Toto S.p.A. Costruzioni Generali

Transcription

( Translation from the Italian original which remains the definitive version )
Toto Spa Costruzioni Generali
2014 Financial Statements
TOTO S.p.A. COSTRUZIONI GENERALI
Company Registration 02208250692
Rea (Economic Administrative Index)no. 160647
Joint-stock company with sole shareholder managed and coordinated by TOTO HOLDING S.P.A.
Registered office in VIALE ABRUZZO 410 - 66100 CHIETI (CH) Share capital € 50,000,000.00 fully paid up
Minutes of the ordinary shareholders' meeting
The ordinary shareholders' meeting of TOTO S.p.A. COSTRUZIONI GENERALI was held on 28 April 2015
at 5.35 p.m. at the offices of the company in VIALE ABRUZZO 410, CHIETI to discuss and resolve on the
following
agenda
1. Financial statements at 31 December 2014 and Directors' Report thereon: resolutions and related
decisions. Report of the Board of Statutory Auditors and report of the independent auditors.
2. Appointment of the Board of Directors and its Chairman for the three-year period 2015 - 2017 and
calculation of the related fees.
3. Appointment of the Board of Statutory Auditors and its Chairman for the three-year period 2015 - 2017
and calculation of the related fees.
4. AOB
The following people were physically present in the place and at the time indicated:
Alfonso Toto
Valentina Toto
Paolo Toto
Giovanni Smargiassi
Vito Giuseppe Ramundo
Francesco Cancelli
Chairman of the Board of Directors
Director
Director
Chairman of the Board of Statutory Auditors
Standing Auditor
Standing Auditor
as well as the Sole shareholder, representing the entire share capital directly or by proxy.
Pursuant to the By-laws, Mr. Alfonso Toto, the Chairman of the Board of Directors takes the chair.
Those present request Mr. Giovanni Cagna to act as secretary, renouncing the appointment of scrutineers.
After having been appointed, the Chairman acknowledges that the shareholders' meeting has been duly
called since the entire Board of Directors and the Sole shareholder are present, representing the entire share
capital.
The items of the agenda are addressed.
The Chairman asks if anyone intended to declare themselves as not informed about the issues on the
agenda.
Having obtained the consent to discuss the issue, the Chairman declares the meeting as ready to resolve.
The Chairman asks the participants to communicate the existence of situations that obstructed the right to
vote and no one responded.
Page 1
In reference to the first agenda item, the Chairman distributes the following copies to those present:
•
financial statements at 31 December 2014;
•
Directors’ Report on the financial statements at 31 December 2014;
•
Report of the Board of Statutory Auditors on the financial statements at 31 December 2014;
•
Report of the independent auditors on the financial statements at 31 December 2014.
The Chairman of the Board of Statutory Auditors, Mr. Giovanni Smargiassi reads the Report of the Board of
Statutory Auditors on the financial statements at 31 December 2014.
Once discussion of the various issues begins, the Chairman provides the requested clarifications.
Furthermore, the Chairman, in expressing the shareholders' request to obtain the allocation of dividendd,
presents the possibility to distribute part of the net profit for the year and part of the existing income-related
reserves. He notes that the proposed transaction does not impact the company's financial position. Finally,
he notes that the company has achieved positive financial results with an improvement on 2013 and that the
company recognised available reserves comprised of prior year profits.
After asking again whether there are situations that may obstruct the right to vote, the Chairman puts the first
agenda item up for vote.
After in-depth discussion, the shareholders unanimously
resolve
-
to acknowledge the Report of the Board of Statutory Auditors on the financial statements at 31
December 2014 and the report of the independent auditors on the financial statements at the same
date (Annexes A – B);
-
to approve the financial statements, which were not prepared in the XBRL format, and the Directors'
Report for 2014, which shows a net profit of € 5,015,786, (Annex C);
-
to allocate 5% (€ 250,789) of the net profit for 2014 to the legal reserve;
-
to allocate € 15,364 of the net profit for 2014 to cover prior year losses;
-
to allocate € 249,633 of the net profit for 2014 to the extraordinary reserve;
-
to allocate € 4,500,000 of the net profit for 2014 and € 5,000,000 of the extraordinary reserve to the
distribution of dividends totalling € 9,500,000, granting the shareholders € 19 for each of the 500,000
shares, of a nominal amount of € 100 each;
-
to establish that the above dividends be paid as of 1 June 2015;
-
to grant wide authority to the Chairman of the Board of Directors for all connected legal fulfilments.
Moving on to the second item on the agenda, the Chairman notes that the term of office of the current
Board of Directors expires with the approval of the financial statements at 31 December 2014. Therefore, the
Board of Directors must be renewed. Upon the proposal of the sole shareholder Toto Holding S.p.A., the
shareholders unanimously
resolve
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1. pursuant to article 20 of the By-laws, to set at three the number of directors;
2. to grant the Board of Directors, as a whole, an annual fixed remuneration, gross of withholding taxes,
of € 500,000 (Euro five hundred thousand), in addition to an emolument including the end-of-office
entitlement at the end of the three-year term of office, equal to € 100,000 (Euro one hundred),
allowing the Board of Directors to allocate these amounts among its members with specific roles.
3. to appoint the new Board of Directors, made up of the following people, who will remain in force until
the approval of the financial statements at 31 December 2017:
- Alfonso TOTO, born in Chieti, on 8/01/77, tax code TTO LNS 77A08 C632G, domiciled for the
purpose of his office at viale Abruzzo 410, Chieti;
- Paolo TOTO, born in Chieti on 15/01/65 Tax Code TTO PLA 65A15 C632T, domiciled for the
purpose of his office at viale Abruzzo 410, Chieti;
- Valentina TOTO, born in Guardiagrele (CH) on 30/12/75, tax code TTO VNT 75T70 E243M,
domiciled for the purpose of her office at viale Abruzzo 410.
Mr. Alfonso TOTO is also appointed Chairman of the Board of Directors.
The above-mentioned Directors accept the position and represent that there are no reasons of ineligibility or
disqualification pursuant to article 2382 of the Italian Civil Code.
The shareholders request that in the next meeting of the Board of Directors, the Directors allocate the
powers and the tasks within the Board in accordance with the allocation criteria for fees mentioned earlier.
With respect to the third item on the agenda, since the term of office of the Board of Statutory Auditors has
expired, the Chairman notes that a new Board of Statutory Auditors is to be renewed.
After a short discussion, the Chairman puts the third agenda item up for vote.
After a discussion, the shareholders unanimously
resolve
to appoint the following people as members of the Board of Statutory Auditors:
- Giovanni SMARGIASSI, born in Vasto (CH) on 26/03/43, tax code SMR GNN 43C26 E372Y, domiciled for
the purpose of his office in Vasto (CH), via Genova Rulli 7, Chairman;
- Vito Giuseppe RAMUNDO, born in Lavello (PZ) on 29/05/62, tax code RMN VGS 62E29 E493Q,
domiciled for the purpose of his office in Pescara, via Firenze 10, Standing Auditor;
- Francesco CANCELLI, born in Chieti on 27/09/63, tax code CNC FNC 63P27 C632L, domiciled for the
purpose of his office in Chieti, via Baroncini 32, Standing Auditor;
- Lucio RAIMONDI, born in Chieti on 12/04/57, tax code RMN LCU 57D12 C632W, domiciled for the
purpose of his office in Chieti (CH), via Filippo Rega 4, Alternate Auditor
- Giovanni D’AQUINO, born in Chieti on 17/07/61, tax code DQN GNN 61L17 C632P, domiciled for the
purpose of his office in Pescara, via Elettra 92 Alternate Auditor
who will remain in force until the approval of the financial statements at 31 December 2017.
All members of the Board of Statutory Auditors are registered with the relevant register.
The annual fees for the entire Board of Statutory Auditors total € 93,000.00.
There being no other business, the meeting is adjourned at 6.25 p.m., after reading and unanimously
approving these minutes.
The Secretary
Giovanni Cagna
The Chairman
Alfonso Toto
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REA (Economic Administrative Index)no. 160647
Joint-stock company with sole shareholder managed and coordinated by Toto Holding S.p.A.
Registered office in Viale Abruzzo 410 - 66100 Chieti Scalo (CH)
Share capital € 50,000,000.00 fully paid-up
Directors' report on the financial statements at 31 December 2014
Page 1
BOARD OF DIRECTORS
In office until the approval of the 2014 financial statements
Chairman and Managing Director:
Director:
Director:
Alfonso Toto
Paolo Toto
Valentina Toto
BOARD OF STATUTORY AUDITORS
In office until the approval of the 2014 financial statements
Chairman:
Statutory Auditor:
Statutory Auditor:
Giovanni Smargiassi
Francesco Cancelli
Vito Ramundo
Alternate Auditor:
Alternate Auditor:
Lucio Raimondi
Giovanni D’Aquino
INDEPENDENT AUDITORS
KPMG S.p.A.
Page 2
Dear Shareholders,
2014 ended positively. Net profit equals € 5,015,786 after amortisation and depreciation of €
7,183,385 and current and deferred taxes totalling € 5,485,480.
Operating conditions and business development
The company operates in the large infrastructure construction sector and is among the top
20 general building companies in Italy, and the leading one in Abruzzo. Its main business
involves the construction of large transport infrastructure.
The company's target market is the domestic one, for which TOTO carries out projects for
the main public and private customers, such as ANAS, Autostrade per l’Italia, ITALFERR,
Strada dei Parchi S.p.A. and other organisations.
Operating performance
General conditions
In the first few months of the year, the economy in the Eurozone was characterised by more
pronounced weakness than expected, due, in particular, to an unexpectedly modest growth
in both investments and exports. Conversely, several internal and external factors supported
a modest expansion in the last few months of 2014 which is likely to extend to 2015.
In Italy, with respect to public accounts, 2014 was once again an extremely negative year for
all economic indicators. According to figures published by ISTAT (the Italian National
Institute of Statistics), GDP fell by 0.4% to below 2000 levels, debt reached an all-time high
of 132% of GDP and the tax burden has increased to 43.5%. The ratio between public deficit
and GDP is the only positive element which remained below the 3% European threshold.
However, EU forecasts for the Italian economy in 2015 confirm the signs of recovery noted in
the last few months of the year: GDP is set to increase by approximately 0.6%, reaching
1.3% in 2016. Exports will rise faster than imports, generating an increase in the current
account surplus to 2.6% of GDP in 2015.
With respect to production, the industrial sector and constructions reflect different trends for
2014. Industrial volumes decreased for the third year in a row (-0.8%), though at a slower
pace compared to the past two years; conversely, the index of construction production
remained extremely variable and recorded a considerable decrease (-6.9%) year-on-year.
Target sector
For the seventh year in a row, 2014 was marked by a dramatic crisis which hit both the
public and the private sector.
Between 2008 and 2014 the construction sector lost 32% of investments. Specifically, the
public sector fell by more than 48% and by 54% between 2005 and 2014.
The impact on employment was extremely serious, with the loss of over half a million jobs.
However, with respect to public works, in 2014, after years of considerable decreases, the
number and amount of invitations to tender increased: +30% on 2013 and +18% on 2013,
respectively.
Our company is facing the continuing economic crisis by carefully managing operations by
controlling and containing costs and constantly monitoring margins.
Significant events of the year
In June, following the conclusion of negotiations to obtain payment of the claims related to
the Lots 6/7 Contract, acting on behalf of Autostrade per l’Italia, the customer entered into an
agreement with the contractor whereby it committed to pay the Joint Venture, as it did, € 60
million as advance for litigation. By signing this agreement, the Joint Venture did not waive
Page 3
any claim related to the litigation. Indeed, it was agreed that the Joint Venture will retain the
right to continue all the legal procedures it will deem necessary for the recognition and
payment of the greater amounts due. The same agreement also covers Variation appraisal
no. 3 whereby the customer assigned the contractor additional works worth € 118 million.
In October, the company reached an agreement with ANAS, settling the dispute over the
arbitration award for the calculation of the claims pertaining to ANAS S.p.A. contract
“Autostrada Salerno - Reggio Calabria - Lot 3 from km 44+100 to km 47+800 (Contursi).
Under the agreement, € 22 million was collected in relation to a receivable from ANAS
following the arbitration award in favour of the company, which ANAS had unreasonably
challenged.
In November, the company collected the residual receivable of € 1.6 million accrued in
respect of the Milan – Naples motorway: Valico by-pass Lot 3 (Marzabotto) contract following
the favourable outcome of the civil lawsuit commenced by the company before the Rome
Court against Autostrade per l’Italia.
During the year, the company won three new contracts totalling € 300 million, increasing and
diversifying its order book.
With a view to increasing its order book, the company also took measures to safeguard its
position as shareholder of DIRPA S.c.a.r.l. (currently under extraordinary administration) and
aimed at obtaining control of this company which holds the contract as general contractor of
the “Quadrilatero Marche – Umbria, maxi-lot 2” contract, worth over € 500 million.
The share capital of DIRPA S.c.a.r.l. is currently owned as follows:
- Consorzio Stabile Operae: 99.98%;
- Consorzio Stabile Ergon: 0.01%;
- Toto S.p.A.: 0.01%.
The consortium fund of Consorzio Stabile Operae is in turn owned as follows:
- Impresa S.p.A. (under extraordinary administration) (47.06 %);
- Satrel S.p.A. (under composition with creditors) (42.94 %);
- SAF S.p.A. (under extraordinary administration) (10 %).
Dirpa S.c.a.r.l. was put under extraordinary administration based on the fact that this
company is controlled by Impresa S.p.A.. Indeed, the same Official Receiver was appointed
for both procedures. However, it is not possible to say that control is exercised over DIRPA.
Moreover, following the inclusion of Impresa S.p.A. and its subsidiary SAF S.p.A. in the
extraordinary administration procedure, Consorzio Operae should automatically have been
wound up and thus excluded from the shareholding structure of DIRPA, increasing the
investment percentage of the other shareholders.
Furthermore, following the inclusin of DIRPA S.c.a.r.l. in the extraordinary administration
procedure, the Official Receiver of both separate procedures did not take any real action to
safeguard the assets of DIRPA S.c.a.r.l.; indeed, it accepted Impresa S.p.A.'s failure to
comply with the relevant work contracts.
Consequently, in order to safeguard the company's interests, an extraordinary appeal was
filed with the President of the Italian Republic against DIRPA S.c.a.r.l. under extraordinary
administration together with an appeal pursuant to article 65 of the Prodi law bis against the
Official Receiver's management of the Dirpa procedure. At the same time, negotiations
commenced with the extraordinary administration in order to reach an out-of-court settlement
and enable the company to obtain full control of the project and reach the objective of selling
the asset.
Order book
At 31 December 2014, the company's order book amounts to € 574 million, ensuring the
continuity of operations over the next few years.
Page 4
PORTAFOGLIO LAVORI A FINE ESERCIZIO
1.000
800
588
655
630
600
519
574
517
400
200
-
2009
2010
2011
2012
2013
2014
The breakdown of the order book by customer in €/thousand is as follows:
Committente
Importo
%
Italferr
ANAS
Autostrade per l'Italia
Cons. Autostrade Siciliane
Strada dei Parchi
257
143
115
44
16
45%
25%
20%
8%
3%
Totale
574
100%
New contracts included in the book:
The company's book rose 11% on the previous year following the positive effect of the
activities launched, both in commercial terms with the participation in tenders and with
respect to the identification of engineering solutions for contracts in progress (shoring of the
Sparvo tunnel, lots 6/7) and through the market acquisition of business units, such as the
ANAS La Spezia contract.
The following contracts were obtained:
ASPI: Valico by-pass - Lots 6 and 7: shoring of the Sparvo tunnel and other minor works,
totalling € 118 million;
ANAS: Executive design and execution of the variation to S.S. 1 Aurelia: access roads to the
La Spezia harbour, totalling € 125 million. The contract was obtained through the acquisition
of the business units of Imprese Co.E.Stra. S.p.A. (the agent), L’Avvenire 1921 Società
Cooperativa and S.E.C.O.L. S.p.A., which form the joint venture to which the contract was
originally awarded.
Consorzio per le Autostrade Siciliane: Executive design and static adaptation works of the
Ritiro by-pass of the A20 ME-PA, totalling € 43.5 million.
Page 5
Furthermore, in March 2015, the company topped the list for the awarding of a contract in
Poland worth approximately € 100 million for the construction of 16 Km of the new S5
freeway in the Poznan-Breslavia section.
Again in March, the company reached an agreement for the construction of a 16 MW wind
park in the municipality of Mongrassano (CS), Calabria. The project provides for the
construction of eight wind towers with an individual nominal capacity of 2 MW. The Single
Authorisation is held by the Customer GAMESA (Spain) on behalf of which TOTO will act as
EPC Contractor. The contract is worth approximately € 23 million.
The company's order book amounts to approximately € 700 million, including these two
contracts which are being formalised.
Developments during the year
The reclassified profit and loss account for 2014 is provided below compared with that of the
previous year.
Net revenues
(Net revenues) %
External costs
Added value
Cost of labour
Gross operating profit
(EBITDA)
(EBITDA) %
Amort./ deprec., write-downs
and other provisions
Other income
Operating profit (EBIT)
(EBIT)%
Net financial charges
Operating Profit
Net extraordinary expense
Profit before taxes (EBT)
2014
177,121,359
100%
128,791,115
48,330,244
26,590,418
2013
236,780,426
100%
173,628,695
63,151,731
38,666,953
Change
(59,659,067)165
21,739,829
12.3%
24,484,778
10.3%
(2.744.952)
(11.2)%
7,202,795
502,923
15,039,954
8.5%
(4.428.390)
10,611,564
(110.298)
13,143,048
2,685,075
14,026,805
5.9%
(5.183.723)
8,843,082
(1.096.425)
(5.940.253)
(2.182.152)
1,013,149
7.2%
755,335
1,768,482
986,127
10,501,266
5.9%
5,485,480
5,015,786
7,746,657
3.3%
4,730,493
3,016,164
2,754,609
35.6%
754,987
1,999,622
(EBT)%
Income tax
Net profit for the year
(44.837.580)
(14.821.487)
(12.076.535)
EBITDA amounts to € 21.7 million, down on 2013 (€ 24.5 million) by approximately € 2.7
million, but up in percentage terms (2014: 12.3%; 2013: 10.3%); EBIT of €15.0 million (8.5%)
is up on the € 14 million (5.9%) for 2013.
