts compared to a mix of 72-28 in 2017.

Our backlog was at $14.9 billion at the end of the year. Our book-to-bill ratio was at 0.9% in the quarter and 1.1% for the year.

Our bookings for the quarter were $2.2 billion, which includes $0.9 billion in EDPM, $0.6 billion in Oil & Gas and $0.2 billion in Clean Power. Our backlog remains heavily weighted in reimbursable and engineering service contracts with 73% versus 27% for EPC fixed-price contracts.

And lastly on the slide, in order to strengthen the company's balance sheet, the Board of Directors have reduced the quarterly dividend by $0.187 per share to $0.10. On an annual basis, this will allow SNC-Lavalin to retain approximately $131 million of cash, which will be use to deleverage the balance sheet and provide the company additional flexibility in the future.

Now moving to Slide 9. We kept this slide in the presentation to be consistent with previous quarters and I won't spend much time on it.

We see the negative segment EBIT in Mining & Metallurgy caused by the 346 million loss on a major EPC project as well as the negative segment EBIT in Oil & Gas, while the Nuclear and Infrastructure segments had a good quarter. The EDPM segment also had a good quarter with an 11% segment EBIT margin.

Turning to Slide 10. Our operations used $112 million in cash in Q4 2018.

On a year-to-date basis, our operations used $304 million in cash compared to $236 million in 2017. This was mainly driven by a lower EBIT from E&C segments, the cash outflow of $89 million for the class action settlement and an increase in interest paid, partially offset by a decrease in restructuring costs and income tax paid.

The 2018 cash consumption is primarily driven by the closeout of our terminal business on the major EPC challenging project in Mining & Metallurgy, higher working capital usage in our Oil & Gas business in the Middle East and finding a milestone achievement on major projects in infrastructure. Note that a significant cash consumption related to the revised reforecasted costs on the mining project will occur in Q1 and Q2 2019 as we expect this project to be completed towards the end of Q2.

Moving to Slide 11. We closed the year with $634 million in cash and cash equivalents, $1.7 billion in net recourse debt and $2.1 billion in unused capacity under our $2.6 billion committed revolving credit facility.

The net recourse debt to adjusted EBITDA ratio based on our financial statements was 3.3, while this ratio calculated according with the terms of the company's revolving facility agreement as amended was 2.9 times. I remind you that our covenant and ratio calculation with our lenders has been temporally increased to 4 times and that the forecasted loss on the Mining & Metallurgy project is to be considered as a nonrecurring item up to maximum amount of $310 million.

Also note that on February 15, DBRS issued a rating report, placing the company under review with negative implications, while S&P on February 12 downgraded the company's rating to BBB minus from BBB, but revised its outlook to stable. Now turning to my last slide, Slide 12.

We've already disclosed our EPS outlook in the February 11, 2019 press release, but we decided to give you additional details, such as adjusted EBITDA from E&C and expected effective tax rate on adjusted E&C in order to help you better assess the year to come. Note that the guidance on EBITDA reflect the adoption of IFRS 16 and does not assume any recoveries from the upcoming arbitration process on the previously mentioned mining project.

This concludes my presentation. We can now open the line for questions.

Thank you.

We can open the line for questions. Operator?

I'll ask the obvious question, Neil. Can you give us an update to the extent possible on 407 process?

The 407 process is going fine. It's a confidential piece.

It continues to progress. And as soon as we've got some news, we'll let everybody know.

Okay. So no change to -- the time line seems to have slipped.

Any -- I mean, can you give us any color on why that's happened?

No. It's a detailed process, and it needs to be done properly.

So it's progressing. It's progressing well from our perspective and we'll update everybody when it's done.

Okay. What would be the use of proceeds as you see it today?

What would be the priorities?

Same as they were last quarter and the quarter before.

Okay. Just switching gears.

What's the strategy right now within the company? Have you moved on from all hope of remediation agreement?

And are you carrying on as if this is going to go to trial and preparing for everything that, that entails?

