2012 Annual Report - Italcementi Group

Recoverable amount coincides with value in use.
The discount factor is obtained by applying the estimated long-term inflation rate to the weighted average cost
of capital (WACC). WACC is computed on the basis of the market value of capital and of sector debt, to which
the mean sector coefficient based on the debt/stock market capitalization ratio is applied.
Assumptions used for calculation of the CGU:
(in %)
Pre-tax discount rate
Growth rate
including inflation
Cash-generating units 2012 2011 2012 2011
Italy 8.8 8.9 2.0 2.0
The test for 2012 did not require a reduction in the goodwill of the CGU.
Sensitivity analysis
With reference to the current and expected industry situation and to the results of the 2012 impairment tests, a
sensitivity analysis was conducted on recoverable amount, using the discounted cash flow method.
At December 31, 2012 a 1% increment in the weighted average cost of capital would not determine a surplus
difference in carrying amount with respect to recoverable amount for the CGU.
A 5% reduction in demand in the explicit forecast period with respect to the projections would not determine a
surplus difference in carrying amount with respect to recoverable amount for the CGU.
A 5% reduction in EBITDA with respect to projections would not determine a surplus difference in carrying
amount with respect to recoverable amount for the CGU.
On the basis of the above analysis the company believes that it is not necessary to make any reduction in
goodwill.
The discount rate that equates the CGU’s recoverable amount with net carrying amount is 10.1%.
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