Production revenues
Production revenues fell by approximately € 60 million on the previous year. This
considerable decrease is due to: the completion of the Roma Est slip road contract; the
temporary lower contribution of the Lots 6/7 contract to revenues and the delay in the
beginning of the new contracts in the order book.
The breakdown of this item is as follows:
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2014
2013
Change
Turnover from sales and services
200,137,835
278,624,554
(78,486,719)
Change in contract work in progress
Total revenues
(23,016,476)
(41,844,127)
18,827,651
177,121,359
236,780,427
(59,659,068)
502,923
2,685,075
(2,182,152)
177,624,282
239,465,502
(61,841,220)
Other revenues and income
Production revenues
Production revenues for the five-year
year period
300
247
200
242
248
178
157
100
-
2010
2011
2012
2013
2014
Production cost
The main operating costs are shown below:
Raw materials
Services
Total raw materials and services
Personnel
Use of third party assets
2014
23,139,100
93,057,154
116,196,254
26,590,418
3,432,590
2013
54,772,989
108,508,170
163,281,159
38,666,953
5,046,969
Change
(31,633,889)
(15,451,016)
(47,084,905)
(12,076,535)
(1,614,379)
The combined “costs for raw materials and services” fell considerably on 2013, down by
approximately € 47 million. The decrease is due to the reduction in revenues.
revenues
Personnel expenses
Personnel expenses decreased by 31.2% on 2013 following the proportional reduction in the
company's revenues for the year.
The table below details the workforce and expenses by category, the analysis of which
illustrates the changes in the various cost components that resulted in the reduction.
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2014
2013
var.
14.335,2
16.235,4
(1.900,1)
7.898,1
7.216,7
681,4
9,4
12.255,2
26.590,4
22.431,6
38.667,0
(10.176,4)
(12.076,5)
(45,4)
(31,2)
Teste Medie Dir/Imp
Teste Medie Operai
Teste Medie Totali
158,9
239,5
398,4
190,5
396,4
586,9
(31,6)
(156,9)
(188,5)
(16,6)
(39,6)
(32,1)
Costo Medio Dir/Imp
Costo Medio Operai
Costo Medio Totale
90,2
51,2
66,7
85,2
56,6
64,4
5,0
(5,4)
2,4
5,8
(9,6)
3,7
409.258
29,9
772.044
29,1
(362.786,0)
0,9
(47,0)
3,1
Descrizione
Costo Dir/Imp
di cui Sede
Costo Operai
Totale Costo
Ore Lavorate Operai
Costo orario Operai
var. %
(11,7)
Financial position
The breakdown of the company’s net financial position is shown below.
2014
2013
9,225,596
13,577
9,239,173
1,799,191
16,200
1,815,390
7,426,405
(2,623)
7,423,782
604,573
604,409
164
Bank loans and borrowings (due within one year)
Current portion of loans
Current financial liabilities
(35,988,352)
(6,027,599)
(42,015,951)
(41,401,769)
(4,177,323)
(45,579,092)
5,413,416
(1,850,276)
3,563,140
Net current financial position
(32,172,206)
(43,159,293)
10,987,087
Bank loans and borrowings (due after one year)
Non-current portion of loans
Financial receivables from group companies
Financial receivables from others
Non-current net financial position
(9,334,021)
(28,889,743)
61,752,231
2,842,841
26,371,308
(15,362,860)
(35,309,686)
30,482,997
3,005,436
(17,184,113)
6,028,839
6,419,943
31,269,234
(162,595)
43,555,421
(5,800,898)
(60,343,406)
54,542,508
Bank deposits
Cash-in-hand and cash equivalents
Liquid funds and own shares
Current financial assets
Net financial position
Difference
The net financial position at 31 December 2014 equal to € 5.8 million shows, compared to
the previous year, an increase of € 54.5 million, caused by a significant improvement in the
Page 8
current (approximately € 11.0 million) and the non-current net financial position (€ 43.6
million).
Bank loans and borrowings, broken down below, decreased by approximately € 16 million
following the repayment of principal related to advances for “Claims”, loans and financing.
Descrizione
31/12/2014
31/12/2013
Variazioni
C/c ordinari
C/anticipi "SIL/SAL"
C/anticipi "Claims"
Mutui su Aree e Fabbricati
Finanziamenti Beni Strum.li
4.356.996
25.211.414
15.361.620
35.309.686
6.313.068
24.777.692
3.891.066
19.540.543
41.729.269
(1.956.072)
433.722
(3.891.066)
(4.178.923)
(6.419.583)
Totale debito verso banche
80.239.716
96.251.638
(16.011.922)
Operations
Pursuant to article 2428, it is noted that the company's business is carried out at the Chieti
office and in the Rome office, in addition to in the other secondary offices set up at the main
work sites in operation in the municipalities of Castiglione dei Pepoli (Bologna), Rome,
Manoppello (Pescara), Cefalù (PA) and Eboli (SA) and in the other minor work sites
considered as business units. The two branches set up in the United Arab Emirates of Dubai
and Abu Dhabi are also operative.
During 2014, the company's operations were primarily carried out on a domestic level.
Information on the main contracts under way and completed during the year is given below.
MAIN CONTRACTS UNDER WAY
Milan-Naples motorway upgrade - Lots 6 and 7
Customer: Autostrade per L’Italia S.p.A.
Description: Upgrading of the Apennine section between Sasso Marconi and Barberino del
Mugello – La Quercia - Badia Nuova section - Lots 6 and 7
Contractual amount: €. € 510,584,462 (following the 3rd variation appraisal)
Contracting companies: Joint Venture Vianini S.p.A. - Toto S.p.A. – Profacta S.r.l.
The tender involves the design and execution of upgrading of the Apennine section between
Sasso Marconi and Barberino del Mugello on the La Quercia - Badia Nuova section of the
Milan-Naples Motorway.
Production in 2014 amounted to approximately € 61 million. 79% of the work had been
completed at 31 December 2014.
During the first half of the year, after the crumbling that involved the two bores of the Sparvo
tunnel after finishing their excavation and lining work using the TBM – EPB boring machine,
negotiations started between the Joint Venture and ASPI to assess the future decisions.
At the end of these negotiations, a private deed was signed on 26 June 2014 between the
Joint Venture and ASPI, agreeing upon the following, among other items:
1. to discuss the design solution for the works to be carried out, necessary to reinforce the
two bores of the Sparvo tunnel.
2. after completing the development of the executive design in accordance with the above
design solution, with the specific addendum described below, ASPI would entrust the Joint
Venture with the shoring of the Sparvo tunnel and additional works that were not previously
covered by the contract. These works are necessary to complete the lot for opening to traffic.
Page 9
3. the above addendum would extend both the contractual term for the completion of work as
well as the term for the early completion of the work, for which there is an additional fee for
early completion, and to define new partial terms for the payment of advances for the
additional fee.
4. The Joint Venture has agreed to draw up and deliver the executive designs related to the
work specified in points 1 and 2 to ASPI and once ASPI has approved these designs, it will
assign the relative work to the Joint Venture with specific addendum to the contract (which
also will acknowledge the agreements specified above in points 2 and 3), with an advance
payment to the Joint Venture of 10% of the amount of the new work.
5. Payment to the Joint Venture of an advance related to the claims recognised, as
described later on.
In fulfilment of that agreed upon in the private deed signed on 26 June 2014, the Joint
Venture delivered the designs for the new work to ASPI. ASPI approved the projects and,
with the addendum dated 29 September 2014:
1. ASPI assigned to the Joint Venture the execution of the shoring that has become
necessary after the crumbling that occurred in the Sparvo tunnel as well as additional work
necessary in order to complete the lot so it can be opened to traffic;
2. ASPI extended the contractual term for the completion of work as well as the term for the
early completion of the work, for which there is an additional fee for early completion, and
defines new partial terms for the payment of advances for the additional fee.
3. as a result of the above, the contractual amount (net of rebate and including the fee for the
design and the charges for safety) is increased from € 392,706,215 to € 510,584,462;
4. the advance due to the Joint Venture in connection with the new works amounts to €
11,744,900;
5. ASPI committed to indemnify and hold harmless the Joint Venture from any damage
(including landslides, worsening of the causes that led to the crumbling of the concrete in the
section of the tunnel under pressure which is unacceptable under the relevant Technical
Standards, or any other reason), to the Sparvo tunnel, unless the future damage is
attributable to the Contractor's failure to comply with the new project adopted by the means
of the above addendum.
With respect to the above additional fee, at the date of preparation of this report, the two new
milestones introduced by the above addendum (completion of the Northern and Southern
bores of the Val di Sambro tunnel in accordance with the relevant deadlines), were reached,
generating an additional € 20 million for the Joint Venture for early termination of works.
In the past, the Joint Venture has recognised several claims for a total amount of €
655,701,936.84, updated to date of the most recent progress report issued, no. 41 for works
included up to 31 January 2015.
The obstacles caused by the Customer prevented the commencement of the procedures
aimed at reaching an amicable agreement (article 240 of Legislative decree no. 163/2006)
to settle the claims. Consequently, the Joint Venture decided to safeguard its rights and
opted for different alternatives. Therefore, in the first few months of 2013, it requested that
the Court of Rome carry out a Preventive Technical Assessment pursuant to article 696 bis
of the Code of Civil Procedure, in order to verify the various facts and situations which
occurred during the performance of works, which are detrimental to the Joint Venture and
calculate the amount to be paid in respect of the recognised claims.
The Court accepted in full the Joint Venture's request and allowed all its questions, quashing
the exceptions and objections of the Customer Autostrade per l’Italia S.p.A. (“ASPI”) which
said that the procedure was inadmissible. Consequently, the Court ordered the Preventive
Technical Assessment (R.G.N. 12103/2013), appointing Mr. Gianfranco Belli, Mr. Fernando
Ciotti and Mr. Roberto Graciotti, all based in Rome, as experts.
The claims examined in the Preventive Technical Assessment total € 433,450,125.78, as
per the most recent progress report no. 28 dated 30 November 2012.
During the Preventive Technical Assessment, and with the intention of interrupting it, ASPI
said it was open to a settlement. To this end, some meetings were held among its
Page 10
technicians and representatives and those of the Joint Venture. During these meetings, the
Parties agreed to focus the negotiations on the most technical claims (additional fees, etc.
for charges related to safety, work, price adjustment and fees and similar), with an amount
(redress) of approximately € 100 million, and that the claims related to indirect charges, subproduction and other (equal to a residual amount of approximately € 333 million) be
assessed by the above Court-appointed experts.
Upon completion of the negotiations, with a deed dated 26 June 2014, ASPI committed to
pay the Joint Venture an advance of € 60 million related to the relief sought. The amount
was paid in the days immediately afterwards.
It was established that the agreement and the payment of the above amount would not have
entailed the Joint Venture's waiver to claim the greater amounts of the claims, hence the
waiver to the above Preventive Technical Assessment. This was also set out in the above
deed.
On 20 February, the Court-appointed experts handed the parties' advisors their first
appraisal, on which their observations and deductions will be submitted within the next 60
days. Once the 60-day period has elapsed, the Court-appointed experts will file the definitive
Appraisal.
In their appraisal, the Court-appointed experts, acknowledging the Joint Venture's reasons,
declared having ascertained that, because of the weaknesses of the project underlying the
tender compared to the real situation of the location, the Joint Venture was forced to perform
works that were completely different from those set out in their tender offer and,
consequently, was before a case of aliud pro alio.
Consequently, according to the Court-appointed experts, the contractual conditions cannot
be applied and it is proposed that the Joint Venture be remunerated similarly to “day work”,
and, therefore, that the actual costs incurred in relation to the tender be reimbursed.
Sparvo tunnel.
During the first half of 2014, operations at the Sparvo tunnel were almost entirely suspended
in order to perform the many extensive test campaigns and monitoring activities necessary to
define the project for the structural reinforcement with metallic shoring of the two tunnel
bores, with the Northern bore and the Southern bore extending for approximately 400 metres
and 330 metres, respectively.
Once prepared, the project was approved with the third Variation appraisal with Addendum,
and the activities to prepare the tunnel sections subject to shoring commenced, while
resuming by-pass excavation. During the year, the cut-and-cover tunnels at the two Bologna
and Florence entrances were completed, while works for the final completion of the two
entrances in accordance with the new project provisions continued.
Val di Sambro tunnel
The excavation and coating of the two bores were completed, including the sections
awarded under the third variation appraisal:
-
excavation of the Northern bore was completed on 1 September;
excavation of the Southern bore was completed on 18 September.
Furthermore, during the year, the excavation and coating of all the tunnel by-passes were
completed and the plant engineering and hydraulic preparation activities were commenced.
The cut-and-cover tunnels on the Florence side were completed and finishing work on the
entrances started.
Earth movement, Storage areas
Page 11
Works outside the Val di Sambro and Sparvo tunnels continued regularly in accordance with
work site schedules.
Specifically, the works related to the AD6 storage area were completed together with the
construction of the motorway embankments. Furthermore, all works in the areas freed from
interferences were completed. Finally, the metal deck of the A-1 motorway overpass was
assembled.
Works at the AD5 storage areas were interrupted in order to prepare a new final project
necessary to resolve the issues affecting the final arrangement of the ophiolites of excavated
earth and rocks characterised by concentrations of BTEX which exceed the limits set by
Legislative decree no. 152/06 and subsequent amendments and integrations.
Palermo - Messina railway section - Cefalù contract (PA)
Customer: ITALFERR S.p.A.
Description: doubling of the Cefalù – Ogliastrillo – Castelbuono railway section
Contractual amount: € 347,505,711
Contracting company: Joint Venture Toto S.p.A. – Italiana Costruzioni S.p.A. – Armafer S.r.l.
– E.S.I.M. S.r.l. – Alpitel S.p.A.
Percentage of investment: 74.11%
Contractual amount: €. € 257,536,483
The contract involves the executive plan and construction of the 12.3 km Cefalù (Ogliastrillo)
- Castelbuono railway section, along the Palermo - Messina railway line, and is an integral
part of the Italian railway infrastructure modernisation and development programme.
During the year, the executive design of the lot and its analysis with the Customer were
completed. On 16 January 2014, the executive design was delivered to the customer which
approved it, after a long technical preliminary investigation, on 25 November 2014, together
with the signing of the first Addendum, which sets the total contractual amount to €
347,505,711.33 and the timeframe for the execution of works at 2,050 days.
Works were delivered on 10 December 2014.
The company will be involved in constructing three tunnels, which will affect almost the entire
new railway line:
the first, called “Cefalù, 6,700 metres long and double-arched, will be constructed using
mechanised digging technology, using one TBM (Tunnel Boring Machine) with a diameter of
9.90 metres;
the second, called “S.Ambrogio”, 4,000 metres long and single-arched, will be constructed
using mechanised digging techniques, using one TBM with a diameter of 12 metres;
the third, called “Malpertugio”, 120 metres long, will be constructed using traditional digging
techniques.
The work also comprises the two viaducts called "Carbone 1” and “Carbone 2” with mixed
steel/concrete deck, the work and services provided for the superstructure and the
installations for Electrical Traction, Signalling, Control and Command, Telecommunications,
Light and Power Points.
A24/25 Motorway - Awarding of the design and construction of the Roma Est slip
roads
Customer: Strada dei Parchi S.p.A.
Description:
Creation of an A24 motorway slip road system from the Portonaccio junction
to the Roma Est station. Executive design and works
Contractual amount following the second Variation appraisal: €. 209,775,840
Contracting company: Toto S.p.A.
Page 12
The contract awarded by the operator Strada dei Parchi S.p.A. involves the executive plan
and construction of the urban section of the A24/A25 motorway, from the Portonaccio
intersection to the Roma Est station.
In addition to extending both the east and west carriageways by over 14 km, the project also
boasts several new facilities (28 in total), including the new intersection on the GRA (great
ring road), two new steel viaducts over the Aniene river and the new Via di Salone and Tor
Cervara intersections.
Production in 2014 amounted to €
16,776,000. Total progress of the work is approximately 99%.
The activities carried out in 2014 mainly related to those set out in the second variation
appraisal and to the works to complete the lot.
A/24 - A/25 Motorway – Improvement to the seismic capacity of various viaducts
Description: Improvement of seismic capacity and restoration of damaged concrete on the
Palude, Campane and Sant’Onofrio viaducts of the A/24 and the Cerchio and Collarmele
viaducts of the A/25
Contractual amount: € 28,913,836 (following variation appraisal)
Production in 2014 amounted to approximately € 3.5 million and the work was completed in
October.
The work is part of the programme to bring the seismic capacity of the viaducts in line with
new safety regulations and was begun by Strada dei Parchi following the earthquake in 2009
and therefore is aimed at bringing the structures of the viaducts along the layout of the
motorway in line with the new provisions. They substantially involve removing the piers and
pier caps of the surface layer of damaged concrete using hydroblasting, then laying
reinforced armature and replastering them with special highly-resistant cement-based
mortar.
A/24 - A/25 Motorway – Carestia tunnel modernisation and restoration contract
Description: Modernisation and restoration of the west bore of the Carestia tunnel.
Production during the year amounted to € 2.9 million and led to the completion of the work.
The project involves the removal of the damaged definitive concrete lining, waterproofing of
the milled surfaces using a sprayed polymer coating, addition of reinforced armature and
casting of a new 40 cm layer of reinforced concrete.
A/24 – A/25 Motorway - San Sisto viaduct contract
Description: Work for the improvement of seismic capacity of the San Sisto viaduct - l’Aquila.
Page 13
Production during the year amounted to € 5.5 million. 58% of the work had been completed
at 31 December 2014.
This contract involves recovering the damaged concrete and structural reinforcement.
Ponte Albanito S.r.l. – Wind park
Customer: Ponte Albanito S.r.l.
