The Fiat Group in 1999 - Report on Operations - Fiat SpA

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Statement of operations <strong>The</strong> statement of operations for the fiscal year shows net <strong>in</strong>come of 396 million euros, compared with 408 million euros <strong>in</strong> 1998. <strong>The</strong> follow<strong>in</strong>g table conta<strong>in</strong>s a breakdown of net <strong>in</strong>come: (<strong>in</strong> millions of euros) <strong>1999</strong> 1998 Investment <strong>in</strong>come 608 530 Writedowns (210) – Net f<strong>in</strong>ancial <strong>in</strong>come 15 47 Cost of personnel and services, less revenues (15) 25 Extraord<strong>in</strong>ary <strong>in</strong>come (expense) 81 (51) Income taxes (83) (143) Net <strong>in</strong>come 396 408 Investment <strong>in</strong>come amounted to 608 million euros. It consists of dividends, <strong>in</strong>clud<strong>in</strong>g the respective tax credits, paid by subsidiaries and affiliated companies (530 million euros <strong>in</strong> 1998). A breakdown of the dividends earned <strong>in</strong> <strong>1999</strong> and 1998 is provided <strong>in</strong> the Notes of <strong>Fiat</strong> S.p.A. F<strong>in</strong>ancial Statements. <strong>The</strong> ma<strong>in</strong> component of writedowns was the charge of 209 million euros aga<strong>in</strong>st the carry<strong>in</strong>g value of <strong>Fiat</strong> Auto S.p.A., which, as mentioned above, was taken to reflect a correspond<strong>in</strong>g change <strong>in</strong> the net worth of this company. Net f<strong>in</strong>ancial <strong>in</strong>come totaled 15 million euros, compared with 47 million euros <strong>in</strong> 1998. <strong>The</strong> decrease of 32 million euros from 1998 is due to the worsen<strong>in</strong>g of the net f<strong>in</strong>ancial position as a result of the cash outlays for the new <strong>in</strong>vestments discussed above. <strong>The</strong> cost of personnel and services, less revenues, totaled 15 million euros (net revenues of 25 million euros <strong>in</strong> 1998). In particular, cost of personnel and services came to 174 million euros, or 20 million euros less than the 194 million euros reported <strong>in</strong> 1998. <strong>The</strong> Company’s headcount averaged 245 employees, (<strong>in</strong>clud<strong>in</strong>g 26 seconded to the <strong>Group</strong>’s pr<strong>in</strong>cipal companies) compared with 256 <strong>in</strong> 1998 (<strong>in</strong>clud<strong>in</strong>g 25 seconded employees). Revenues totaled 159 million euros, down from 219 million euros <strong>in</strong> the previous fiscal year. <strong>The</strong>y <strong>in</strong>clude royalties for the license to use the <strong>Fiat</strong> trademark, computed as a percentage of the sales of the <strong>in</strong>dividual <strong>Group</strong> companies, and fees for services rendered by management personnel. <strong>The</strong>y also reflect the already mentioned ga<strong>in</strong> realized on the sale of build<strong>in</strong>gs (42 million euros). <strong>The</strong> ma<strong>in</strong> components of extraord<strong>in</strong>ary <strong>in</strong>come were the ga<strong>in</strong>s realized on the disposal of 30% of IN.TE.SA. S.p.A. (32 million euros) and of a 0.46% <strong>in</strong>terest <strong>in</strong> Banco Central Hispano Americano S.A. (41 million euros). <strong>The</strong> net extraord<strong>in</strong>ary expense shown for 1998 reflects the special bonus paid to Chairman Cesare Romiti, <strong>in</strong> accordance with a resolution approved by the Board of Directors on January 30, 1998. Income taxes totaled 83 million euros, compared with 143 million euros <strong>in</strong> 1998. <strong>The</strong>y <strong>in</strong>clude corporate <strong>in</strong>come taxes of 69 million euros. Tak<strong>in</strong>g <strong>in</strong>to account tax credits on dividends, which are reflected <strong>in</strong> <strong>in</strong>vestment <strong>in</strong>come (124 million euros <strong>in</strong> <strong>1999</strong>), <strong>in</strong>come tax receivables totaled 41 million euros (compared with net taxes payable of 25 million euros <strong>in</strong> 1998). <strong>Report</strong> on Operations – Analysis of the F<strong>in</strong>ancial Position and Operat<strong>in</strong>g Results of the <strong>Fiat</strong> <strong>Group</strong> and <strong>Fiat</strong> S.p.A. 31