Yes. I mean, our innocent employees are being used as a puck in a political hockey game.

And frankly, they don't deserve it, and we've had enough. So we are 100% concentrating now on defending ourselves in court.

Unfortunately, if you look at the time involved, so we're 6, 7 years past the events of 2012, highly likely that this is going to go on for a number of -- another number of years. And frankly, we've had enough of all of that, and we're just going to vigorously defend our self in court, and that's our strategy.

Okay. And do you look to focus your growth outside of the country?

And as you go down that route or carry on as usual and see what happens? Just curious as to what management and the board are thinking as we go forward here?

No. I mean, we've got plenty of opportunities to grow the business outside of Canada.

And -- but we're also connect -- we are connected to the Canadian market and to our Canadian employees as well. So from that perspective, we're going to make sure that we defend ourselves through the court process.

And we are pretty confident that in the end, we will win through and we'll continue to grow the -- really going to see the ability to grow the Canadian business the way that we should have been doing over the last 6 years.

If I could just ask a follow-up on the 407. I appreciate the very detailed process.

But just curious, at this point, if there's been any indicative offers, if this is really a pricing issue. Just curious if you can help us with that.

Well, it's a confidential process, so we'll update you once we're in a position to release that information.

Okay. Then just on free cash.

For the earnings guidance for 2019, the $2 to $2.20, I think in the last call, you spoke to a 70% conversion rate by 2020 or 2021. I'm sort of just curious if that is still your expectation, sort of what to expect for free cash flow in 2019?

Yes. So, the 70% conversion out in 2020 and forward remains valid.

I think there's a bit of adjustment you've got to make on that with the implementation of IFRS 16. It does change a bit of the geography in the cash flow statement.

But that's still unplanned. As it relates to '19, we're obviously impacted quite a bit by the mining project.

There is a significant cash outflow that will result from that. So that, we thought we'd be kind of trending towards that 70%, a little bit underneath the halfway point probably, and now with this cash outflow, we'll be more than that.

But we'll still be positive on free cash flow conversion.

And maybe just on the dividend. Just sort of the motivation around the cut.

I do appreciate sort of where the balance sheet is at and the need to preserve cash. But just any thoughts on that.

Is it really just the E&C business is just not generating enough to cover it right now? Just any thoughts around that.

Yes, I think it goes to my earlier comment. I mean, a little bit more than a couple of hundred million dollars coming out on this mining project from a cash standpoint, so that hurts the free cash flow quite a bit.

So the objective here was really to strengthen the balance sheet, produce leverage and protect the investment grade. So that's kind of where we're at.

And we feel confident this is what it's going to give us.

If I can just maybe stick one last one in. Just on the covenant.

I guess if I do some math, it looks like the add-backs to debt are about 500 million. Is that ballpark about right?

I'm sorry. What's the...

Just on the covenant calculation. Yes, the covenant calculation, the 2.9x.

I mean, to get there, it looks like there's about 500 million add-back to debt on my math. Is that about right?

I don't have the specific number. I mean, when you need that back in some of the advances and so forth.

And then you take the EBITDA and you have to adjust for capital to make it on a cash basis. So we have to come back to you on this.

If that's not good enough, that would be the number. And don't forget to adjust for the 310 million of nonrecurring item.

Just on Ian Edwards, I think you reviewed, I guess, the mining projects, but how about other fixed-price contracts in infrastructure? Have you done another review of your fixed-price contracts in infrastructure?

And are there any potential concerns out there that you have? And again, I bring up the Champlain Bridge again in light of the fact that we are in a bit of a different situation than we were a few quarters ago.

Yes, I mean, I think you've asked a good question. Yes, we have gone through more than 20 of our top contracts.

In terms of the work we do in this arena, we've gone through. We've done the peer reviews.

We've done all the checks again to make sure that what we approved is what we signed and that they are on track and we don't have anything of any similar nature whatsoever, and we concluded that by exercise. We did that immediately.