Description: construction of a 22.8 MW wind park
Contractual amount: € 31,220,000
Percentage of work: 100%
Production during the year amounted to € 6.5 million. 100% of the work had been completed
The work started in May 2013 and was completed in June 2014. The contract involves
constructing a new 22.8 MW wind park, comprising eight wind turbine towers each with a
capacity of 2.85 MW each. It also includes the construction of a cable duct, approximately 25
km in length, to carry the energy produced to the Terna power station, and a medium-to-high
voltage power transformer substation.
ACQUIRED CONTRACTS IN THE SET-UP STAGE
Variation to the S.S. 1 Aurelia Lot 3 – La Spezia contract
Customer: ANAS
Description: Executive design and execution of the variation to S.S. 1 Aurelia; access roads
to the La Spezia harbour
Contractual amount inclusive of the variation appraisal being formalised: € 125 million
Percentage of investment: 100%
The contract was obtained through the acquisition of the business units of the three
companies that formed the Joint Venture. The latter had only performed a minimum
percentage of work.
The contract refers to Lot 3 of the variation to S.S. 1 Aurelia at La Spezia, between Felettino
and the La Spezia – S. Stefano motorway link.
The variance is part of the project related to the access roads to the La Spezia harbour as
the backbone of the road system of the area. It is a ring-road around the city which runs from
the Felettino area, in the Northern/Western part of the city, to the Stagnoni area, on the East
side of the city, where it connects with the Motorway link, avoiding the urban centre.
The definitive project was approved with CIPE (Interministerial Committee on Economic
Programming)
resolution no. 60 of 2 April 2008.
The work carried out in 2014 involved:
• Building yard set up, with partial field restoration, reactivation of shacks, utilities and
base contracts;
• Safety of the Fornaci 1 (GN04) and Fornaci 4 (GN06) tunnels, draining the water that
had filled them up to the side walls, threatening the nearby local road network;
• Reactivation of sub-contracts and supply contracts;
• Topographical controls;
• Accounting controls and, more in general, of tender documentation;
• Study and design of a variance with respect to the original design.
Business development
The company has a public works qualification certification (SOA), issued by Protos Soa
S.p.A., applicable to various fields of work and with unlimited amounts.
Page 14
The certificate issued on 26 November 2014 by the certification body is valid until 6
November 2016 and includes 23 fields of work, 9 of which for general work (4 with unlimited
contractual amounts) and 14 for specialist work (3 with unlimited contractual amounts).
The company is also a certified class "I" General Contractor. The certificate, issued on 12
March 2015, is valid until 6 November 2016 and will enable the company to participate
independently in tenders for amounts of up to € 350 million.
The company's objectives for the upcoming years are primarily to work in the domestic
market for third-party customers as a general contractor for complex infrastructural projects
with a high technological content and as an EPC contractor for companies in the Renexia
Group (renewable energy) and for Strada dei Parchi (A24-A25 motorway concession).
Furthermore, also on the basis of the proven experience gained in the mechanised drilling of
tunnels, to continue working as a specialist in the TBM Tunnelling sector, not only as a direct
contractor but also for main third-party contractors within the scope of so-called large scale
projects (underground systems and water tunnels) in Italy and abroad.
In terms of commercial strategy, more emphasis will be placed on commercial partnerships
with other Italian and international players in order to increase its share of the domestic
market, acquire new customers, open new markets, share the country risk as well as the
project related risk.
The objective is to reach a critical mass that makes it possible to compete better in the
markets of reference, both on a stand-alone basis for projects up to € 400 million as well as
in equal JVs for projects with amounts that exceed that value.
The two branches in Dubai and Abu Dhabi continue their activities of searching for new work
that could be interesting within the markets of reference and in the nearby Oman.
The company is also developing its commercial activities in Eastern Europe, specifically
Poland and the Balkans.
At the date of preparation of this report, the company was eligible to participate in the
following foreign tenders:
Poland – European Bank for Reconstruction and Development financing:
-
Construction of the WLacz ring road on national road 10 - expected amount € 100
million;
Construction of the North Approach Road to the Bridge on the Sava river - expected
amount approximately € 100 million;
Construction of the Koszalin & Sianow ring road on the S6 freeway along the S11
section from the Police junction to the Koszalin West junction - expected amount
approximately € 100 million;
Extension of the Warsaw-Białystok national road 8 to become a freeway, Wyszków Podlaskie Voivodeship border section, Wyszków 1a section - Poręba junction –
expected amount approximately € 100 million;
Extension of the Warsaw-Białystok national road 8 to become a freeway, Wyszków Podlaskie Voivodeship border section, Poręba junction 1b section – expected amount
Construction of the S7 Kraków - Rabka Zdrój freeway, section Skomielna Biała Chabówka, and construction of the new section of state road 47, section rabka Zdrój
– Chabówka; expected amount approximately € 100 million;
Construction of the Kraków - rabka Zdrój S7 freeway, Lubień - Naprawa section,
from km 713+580 to km 721+170.00; expected amount approximately € 100 million;
Extension of state road no. 8 Warszawa - Białsytok and adjustment to become a
freeway; Wyszków section - Podlaskie regional border, section II: Ostrów
Mazowiecka ring road - Podlaskie regional border from km 553+145.50 to km
562+542.07; expected amount approximately € 80 million;
Page 15
Bosnia Herzegovina – European Bank for Reconstruction and Development financing:
-
-
Construction of the motorway on the Corridor Vc, Počitelj-Bijača section, PočiteljZvirovići sub-section. LOT 1: Počitelj-ponte Počitelj junction (from km 0+000.00 to km
4+404.00) - expected amount approximately € 50 million;
Construction of the motorway on the Corridor Vc, Počitelj-Bijača section, PočiteljZvirovići sub-section, LOT 2: Počitelj-Zvirovići bridge (from km 4+404.00 to km
11+075.00) - expected amount € 40 million.
On the date this report was drawn up, the company is awaiting news on the outcome of the
following tenders in Italy for which it has submitted bids:
ANAS: S.S. 260 PICENTE - Dorsale Amatrice-Montereale -L'Aquila - Lot IV from the Marana
to the Cavallari junctions. Adjustment to section C2 of DM 5/11/2001 – gross amount of
ANAS: North/South path S. Stefano di Camastra - Gela S.S. 117 "Centrale Sicula" Modernisation and upgrading of the section from km 19+000 and km 23+200. Lot B2 Completion works – amount of approximately € 57 million.
Research and development
During the year, the company incurred no costs for research and development activities.
Quality – Safety – Environment
In 2014, Toto S.p.A. determinedly pursued the consolidation and continuous improvement
targets of the Quality, Environment and Safety Integrated Management System which, since
2010, has been certificated by the TÜV Rheinland Group, the largest and most authoritative
certification body in the world, in compliance with the international standards of reference
UNI EN ISO 9001:2008, UNI EN ISO 14001:2004 and BS OHSAS 18001:2007.
In November 2014, the TÜV Rhineland Group carried out – at the company’s office and work
sites – a periodic inspection to renew the Quality and Monitoring Management System
Certificate and that for the Safety and the Environment and check compliance with the
reference standards and issued and approved the validity of the company’s certificates.
The company’s Quality, Environment and Safety Integrated Management System consists of
all processes connected and related to the company’s core business and falling within the
scope of the following: “Design and construction of civil engineering works and infrastructure,
such as tunnels, viaducts, bridges, motorways, roads, civil and industrial buildings, energy
production systems and complementary and specialised works such as special structural
works, barriers and road protections”.
The continuous improvement of the Integrated Management System and the maintenance of
the certificates are the result of the company's constant commitment towards achieving
customer satisfaction and quality constructions, protection of the environment and prevention
of pollution, the safety and health of workers and the prevention of accidents and
occupational diseases, compliance with current legislation and other requirements to which
the company subscribes, the use of sector best practices and research for technological
innovation and the continuous improvement of services and of the company’s management
system.
In 2014, Toto S.p.A. also maintained the FPC System (“Factory Production Control”)
certification of the control of factory production of ready-mixed concrete plants produced at
the company installed at sites.
Page 16
With regard to hygiene, health and safety issues, a training plan financed by Fondo Impresa
was launched which, through nationally recognised standards, in 2014 – and also in 2015 enabled the company to develop the knowledge and skills necessary to ensure that each
worker can effectively interpret and play the role of “agent/carrier of security”.
Information on main subsidiaries
ALITEC S.p.A.
The company is the owner of an industrial complex located in Chieti Scalo, which has been
unused for many years and covers a total area of 165,000 m2, where ALITEC S.p.A. is
involved in a project involving the construction of a multifunctional complex for commercial,
residential (for students), cultural, entertainment and well-being uses.
AMBRA S.r.l.
Construction company established in 2004, in which Toto holds an investment of 98.5%, that
has constructed a building complex located in Chieti Scalo called “Agorà". The work was
completed during the first few months of 2009 and overall, 197 building units were
constructed.
Ambra, with the support of the RE division of the parent, is selling the building units that have
not yet been sold.
Investments
The investments of the year primarily referred to the revamping of machinery and equipment
to be used to start contracts, the so-called preliminary work and the building yard set up
related to said contracts which mark the start-up of a project.
Related party transactions (parents, associates and related companies)
Parents
Company
Toto Holding
Total
Loan
assets
52,956,882
52,956,882
Trade
receivables
Other
payables
12,155
12,155
945,406
945,406
Trade
receivables
Other debtors
Payables/Accrued
expenses
3,627
3,627
Revenues
Costs
1,102,452
1,102,452
982,716
982,716
Revenues
Costs
Subsidiaries
Company
IMC S.r.l.
Ambra
Toto S.p.A. in ass. with Taddei
Sc
Parchi Scarl
Alitec S.p.A.
Loan
assets
771,387
193,958
6,666
103,427
5,349,375
42,228
304,850
1,472,260
Page 17
Payables
4,590
258
4,973
36,675
15,005
63,338
276,099
2,600
184,045
176,876
1,014
115,000
6,314,719
Total
1,929,432
0
68,186
504,391
307,895
Related companies
Company
Infraengineering S.r.l.
Strada dei Parchi S.p.A.
Toto Real Estate
Rail One S.p.A.
Parchi Global Services S.p.A.
Renexia S.p.A.
InterSun S.r.l.
Ponte Albanito S.r.l.
Aviagricola
Total
Loan
assets
Trade
receivables
821,582
2,107,731 13,910,526
6,409,068
102,278
71,709
240,597
5,100
582,666
83,951
2,107,731 22,227,475
Prepayments
1,379
1,379
Trade payables
Revenues
1,552,369
576,087
1,646,420 35,499,432
378,032 1,251,237
516
37,518
615,538
61,954
325
113,079
1,400
65,426 7,091,618
20,057
4,258,626 44,652,383
Costs
1,553,395
0
591,960
358
257,306
170
0
215,187
0
2,618,376
Associates
Company
Loan
assets
San Benedetto Val di Sambro Scarl
Intermodale S.r.l.
Arabona Scarl
Trade
receivables
Loans and
borrowings
Trade payables
372,900
372,900
Total
Costs
972,290
6,165,504
17,735
2,700
35,375,184 99,858,877 51,113,596
741,791
7,897,319
2,625
5,325
313,105
103,449
2,484
1,212,511
98,013
8,419
36,903,284 99,956,889 51,225,464
Trade
receivables
Other debtors
Novigal Scarl
Galleria di Tenda
Revenues
Related parties
Company
Real estate projects
Total
Loan
assets
1,204,566
1,204,566
1,587,419
1,587,419
0
Payables
Revenues
0
41,119
41,119
These transactions, which do not include any atypical and/or unusual activities, are governed
at normal market conditions.
Further information on the activities of subsidiaries and associates is provided in the Notes to
the financial statements.
Own shares and shares/quotas in parents
The company does not possess nor has it possessed over the course of the year, either
directly or indirectly, own shares or shares in parents.
Page 18
Costs
31,310
31,310
Organisational Model pursuant to Legislative decree no. 231/2001
In November 2011, by resolution of the Board of Directors, the company adopted the
"Organisational and Management Model" provided for by art. 6 of Legislative decree no.
231/2001 (available on the company website in the section Investors – Code of Conduct and
Organisational Model).
The Model is aimed at preventing specific offences such as:
•
Offences against Public Authorities
•
Company law offences
•
Terrorist offences or crimes to subvert the democratic order
•
Offences involving counterfeit money, in legal tender and in revenue stamps
•
Offences against individuals in breach of safety regulations
•
Handling stolen goods, money laundering and the use of money, goods or profit from
illegal activities
•
Offences committed in breach of authors’ rights
•
Offences involving inciting someone not to make statements or to make false
statements to the Judicial Authorities
•
Offences against industry and commerce and on the subject of industrial property
•
IT offences and unlawful handling of data
•
Organised crime
•
Environmental crimes
•
Use of illegal workers
The Model was also supplemented by the provisions of Law no. 123/07 which extend the
company's liability to culpable homicide crimes and grievous and very grievous bodily harm,
committed in breach of the regulations on accident prevention and worker health and safety
and the New Consolidated Law on Health and Safety at Work - Legislative decree no. 81/08.
With the same Board resolution the "Code of Ethics" was adopted (available on the company
website in the section Investors – Code of Ethics and Organisation Model). This sets out the
commitments and ethical responsibilities in conducting company affairs and activities by the
directors, employees, collaborators and co-workers of Toto S.p.A. and the companies it
controls.
With the same Board resolution the Supervisory Body was also set up, consisting of three
members with the skills and professionalism needed to fill the role, which, in accordance with
art. 6 of Legislative decree no. 231/2001 and in order to ensure the effectiveness and
constant implementation of the Organisational and Control Model and the Code of Conduct,
the body has been vested with autonomous powers of initiative and control which should be
exercised by those fulfilling the requirements of autonomy and independence,
professionalism, continuity of action and adequate spending powers.
In accordance with its regulations, the Supervisory Body is periodically informed by the
Board of Directors on the activities carried out, reports received, corrective measures and
improvements to the organisational model.
Significant events after the reporting date
•
In March, the company was provisionally awarded a contract in Poland for the
construction of 16 Km of the new S5 highway in the Poznan-Breslavia section. The total
amount of the contract is approximately € 100 million.
•
Again in March, the company reached an agreement for the construction of a 16 MW
wind park in the municipality of Mongrassano (CS), Calabria. The project provides for the
construction of eight wind towers with an individual nominal capacity of 2 MW. The Single
Authorisation is held by the Customer GAMESA (Spain) on behalf of which TOTO will act as
Page 19
EPC Contractor. The contract is worth approximately € 23 million.
•
With respect to the ANAS Galleria di Tenda contract, the company, also considering
the modest investment in the joint venture (35%) reached an agreement with Grandi Lavori
Fincosit S.p.A. to exit the Contract.
•
With respect to the ANAS “La Spezia” contract recently acquired by Toto following the
acquisition of the business units of the companies comprising the Joint Venture which won
the contract, the Rome court-appointed expert before which the Joint Venture had begun a
Preventive Technical Assessment to assess the issues which took place during the contract
and the claims recorded in the progress report no. 5 for work up to 6 March 2013 (redress of
€ 38,785,064.74), filed its report on 3 March, stating that:
1. The Customer ANAS S.p.A. did not apply the necessary technical variation and
integration appraisal due to the many issues and situations which occurred
during the performance of work, and which prevented the regular performance
thereof;
2. the irregular performance of work and the considerable delay in their execution
was due to events which were not attributable to the joint venture;
3. the amount to be paid to the joint venture in relation to the claims recognised up
to progress report no. 5 is € 7,391,544.61. In calculating this amount, the Courtappointed expert confirmed that the Joint Venture has no responsibility for the
delay of the works. Furthermore, the stoves and the other facts that prevented
the prosecution of work in the Felettino I, Felettino III and Pellizzarda tunnels are
due to geological uncertainties.
These assessments, where confirmed in the Court-appointed expert's final
report, despite relating to a period prior to Toto's take over in the contract, were
also useful: indeed, in addition to the company's right to collect a portion of the
total amount to be paid in relation to claims, pursuant to the agreements with the
selling companies, the conclusions reached by the Court-appointed expert
implicitly support the company's right to obtain an extension of the contractual
period of time following the prior delays, and compensation for the damage
suffered given the inability to correctly perform the works until the Customer
ANAS S.p.A. has applied the necessary variation appraisal.
•
As described in detail in the section on contracts in progress, with respect to the
Contract Lots 6/7, on 20 February, the Court-appointed experts handed the parties' advisors
their first appraisal, on which their observations and deductions will be submitted within the
next 60 days. Once the 60-day period has elapsed, the Court-appointed experts will file the
definitive Appraisal.
Meanwhile, the companies' respective lawyers will continue to work towards an out-of-court
settlement.
In January, following the sale of the quotas of Ponte Albanito S.r.l. and the related availability
of cash flows, the parent Toto Holding significantly decreased (by approximately € 12 million)
the financial receivable from the company. Furthermore, the expected dividend distribution
will further decrease the receivable by € 9.5 million.
Business outlook
The company's turnover for 2015 is expected at approximately € 240 million, with six active
contracts in Italy and one abroad.
Also due to the considerable size of the order book, the company can also suitably select
projects in which it will participate in 2015, favouring those of greatest value and those that
are the most technologically advanced.
Page 20
The commercial target is to acquire new orders during the year that are at least equal to the
revenues expected for 2015.
The company will focus its commercial efforts on both the domestic market, which remains
the reference market, and promising foreign markets.
Also for 2015, it is believed that the profitability of the orders will also be in line with the
company's historical trend and the sector benchmark for comparable players.
Information on risk management, financial instruments and guarantees
Liquidity risk
Toto S.p.A. pays special attention to managing the resources generated or absorbed by
operating and/or investing activities and to the characteristics of payables in terms of due
and renewal dates in order to ensure cash flow is managed effectively.
A series of policies and processes have therefore been accelerated targeted towards
optimising the dynamics of financial resources, with the purpose of managing and mitigating
liquidity risk.
In particular, special attention is paid to:
•
•
•
Monitoring the level of liquidity available
Optimising credit lines
Monitoring future liquidity
Exchange rate risk
Toto S.p.A. primarily operates in Italy: transactions are therefore for the most part in euros.