32 OTHER HOLDING COMPANIES In addition to <strong>Fiat</strong> S.p.A., the <strong>Group</strong> manages its <strong>in</strong>vestment portfolio through the follow<strong>in</strong>g hold<strong>in</strong>g companies: I. H. F. – INTERNAZIONALE HOLDING FIAT This company, organized under Swiss law, was aga<strong>in</strong> chiefly engaged <strong>in</strong> provid<strong>in</strong>g the foreign companies of the <strong>Fiat</strong> <strong>Group</strong> with f<strong>in</strong>ancial support. Its <strong>in</strong>vestment portfolio, consist<strong>in</strong>g ma<strong>in</strong>ly of shares <strong>in</strong> Iveco N.V., <strong>Fiat</strong> France S.A. and <strong>Fiat</strong> F<strong>in</strong>ance Corporation B.V., amounted to 2,992 million Swiss francs at the end of <strong>1999</strong>. Net <strong>in</strong>come came to 67 million Swiss francs, equivalent to 41.9 million euros (35 million Swiss francs <strong>in</strong> 1998). SICIND In <strong>1999</strong>, the company cont<strong>in</strong>ued to be concerned primarily with the management of its <strong>in</strong>vestment portfolio. <strong>The</strong> most important transactions completed dur<strong>in</strong>g the fiscal year were: ❚ Transfer of its 50.85% <strong>in</strong>terest <strong>in</strong> IPI S.p.A. to the Ingest S.p.A. subsidiary, where the real estate assets of the <strong>Fiat</strong> <strong>Group</strong> are concentrated. ❚ Absorption of Sogespar S.p.A. (100% <strong>Fiat</strong>) and Multiparuno (100% Sogespar S.p.A.) as part of a program implemented to streaml<strong>in</strong>e the <strong>in</strong>vestment portfolio of the <strong>Fiat</strong> <strong>Group</strong>. ❚ Sale of 14,061,735 H.d.P. S.p.A. ord<strong>in</strong>ary shares, equivalent to 0.5% of the capital stock, to Gem<strong>in</strong>a S.p.A. as part of the agreement concluded with Mr. Romiti upon his retirement. This transaction generated proceeds of 8.1 million euros and a gross capital ga<strong>in</strong> of 1.6 million euros. At year’s end, the carry<strong>in</strong>g value of Sic<strong>in</strong>d’s <strong>in</strong>vestments was 1,231 million euros. <strong>The</strong> ma<strong>in</strong> hold<strong>in</strong>gs were: 51.8% of the ord<strong>in</strong>ary shares of Toro Assicurazioni S.p.A. (481 million euros), 100% of Augusta Assicurazioni S.p.A. (130 million euros), 100% of Ingest S.p.A. (302 million euros) and 12.7% of the ord<strong>in</strong>ary shares of H.d.P. S.p.A. (164 million euros). <strong>The</strong> year ended with net <strong>in</strong>come of 26 million euros, compared with 106 million euros <strong>in</strong> 1998, when the company had earned an extraord<strong>in</strong>ary capital ga<strong>in</strong> on the sale of a 45.9% <strong>in</strong>terest <strong>in</strong> Snia BPD S.p.A.
Page 1 and 2: The Fiat</
Page 3 and 4: Consolidated Revenues in</s
Page 5 and 6: Honorary Chairman Giovanni Agnelli
Page 7 and 8: OVERVIEW Stockholders, A year ago,
Page 9 and 10: usiness. At the sa
Page 11 and 12: THE FIAT - GENERAL MOTORS ALLIANCE
Page 13 and 14: 40,000 30,000 20,000 10,000 0 Reven
Page 15 and 16: 1899 - 1999 Centen
Page 17 and 18: 16 FIAT AND ITS PEOPLE HUMAN RESOUR
Page 19 and 20: 18 With regard to workin</s
Page 21 and 22: 20 FIAT FOR THE ENVIRONMENT <strong
Page 23 and 24: 22 ANALYSIS OF THE FINANCIAL POSITI
Page 25 and 26: 24 represents a gain</stron
Page 27 and 28: 26 In particular: ❚ Teksid closed
Page 29 and 30: 28 Net deferred tax assets At Decem
Page 31: 30 FINANCIAL POSITION AND OPERATING
Page 35 and 36: 34 The Companies o
Page 37 and 38: 36 FINANCIAL HIGHLIGHTS BY SECTOR F
Page 39 and 40: 38 model of which 3.3 million units
Page 41 and 42: 40 COMMERCIAL VEHICLES — IVECO Hi
Page 43 and 44: 42 AGRICULTURAL AND CONSTRUCTION EQ
Page 45 and 46: 44 METALLURGICAL PRODUCTS — TEKSI
Page 47 and 48: 46 PRODUCTION SYSTEMS — COMAU/PIC
Page 49 and 50: 48 ROLLING STOCK AND RAILWAY SYSTEM
Page 51 and 52: 50 INSURANCE — TORO ASSICURAZIONI
Page 53 and 54: 52 FIAT ENGINEERING Fiat</s
Page 55 and 56: 54 ❚ With regard to the Internal
Page 57 and 58: 56 TRANSACTIONS AMONG GROUP COMPANI
Page 59 and 60: 58 MOTION FOR ALLOCATION OF THE <st
Page 61 and 62: New Holland Latino
Page 63: The Fiat</

The Fiat Group in 1999 - Report on Operations - Fiat SpA

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