It took us about a week to do, but we've completed the exercise and we can confirm that there's nothing of the same ilk in any of the sectors, not just the infrastructure sector.

Okay, that's great. And then another question.

Just on the remediation agreement. I mean, I understand that you're focused 100% on the trial now.

The Canadian public prosecutor did say at the time that she wouldn't be inviting you to negotiate an agreement at this time. That was her word, at this time.

Is there is still a chance that they could come back and offer a remediation agreement? Again, I understand that you're focused on the trial.

But could the Canadian public prosecutor return and look to negotiate with you in the future? And then finally, once the full trial starts, presuming that the preliminary trial results in a full trial, does that then preclude you from negotiating a remediation agreement in the future?

Or could you say, a year into the full trial, come back and negotiate a remediation agreement with the Canadian public prosecutor?

I think it's really clear -- crystal clear that the DPP has discretion to invite us in at any time. But that's certainly their discretion.

If we'll be invited in, of course. Of course, we would because that's basically been our priority.

And we believe that whether it's before or during, the DPP does have that discretion. So I mean, it's not really a question for us.

I think the only thing we'd really, really want to see is that if we were ever invited in the future, then of course, we would be a willing participant. But frankly, it doesn't look like that today.

So what our employees want to hear is that we're moving on and we're going to defend them and the innocent employees through this process and we are going to do that rigorously through the court system.

Given all that's happened in the past six months, at what point do you look at a Plan B or a Plan C, for instance, either splitting up the company or selling certain divisions?

Well, I think we've mentioned before that we formed a committee in the board in terms of looking at alternatives. I mean, that's obviously a confidential process in terms of the details of all of that.

But as we've said before, we are constantly looking at -- our priority is maintaining and looking after shareholder value. And with that in mind, we continue to look at all of our -- all of the future opportunities.

You commented on the EDPM margins being quite strong, but revenues were down year-on-year for the quarter. What was the driver there?

I think last year, we had a quite strong activity across the board, especially in the U.S. with the sima remediation work.

So we had a bit of a downscale on that.

And then my last question here is, I guess with some press out there about potential changes to the integrity regime, there might be some changes to the automatic 10-year suspension. Are you aware of any of this and any comments?

I mean, it's public information, so I mean, you've got as much as we've got. And like I said, we just need to get on with the business of defending ourselves in court and that's something further down the line.

Sylvain, could you provide maybe some color about the cash outlay expected in Q1, Q2 with respect to the mining project?

Yes, I mean, like I said, it's actually over $200 million both in Q1, Q2. I'd say, the biggest piece in Q1.

Yes. Yes, over $200 million cumulatively and you split that between Q1 and Q2.

Yes, there's a little bit in Q3.

Okay. And for Clean Power, I mean, you're ramping down one project and ramping up another one.

The backlog has increased. Could you maybe mention more color about the past for profitability or what we should expect for Clean Power going forward?

Well, I think Clean Power, what you're going to see increasing and continuing is the Linxon activities. So I think we're very pleased with how the John Hart project went.

And I think as we close the year, we start to ramp up some of the geographies that Linxon has gone very well. We've still got a few more coming in online this quarter, so that will be where you'll see the increased activity.

Okay. And last one for me.

With respect to the potential contract Oil & Gas in Western Australia, obviously, it's something to monitor and that could be pretty sizable. So what's your level of confidence to reaching that build deal or maybe the next milestone for this particular project?

Well, I mean, we are optimistic that we can support our customer in terms of developing. And that's -- I mean, ultimately that's a customer decision in terms of the next phase and the economics and everything that go with it.

But I mean, it looks like a good prospect.

Sylvain, earlier when you were commenting on the leverage ratio calculated under the credit agreement versus your own calculations, I just wanted to confirm a couple of things. So first of all, the credit agreement calculation that gets us 2.9x, that does add back $310 million?

Yes. The $310 million is a non-recurring, absolutely.