The euro is also the currency for external sources of financing to support and develop the
company's industrial activities.
The company’s financial performance is therefore not subject to market risk resulting from
exchange rate fluctuations.
Derivatives
The company has five outstanding interest rate hedging contracts to cover a portion of its
bank debt.
Further information is provided in the notes to the financial statements.
Credit risk
The company's customers are companies with high credit ratings. Government and public
bodies, solvent by nature, or companies belonging to the Group. Credit risks, which means
the exposure of the company to potential losses deriving from non-fulfilment by its customers
of their obligations, should therefore be considered insignificant.
Guarantees and sureties
For information on guarantees and sureties, reference should be made to the section on
memorandum accounts in the explanatory notes.
Allocation of the net profit for the year
Dear Shareholders:
Page 21
We propose that you:
-
discuss and approve the directors' report and the financial statements at 31 December
2014 which show a net profit of € 5,015,786;
-
allocate 5% (€ 250,789) of the net profit for 2014 to the legal reserve;
-
allocate € 15,364 of the net profit for 2014 to cover prior year losses;
-
allocate € 249,633 of the net profit for 2014 to the extraordinary reserve;
-
allocate € 4,500,000 of the net profit for 2014 and € 5,000,000 of the extraordinary
reserve to the distribution of dividends totalling € 9,500,000, granting the shareholders €
19 for each of the 500,000 shares, of a nominal amount of € 100 each;
-
decide that the above dividends be paid as of 1 June 2015.
Chieti, 27 March 2015
Alfonso Toto
Page 22
Companies Register 02208250692
Rea (Economic Administrative Index)160647
Managed and coordinated by TOTO Holding S.p.A. Single-member company
Registered office in Viale Abruzzo 410 - 66100 CHIETI (CH)
Financial statements at 31 December 2014
Balance sheet - assets
31/12/2014
31/12/2013
616,391
823,854
A) Share capital proceeds to be received
(of which: called up)
B) Fixed assets
I. Intangible fixed assets
1) Start-up and capital costs
2) Research, development and advertising costs
3) Industrial patents and intellectual property rights
4) Concessions, licences, trademarks and similar rights
8,000
12,000
61,075
141,874
55,341
58,800
5) Goodwill
3,579,235
6) Assets under development and payments on account
1,031,000
1.191,214
65,856
136,911
5,416,898
2,364,653
1) Land and buildings
20,404,829
20,834,917
2) Plant and machinery
43,681,114
48,333,431
143,196
456,258
4) Other assets
1,946,680
2,789,496
5) Assets under construction and payments on account
1,187,210
1,206,014
67,363,029
73,620,116
7) Other
II. Tangible fixed assets
3) Industrial and commercial equipment
III. Financial fixed assets
1) Investments:
a) subsidiaries
49,806,976
49,807,141
b) associates
4,052,312
4,052,312
c) parents
d) other
7,413,246
7,413,246
61,272,534
61,272,699
2) Financial receivables
a) from subsidiaries
- due within one year
6,314,719
6,154,361
- due after one year
6,314,719
6,154,361
b) from associates
Page 1
372,900
276,200
372,900
276,200
c) from parents
52,956,882
22,345,326
52,956,882
22,345,326
d) from others
4,950,572
4,712,546
4,950,572
4,712,546
64,595,073
33,488,433
-
125,867,607
94,761,132
Total fixed assets
198,647,534
170,745,901
6,573,388
8,954,357
3) Other securities
4) Own shares
(total nominal amount)
C) Current assets
I. Inventory
1) Raw materials, consumables and supplies
2) Work in progress and semi-finished products
3) Contract work in progress
59,654,495
82,670,971
4) Finished goods
4,418,840
4,418,840
5) Payments on account
2,112,807
3,584,779
72,759,530
99,628,947
II. Receivables
1) Trade receivables
9,667,282
35,480,793
9,667,282
35,480,793
2) From subsidiaries
1,929,432
5,037,866
1,929,432
5,037,866
3) From associates
7,897,319
13,079,156
7,897,319
13,079,156
4) From parents
12,155
17,889
12,155
17,889
4-bis) Tax receivables
2,123,673
1,285,682
2,123,673
1,285,682
4-ter) Deferred tax assets
632,310
488,220
Page 2
632,310
488,220
5) From others
25,926,339
14,975,707
25,926,339
14,975,707
48,188,510
70,365,313
575,164
575,000
III. Current financial
assets
1) Investments in subsidiaries
2) Investments in associates
3) Investments in parents
4) Other investments
5)Own shares
(total nominal amount)
6)Other securities
29,409
29,409
604,573
604,409
9,225,596
1,799,191
13,577
16,200
9,239,173
1,815,391
130,791,786
172,414,060
IV. Liquid funds
1) Bank and postal accounts
2) Cheques on hand
3) Cash-in-hand and cash equivalents
Total current assets
D) Prepayments and accrued income
- discounts on loans
- miscellaneous
6,451,898
2,809,071
6,451,989
2,809,071
Total assets
335,891,309
345,969,032
Balance sheet - liabilities
31/12/2014
31/12/2013
50,000,000
50,000,000
20,699,616
20,699,616
303,128
152,320
A) Net equity
I.
Share capital
II. Share premium reserve
IV. Legal reserve
VII. Other reserves
Extraordinary or optional reserve
5,759,438
2,894,082
Euro rounding difference
VIII. Net profit (loss) carried forward
IX. Net profit for the year
Total net equity
1
5,759,438
2,894,083
(15,364)
(15,364)
5,015,786
3,016,164
81,762,604
76,746,819
Page 3
B) Provisions for risks and charges
2) Tax provision, including deferred tax liabilities
5,887
3) Other provisions
Total provisions for risks and charges
C)
Employees' leaving entitlement
3,446,343
4,417,122
3,452,230
4,417,122
981,736
1,398,148
D) Payables
4) Bank loans and borrowings
42,015,952
45,579,092
38,223,764
50,672,546
80,239,716
96,251,638
6) Payments on account
3,569,956
10,195,042
3,569,956
10,195,042
7) Trade payables
50,117,367
75,774,122
50,117,367
75,774,122
9) Payables to subsidiaries
68,186
3,827,844
68,186
3,827,844
10) Payables to associates
36,908,609
29,762,694
36,908,609
29,762,694
11) Payables to parents
945,406
682,992
945,406
682,992
12) Tax payables
44,227,368
31,796,726
19,493,721
3,830,103
63,721,089
13) Social security charges
payable
1,283,042
35,626,829
2,161,889
1,283,042
2,161,889
14) Other payables
10,184,809
1,455,467
Total payables
8,937,073
11,640,276
8,937,073
248,493,647
263,220,123
Page 4
E) Accrued expenses and deferred income
- premiums on loans
- miscellaneous
1,201,092
Total liabilities
186,820
1,201,092
186,820
335,891,309
345,969,032
31/12/2014
Memorandum and contingency accounts
4) Other memorandum and contingency accounts
Total memorandum and contingency accounts
747,058,176
659,386,883
747,058,176
659,386,883
2014
Profit and loss account
31/12/2013
2013
A) Production revenues
1) Turnover from sales and services
200,137,835
278,624,554
(23.016.476)
(41.844.127)
2) Change in work in progress,
semi-finished products and finished goods
3) Change in contract work in progress
4) Internal work capitalised
5) Other revenues and income:
- miscellaneous
502,923
2,685,075
- grants related to income
- grants related to assets (current portion)
502,923
2,685,075
177,624,282
239,465,502
6) Raw materials, consumables, supplies and goods
23,139,100
54,772,989
7) Services
93,057,154
108,508,170
3,432,590
5,046,969
Total production revenues
B) Production cost
8) Use of third party assets
9) Personnel expenses
a) Wages and salaries
18,394,734
26,204,867
b) Social security contributions
6,977,583
10,603,232
c) Employees' leaving entitlement
1,078,416
1,804,140
139,685
54,714
d) Pension and similar costs
e) Other costs
26,590,418
38,666,953
10) Amortisation, depreciation and write-downs
a) Amortisation of intangible fixed
assets
b) Depreciation of tangible fixed
assets
c) Other write-downs of fixed assets
362,503
384,929
6,820,882
12,245,079
Page 5
d) Write-downs of current receivables
and liquid funds
400,000
11) Change in raw materials, consumables,
supplies and goods
12) Provisions for risks
7,183,385
13,030,008
2,380,969
1,676,843
19,410
113,040
6,781,302
4,619,884
162,584,328
226,434,856
15,039,954
13,030,646
13) Other provisions
14) Other operating costs
Total production cost
Operating profit (A-B)
C) Financial income and charges
15) Income from investments:
1,350
- in subsidiaries
- in associates
- other
1,350
16) Other financial income:
a) From financial receivables classified as fixed assets
- from subsidiaries
187,441
155,210
954,395
419,711
- from associates
- from parents
- from others
462,260
b) from securities classified as fixed assets
c) from securities classified as current assets
389,533
615
641,349
232,874
d) other income:
- from subsidiaries
- from associates
- from parents
- from others
-
2,172,718
1,270,670
2,172,718
1,272,020
17) Interest and other financial charges:
- to subsidiaries
- to associates
- to parents
- other
17-bis) Net exchange rate losses
Net financial charges
6,596,792
6,421,208
6,596,792
6,421,208
(4.316)
(34.535)
(4.428.390)
(5.183.723)
D) Adjustments to financial assets
18) Write-backs:
a) investments
Page 6
b) financial fixed assets
c) securities classified as current assets
19) Write-downs:
a) investments
b) financial fixed assets
c) securities classified as current assets
Total adjustments
E) Extraordinary income and expense
20) Extraordinary income:
- gains on sale of assets
- other income
112,973
1,825,896
1,255,278
1,938,869
1,255,278
21) Extraordinary expense:
- losses on sale of assets
- taxes relative to prior years
- other expense
2,049,167
Net extraordinary expense
Profit before taxes (A-B±C±D±E)
1,355,544
2,049,167
1,355,544
(110.298)
(100.266)
10,501,266
7,746,657
22) Current and deferred taxes
a) Current taxes
b) Deferred tax expense
c) Deferred tax income
5,623,683
4,825,956
5,887
(93,134)
(144,090)
(2,329)
d) Income (expense) from participation in the tax
consolidation/transparency scheme
23) Net profit for the year
5,485,480
4,730,493
5,015,786
3,016,164
Alfonso Toto
Page 7
REA (Economic Administrative Index) no. 160647
Managed and coordinated by TOTO HOLDING S.p.A. Single-member company
Registered office in Viale Abruzzo 410 - 66100 CHIETI (CH)
Notes to the financial statements at 31 December 2014
Foreword
Toto S.p.A. Costruzioni Generali ("Toto S.p.A.") is the company of the Toto group which directly and indirectly
- through its subsidiaries and associates – designs and constructs infrastructure and residential and industrial
buildings.
Business activities
On the Italian market, Toto S.p.A. Costruzioni Generali is one of the top building firms specialised in the design
and construction of large-scale transport infrastructure.
At the reporting date, the company had an order book of approximately € 621 million.
Preparation criteria
The following financial statements comply with articles 2423 et seq. of the Italian Civil Code, as shown by these
notes prepared pursuant to article 2427 of the Italian Civil Code and which form an integral part of the financial
statements in accordance with and pursuant to article 2423.
These financial statements have been prepared using the measurement criteria set out in article 2426 of the
Italian Civil Code, which were supplemented and integrated by the accounting standards issued by the Italian
Accounting Profession (Consigli Nazionali dei Dottori Commercialisti e dei Ragionieri), as amended by the OIC
(the Italian Accounting Standard Setter) as well as by the document issued directly by the OIC.
The OIC standards have been recently revised and updated. The changes introduced apply starting from the
financial statements at 31 December 2014. Therefore, these financial statements have been prepared taking
into account these changes. For information about the effects of the application of the new OIC standards,
reference should be made to the section ‘Application of the new OIC standards’ of these notes.
These financial statements comprise: a balance sheet, a profit and loss account and these notes.
Each balance sheet and profit and loss account caption is accompanied by prior year corresponding figures.
When captions cannot be compared, prior year figures have been adjusted, including a comment thereon,
where necessary.
For the purposes of a better presentation of the company's financial position and results of operations, these
notes also include a cash flow statement which shows the reasons behind the increases and the decreases in
liquid funds during the year. The cash flow statement has been prepared with prior year corresponding figures
in accordance with the indirect method and using the format required by OIC 10.
The balance sheet and the profit and loss account have been prepared in units of euros.
For information about the company's business, transactions with subsidiaries, associates, parents and other
related parties and about the significant events after the reporting date, reference should be made to the
Directors' Report which accompanies these financial statements.
Page 1
Group membership
Pursuant to article 2497 and subsequent articles of the Italian Civil Code, it is noted that the company is
managed and coordinated by Toto Holding S.p.A..
In accordance with current law, the company made use of the option not to prepare the group’s consolidated
financial statements, despite holding controlling interests directly in the following companies: Alitec S.p.A., IMC
S.r.l., Parchi Scarl, Ambra S.r.l., since the consolidated financial statements are drawn up by the parent Toto
Holding S.p.A..
The following table provides key figures from the most recent financial statements approved by the aforesaid
company which is responsible for management and coordination.
2013
2012
BALANCE SHEET
ASSETS
A) Subscribed capital unpaid
B) Fixed assets
C) Current assets
Total assets
455,562,477 508,490,517
18,580,333
20,080,664
79,010
92,350
474,221,820 528,663,531
LIABILITIES:
A) Net equity:
298,651,725 370,649,131
Share capital
100,000,000 100,000,000
Reserves
271,236,305 271,236,305
Net profit (loss) carried forward
Net profit (loss) for the year
(587,174)
0
(71,997,406)
(587,174)
31,821,046
31,821,046
C) Employees' leaving entitlement
180,157
142,007
D) Payables
143,554,430 126,049,469
E) Accrued expensed and deferred income
14,462
1,878
Total liabilities
474,221,820 528,663,531
PROFIT AND LOSS ACCOUNT
B) Production costs
D) Adjustments to financial assets
Income taxes for the year
4,263,058
12,285,632
395,765
(67,313,576)
(677,105)
(3,620,084)
(71,997,406)
3,439,811
8,949,344
6,730,395
(3,851,954)
(288,000)
(2,331,918)
(587,174)
Basis of presentation
Financial statements captions have been measured in accordance with the general principles of prudence and
on an accruals basis, assuming the company will continue as a going concern and taking into account the
economic function of the asset or liability concerned.
In accordance with the principle of prudence, assets and liabilities are measured separately to avoid offsetting
losses which should have been recognised against unrealised profits not to be recognised. Specifically, profits
are recognised only if realised by the reporting date. Conversely, the risks and losses pertaining to the year are
Page 2
recognised even when they become known after the reporting date.
In accordance with the accruals-based accounting, the effect of transactions is recognised in the year to which
the transactions relate, regardless of when collections and payments take place.
For the purposes of financial statements comparability, the measurement criteria applied are unchanged from
those of the previous year, except for that set out in the section ‘Application of the new OIC standards’.
During the year, no exceptional circumstances took place which required application of the waivers permitted
by article 2423.4 of the Italian Civil Code, since they prevent the true and fair presentation of the company's
financial position and results of operations. Furthermore, during the year, no assets were revalued in
accordance with special revaluation laws.
The preparation of financial statements requires the calculation of estimates which affect reported assets and
liabilities and related disclosure. Actual results may differ from these estimates. These estimates are regularly
reviewed and the effects of such changes, except for those arising from incorrect estimates, are recognised in
the profit and loss account of the relevant year, when the changes only affect said year, and also in subsequent
years when they affect both the current and subsequent years.
Application of the new OIC standards
In financial statements at 31 December 2014, the company changed the criterion applied to recognise
pre-operating costs.
This change was necessary following the OIC's approval, during the year, of new accounting standards
applicable to the financial statements at 31 December 2014.
The recognition criterion was changed in accordance with OIC document no. 29 and that set out in OIC
document no. 23, both published on 5 August 2014.
Under the new standard, subject to compliance with specific conditions, pre-operating costs are included under
contract costs and considered in the calculation of the contract profit margin based on the progress of works.
Consequently, they are no longer capitalised and amortised.
This change has been applied and recognised in these financial statements. The related effects have been
recognised in accordance with the new standard which was applied on a retrospective basis.
Retrospective application also affected the facts and operations which took place in the years prior to the
application of the above change, as if the new standard had always been applied.
Therefore, pursuant to article 2423.ter of the Italian Civil Code, in order to compare these financial statements
to those of the previous year, 2013 financial statements captions have been adjusted.
The adoption and application of the accounting standard which changed the recognition criteria applicable to
some prior year financial statements captions had no effects on the net profit for the year or net equity.
For additional information about the above change, reference should be made to that set out later on in these
notes.
Measurement criteria
Foreign branches
The operations of the foreign branches have been recognised in the financial statements of the parent using
the “foreign currency/euro” exchange rate ruling on the date the operation was performed.
At the reporting date, foreign currency receivables and payables were translated using the “foreign
currency/euro” exchange rate in place at 31 December 2014, taking any conversion differences to the profit
and loss account.
Tangible fixed assets were recognised using the exchange rate ruling on the date the operation was
performed, except in the case of a persistent unfavourable trend of the reference exchange rate.
Fixed assets
Intangible fixed assets
Page 3
These are recognised at the historical purchase cost and are shown net of accumulated amortisation, which is
directly charged to the individual items.
Start-up and capital costs and research and development costs of a long-term nature are recognised under
assets with the approval of the Board of Statutory Auditors and are amortised over five years.
Costs for the use of intellectual property rights are capitalised and amortised over three years. Concessions,
licences, trademarks and similar rights are amortised over 20 years.
Goodwill is recognised under assets only when acquired against consideration. Its amount can be calculated
and it is originally comprised of charges and costs of a long-term nature which ensure future economic benefits
and meet the principle of cost recoverability. This caption is amortised over not more than five years on a
straight-line basis over the term of the works acquired as part of the acquisition of a business unit.
