Separate Financial Statements 2007 - Indesit

Separate Financial Statements as of 31 December 2007
certain minority investments. As discussed in the notes to the separate financial statements, this
involved the disposal of interests that are no longer strategic and the purchase of minority
interests in subsidiaries, as well as the merger of wholly-owned companies.
Product innovation continues to play an essential role in the Company's strategy. In particular,
Indesit Company launched a range of innovative products during 2007 that both respond to and
anticipate major market trends: the concepts of environmental sustainability, ease of use,
flexibility and design guided the creation and development of the products presented during the
year. Indesit's Moon washing machine is a leading example, combining a revolutionary design
from Giugiaro with extreme ease of use: just 4 programmes satisfy all washing requirements.
Just one year after the launch, Moon's design has become a beacon for the entire market. This is
confirmed by the numerous official awards already received: Design Award, Good Design,
Grand Prix de l‟Innovation and Janus de l‟Industrie. Moon has also achieved exceptional results
in terms of profitability, with a price positioning that greatly exceeds the average for Indesit's
standard range of washing machines. In the refrigeration segment, Hotpoint-Ariston's "Big 60"
fridge-freezer combines the flexibility of a standard unit affording more than 35 litres of extra
capacity with the savings of energy class A+. This product, designed by Makio Hasuike, was
launched throughout Europe in June 2007 and has rapidly gained acceptance and market share
everywhere, despite a price positioning that is more than 30% higher than the category average.
Hotpoint-Ariston's Flexipower dishwasher represents the most significant innovation among the
Group's built-in products. This radically new product is positioned at the top end of the market
in terms of wash effectiveness (variable intensity, depending on the level of grime), quietness
(43 dbA) and flexibility. Also launched in June 2007, Flexipower has already had a significant
impact on segment profitability: in Italy, as an example, this product has raised Group sales at
the top end of the market by 20%.
In addition to these launches, work in 2007 laid the foundations for a 2008 product plan that is
even more innovative and ripe for further success. The development costs capitalised during the
year in relation to projects for products already launched amounted to 9.0 million euro. On the
other hand, the development costs capitalised in relation to projects for products not yet
launched amounted to 7.0 million euro; the amortization of these costs has not yet commenced.
No less than 60 projects are dedicated to the development of new concepts for products, while
20 research projects are updating and expanding our market knowledge: these efforts represent
an important driver for the confirmation and consolidation of the Group's position in all
markets.
In view of the good results achieved and confirmation of the objectives established in the threeyear
plan, Indesit Company has adopted a new dividend policy which envisages paying out at
least 50% of the Group's profit. In 2007, Indesit Company paid an increased dividend of 0.385
euro per ordinary share and 0.403 euro per savings share (up from 6.6% and 6.3% respectively
in 2006).
Intercompany and related-party transactions, and significant, non-business or
unusual transactions
Relations between Indesit Company S.p.A. and all other Group companies are settled on arms'-
length terms, having regard for the quality of the goods and services provided. A specific
section of the explanatory notes (note 8) describes the nature of the principal transactions
arranged by the parent and other group companies with related parties including, in particular,
associates, subsidiaries and parent companies and companies controlled by the latter. This
section also contains the detailed information required by Consob regulations and IAS 24. In
accordance with Consob Resolution no. 15519 dated 27 July 2006 and Consob Communication
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