Okay. And then I think there was -- I missed it, but I think there was reference to some other adjustments to adjusted trailing EBITDA beyond simply that $310 million amount.

Can you just go over what those other adjustments were?

At a high-level, it's essentially you've got your capital more on a cash basis. So you look at the dividends coming in, so you kind of remove some of the equity pickups and replace it by dividend or distributions.

That's basically what you get. And we have disclosed this number because obviously, we're getting a number of questions and we will continue to disclose that into the upcoming quarters.

And then in terms of free cash flow, you mentioned that for the year, it should be positive. Obviously, that sounds like the biggest drag this year is going to be the inflows from the mining project, which you've quantified.

If we were to look at free cash flow excluding the drag from the mining project, would you have been or would you have expected to be somewhere around the same kind of halfway to that 70% conversion that you've previously talked about?

Yes, yes. It would be slightly better actually but yes.

And then Neil, I'm not sure if you can add anything to this, but you did mention that there was a special committee of the board formed to look at options to protect shareholder value and stakeholder value. Can you just talk about sort of how advanced that has become over the last couple of months in terms of any work that's been done?

Like have you hired advisers? Have they actually begun to sort of form some options?

Or is this still fairly early days?

I think your two questions, the answer is yes and yes. So yes, we've got advisers and yes, they've started working.

And maybe just lastly, so now with respect to the Mining & Metallurgy segment, I realize it's going to be a lot smaller here than it was before with the shift out of EPC mining work. But in your 2019 guidance, are you assuming that whatever the Mining & Metallurgy segment contributes in 2019, is it contributing positive EBIT or is there still a loss assumed in the guidance you've given us?

It's thereabouts breakeven, I would say.

I just wanted to come back to the decision to reduce the dividend. On the one hand, it seems prudent as it allows more cash to be directed towards debt repayment.

But at the same time, you're looking to sell down your stake in the 407, which would potentially be a pretty significant deleveraging event. How should we be thinking about this?

Just wondering is there any change in the commitment to proceed with the 407 sale or whether there's a timing difference in that transaction versus when you need the cash? Or I'd say the lenders, when you negotiated your covenant relief, whether they insisted on this?

Just any color there would be helpful.

Yes, It's not your last point, for sure. I think it's more like in any M&A process, there's uncertainty around the finalization, the timing and all that.

And I think when we look at where we're at and how, especially this level of cash out we're going to impact in the first half of the year, the fact that we've got downgraded by the rating by S&P. So like exactly what you said, it's a prudent thing to do.

Okay. And maybe going to the Oil & Gas business.

I recognize there's a lot of moving parts here, including increasing the focus on the North American market. But how should we be expecting or what should we be expecting doing revenues for this business in 2019?

I know in Q4, revenues were down about 40%. I don't suspect that is a good go-forward kind of revenue growth expectation.

But just how should we be thinking about that in 2019?

Yes, I mean, I think part of what's linked to that is we -- as I said before, I mean, a large part of our revenues are in the Middle East, and they are on top of what we're doing in America. And a large part of that has been exciting.

I mean, we are completely and definitely committed to supporting or signing customers in terms of what they need and the value that we can bring. However, as we've said before, there is a degree of uncertainty around what we will be selected for.

So that's why in the 2019 guidance, we've actually taken down our expectations around the Oil & Gas, specifically around the Middle East just in case that turns out to be the fact. So it's a bit difficult to be any more precise at this time on that, but within our 2019 guidance, it includes taking out a degree of uncertainty around the oil and gas market that we do in the Middle East.

Okay. Yes, that's fair, okay.

And then maybe just one last one. Just wondering if the, I would say, the strained relationship between Canada and Saudi Arabia, obviously, it's impacted your ability at work in Saudi Arabia.

But has that also extended outside of the KSA?

No.

Neil, maybe just thinking about all the different moving parts we've got going into this year. You talked about walking away from certain portions of the mining business.