If, regardless of the amortisation already charged, an impairment loss exists, the asset is written down
accordingly. If in following years the reasons for the write-down no longer apply, the original amount is
reinstated adjusted by amortisation only.
Tangible fixed assets
These are recognised at purchase cost and adjusted by the corresponding accumulated depreciation.
The carrying amount takes into account ancillary charges and costs incurred for using the asset, less any
material trade or cash discounts.
The depreciation charges, taken to the profit and loss account, are calculated according to the use and the
expected useful life of the assets. The following depreciation rates are believed to reflect the effective useful
life of the assets, and are unchanged from the previous year. They are halved in the year in which the asset
comes into use.
Rates
Industrial buildings
3.00%
Light constructions
12.50%
General plant and sundry equipment
10.00%
Operator machinery and specific plant
Specific plant (Martina TBM boring machine)
Ordinary office equipment and furniture
15.00%
5.88%
12.00%
Electrical and electronic equipment
20.00%
Cars
25.00%
Lorries
20.00%
Self-propelled excavators
20.00%
Operator machinery and specific plant include the “Martina TBM boring machine”. Since at 31 December 2013,
this asset was being used in work sites for excavation activities, it was amortised based on the ratio excavated
meters/total excavation production capacity in accordance with OIC 16.
Starting from 2014, although the asset was not used given the completion of excavation activities, in
accordance with the new accounting standards, the company has continued to amortise it using a 5.88%
depreciation rate which reflects the asset's residual life of 17 years, calculated on the residual value at 31
December 2013, net of the estimated realisable value at the end of the useful life (OIC 16).
If, regardless of the depreciation already charged, an impairment loss is identified, the asset is written down
accordingly. If in following years the reasons for the write-down no longer apply, the original value is reinstated
Page 4
adjusted by depreciation only.
Tangible fixed assets under finance leases are recognised under assets when the repurchase right is
exercised, if any. During the lease term, lease payments are recognised in the profit and loss account in the
relevant years and the financial commitment to make such residual payments is recognised in the
memorandum and contingency accounts when it is not included under payables. These notes describe the
effects on net equity and the profit for the year which would have arisen had the company applied the so-called
“financial method” (IAS 17).
Financial fixed assets
Investments, debt securities and own shares held on a long-term basis following management's decision and
the company's effective ability to held them for a long time are classified under financial fixed assets.
Otherwise, they are recognised under current assets.
The transfer from fixed assets to current assets, or vice-versa, is recognised using measurement criteria that
are specific to the original portfolio.
Receivables are classified under financial fixed assets and current assets based on their allocation criterion
with respect to ordinary business activities, hence, regardless of their due date. Financial receivables are
classified under financial fixed assets, while trade receivables under current assets. The measurement
criterion applied to receivables is described below.
Investments
Investments in subsidiaries and associates, recognised under financial fixed assets, are measured at
purchase or subscription cost.
Other investments are recognised at purchase or subscription cost.
Investments classified as fixed assets represent the company's long-term, strategic investments.
Investments recognised at purchase cost which have undergone an impairment loss have been written down.
With respect to other investments, if the cost of the investment exceeds the relevant portion of net equity, no
write down is recognised since the higher carrying amount is justified by the gains and goodwill of subsidiaries
and associates.
Inventory
Raw and ancillary materials are recognised at purchase cost or at their realisable value (or replacement value)
based on market trends, whichever is lower. Purchase cost is equal to the latest price which reflects the
average weighted cost.
Despite the binding agreement between the parties and the company's ability to reliably estimate the contract
profit/loss, contract work in progress is recognised based on the progress of works (or the percentage of
completion), whereby costs, revenues and margins are recognised based on the work performed. The
percentage of completion is obtained by applying the physical measurement method.
Measurement reflects the best estimate of works at the reporting date. The assumptions underlying
measurements are periodically updated. Any financial effects are recognised in the year the update takes
place.
Contract revenues include: the contractually-agreed consideration, formalised variations to works, price
adjustments, claims requested and incentives, to the extent that it is reasonably certain that they can be
measured reliably.
In accordance with OIC document no. 23 of 5 August 2014, pre-operating costs have been recognised under
inventory. These costs are considered in the contract profit margin based on the progress of works.
Price adjustments are stated in accordance with article 1.550 of Law no. 311/04 (2005 Finance Act) and the
subsequent decrees of the Ministry of Infrastructure and Transport of 30 June 2005, 11 October 2006, 2
Page 5
January 2008 and 9 May 2009, which provided for annual price variations on the main materials used in the
construction sector.
Additional fees have been recognised in accordance with the principle of prudence; consequently, the
repayment of the greater costs incurred or the greater consideration are included under contract revenues only
to the extent of the amounts which can be reasonably identified and calculated. Claims are measured
considering the estimates prepared by the specific company areas (based on the type of each claim, including
assessments of the legal grounds and financial capacity) and the fact that for certain tenders an initial claim
definition procedure has already been concluded. The reasons behind the “Claims” valuations are therefore
similar to those established in previous arbitration procedures.
The most significant claims relate to updates, which are measured using the same criteria as those previously
applied by the Board of Arbitrators and the Commission, as the case may be, in the above proceedings.
Receivables
They reflect the rights to receive liquid funds from customers or other third parties and are measured at their
estimated realisable value.
The nominal amount of receivables is adjusted to reflect bad debts, invoice adjustments, discounts and
rebates and other reasons for a reduced use.
With respect to bad debts, the nominal amount of receivables is adjusted through the provision for debt debts
which reflects the possibility that the debtor fails to fully meet its contractual commitments. The provision for
bad debts is estimated by analysing individual receivables, calculating the expected loss for each irregularity
already identified or reasonably expected and by estimating, based on experience and any other useful
element, the additional losses that may affect the receivables outstanding at the reporting date.
Securities
Securities recognised under current assets are recognised at purchase cost or their realisable value based on
market trends, whichever is lower.
Liquid funds
They are measured at their estimated realisable value, which is the same as their nominal amount.
Prepayments and accrued income, accrued expenses and deferred income
These are determined on an accruals basis.
For long-term prepayments and accrued income, accrued expenses and deferred income, the conditions
which led to them being initially recognised have been checked and changes made as necessary.
Provisions for risks and charges
Provisions for risks and charges comprise specific liabilities of a certain or probable nature, whose due date or
amount is not known. Specifically, the provisions for risks reflect specific and probable liabilities with estimated
amounts, while the provisions for charges reflect specific and certain liabilities, with estimated amounts or due
dates, related to commitments in place at the reporting date, but which will take place in subsequent years.
Accruals to the provisions for risks and charges are recognised in the profit and loss account under the
captions to which the transaction refers, classifying costs by nature.
The amount of accruals reflects the best estimate of costs, including legal fees, at each reporting date and is
not discounted. When a change in amounts is identified, the accrual reflects the best estimate between the
highest and lowest limits of such change range.
Provisions are subsequently used directly and only for those costs and liabilities for which they were originally
accrued. Any positive or negative differences with respect to the charges actually incurred are recognised in
the profit and loss account in line with the original accrual.
Page 6
This represents the actual amounts due to employees upon termination of work, pursuant to article 2120 of the
Italian Civil Code and considering the changes introduced by Law no. 296 of 27 December 2006. It reflects
the total amounts accrued considering any form of ongoing remuneration, net of advances paid and partial
advances in accordance with collective or individual employment agreements or company agreements for
which no reimbursement is requested. The related liability is equal to the amount that would be due to
employees should their employment terminate at the reporting date.
The provision does not include the amounts accrued from 1 January 2007 allocated to supplementary
pension schemes under Legislative decree no. 252 of 5 December 2005 (or transferred to the INPS - Italian
Social Security Institute - treasury fund).
Payables
These are recognised at their nominal amount, adjusted in the event of returns or invoicing adjustments.
Foreign currency transactions, assets and liabilities
Receivables and payables originally expressed in foreign currencies, recognised at the exchange rates in force
on the date they arose, are adjusted to the exchange rates applicable at the reporting date.
In particular, current assets and liabilities and financial receivables recognised under fixed assets are
recognised at the spot exchange rate applicable at the reporting date. Translation gains and losses are taken
to the profit and loss account under caption 17 bis Exchange gains and losses.
Fixed assets in foreign currency are instead recognised at the exchange rate in force at the time of their
purchase or at the lower closing rate only if negative changes have resulted in an impairment loss on such
assets.
Guarantees, commitments, third party assets and risks
Guarantees, commitments and third party assets are shown in the memorandum and contingency accounts at
their contractual value.
Risks for which a liability is probable are described in the notes and allocated to the provision for risks in
accordance with the criteria of adequacy.
Risks for which a liability is only possible are described in the notes, but no amount is allocated to the provision
for risks in accordance with the applicable accounting standards. Remote risks have not been taken into
account.
Revenue recognition
Revenues from contract work in progress are recognised on a percentage of completion basis, as shown in the
work progress reports (SALs) certified by the contracting bodies.
Income tax
Taxes are provided for on an accruals basis. Therefore, they reflect accruals for taxes paid or to be paid during
the year, calculated in accordance with applicable rates and laws.
Deferred tax assets pertaining to the year are recognised only in the case of temporary differences when it is
reasonably certain that there will be a lower tax charge in the future.
They are recognised in order to reflect the future tax benefits that result from the temporary differences
between the carrying amounts of reported assets and the corresponding amounts considered in order to
determine the current taxes, as well as any tax losses carried forward. Deferred tax assets are recognised in
compliance with the principle of prudence, if it is reasonably certain that, in the years in which the temporary
deducible differences that led to their recognition reverse, the company will report a taxable profit equal to at
least the amount of the differences that will be offset.
They are determined based on the tax rate defined for the income tax for the years in which the temporary
differences will be offset. The effect of the change of the tax rates for said taxes is recognised in the year in
which the related legal provisions are approved. In the balance sheet, deferred tax assets are recognised
Page 7
under “Deferred tax assets”. In the profit and loss account, the deferred tax assets and liabilities are recognised
under "Current and deferred taxes”.
From 2009 the company, as consolidated company, has opted to participate in the national tax consolidation
scheme – which allows for IRES (corporate income tax) to be calculated according to a taxable basis
corresponding to the total of positive and negative taxable amounts of the individual participating companies –
together with the company Toto Holding S.p.A., the latter acting as the parent.
Financial relationships between the parent and the subsidiary, in addition to their mutual responsibilities and
obligations, are set out in the Consolidation Regulations for the companies in the Group which was signed on
16 June 2009, as subsequently amended and integrated.
Prepaid IRES (corporate income tax) is calculated based on the temporary differences between the amounts
of assets and liabilities determined according to statutory criteria and the corresponding tax values solely with
reference to the company.
Current and prepaid IRAP (regional tax on production) are calculated exclusively with reference to the
company.
Significant events after the reporting date
These events which alter the conditions already in place at the reporting date and which require changes to the
carrying amounts of assets and liabilities, in accordance with the relevant accounting standards, are
recognised reflecting the effect of these events on the financial position and results of operations at the
reporting date.
The events which alter situations already in place at the reporting date, but which do not alter financial
statements figures, under the relevant accounting standard, as they pertain to the subsequent year, are not
recognised but disclosed in the notes, where necessary, for a better understanding of the company's position.
These events are reflected in the financial statements provided that they occur before the date of the draft
financial statements, unless when between such date and that for the shareholders' approval of the financial
statements events occur such to require that the draft financial statements be changed.
Workforce
The company's average workforce, broken down by category, underwent the following changes compared to
the previous year.
Personnel
Managers
White collar workers and
middle-management
Blue collars
Other
31/12/2014
31/12/2013
Change
22
122
22
148
(26)
228
16
388
389
6
565
(161)
10
(177)
The employment contract applied for white and blue collar workers is the Collective National Employment
Contract for employees of construction firms and similar businesses of 19 April 2010, updated by the
agreement of 1 July 2014. The agreement applied for managers is the Collective National Employment
Contract for managers of companies that produce goods and services of 25 November 2009, updated by the
agreement of 30 December 2014.
Assets
Page 8
B) Fixed assets
I. Intangible fixed assets
31/12/2014
5,416,898
31/12/2013
2,364,653
Change
3,052,245
31/12/2013
Increases of Amortisati
balance, post
the year
on of the
reclassif.
year
823,854
207,463
Decreases and
rounding
Total change in intangible fixed assets
Start-up and capital
costs
Research,
development and
advertising costs
Industrial patents
Concessions, licences
and trademarks
Goodwill
Assets under
development and
payments on account
Other
Carrying
Reclass. purs. to
amount at
art. 2423-ter
31/12/2013 Italian Civ. Code
823,854
12,000
12,000
141,874
58,800
141,874
58,800
Carrying
amount at
31/12/2014
616,391
4,000
13,850
94,648
3,459
8,000
(1)
3,579,235
4,068,197
(2,876,983)
1,191,214
1,043,494
6,148,219
(906,583)
(3,783,566)
136,911
2,364,653
3,593,085
52,933
362,503
61,075
55,341
(160,214)
3,579,235
1,031,000
(18,122)
(178,337)
65,856
5,416,898
Transfers from one caption to another
As described in the section “Application of the new OIC standards”, pursuant to article 2423.ter of the Italian
Civil Code, in order to compare these financial statements with those of the prior year, the 2013 balance (€
3,783,566) related to pre-operating costs was reclassified to current assets.
Previous revaluations, amortisation and write-downs
The historical cost at the start of the year is broken down as follows.
Historical
cost
Start-up and capital costs
Research, development and
advertising costs
Industrial patents
Concessions, licences and
trademarks
Assets under development and
payments on account
Other
1,042,318
20,000
908,168
69,176
Accumulated
amortisation
Reclass. purs. to
art. 2423-ter
Italian Civ. Code
Carrying
amount
218,464
823,854
8,000
766,294
12,000
141,874
10,376
4,068,197
25,441,577
31,549,436
Write-downs
58,800
(2,876,983)
24,398,083
25,401,217
(906,583)
(3,783,566)
1,191,214
136,911
2,364,653
Breakdown of start-up and capital costs, research and development costs and advertising costs
Start-up and capital costs and research and development costs, recognised with the approval of the Board of
Statutory Auditors, are broken down below together with the reasons for their recognition.
Page 9
Start-up and capital costs
Incorporation costs
Costs for new offices
Carrying
amount at
31/12/2013
6,000
817,854
823,854
Increase of the
year
Decrease of the Amortisation of
year
the year
3,000
204,463
207,463
Carrying
amount at
31/12/2014
3,000
613,391
616,391
Costs for new offices refers to the costs incurred to set-up the Dubai and Abu Dhabi branches. They are
amortised over five years.
Research and development costs
Increase in production
Carrying
amount at
31/12/2013
12,000
12,000
Increase
of the year
Decrease
of the year
Amortisation
of the year
4,000
4,000
Carrying
amount at
31/12/2014
8,000
8,000
The balance consists of costs incurred by the company for purchasing a certification as a general contractor.
They are reasonably associated with a useful life that spans over several years and are systematically
amortised over their residual income generating potential.
Industrial patents and intellectual property rights
Software
Carrying
amount at
31/12/2013
141,874
141,874
Increase of
the year
13,850
13,850
Rounding
(1)
(1)
Amortisation of
the year
94,648
94,648
Carrying
amount at
31/12/2014
61,075
61,075
The balance refers to software licences purchased and used during the year as part of business activities
(Autocad, Oracle, MS Office, etc.).
Goodwill
Carrying
amount at
31/12/2013
Business unit acquisition
Increase
of the year
3,579,235
3,579,235
Decrease
of the year
Amortisation
of the year
Carrying
amount at
31/12/2014
3,579,235
3,579,235
The increase of the year refers to the acquisition of the business units of Imprese Co.E.Stra. S.p.A. (€
2,040,200) and L’Avvenire 1921 (€ 1,539,035), which form part of the Joint Venture which, together with
S.E.C.O.L. S.p.A., won the ANAS contract for the executive design and execution of the variation to S.S. 1
Aurelia: access roads to the La Spezia harbour, totalling € 125 million. Amortisation will be charged on a
straight-line basis over not more than five years starting from 2015. Indeed, acquisition of the last business unit
was completed at the end of 2014, based on the term of the works obtained as part of the business unit
acquisition.
Page 10
Goodwill was recognised with the approval of the Board of Statutory Auditors. At the date of preparation of
these notes, the following conditions were met:
− it was acquired against consideration as it derives from the acquisition of a business unit;
− its amount can be calculated as it is included in the agreed consideration;
− it is originally comprised of charges and costs of a long-term nature which ensure future economic benefits;
− the principle of cost recoverability is met.
Assets under development and payments on account
This caption amounts to € 1,031,000 and refers to the costs incurred for a traffic feasibility study and
preparation of the preliminary project regarding the road conditions of a road section.
Other
Leasehold improvements
Pre-operating costs
Carrying
amount
at31/12/201
3
136,912
906,582
1,043,494
Increase
(decrease)
Reclass. purs. Amortisation
to art. 2423-ter of the year
Italian Civ.
Code
(18,123)
52,933
1
(906,583)
(18,122)
(906,583)
52,933
Carrying
amount at
31/12/2014
65,856
0
65,856
These costs are amortised over the period of future usefulness of the expenses incurred or the residual lease
term, whichever is shorter.
II. Tangible fixed assets
31/12/2014
67,363,029
31/12/2013
73,620,116
Change
(6,257,087)
Land and buildings
Historical cost
Accumulated depreciation
31/12/2013
Increases of the year
Decreases of the year
Depreciation of the year
31/12/2014
24,682,952
(3,848,035)
20,834,917
117,042
(16,052)
(531,078)
20,404,829
of which: land 4,587,110
of which: land 4,587,110
The increases of the year are entirely related to light constructions to be used in work sites.
As a guarantee for the loans granted by the banks to the company, mortgages were placed on land and
buildings owned by the company, for a total of € 90,000,000.
Plant and machinery
Historical cost
31/12/2013
Page 11
83,259,962
(34,926,531)
48,333,431
336,370
31/12/2014
(91,835)
(4,896,852)
43,681,114
The balance refers to machinery and equipment used at the company's work sites. These include:
demolisher hammers, air pads for handling systems, self-lifting platforms, conveyor belts, tunnel boring
machines, etc..
