ITALMOBILIARE GROUP
- REVENUE: 5,016.0 MILLION EURO (5,016.4 MILLION EURO IN 2010)
- TOTAL LOSS FOR THE YEAR OF 60.6 MILLION EURO (PROFIT OF 187.8 MILLION EURO) AFTER EXTRAORDINARY WRITE-DOWNS OF 235 MILLION EURO GENERATED BY THE EFFECTS OF THE CRISIS ON THE MARKETS
- NET DEBT: 2,039.6 MILLION EURO (2,095.5 MILLION EURO)
- TOTAL EQUITY: 5,539.6 MILLION EURO (5,932.8 MILLION EURO)
- POSITIVE NET FINANCIAL POSITION OF 105.2 MILLION EURO FOR PARENT COMPANY AND FINANCIAL COMPANIES (170.6 MILLION EURO)
- NET ASSET VALUE: 1,138.5 MILLION EURO AT DECEMBER 31, 2011 (1,654.9 MILLION EURO AT THE END OF 2010)
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Milan, March 28, 2012 – The Board of Directors of Italmobiliare S.p.A. today examined and approved the consolidated financial statements and the draft separate financial statements for financial year 2011.
The worsening crisis in the euro zone as a result of some countries’ sovereign debt difficulties had a severe impact on the financial markets, with significant repercussions on share and debenture prices. This situation, which was particularly marked in the second half of the year, necessarily led to value adjustments on securities in portfolio, with a material effect on results in the financial and banking sectors.
Results in the industrial sector were adversely affected by the resurgence of inflationary pressure, especially on the cost of energy and raw materials, and, in construction materials, by the continuing uncertainty on the Egyptian market as a result of the local political situation.
Under these conditions, income was materially impacted by the extraordinary effects of significant impairment losses of 148.1 million euro on fixed assets and goodwill and 86.6 million euro on financial assets, in banking and publishing in particular. The remeasurements applied in accordance with by the IAS/IFRS standards – which provide for the losses to be reflected in the income statement – have an impact only at accounting level, but no effects on cash and may be reversed should markets improve. Considering these impairment losses for a total of approximately 235 million euro, the Italmobiliare Group posted a loss for 2011 of 60.6 million euro compared with profit of 187.8 million euro in 2010.
The market upturn that emerged in the early months of 2012 has, however, already made possible a partial reversal of the measurement losses recognized in 2011: since the 2 beginning of the year the stock market index has risen by approximately 8.2% compared with the 2011 full-year fall of 24.3%; specifically, the index for the banking sector, of significance to Group equity investments, rose by approximately 10.5% in the first three months of 2012, compared with a fall of 43.9% in 2011.
Among the sectors in which the Group operates, the financial sector, which comprises the parent company and the wholly owned financial subsidiaries, reported the worst performance, due to the high volatility on the financial markets: after important impairment losses of 94.1 million euro on securities in portfolio, the sector reported a loss for the year of 96.2 million euro, compared with profit of 26.7 million euro in 2010.
In the banking sector, the intermediation margin of 33.3 million euro reflected the reduction in commission income at Finter Bank Zurich. After provisions for bad debts of approximately 4.4 million euro and impairment of 11.4 million euro, the sector posted a loss for the year of 23.1 million euro (a loss of 4.1 million euro in 2010).
Looking at the Group’s industrial operations, the construction materials sector formed by the Italcementi group (which published its results on March 2) posted revenue of 4,720.5 million euro (+1.3% on 2010). Operating results, supported by industrial efficiency but adversely affected by higher energy costs and impairment on a number of acquisitions in previous years in Spain, Greece and Italy, were down on 2010: recurring EBITDA was 697.3 million euro (-17.2%), while EBIT was 129.0 million euro (- 65.2%). A profit was posted for the year of 91.2 million euro, thanks to the capital gain on the sale of the main group operations in Turkey.
The food packaging and thermal insulation sector, consisting of the Sirap Gema group, reported revenue for 235.6 million euro (239.3 million euro in 2010); trends differed between food packaging, where revenue fell by 3.0%, and thermal insulation, where revenue rose by 3.0%. Operating results, affected by an average 12% increase in the cost of raw materials and a series of write-downs in rigid packaging, were down on 2010, with recurring EBITDA at 14.5 million euro and negative EBIT of 2.1 million euro. A loss of 8.9 million euro was reported for the year (profit of 3.5 million euro in 2010).
In 2011 revenue amounted to 5,016.0 million euro, unchanged from 5,016.4 million euro in 2010 reclassified in compliance with IFRS 5 to take account of the sale of operations in Turkey in March 2011.
Recurring EBITDA at 681.0 million euro was down by 203.2 million euro from 2010. All the sectors contributed to the reduction, but the largest decreases in absolute terms were in construction materials (-144.4 million euro) and the financial sector (-36.1 million euro).
EBIT fell by 80.0% to 79.5 million euro, after an increase in amortization and depreciation (491.1 million euro, compared with 477.0 million euro in 2010) and material impairment losses (148.1 million euro compared with 7.9 million euro in 2010).
Impairment related to goodwill (99.4 million euro), property, plant and equipment (33.6 million euro) and intangible assets (15.1 million euro), in the construction materials sector (134.3 million euro), the banking sector (11.4 million euro) and the food packaging and thermal insulation sector (2.4 million euro).
Impairment losses on financial assets amounted to 86.6 million euro (23.2 million euro in 2010) and referred chiefly to equity investments in Unicredit, Rcs MediaGroup and UBI held by the financial sector (-94.1 million euro). A positive factor (+7.5 million euro) was the reversal of the impairment loss recognized on the Calcestruzzi group at December 31, 2010, in the fair value reserve and taken to income in 2011 after the group was included in the consolidation as from January 1, 2011.
Continuing operations showed a loss of 167.1 million euro (a gain of 206.6 million euro in 2010). After capital gains of 106.5 million euro on the sale of Set Group in Turkey, the 3 Group posted a loss for the year of 60.6 million euro (profit of 187.8 million euro). The loss attributable to owners of the parent, after profit of 87.1 million euro attributable to non-controlling interests (166.5 million euro in 2010), was 147.7 million euro (profit of 21.3 million euro).
At December 31, 2011, Italmobiliare Group total equity amounted to 5,539.6 million euro compared with 5,932.8 million euro at December 31, 2010. Year-end net debt stood at 2,039.6 million euro, an improvement of approximately 56 million euro from the end of 2010; the gearing ratio was 36.82% at December 31, 2011, from 35.32% at the end of 2010, while leverage stayed below 3% (2.99% compared with 2.37% at the end of 2010).
The net financial position of Italmobiliare and the wholly owned financial companies was positive at the end of 2011, at 105.2 million euro (170.6 million euro at December 31, 2010).
The parent company Italmobiliare S.p.A. reported a loss for the year of 57.3 million euro, compared with a profit of 35.2 million euro for the year to December 31, 2010. The loss arose substantially from impairment losses of 80.4 million euro on equity instruments and the reduction in capital gains obtained in 2011 compared with the previous year.
Italmobiliare Net Asset Value (NAV) was 1,138.5 million euro at December 31, 2011 (1,654.9 million euro at December 31, 2010).
In consideration of the effects generated by the economic and financial crisis, the Italmobiliare Board of Directors will propose at the Shareholders' Meeting called for May 28 and 29, 2012 (first and second call respectively) that no dividend be paid out for financial year 2011.
Outlook – The conflicting economic and financial projections for full-year 2012 and the changing macroeconomic situation are factors of uncertainty preventing formulation today of reliable guidance on overall Group results for the current year.
Attached the full press release