ITALMOBILIARE GROUP:
- TOTAL PROFIT FOR THE PERIOD: 164.0 MILLION EURO (84.3 MILLION EURO IN THE FIRST HALF OF 2010)
- REVENUE: 2,598.1 MILLION EURO (2,574.7 MILLION EURO)
- EQUITY: 5,737.0 MILLION EURO (5,932.8 MILLION EURO AT DECEMBER 31, 2010)
- NET DEBT: 2,177.4 MILLION EURO (2,095.5 MILLION EURO AT DECEMBER 31, 2010)
- NET ASSET VALUE: 1,581.3 MILLION EURO
Milan, August 5, 2011 – The Italmobiliare S.p.A. Board of Directors has examined and approved the half-year financial report at June 30, 2011.
The Italmobiliare Group closed the first half of 2011 with consolidated profit of 164.0 million euro (84.3 million euro in the year-earlier period) after capital gains on the previously announced sale of Italcementi group assets in Turkey.
Revenue for the six months was 2,598.1 million euro, substantially in line with the first half of 2010 (2,574.7 million euro reclassified in accordance with IFRS 5 to take account of the sold assets); after amortization and depreciation for 240.9 million euro, EBIT was 143.1 million euro (229.8 million euro).
The rise in market volatility as renewed pressure developed on the prices of financial instruments and – in the second quarter in particular – on the debenture markets due to serious concern over the sovereign debt position of a number of Eurozone countries, affected the financial and banking sectors.
Meanwhile, results in the industrial sector were adversely influenced by new inflationary pressures, especially on energy costs and raw materials.
In construction materials, the subsidiary Italcementi – which published its half-year results on July 29 – reported sales volumes substantially in line with the year-earlier period. Revenue, at 2,452.0 million euro, rose by 2.1% from the first half of 2010; operating results, affected by the significant and widespread increase in energy costs, were lower than the first half of 2010: recurring EBITDA 372.1 million euro (-15.4%) and EBIT 158.0 million euro (-24.2%). Profit for the period was 187.8 million euro (81.8 million euro in the first half of 2010) and reflected the capital gain (109 million euro) on the sale of assets in Turkey.
In food packaging and thermal insulation, consisting of the Sirap Gema group, demand in the food packaging sector decreased, while performance was lively in thermal insulation, especially in the second quarter of 2011. First-half revenue at 115.8 million euro showed a small increase (+1.5%), but the sharp rise in the cost of polymer raw materials, which could 2 not be transferred to sales prices due to fierce competitive pressures in the sector, led to a reduction in operating results: EBITDA was down to 4.4 million euro and EBIT was negative at 1.3 million euro. After finance costs of 2.2 million euro, profit for the period was 3.6 million euro (1.0 million euro for the first half to June 30, 2010).
The financial sector, which includes the parent company Italmobiliare and the wholly owned financial companies, reported profit of 8.6 million euro, a decrease from 19.6 million euro in the first half of 2010. The earnings downturn was substantially due to lower capital gains in the period and, to a lesser extent, to higher net finance costs.
The banking sector (Finter Bank Zürich and Crédit Mobilier de Monaco) reported a small decrease in the intermediation margin to 15.8 million euro (16.9 million euro) largely owing to the reduction in commission income and a slight reduction in third-party assets under management. After write-downs on receivables for approximately 4 million euro, the sector had a loss for the period of 7.6 million euro (-0.6 million euro). Equity in the banking sector amounted to 101 million euro.
At the end of the first half, the Italmobiliare Group had total equity of 5,737.0 million euro, a decrease of 195.8 million euro from the end of 2010 caused largely by a negative exchangerate effect.
Consolidated net debt stood at 2,177.4 million euro at June 30, 2011, up by 81.9 million euro from the end of 2010. The increase was driven by capital expenditure (257.5 million euro) and dividends paid (138.4 million euro), as well as by the re-consolidation of the Calcestruzzi group (218 million euro). These effects were counterbalanced only in part by cash flows from operating activities (66.0 million euro) and proceeds from the sale of fixed assets (393.7 million euro). As a result, the gearing ratio (net debt/consolidated equity) rose to 37.95% at June 30, 2011, from 35.32% at December 31, 2010.
The net financial position of the financial sector (Italmobiliare S.p.A. and the wholly owned financial companies) was positive, at 133.4 million euro (170.6 million euro at the end of 2010), including cash flows for investments in Ciments Français in the first half (28 million euro) and dividends paid (21.3 million euro).
After the sharp decline on the financial markets in the second quarter of the year, Italmobiliare Net Asset Value (NAV) at June 30, 2011, was 1,581.3 million euro (1,744.2 million euro at March 31, 2011, and 1,654.9 million euro at the end of fine 2010).
Outlook – World economic growth is slowing and characterized by persistent uncertainty over government decisions in the Eurozone countries and the USA with regard to sovereign debt and fiscal policy, which are playing an increasingly central role on market drivers. Nevertheless, growth prospects continue to be positive, especially in the emerging countries, despite inflationary pressures fuelled by the rises in prices for raw materials and energy, which will also impact the Group’s results.
From an industrial viewpoint, the Group intends to continue optimizing the efficiency programs already introduced to rationalize production costs and overheads and, as far as possible, transfer the rise in raw material and energy costs to sales prices.
In the climate of uncertainty over the intensity and quality of the international recovery, volatility continues to rise on the financial markets, with repercussions for share prices, while the sovereign debt difficulties in some Eurozone countries is pushing down yields on government securities in the countries considered to be more solid, leading to a rise in risk premiums on other debentures.
This scenario, exacerbated by the difficulties for Italy’s economic recovery and political uncertainty in some of the countries where the Group operates, makes it difficult to provide reliable guidance with regard to full-year results.
Attached the full press release