Depreciation also applies to the Martina TBM boring machine for a total of € 1,912,333. This plant, which is
currently unused as excavation of the tunnels of the “Valico by-pass” - Lots 6/7 contract has been completed,
was depreciated using a 5.88% rate which reflects a residual useful life of 17 years, calculated over the
residual carrying amount at 31 December 2013, net of the estimated residual amount at the end of the asset's
useful life, as set out in the introduction to these notes.
Industrial and commercial equipment
Amount
Historical cost
31/12/2013
31/12/2014
5,039,093
(4,582,835)
456,258
74,581
(9,209)
(378,434)
143,196
Historical cost
31/12/2013
Transfers (reclassification)
31/12/2014
10,883,536
(8,094,040)
2,789,496
242,516
(89,618)
18,804
(1,014,518)
1,946,680
Other assets
Assets under construction and payments on account
Amount
31/12/2013
Transfer to asset
31/12/2014
1,206,014
(18,804)
1,187,210
III. Financial fixed assets
31/12/2014
125,867,607
Investments
Page 12
31/12/2013
94,761,132
Change
31,106,475
31/12/2013
Subsidiaries
Associates
Other companies
Increase
49,807,141
4,052,312
7,413,246
61,272,699
Decrease
165
165
31/12/2014
49,806,976
4,052,312
7,413,246
61,272,534
The decrease is due to the investment in the Moldovan ICS whose sale was approved. Consequently, the
investment was reclassified to current financial assets.
Subsidiaries
ALITEC S.p.A.
I.M.C. S.r.l.
PARCHI SCARL
AMBRA S.r.l.
TOTO S.p.A. IN
ASSOCIATION WITH
TADDEI S.p.A. SCARL
City or
foreign
country
CHIETI
CHIETI
CHIETI
CHIETI
CHIETI
Share/quota
capital
Net
equity
45,000,000
12,000
10,000
6,900,000
10,000
43,088,129
8,268
10,000
6,260,962
10,000
Net profit/
Loss
(234,783)
(34,320)
(299,306)
% of invest.
Carrying
amount
95.54 42,993,820
51
6,120
19.36
1,936
98.55
6,800,000
51
5,100
1) ALITEC S.p.A.
The business purpose of the company is the construction and management of properties.
Alitec S.p.A. is the owner of an industrial complex totalling 165,000 square metres, where it is involved in a
project to construct a multifunctional complex for management, commercial, residential, cultural, entertainment
and well-being uses.
The carrying amount of the investment in Alitec S.p.A. is primarily justified by that of the industrial complex
which it owns. The improvement of the area, as indicated above, will allow full recoverability of the recognised
amounts.
Net equity and the net loss for the year refer to the financial statements at 31 December 2014, which are
undergoing approval.
2) I.M.C. S.r.l.
Investment acquired in 2005 for a share of 51% in the share capital. I.M.C. S.r.l. operates in the road barrier
production and installation sector. The company, in a joint venture with Toto S.p.A. Costruzioni Generali, is the
contractor for the replacement of the road traffic safety barriers of the A/24 – A/25 Motorways. Contracting
body: Strada dei Parchi S.p.A.
The carrying amount of the investment is equal to its purchase cost.
Net equity and the result for the year refer to the financial statements at 31 December 2014, which are
3) PARCHI SCARL
Consortium company set up by IMC S.r.l. (80.64%) and Toto S.p.A. Costruzioni Generali (19.36%) after the
entire management of the “works necessary for replacing the traffic safety barriers of Motorways A/24 – A/25”
was awarded to the joint venture. Contracting body: Strada dei Parchi S.p.A.
4) AMBRA S.r.l.
The company was established on 23 September 2004 with the purpose of purchasing, building, restructuring,
Page 13
selling and managing all types of buildings.
On 30 September 2013, Toto S.p.A. Costruzioni Generali subscribed the quota capital increase resolved by
Ambra S.r.l. quotaholders, becoming the company's majority quotaholder. The quota capital increase was
carried out by offsetting Toto S.p.A. Costruzioni Generali's receivables up to € 6,800,000.
The carrying amount of the investment is equal to the percentage of the company's net equity held when quota
capital was subscribed. The enhancement of the company's property will make it possible to recover the
investment in the future.
5) TOTO S.p.A. IN ASSOCIATION WITH TADDEI S.p.A. SCARL
The company, set up by Toto S.p.A. and Taddei S.p.A., has been awarded two contracts for the “M2
Chisinau-Soroca Redevelopment Works” assigned by the “Ministry of Transport and Road Infrastructure” of
the Republic of Moldavia. Works, which were completed in 2014, amount to approximately € 19,5 million.
The carrying amount of the investment is equal to the ownership share in the company on the date of its
incorporation.
Associates
ARABONA SCARL
SAN BENEDETTO VAL
DI SAMBRO SCARL
NOVIGAL SCARL
INTERMODALE S.r.l.
GALLERIA DI TENDA
SCARL
City or
foreign
country
CHIETI
ROME
BARI
CHIETI
ROME
Share/quota
capital
Net
equity
100,000
10,000
100,000
10,000
10,000
8,000,000
10,000
10,000
6,753,031
10,000
Net profit/
Loss
(504,899)
% held
Carrying
amount
49.9
3.6
49,900
3,600
33
49.9
35
3,312
3,992,000
3,500
1) ARABONA SCARL
A non-profit consortium company set up on 23 January 2009 to complete the Val Pescara Multimodal Freight
Terminal located in Manoppello (PE).
Toto S.p.A. Costruzioni Generali holds 49.90% of the company’s share capital.
2) SAN BENEDETTO VAL DI SAMBRO SCARL
A non-profit consortium company set up on 23 July 2007 under article 23 bis of Law no. 584/77 between
Vianini S.p.A. (54%), Toto S.p.A. Costruzioni Generali (36%) and Profacta S.p.A. (10%) after the integrated
tender (under art. 19.b of Law no. 109/94) was awarded to the joint venture formed between these three
companies involving the “Upgrading of the Apennine stretch between Sasso Marconi and Barberino del
Mugello – La Quercia Badia Nuova Section – Lots 6 and 7” – Contracting body Autostrade per l’Italia S.p.A..
The carrying amount of the investment is equal to its purchase cost.
3) NOVIGAL SCARL
A non-profit consortium company set up under article 96 of Presidential decree no. 554 of 21 December 1999
between Dec S.p.A. (67%) and Toto S.p.A. (33%) after the Municipality of Potenza awarded the joint venture
formed between these two companies the contract involving the construction of the “Galitello Complex Road
Junction” in the same Municipality.
Page 14
4) INTERMODALE S.r.l.
The company was established on 8 April 2008 as a special purpose vehicle pursuant to article 156 of
Legislative decree no. 163/2003. Its business purpose is the execution of the agreement entered into by the
Abruzzo region and the Joint Venture Dino Di Vincenzo & C. S.p.A. and Toto S.p.A. Costruzioni Generali on 10
January 2008. The agreement provides for, among other things, the design, construction, management and
maintenance of the completion of the Val Pescara Multimodal Freight Terminal located in Manoppello (PE) and
the financial and functional management and maintenance of work already carried out by Interporto Val
Pescara S.p.A.
Toto S.p.A. holds 49.90% of the company’s quota capital.
undergoing approval. The greater amount of the investment compared to the portion of net equity held is
deemed recoverable based on the future income expectations set out in the Financial Plan, under review, of
the above agreement.
5) GALLERIA DI TENDA SCARL
A non-profit consortium company set up on 19 September 2012 by Grandi Lavori Fincosit S.p.A. (65%) and
Toto S.p.A. Costruzioni Generali (35%) following the awarding to the joint venture of the contract related to the
state highway S.S. 20, in Colle di Tenda, which provides for the construction of a new 3.3 km tunnel using
traditional digging techniques and widening the existing side tunnel.
Financial receivables
31/12/2013
Subsidiaries
Associates
Parents
Others
6,154,361
276,200
22,345,326
4,712,546
33,488,433
Increase
160,358
96,700
47,887,793
1,025,407
49,170,258
Decrease
17,276,237
787,381
18,063,618
31/12/2014
6,314,719
372,900
52,956,882
4,950,572
64,595,073
Financial receivables from subsidiaries
They refer to interest-bearing loans in favour of subsidiaries. These include the receivable due from Alitec
S.p.A. of € 5,349,719.
Financial receivables from associates
The balance refers to the advances granted to Galleria di Tenda Scarl.
Financial receivables from parents
The balance refers to interest-bearing loans granted to Toto Holding S.p.A..
As described in the Directors' Report, this loan was partially repaid in the next twelve months (approximately €
12 million) given the parent's availability of cash flows generated by the sale of Ponte Albanito. Again, as
reported in the Directors' Report, the expected dividend distribution will further decrease the receivable by €
9.5 million.
Financial receivables from others
Page 15
This caption, which is down € 787,381 on the previous year following the repayment of the loan granted to
Libra S.r.l., refers to an interest-bearing loan (€ 1,638,275) granted to the related party (Iniziative Immobiliari
Sas) entered into at standard market conditions (up by € 624,786 on the previous year), the balance of the
capitalisation contracts agreed with Generali Italia S.p.A. (preliminary to the surety policies related to works at
some work sites) and the interest-bearing loan (€2,107,110) to the related party Strada dei Parchi (up by €
400,621 on the previous year).
The breakdown of financial receivables at 31 December 2014 by geographical area is shown in the table
below:
Crediti per
Area
Geografica
Italy
Total
Subsidiaries
Associates
6,314,719
6,314,719
372,900
372,900
Parents
Other
companies
52,956,882
52,956,882
4,950,572
4,950,572
Total
64,595,073
64,595,073
C) Current assets
I. Inventory
31/12/2014
72,759,530
31/12/2013
99,628,947
Change
(26,869,417)
This caption breaks down as follows:
31/12/2013
Raw materials
Contract work in progress
Finished goods
Payments on account
8,954,357
78,887,405
4,418,840
3,584,779
95,845,381
Reclass. purs.
31/12/2013
to art. 2423-ter balance, post
Italian Civ. Code
reclassif.
8,954,357
3,783,566
82,670,971
4,418,840
3,584,779
3,783,566
99,628,947
Increase
Decrease
31/12/2014
34,934,050
2,380,969
57,950,526
34,934,050
1,471,972
61,803,467
6,573,388
59,654,495
4,418,840
2,112,807
72,759,530
Raw materials, consumables and supplies: the balance refers to inventory of raw materials that will be used
in production. It decreased by a net € 2,380,969 on the previous year.
Contract work in progress: this caption decreased by a net € 23,016,476 compared to the previous year and
includes work carried out pending the issue of the payment certificate (€ 3,262,978), in addition to the increase
in fees for price adjustments (totalling € 1,173,901) and in fees requested from customers for claims (€
48,500,000). The latter decreased by a net € 25,800,000, being the decrease in the caption of a total €
57,800,000, of which € 56,800,000 collected during the year, and the recognition of new claims accrued during
the year worth € 32,000,000.
Contract work in progress includes the pre-operating costs recognised in accordance with OIC document no.
23 of 5 August 2014 for a total of € 6,717,616.
The balance comprises the opening balance of these costs (€ 3,783,566) which, in the 2013 financial
statements were recognised under intangible fixed assets, and the calculation of the costs incurred to start-up
contracts in 2014 (€ 2,934,050).
Pre-operating costs are considered contract costs and form part of the net profit (loss) for the year based on
the progress of work, calculated using the percentage of completion method with the physical measurement
method.
Page 16
Claims are measured considering the estimates prepared by the specific company areas (based on the type of
each claim, including assessments of the legal grounds and financial capacity) and the fact that for certain
tenders an initial claim definition procedure has already been concluded. The reasons behind the “Claims”
valuations are therefore similar to those established in previous arbitration procedures. The Directors consider
that the disputes underway will have a positive outcome and therefore that these amounts will be recoverable,
also taking into account the assessments and opinions issued by an independent professional.
Finished goods: the caption, unchanged from the previous year, includes the carrying amount of real estate
units to be sold located in Chieti, via Colonnetta 239/247.
Payments on account decreased by € 1,471,972 on the previous year and include the amounts paid to
suppliers for the purchase of goods.
II. Receivables
31/12/2014
48,188,510
Trade receivables
From subsidiaries
From associates
From parents
Tax receivables
Deferred tax assets
From others
31/12/2013
70,365,313
Due within
one year
9,667,282
1,929,432
7,897,319
12,155
2,123,673
632,310
25,926,339
48,188,510
Due after
one year
Change
(22,176,803)
Due after
5 years
Total
9,667,282
1,929,432
7,897,319
12,155
2,123,673
632,310
25,926,339
48,188,510
Trade receivables: they decreased by € 25,813,511 following the amounts collected in 2014, specifically the
amount due from ANAS of € 22,000,000.
Their nominal amount is adjusted to their estimated realisable value through the provisions for bad debts which
underwent the following changes during the year:
Description
31/12/2013
Utilisation of the year
31/12/2014
Total
1,135,259
(100,000)
1,035,259
Due from subsidiaries : this caption decreased by € 3,108,404 and is mainly comprised of the trade
receivable from Alitec S.p.A. (€ 1,472,260) and the trade receivable from Parchi Scarl (€ 304,850).
From associates: this caption decreased by € 5,181,837 and mainly includes trade receivables from
Intermodale S.r.l. (€ 6,165,504), trade receivables from San Benedetto Val di Sambro Scarl (€ 972,290) and
trade receivables from Galleria di Tenda Scarl (€ 741,791).
Due from parents: this caption includes trade receivables from the parent Toto Holding S.p.A..
Tax receivables: this caption rose by € 837,991 on the previous year and is mainly comprised of the VAT
credit of € 1,039,593 and other tax credits to be reimbursed.
Page 17
Deferred tax assets: this caption rose by € 144,090. The receivables included in the table are broken down in
the note to income taxes.
From others: this caption rose by € 10,950,632 on the previous year. In this caption, receivables from others related parties include the amounts due from employees for loans and advances, receivables for guarantee
deposits and trade receivables from related companies of € 22,227,475, which break down as follows:
Amount
13,910,526
6,409,068
821,582
582,666
240,597
102,278
83,951
71,709
5,100
22,227,475
Toto Real Estate S.p.A.
Renexia S.p.A.
Rail One S.p.A.
Azienda Aviagricola Abruzzese S.r.l.
Parchi Global Service S.p.A.
InterSun S.r.l.
Balance at 31/12/2014
The nominal amount of receivables due from others is adjusted to their estimated realisable value through the
provisions for bad debts which underwent the following changes during the year:
Amount
803,683
0
803,683
31/12/2013
Utilisation of the year
31/12/2014
The breakdown of receivables at 31 December 2014 by geographical area is shown in the table below.
Italy
Total
Trade
Subsidiaries Associates
receivables
9,667,282
1,929,432
7,897,319
9,667,282
1,929,432
7,897,319
Parents
12,155
12,155
From others
Total
25,926,339
25,926,339
45,432,527
45,432,527
III. Current financial assets
31/12/2014
604,573
31/12/2013
Other investments
Other securities
31/12/2013
604,409
Increase
575,000
29,409
604,409
Decrease
164
164
Change
164
31/12/2014
575,164
29,409
604,573
Other investments: this caption includes the carrying amount of the investment in RTR Monteboli S.p.A.,
which will be sold soon after the fulfilment of the formal and bureaucratic requirements necessary for the sale
contract, which includes obtaining the final testing of the photovoltaic park located in the Municipality of Eboli.
Page 18
The investment, which is set to be sold in 2015, is currently given as a guarantee with Monte dei Paschi di
Siena.
The increase is due to the investment in the Moldovan ICS which was sold in February 2015.
Other securities: The balance in the table consists of securities and investments intended to be held for a
short period of time.
IV. Liquid funds
31/12/2014
9,239,173
Description
Bank and postal accounts
Cash in hand and cash
equivalents
31/12/2013
1,815,391
Change
7,423,782
31/12/2014
9,225,596
13,577
31/12/2013
1,799,191
16,200
9,239,173
1,815,391
The balance represents liquid funds and cash equivalents at the reporting date.
Bank and postal accounts include term deposits amounting to € 4,737,239. These include the term deposit (€
506,790) given as collateral for a surety of the same amount issued by Cassa di Risparmio di Chieti S.p.A., a
term deposit (€1,560,934) given as collateral for a surety of the same amount issued by BCC, two term
deposits with BPM (€ 2,089,955) given as collateral for sureties to participate in foreign tenders and term
deposits with DEXIA S.p.A. related to contractual charges with the customer Strada dei Parchi (€ 569,822).
31/12/2014
6,451,989
31/12/2013
2,809,071
Change
3,642,918
This caption reflects income and expenses pertaining to previous or future years with respect to the related
payment or collection. These are recorded regardless of the date of payment of the respective income and
expenses, which relate to two or more years and can be spread out over time.
At 31 December 2014, there were no prepayments or accrued income due after more than five years.
The breakdown of this caption is as follows:
Insurance premiums
Rent and leases
Prepaid lease instalments
Commissions on sureties
Financial charges
Lease of the Secol business unit - La Spezia contract
Others of a non-material amount
Amount
4,295,973
49,006
247,350
108,362
547,533
1,014,411
189,354
6,451,989
Prepaid insurance premiums mainly refer to contracts of a long-term nature for the “RFI Cefalù” contract in the
start-up stage.
The lease of the Secol business unit, entered into in December 2014, refers to the portion of costs pertaining to
2015.
Page 19
Liabilities
A) Net equity
31/12/2014
81,762,604
31/12/2013
76,746,819
31/12/2013
Share capital
Share premium reserve
Legal reserve
Extraordinary or optional reserve
Net profit (loss) carried forward
Increase
50,000,000
20,699,616
152,320
2,894,082
1
(15,364)
3,016,164
76,746,819
Total
Change
5,015,785
Decrease
31/12/2014
150,808
2,865,356
1
5,015,786
8,031,950
3,016,164
3,016,065
50,000,000
20,699,616
303,128
5,759,438
0
(15,364)
5,015,786
81,763,604
Details of the changes in net equity are shown in the table below.