And then I guess, there's also been some commentary around your ability to bid on new work. How should we think about your ability to maintain your backlog through the year?

And can you maybe give us an idea of where you think you still have opportunities to grow and maybe offset some of these losses? And I guess what I'm trying to think about is, do you have a reasonable expectation you can maintain at least a 1x book-to-bill ratio for the year?

Yes, I mean, so to answer the question in the middle of that first. We have absolutely no restrictions whatsoever on bidding and winning anything to do with a Canadian government work.

Whether it's federal or provincial, we've got the agreement that was put in place earlier than that. That is maintained until the end of any form of court process.

So we are not concerned with that at all. And the restriction doesn't apply.

I mean, that form of restriction doesn't apply anywhere else because, ultimately, everywhere else in the world, I mean, basically, they don't penalize you until you're found guilty, and they don't penalize you when you're still innocent. So from that perspective, we are free to bid on anything that we -- I think is going to add value to our customer base and to our employees and to the company.

And we're very, very confident around a number of prospects both inside Canada and internationally. So yes, I mean, we had a great Q4.

We've got $14.9 billion. And I see absolutely no reason whatsoever why we will not continue to progress that from this point onwards.

All right. So you believe you actually have a reasonable shot at increasing the backlog year-over-year?

Is that a fair way to characterize that?

Yes, absolutely. I mean, the only thing that -- what our competitive disadvantage on is the fact that we -- this overhang continues to be there and competitors in the U.S.

are pretty ruthless and they use it against us. even when they're using it against us, we continue to win through and we win our fair share, and we expect that to continue.

Okay, fair enough. And then Sylvain, maybe for you, just a quick question, thinking about cash flow.

And I know you've talked about some issues front end of the year. You're bringing the dividend down.

Still very conscious about your debt levels. While thinking about your investments in capital -- and let's think about maybe outside the 407 for a moment.

You have the recent rating changes or maybe your ability to fund new investments, does that start to impact investments in new concessions as you move through '19, and maybe into 2020? And does that as well on the other side maybe change her perspective on the portfolio and maybe accelerating any potential sales?

Well, we have in the coming year in the '19, we do have a few project completions that we've accounted for in our budget into the investment and we're fine with that. I think we're fully committed to that and there is no issue there, so we'll continue on that.

The -- as we look forward on projects, we see ourselves continuing to invest in concessions. So that's -- that's not something we consider a problem.

Now what -- when we created the infrastructure partners fund, it was exactly to recycle our cash. Once investment concessions were stabilized, then we would put them into the fund.

So I think that strategy's still valid and there's no change to that. I think as in any times, good or bad, we would try to recycle that cash as soon as we could basically, that's basically the purpose of this fund, so nothing changed there either.

And your change in debt rating doesn't impact your ability to fund any of these transactions?

Not at this point. And I think some of the actions that we're taking now, including the dividend cut, is obviously to secure our balance sheet and investment grade.

So I think we're in a good shape for that.

Sylvain, I just had a clarification question in terms of the comments around mining. So when you're making a reference, the $200 million drag, is that on, I guess, working capital or was that on EBIT?

On cash. So the EBIT impact has been taken.

And then as you complete the project, you basically have all your costs to go and your accounts payable to go out essentially. So it's working capital.

It's all working capital essentially because the loss has taken. The project is a massive loss, so yes.

So I guess, it's conceivable, we're going to be sort of in the same position as in last year's H1, like the drag of kind of $439 million for the consolidated entity, right? Because we don't have the breakdown segment-by-segment?

Well, you will see the big drag in Q1, Q2, absolutely.

And then so in terms of the mining, the question that I have, I mean, obviously, if you stop doing EPC-related work, how do you think about matching the revenue and the headcount in that division on a prospective basis?

Well, I think we're going to concentrate very much on a lot of our bread-and-butter in the past, which is EPCM. And so reimbursable, our target cost EPCM work, together with the sustaining capital, that we have actually built up a nice competitive business within that area.