Prior year opening balance
Share
capital
Share
Round.
premium
reserve
50,000,000
20,699,616
0
Legal
reserve
Extraordinary
reserve
27,823
528,645
Net profit
(loss)
carried
forward
(15,364)
Result for
the period
2,489,934
Total
73,730,654
Allocation of profit for the year
- legal reserve
(124,497)
124,497
- extraordinary reserve
(2,365,437)
2,365,437
Net profit (loss) for the previous
year
1
Prior year closing balance
50,000,000
20,699,616
1
152,320
2,894,082
(15,364)
3,016,164
3,016,165
3,016,164
76,746,819
Allocation of profit (loss) for the
year
- legal reserve
150,808
- extraordinary reserve
(150,808)
2,865,356
(2.865.356)
-1
-1
Closing balance of the year
50,000,000
20,699,616
0
303,128
5,759,438
(15,364)
The breakdown of share capital is as follows.
Shares
Ordinary shares
Total
Number
500,000
50,000,000
Page 20
Nominal amount
in euro
100
5,015,786
5,015,786
5,015,786
5,015,786
81,762,604
81,762,604
Net equity captions are broken down as follows by origin, possible use, distribution and use in the previous
three years.
Amount
Possible use
(*)
Available
portion
Actual use in the Actual use in the
past three years To past three years
cover losses
For other reasons
Share capital
50,000,000 B
Share premium reserve
20,699,616 A, B, C
Legal reserve
303,128 B
Other reserves
5,759,438 A, B, C
Net profit (loss) carried
(15,364) A, B, C
forward
(*) A: share capital increase; B: loss coverage; C: dividends
In accordance with OIC 28 on Net equity, the following additional information is provided:
No monetary or fair value revaluation reserves are included in the share capital.
There are no reserves or other provisions which if distributed would form part of the taxable income of
the company or shareholders.
31/12/2014
3,452,230
31/12/2013
4,417,122
31/12/2013
Tax provision, including
deferred tax liabilities
Other
Increase
Change
(964,892)
Decrease
5,887
4,417,122
4,417,122
19,410
25,297
31/12/2014
5,887
990,189
990,189
3,446,343
3,452,230
The provision for deferred tax liabilities refers to taxes (IRES (corporate income tax) 27.5%) and reflects the
decrease in unrealised exchange rate gains (€ 21,408).
Other provisions include amounts set aside for charges for ten-year post-completion policies and work site
disposal charges. The decrease refers to the downward revision of costs for policies, following the better
conditions offered by the insurance market, compared to the original accrual, and the decreases in accruals
recognised in prior years which are no longer necessary.
C) Employees' leaving entitlement
(Ref. Art. 2427, para. 1, No. 4, Italian Civil Code)
31/12/2014
981,736
The change is broken down as follows.
Page 21
31/12/2013
1,398,148
Change
(416,412)
Change
31/12/2013
Employees' leaving
entitlement, changes during
the year
Increase
1,398,148
Decrease
1,078,416
1,494,828
31/12/2014
981,736
The provision represents the actual amount due to employees in accordance with law and current employment
contracts, taking into account all forms of remuneration of an ongoing nature.
The provision corresponds to all the individual indemnities accrued up until 31 December 2006 by employees
on the reporting date, net of any advances paid, and amounts to what would be due to employees should their
employment have terminated on that date.
The provision does not include the indemnities accrued from 1 January 2007 allocated to supplementary
pension schemes under Legislative decree no. 252 of 5 December 2005 (or transferred to the INPS (Italian
Social Security Institute) treasury fund).
D) Payables
31/12/2014
248,493,647
31/12/2013
263,220,123
Change
(14,726,476)
Payables are stated at their nominal amount and are broken down as follows:
Bank loans and borrowings
Payments on account
Trade payables
Payables to subsidiaries
Payables to associates
Payables to parents
Tax payables
Social security charges payable
Other payables
Due within
one year
42,015,952
3,569,956
50,117,367
68,186
36,908,609
945,406
44,227,368
1,283,042
10,184,809
189,320,695
Due after
one year
35,013,793
Due after
five years
3,209,971
19,493,721
1,455,467
55,962,981
3,209,971
Total
80,239,716
3,569,956
50,117,367
68,186
36,908,609
945,406
63,721,089
1,283,042
11,640,276
248,493,647
Bank loans and borrowings
Bank loans and borrowings are down € 16,011,922 compared to the previous year and include loans payable
and the actual principal, interest and ancillary charges incurred and due.
This caption is broken down as follows:
Descrizione
31/12/2014
31/12/2013
Variazioni
C/c ordinari
C/anticipi "SIL/SAL"
C/anticipi "Claims"
Mutui su Aree e Fabbricati
Finanziamenti Beni Strum.li
4.356.996
25.211.414
15.361.620
35.309.686
6.313.068
24.777.692
3.891.066
19.540.543
41.729.269
(1.956.072)
433.722
(3.891.066)
(4.178.923)
(6.419.583)
Totale debito verso banche
80.239.716
96.251.638
(16.011.922)
Page 22
Loans and financing consist of:
the amount due to WESTLB AG – Milan Branch deriving from the Loan Agreement totalling € 52
million for the purchase of the TBM boring machine used for the Valico bypass – Lots 6/7 contract
awarded by ASPI. At the reporting date, € 17,829,921 was repaid;
loans and financing were contracted with the following banks: Banca Popolare dell’Emilia Romagna,
Cassa di Risparmio di Chieti and Cassa di Risparmio di Pescara. At the reporting date, the balance is
€ 15,361,620. These loans are secured by collateral on real property owned by the company.
Payments on account
This caption decreased by € 6,625,087 on the previous year and includes the advances received from
customers for the supply of goods and services still to be performed; it includes the payments on account from
the customer Autostrade per l'Italia S.p.A. (€ 3,537,213).
Trade payables
They decreased by € 25,656,755 on the previous year and are recognised net of trade discounts, while cash
discounts are recognised upon payment. The nominal amount of these payables has been adjusted to reflect
returns or rebates (invoicing adjustments) by the amount agreed upon with the other party.
Payables to subsidiaries
This caption is down € 3,759,659 on the previous year and mainly includes the payable due to the subsidiary
Parchi Scarl (€ 63,338).
Payables to associates
This caption rose € 7,145,915 on the previous year. It can be analysed as follows:
San Benedetto Val di Sambro Scarl for trade transactions
San Benedetto Val di Sambro Novigal Scarl for share capital to be paid
Arabona Scarl for commercial transactions
Galleria di Tenda Scarl for commercial transactions
Galleria di Tenda Scarl for share capital to be paid
Novigal Scarl for share capital to be paid
Balance at 31/12/2014
Amount
35,375,184
2,700
313,105
1,212,511
2,625
2,484
36,908,609
Payables to parents
They rose by € 262,414 on the previous year and refer to the amount to be paid to the parent Toto Holding in
relation to the IRES (corporate income tax) for 2014, being the parent in the national tax consolidation scheme.
Tax payables
They rose € 28,094,260. The balance indicates the liabilities for certain and specific taxes.
This caption includes
Page 23
the IRAP (regional tax on production) payable amounting to € 2,138,252.
the VAT payable of € 54,709,710 of which € 26,184,722 related to 2013 and to be paid in 20 quarterly
instalments. The first instalment was paid in October 2014 following the payment reminder sent by the
Tax Authorities in September 2014;
Withholdings for employees' and freelancers' income in 2014 totalling € 5,368,744;
Penalties and interest for the late payment of taxes and dues for € 1,504,383.
Social security charges payable
Social security charges payable decreased by € 878,847 on the previous year and include the amounts
payable to social security institutions (INPS, INAIL, Previndai, special construction workers funds and
supplementary social security institutes) for contributions incurred during the year.
Among others, this caption includes:
INPS contributions for employees, collaborators and professionals working on an occasional basis for
€ 798,560;
INAIL contributions totalling € 258,814;
PREVINDAI contributions totalling € 113,968;
special construction workers funds totalling € 81,911.
Other payables
This caption amounts to € 2,703,203. € 11,640,276 is mainly comprised of:
Amounts due to employees for monthly pay, 14-month pay, accrued holiday and leave pay accrued at
31 December 2014 and still payable totalling € 3,426,382. The payable related to the December 2014
pay was paid in January 2015.
Payables to CO.E.STRA S.p.A. (€ 1,560,934) and Avvenire 1921 (€ 1,350,000) for the purchase of the
respective business units related to the contract awarded by ANAS and related to the Executive
design and execution of the variation to S.S. 1 Aurelia: access roads to the La Spezia harbour. These
payables, of € 1,455,467, are due after one year.
Payables to related companies totalling € 4,258,626, the balance of which at 31 December 2014
was as follows:
Parchi Global Service S.p.A.
Toto Real Estate S.r.l.
Rail One S.p.A.
Renexia S.p.A.
Amount
1,646,420
1,552,369
615,538
378,032
65,426
516
325
4,258,626
The breakdown of Payables at 31 December 2014 by geographical area is shown in the table below.
Page 24
Italy
Romania
Germany
Bulgaria
United Kingdom
Denmark
France
Czech Republic
Poland
Lebanon
Switzerland
Honk Kong
United Arab
Emirates
Armenia
Total
Trade
payables
47,741,948
194,504
278,437
20,000
102,648
990,383
31,094
28,413
4,044
39,097
626,905
12,492
12,402
Due to
subsidiaries
68,186
35,000
50,117,367
Due to
Due to parents Due to others
associates
36,908,609
945,406
11,640,276
68,186
36,908,609
945,406
11,640,276
Total
97,304,425
194,504
278,437
20,000
102,648
990,383
31,094
28,413
4,044
39,097
626,905
12,492
12,402
35,000
99,679,844
E) Accrued expenses and deferred income
31/12/2014
1,201,092
31/12/2013
186,820
Change
1,014,272
These are adjusting entries for the year calculated on an accruals basis.
At 31 December 2014, there were no accrued expenses and deferred income due after more than five years.
The breakdown of this caption is as follows:
Amount
Deferred income for insurance policies
Deferred income for insurance sureties
Accrued bank interest
Others of a non-material amount
1,002,514
37,234
89,051
72,293
1,201,092
Deferred income for insurance policies includes costs related to insurance policies, fully entered into by the
company which is the agent of the Joint Venture to which the “RFI Cefalù” contract was awarded, and to be
recharged to the other members of the Joint Venture.
Memorandum and contingency accounts
31/12/2014
747,058,176
31/12/2013
659,386,883
Change
(87,671,293)
Details of the caption are as follows:
31/12/2013
Commitments assumed by the
company
Other memorandum and
contingency accounts
Increase
Decrease
31/12/2014
404,536,809
253,964,582
143,628,838
514,872,552
254,850,074
659,386,883
33,225,214
287,189,796
55,889,664
199,518,502
232,185,624
747,058,176
Page 25
The balance under Commitments assumed by the company reflects the residual lease payments to be made
(€1,966,311) and the contractual commitments related to goods or services still to be performed (OIC 23.28) of
€ 512,906,241.
The breakdown of Other memorandum and contingency accounts, which includes insurance and bank sureties
issued in favour of contracting bodies, is as follows:
Insurance and bank sureties provided to customers as a guarantee
for the satisfactory performance of the work totalling € 137,812,834.
Insurance sureties provided to customers as release of guarantee
withholdings on work totalling € 13,897,222.
Insurance sureties provided to customers as a guarantee for
advances received for work totalling € 29,244,900.
Insurance and bank sureties provided as a guarantee for various
contractual commitments totalling € 5,895,313.
Guarantees issued in the interest of group companies for payment
obligations totalling € 45,335,355.
Profit and loss account
2014
177,624,282
2013
239,465,502
2014
Turnover from sales and services
Change in contract work in progress
Other revenues and income
Change
(61,841,220)
2013
200,137,835
(23,016,476)
502,923
177,624,282
278,624,554
(41,844,127)
2,685,075
239,465,502
Change
(78,466,719)
18,827,651
(2,182,152)
(61,841,220)
The change is strictly related to that set out in the Directors' Report.
Revenues from sales and services are broken down as follows:
Revenues by category of business
Category
Services
Other
2014
200,137,835
502,923
200,640,758
2013
278,624,554
2,685,075
281,309,629
Change
(78,486,719)
(2,182,152)
(80,668,871)
Services
200,364,659
Total
200,364,659
Revenues by geographical area
Area
Sales
Italy
Page 26
Moldova
276,099
200,640,758
276,099
200,640,758
B) Production cost
2014
162,584,328
2013
226,434,856
2014
Raw materials, supplies and goods
Services
Wages and salaries
Social security contributions
Other costs
Amortisation of intangible fixed assets
Depreciation of tangible fixed assets
Write-downs of current receivables
Change in raw materials
Provisions for risks
Other operating costs
23,139,100
93,057,154
3,432,590
18,394,734
6,977,583
1,078,416
139,685
362,503
6,820,882
2,380,969
19,410
6,781,302
162,584,328
Change
(63,850,528)
2013
Change
54,772,989
108,508,170
5,046,969
26,204,867
10,603,232
1,804,140
54,714
384,929
12,245,079
400,000
1,676,843
113,040
4,619,884
226,434,856
(31,633,889)
(15,451,016)
(1,614,379)
(7,810,133)
(3,625,649)
(725,724)
84,971
(22,426)
(5,424,197)
(400,000)
704,126
(93,630)
2,161,418
(63,850,528)
Raw materials, supplies and goods
These costs are closely linked to that set out in the Directors’ Report and to point A (Production value) of the
profit and loss account.
The most indicative items that make up the balance include:
costs for construction materials for € 11,928,130 (cement, aggregates, admixtures, iron and
prefabricated and manufactured items, etc.);
fuel and lubricants, € 3,466,611;
spare parts, € 1,063,576;
electric and metal materials, € 6,313,776.
Services
They amount to € 93,057,154. The most indicative items that make up the balance include:
external processing and services, € 28,762,397;
rentals, € 2,315,154;
electricity, € 1,281,498;
insurance, € 3,091,964;
costs recharged by consortium companies, € 52,444,340;
Page 27
The balance is € 3,432,590. Specifically, these costs relate to lease payments for assets under finance lease
with repurchase right (€ 2,279,323) and to costs for property leases and rentals (€ 1,056,030).
Personnel expenses
This caption includes all personnel expenses, including promotions, changes of category, paid holidays
accrued but not taken and provisions required by law and collective employment contracts.
Depreciation of tangible fixed assets
Depreciation was calculated based on the useful life of the asset and its use during production.
Depreciation also applies to the TBM boring machine for a total of € 1,912,333. This plant, which is currently
unused as excavation of the tunnels of the “Valico by-pass” - Lots 6/7 has been completed, was depreciated
using a 5.88% rate which reflects a residual useful life of 17 years, calculated over the residual carrying amount
at 31 December 2013, net of the estimated residual amount at the end of the asset's useful life, as set out in the
introduction to these notes.
Other operating costs
This caption refers mostly to costs for losses on receivables not covered by a specific provision (€ 4,213,853)
and penalties due to the late payment of taxes and dues (€ 1,755,410)
2014
(4,428,390)
2013
(5,183,723)
Change
755,333
Financial income and charges
2014
From investments
From financial receivables classified as
fixed assets
From securities classified as current
assets
Other income
(Interest and other financial charges)
Exchange gains (losses)
2013
Change
1,141,836
1,350
1,037,181
(1,350)
104,655
389,533
615
388,918
641,349
(6,596,792)
(4,316)
(4,428,390)
232,874
(6,421,208)
(34,535)
(5,183,723)
408,475
(175,584)
30,219
755,333
Other financial income
Parents
Bank and post office interest
Interest on loans
Other income
Subsidiaries
954,395
187,441
954,395
187,441
Associates
Other
15,889
529,266
485,727
1,030,882
Total
15,889
1,651,102
485,727
2,172,718
Interest on loans refers to interest accrued on loans granted to the parent Toto Holding S.p.A. (€ 934,395), the
Page 28
subsidiary Alitec S.p.A. (€ 181,018) and others, including the related company Strada dei Parchi S.p.A. (€
316,047).
Interest and other financial charges
Parents Subsidiaries Associates
Bank interest
Interest on trade payables
Interest on medium-term credit
Discounts or financial charges
Interest on loans
Other financial transactions
Other
Total
2,320,235 2,320,235
774,220
774,220
542,477
542,477
1,702,648 1,702,648
552,361
552,361
704,851
704,851
6,596,792 6,596,792
2014
(110,298)
2013
(100,265)
2014
Reduction in the rate for diesel duties, previous
years
Gains from disposals
Release of provision for future risks and
charges
Non-existent trade payables
Non-existent employees payable
Miscellaneous
Total income
Penalties for the late payment of taxes
Charging of fees for previous years
Social security charges
Miscellaneous
Total charges
Change
(10,033)
Previous year
2013
343,461 Repayment of prior year excise duty on
112,973 diesel fuel.
990,189
48,360
51,347
392,539
1,938,869
(1,221,327)
(580,369)
(127,757)
(119,714)
(2,049,167)
(100,298)
Non-existent trade creditors
Non-existent employees payable
Miscellaneous
Total income
Penalties for the late payment of taxes
Charging of fees for previous years
Social security charges
Miscellaneous
Total charges
94,670
465,984
96,461
598,164
1,255,279
(368,906)
(158,528)
(828,110)
(1,355,544)
(100,265)
Penalties for the late payment of taxes amount to € 1,221,327 and relate to the greater penalties arising from
the different rate (10% instead of the previously recognised 3.75%) to be paid to the Tax authorities following
the authorisation to pay 2013 VAT in instalments.
Income tax for the year
2014
5,485,480
Taxes
Current taxes:
IRES (corporate income tax)
IRAP (regional tax on
production)
Deferred (prepaid) taxes
IRES (corporate income tax)
IRAP (regional tax on
production)
2013
4,730,493
Change
754,987
2014
5,623,683
3,866,119
1,757,564
2013
4,825,956
2,874,213
1,951,743
Change
797,727
991,906
(194,179)
(138,203)
(138,446)
243
(95,463)
(95,706)
243
(42,740)
(42,740)
5,485,480
4,730,493
754,987
Page 29
Taxes pertaining to the year were recognised.
The IRES (corporate income tax) payable is recognised under Payables to the parent, net of advances and
withholdings.
The reconciliation between the tax charge shown in the financial statements and the theoretical tax charge is
provided below.
Reconciliation between tax charges shown in the financial statements and theoretical tax charge
(IRES)
Amount
Profit before taxes
Theoretical tax charge (%)
Temporary differences deductible in subsequent years:
Unpaid interest expense
Unrealised exchange rate gains
Differences that will not carry over to subsequent years
Undeductible costs for means of transport
Undeductible prior year expense
Undeductible taxes
Other increases
IRAP (regional tax on production) tax paid in the year (10%)
IRES (corporate income tax) on IRAP (regional tax on production)
for personnel expenses paid during the year
Other decreases
Taxable basis
Current income taxes for the year
10,501,266
27.5
0
523,472
(21,408)
502,064
0
979,071
671,551
187,212
3,222,275
(81,859)
(368,100)
Taxes
2,887,848
0
(1,554,864)
14,058,616
3,866,119
Calculation of IRAP (regional tax on production) taxable basis
Amount
Difference between production revenues and cost
Costs irrelevant for IRAP purposes
INAIL contributions
Deduction for employees
Share of foreign production
Revenues irrelevant for IRAP purposes
Taxable IRAP
Current IRAP for the year
Taxes
41,649,782
9,296,488
(918,175)
(9,546,896)
(216,898)
(93,912)
40,170,389
1,757,564
The information required under article 2427.1.14 of the Italian Civil Code on deferred taxes is as follows:
Deferred / prepaid taxes
They reflect the accrual to the tax provision (€
5,887).
Deferred taxes have been calculated using the global allocation criterion, considering total temporary
differences, based on the average rates in effect when such temporary differences will reverse \based on the
effective rate of the last year.
Prepaid taxes are recognised since it is reasonably certain that the company will report a taxable profit in future
years equal to or more than the amount of deductible temporary differences on which they were calculated.
Page 30
The main temporary differences which resulted in the recognition of deferred tax assets and liabilities are
stated in the table below together with their effects.
Recognition of deferred and prepaid taxes and related effects:
2014
Temporary
Tax effect
differences
Prepaid taxes:
2011 maintenance expenses
deferred
Amortisation of goodwill
Recovery of previous years’
maintenance expenses
Disposal charges for work sites 2012
Unpaid interest on arrears
Total
Deferred taxes:
Unrealised exchange rate gains
Interest on arrears receivable
(uncollected)
Total
Net deferred (prepaid) taxes
2013
Temporary
Tax effect
differences
12,745
3,505
12,745
3,505
5,289
1,697
5,289
1,697
35,460
9,752
35,460
(113,040)
9,752
(31,086)
(19,410)
(523,472)
(524,848)
(5,338)
(143,955)
(144,090)
50,192
9,354
13,803
2,329
21,408
5,887
(338,669)
(93,134)
(338,669)
(93,134)
(95,463)
21,408
5,887
(138,203)
Finance leases
In accordance with the instructions provided in the document "OIC 1 - The main effects of the corporate law
reform on the preparation of financial statements", information is provided in the table below on the effects on
Net equity and the Profit and Loss Account which would have occurred had 133 finance leases been
recognised using the financial method instead of the liability method whereby lease payments are taken to the
profit and loss account.
Assets
a) Contracts in progress
Assets under finance lease at the end of the previous year, net of depreciation
+ Assets under financial lease acquired during the year
- Assets under financial lease redeemed during the year
- Depreciation of the year
- Reversal of provision for redeemed assets
Assets under financial lease at the end of the year, net of depreciation
b) Assets redeemed
Higher total value of assets redeemed, determined in accordance with the financial method,
compared to year-end carrying amount
c) Liabilities
Finance lease payments at the end of the previous year
+ Residual payments arising during the year
- Reductions due to repayment of principal
Finance lease payments at the end of the year
d) Total gross effect at the end of the year (a+b-c)
e) Net tax effect
f) Effect on Net equity at the end of the year (d-e)
The effect on the profit and loss account can be broken down as follows:
Reversal of finance lease payments
Reversal of lease down payment
Recognition of financial charges on financial leases
Recognition of accumulated depreciation
Effect on profit before taxes
Recognition of the tax effect
Net effect of recognition of leases with the financial method on the profit for the year
Page 31
7,531,649
24,500
(424,913)
(3,201,646)
13,388
3,942,978
(315,383)
3,877,032
22,050
(1,932,771)
1,966,311
1,661,284
536,927
1,124,357
1,639,421
311,004
(119,401)
(3,201,646)
(1,370,622)
422,711
(927,911)
Information on financial instruments issued by the company
The company did not issue any financial instruments.
Information on the fair value of derivatives.
The fair value and information on the amount and nature of each category of derivatives of the company are
provided below, broken down by class taking into account aspects such as the characteristics of the
instruments and their intended use.
1) Contract: INTEREST RATE SWAP
− Type of derivative contract: unlisted financial derivative (Interest Rate
Swap);
− Contract start date: 17/07/2009
− Contract end date: 30/06/2015
− Purpose: hedging;
− Notional amount: € 10,000,000
− Underlying financial risk: interest rate risk;
− Market to market value of the derivative contract: € (35,687)
− Liability hedged: bank debt
Swap);
Swap);
Swap);
5) Contract: OPTION
Page 32
−
−
−
−
−
−
−
−
Type of derivative contract: CAP option;
Contract start date: 30/12/2011
Contract end date: 30/12/2019
Purpose: hedging;
Notional amount: € 20,671,875
Underlying financial risk: interest rate risk;
Market to market value of the derivative contract: € (203,589)
Liability hedged: bank debt
Information regarding green certificates
Pursuant to OIC n. 7 Green certificates, the following information is provided: on the reporting date, the
company did not possess any green certificates.
Information regarding greenhouse gas emissions
Pursuant to OIC 8, with respect to greenhouse gas emissions, the company had no grey certificates at the
reporting date.
Information on related party transactions
Details of the transactions with related parties (subsidiaries, associates, parents and related companies)
during the year are provided in the Directors’ Report. The transactions with each related party are carried out at
normal market conditions.
Information about off-balance sheet transactions
No such transactions were carried out.
Information on independent auditors’ fees
As required by law the fees pertaining to the year for services provided by the audit company and its network of
companies are stated below:
Fees due for the legally-required audit of financial statements: €
40,000
Fees for other services: € 15,000.
Other information
As required by the law, the total fees due to directors and the board of statutory auditors are stated below.
Position
Directors
Board of Statutory Auditors
Cash flow statement
Page 33
Fee
459,333
85,129
As required by OIC 10, the cash flow statement is shown below in thousands of euros.
2014
2013
5,015.8
3,016.2
Income tax
5,485.5
4,730.5
Interest expense/(interest income)
4,424.1
5,150.5
0.0
(1.4)
A. Cash flows from operating activities (indirect method)
(Dividends)
(Gains)/losses on the sale of assets
1. Profit for the year before income taxes, interest, dividends and gains/losses
on sales
(113.0)
14,812.4
12,895.8
Accruals to provisions
1,097.8
1,926.8
Amortisation/depreciation
7,183.4
21,508.8
Impairment losses
0.0
Other adjustments for non-monetary elements
Total adjustments for non-monetary elements
2. Cash flows before changes in net working capital
0.0
151.5
8,281.2
23,587.1
23,093.6
36,483.0
Decrease/(increase) in inventory
26,869.4
39,269.8
Decrease/(increase) in trade receivables
25,813.5
(19,667,2)
(25,656,8)
(7,085,4)
(3,642,9)
2,434.3
1,014.3
(145.2)
Increase/(decrease) in trade payables
Decrease/(increase) in prepayments and accrued income
Increase/(decrease) in accrued expenses and deferred income
Other changes in net working capital
21,257.4
18,687.0
45,655.0
33,493.2
68,748.5
69,976.2
Interest received/(paid)
(5,032.2)
(5,150.5)
(Income tax paid)
(3,735.8)
(4,415.3)
Total changes in net working capital
3. Cash flows after changes in net working capital
Dividends received
1.4
(Utilisation of provisions)
(1,387.2)
(2,405.9)
(10,176.1)
(11,970.4)
4. Cash flows after other changes
58,572.4
58,004.5
Cash flows from operating activities (A)
58,572.4
58,004.5
Tangible fixed assets
(450.8)
(2,458.7)
(Investments)
(563.8)
(2,484.6)
113.0
25.8
Total other adjustments
B. Cash flows from investing activities
Divestments realisation price
Intangible fixed assets
(590.2)
(Investments)
Financial fixed assets
(Investments)
Current financial assets
Page 34
(1,701.1)
(31,106.5)
(31,106.5)
1,110.9
(10,288.7)
(46,365.3)
36,076.6
(0.2)
3,934.6
(Investments)
(0.2)
Acquisition or sale of subsidiaries or business units, net of liquid funds
Cash flows used in investing activities (B)
3,934.6
(3,579.2)
0.0
(35,136.7)
(9,402.9)
C. Cash flows from financing activities
Third party funds
Increase (decrease) in short-term bank loans and borrowings
Loans taken out
Increase (decrease) in long-term bank loans and borrowings
0.0
(3,563.1)
(44,075.5)
0.0
(12,448.8)
(10,596.9)
Own funds
0.0
Share capital increase against consideration
0.0
Sale (purchase) of treasury shares
0.0
Dividends (and interim dividends) paid
0.0
Cash flows used in financing activities (C)
(16,011.9)
(54,672.4)
7,423.8
(6,070.8)
Closing liquid funds
9,239.2
1,815.4
Opening liquid funds
1,815.4
7,886.2
Increase/(decrease) in liquid funds
7,423.8
(6,070.8)
Increase (decrease) in liquid funds (A +/- B +/- C)
These financial statements, consisting of the Balance Sheet, Profit and Loss Account and these Notes, give a
true and fair view of the financial position and results of operations for the year and are consistent with the
accounting records.
Alfonso Toto
Page 35
TOTO S.p.A. COSTRUZIONI GENERALI.
REA (Economic Administrative Index) no. 160647
TOTO S.P.A. COSTRUZIONI GENERALI
Joint-stock company with sole shareholder managed and coordinated by Toto Holding Spa
Registered office in VIALE ABRUZZO 410 - 66013 CHIETI SCALO (CH) Share capital € 50,000,000 fully paid-up.
Report of the Board of Statutory Auditors to the shareholders'
meeting pursuant to article 2429 of the Italian Civil Code
FINANCIAL STATEMENTS AT 31 DECEMBER 2014
Dear Shareholders,
During the year ended 31 December 2014, we carried out the supervisory activities
required by the law and the by-laws, while the legally-required audit was carried out by
the independent auditors Kpmg S.p.A., as per the engagement for the three-year period
2014/2016 conferred by the shareholders in their meeting of 9 May 2014.
After checking the draft financial statements and the directors' report and following the
institutional activities carried out during the year, we note the following:
- we participated in the meetings of the board of directors and the shareholders'
meetings which were carried out in accordance with the law and the by-laws;
- we monitored, to the extent of our responsibility, the adequacy of the company's
administrative and organisational structure and its internal control systems;
- pursuant to article 2409 septies of the Italian Civil Code, we met with the
independent auditors KPMG S.p.A., engaged to carry out the legally-required
audit, and exchanged data and information necessary for the performance of the
relevant tasks;
- we met with the company's directors and some managers.
We did not note any atypical or unusual transactions, including those carried out with
related parties.
We did not receive any complaints or reports pursuant to article 2408 of the Italian Civil
Code.
During the year, we did not issue any opinions in accordance with the law.
We have approved the recognition of long-term start-up and capital costs amounting to
€ 616,391, research, development and advertising costs of € 8,000 and goodwill of €
3,579,235.
During our supervisory and control activities we did not note any significant matters to
be disclosed herein.
Report of the Board of Statutory Auditors to the shareholders' meeting
Page 1
Today KPMG issued their report pursuant to article 14 of Legislative decree no.
39/2010, stating that the financial statements at 31 December 2014 give a true and fair
view of the company's financial position and results of operations.
The report includes an emphasis of matter paragraph, to which we expressly refer, on
the recognition of additional claims and/or damages under contract work in progress of
approximately € 48.5 million, the option not to prepare consolidated financial
statements and the inclusion of the highlights of the most recent financial statements of
the company that carries out management and coordination activities in the notes to the
financial statements.
With respect to the above claims, the related delays in the collection of the amounts
related to charges already incurred by the company and the related impacts on the
company's financial position led to the untimely fulfilment of some tax obligations.
The financial statements show a net profit for the year of € 5,015,786 summarised as
follows.
BALANCE SHEET:
- Assets
€
335,891,309
€
254,128,705
- Liabilities
- Net equity (excluding net profit for the year)
€
81,762,604
- Net profit (loss) for the year
€
5,015,786
- Commitments, risks and other memorandum and contingency accounts €
747,058,176
INCOME STATEMENT:
Production
revenues
(non-financial
revenues)
Production costs (non-financial costs)
Operating profit
Financial income and charges
Adjustments to financial assets
Extraordinary income and expense
Profit before taxes
Taxes for the year
Net profit (Loss) for the year
€
177,624,282
€
€
€
€
€
€
€
€
(162,584,328)
15,039,954
(4,428,390)
===
(110,298)
10,501,266
(5,485,480)
5,015,786
We checked the measurement criteria adopted in preparing the financial statements to
establish whether they comply with law and business conditions. We did not identify
any critical issue.
In preparing the financial statements, the directors did not waive any of the laws under
article 2423.4 of the Italian Civil Code. In their report, they adequately described the
main transactions carried out, including those with related parties.
Based on the above, we have no objections to the approval of the financial statements
Page 2
CHIETI, 28 April 2015
The Board of Statutory Auditors
GIOVANNI SMARGIASSI
Chairman
FRANCESCO CANCELLI
Standing auditor
VITO GIUSEPPE RAMUNDO Standing Auditor
______________________
______________________
______________________
Page 3
KPMG S.p.A.
Revisione e organizzazione contabile
Piazza Duca d'Aosta, 34
65100 PESCARA PE
Telefono
Telefax
e-mail
PEC
+39 085 4219989
+39 085 33093
it-fmauditaly@kpmg.it
kpmgspa@pec.kpmg.it
Report of the auditors in accordance with article 14 of Legislative decree
no. 39 of 27 January 2010
To the Shareholders of
We have audited the financial statements of Toto S.p.A. Costruzioni Generali as at and for
the year ended 31 December 2014. The company’s directors are responsible for drawing up
these financial statements in accordance with the Italian regulations governing their
preparation. Our responsibility is to express an opinion on these financial statements based
on our audit.
2
We conducted our audit in accordance with the auditing standards issued by the Italian
Accounting Profession and recommended by Consob, the Italian Commission for Listed
Companies and the Stock Exchange. Those standards require that we plan and perform the
audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement
and are, as a whole, reliable. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant estimates made by
directors. We believe that our audit provides a reasonable basis for our opinion.
Reference should be made to the report dated 15 April 2014 for our opinion on the prior year
financial statements, which included the corresponding figures presented for comparative
purposes as required by the law.
3
In our opinion, the financial statements of Toto S.p.A. Costruzioni Generali as at and for the
year ended 31 December 2014 comply with the Italian regulations governing their preparation.
Therefore, they are clearly stated and give a true and fair view of the financial position and
results of operations of the company as at and for the year ended 31 December 2014.
4
We draw your attention to the information provided by the directors in the notes to
the financial statements and in their report:
4.1
A significant portion of the company’s claims and requests for damages from certain
customers, totalling approximately € 48.5 million, including approximately € 32 million
recognised in 2014, has been recognised under contract work in progress, since it relates to
amounts under arbitration proceedings and transactions being settled at the balance sheet
date. On the basis of past experience and the valuations of an independent professional, the
directors believe that the above claims and requests are not greater than the amount that will
be definitively awarded and paid to the company.
KPMG S.p.A., è una società per az10m d1 dmtto italiana e fa pane
del network KPMG di entità indipendenti aff1hate a KPMG
lntarnat1onal Cooperative ("KPMG lnternationa!"L entità di dintto
svizzero.
Ancona Aosta Bari Bergamo
Bologna Bolzano Brescia
Catania Como Firenze Genova
Lecce Milano Napoli Novara
Padova Palermo Parma Perugia
Pescara Roma Tonno Treviso
Trieste Varese Verona
Soetà per aztonì
Capitale sociale
Euro 8.835.600,00 1.v.
Reg1st10 Imprese Milano e
Codice Fiscale N. 00709600169
A. E.A MUano N. 512867
Part IVA 00709600159
VAT number IT00709600159
Sede legale: Via V1ltor P1sarn, 25
20124 Milano Ml ITALIA
Relazione della società di revisione
31 dicembre 2014
4.2
Despite significant controlling interests, the company has availed itself of the legal exemption
from preparation of consolidated financial statements which will be prepared by its parent.
4.3
As required by the law, the company disclosed the key figures from the latest financial
statements of the company that manages and coordinates it in the notes to its own financial
statements. Our opinion on the financial statements of Toto S.p.A. Costruzioni Generali
does not extend to such data.
5
The directors of Toto Costruzioni Generali S.p.A. are responsible for the preparation of a
directors’ report on the financial statements in accordance with the applicable laws.
Our responsibility is to express an opinion on the consistency of the directors’ report with
the financial statements to which it refers, as required by the law. For this purpose, we have
performed the procedures required by the Italian Standard on Auditing 001 issued by the
Italian Accounting Profession and recommended by Consob. In our opinion, the directors’
report is consistent with the financial
statements of Toto S.p.A. Costruzioni Generali as at and for the year ended 31 December 2014.
Pescara, 28 April 2015 KPMG
S.p.A.
Alfonso Suppa
Director of audit
2

Toto S.p.A. Costruzioni Generali

Transcription

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