So we are absolutely continuing with that. So to be clear, we're not exiting the sector.

And what we're also looking as well in terms of how we can potentially utilize resources wider from other sectors within that to make it a bit more competitive.

And then in terms of -- do you mind maybe providing a bit of color in terms of where you see the opportunities right now in mining? Is it in LatAm?

I mean, is it iron-ore-related just so that we can get a better sense where you're tracking those potential contracts?

Yes, I think most of it at the moment is either -- the vast majority of the stuff that we're looking at in the moment is really in the Middle East, the bigger and wider Middle East. And it's acid plants, it's some fertilizers, potentially gold projects.

And there are also opportunities in the Middle East around aluminum smelters, and work that we have done really successfully in the past, and there's opportunities to sort of reengage and work for some brownfield prospects.

And it's fair to assume it's going to be outside of the KSA, right, Neil?

No, not necessarily. Like we said, I mean, we want to support our customers in KSA.

We would like to carry on across not just Oil & Gas but across all of our businesses, in infrastructure in rail and mining in KSA. But that decision is with the individual customers.

But we intend to and we have been engaging with them. I mean, I was in Saudi twice last week, and we want to continue to do the work there.

And the diplomatic sort of spat right now, that would not preclude you from participating in those contracts on the mining side?

That's up to the individual customers, but we're not going to take the offer and give up. And that was the reason why I was there twice last week.

Right. Okay, no, no, fair enough.

And so again, just to clarify, for mining, Sylvain, you were talking about, let's call it, breakeven EBIT for the year correct?

Correct, yes.

And then Neil, if you don't mind going back to Oil & Gas, you're talking about improving EBIT for the entirety of 2019 versus '18. Do you mind maybe talking about the buckets where you're tracking potential contracts?

And what gives you the confidence you're going to be able to drive the profitability higher this year?

Yes, I mean, I think the -- our prospects list, I mean, we've got a large offer in terms of potential prospects and they are pretty consistent with last year. And so a lot of it across the wider Middle East.

Some emerging prospects in Australia and North America, especially on onshore North America both in terms of offshore, downstream, midstream areas. The only -- like we said, we're taking a more cautious approach for Oil & Gas built into our 2019 guidance, recognizing the fact that in Saudi Arabia, the Oil & Gas prospects are not in our control.

We will continue to bid there, but ultimately, we just want to be cautious about the outlook on that.

Okay, fair enough. And then maybe if we can just circle back lastly to the Plan B sort of discussion.

Is there -- I guess, two part question. One of them is, what options, I guess, are being considered, if you can discuss any?

And then if there is a timeframe by which you will decide to disclose what exactly you think is the right way to protect shareholder value?

Yes, I mean, I understand the curiosity, but it is a confidential process. So when the committee and the board are in a position to disclose some of that, then obviously, we will.

But until then, I can't really comment on that.

And so Neil, but in terms of timing, is this a 2019 event or it's kind of a moving target? Just trying to understand that dynamic better.

Well, I think it's going to be linked with everything else that's going on. So like we said, we're going to defend ourselves against the charges and we need to make sure that whatever we do minimizes or eliminates the effect should the worst come to worst, which we don't believe actually will, but it's very much linked to that.

I just had a question surrounding the working capital. And I was just wondering how much working capital was tied up in the Champlain Bridge project and the two projects in South America, the two mining projects.

Yes. We don't disclose the details of that, but it's clear that the Champlain project, with the delays in the construction that we had, we could not achieve some of the milestones that were linked to some of the last remaining steps of the construction, mainly putting the asphalt and so forth.

So that's caused a cash pressure in our result in '18. So we're anticipating those to come back in the first half of '19.

I think as it relates to your mining question, I guess -- yes, I mean, that's over $200 million cash out expected in the first half. So this is only one project, right, in mining.

Thank you very much, everyone, for joining us today. If you have any further questions, please do not hesitate to contact me.

Have a nice afternoon and a good weekend.