2012 Annual Report - Italcementi Group

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20.2. Management of liquidity, credit and counterparty risks 20.2.1. Liquidity risk The company’s objective is to maintain a debt level able to ensure a balance between average debt maturity, flexibility and diversification of sources. As from 2010, under its financial policy review, Italcementi S.p.A. is a recipient of the fund-raising activities of Italcementi Finance, enabling it to improve its access to credit and benefit from the synergies of a centralized financial policy. The policy aims to obtain loans at competitive conditions and to ensure a balance between average debt maturity, flexibility and diversification of sources. Consequently, Italcementi S.p.A. obtains refinancing from Italcementi Finance through short- and long-term intragroup loans, arranged at arm’s length conditions. Italcementi S.p.A. cash and cash equivalents at December 31, 2012 were immaterial. The tables below compare net financial debt (excluding the fair value of derivatives and financial assets) by maturity with available lines of credit at the end of each year: At December 31, 2012 (*) : Maturity Maturity Maturity Maturity Maturity Maturity Total less than 1 to 2 2 to 3 3 to 4 4 to 5 beyond 5 (in thousands of euro) 1 year years years years years years Non-current financial liabilities 450,012 0 50,474 0 280,671 781,156 Other current financial liabilities 544,963 544,963 Amounts due to banks 48,488 48,488 Cash and cash equivalents (1, 424) (1,424) Total 592,027 450,012 0 50,474 0 280,671 1, 373,183 start 2013 end 2013 end 2014 end 2015 end 2016 end 2017 Committed available lines of credit 795,000 770,000 670,000 300,000 200,000 - (*) exc luding fair value of derivatives At December 31, 2011 (*) : Maturity Maturity Maturity Maturity Maturity Maturity Total less than 1 to 2 2 to 3 3 to 4 4 to 5 beyond 5 (in thousands of euro) 1 year years years years years years Non-current financial liabilities 333,698 229,800 189 190 268,191 832,068 Other current financial liabilities 413,555 413,555 Amounts due to banks 71,416 71,416 Cash and cash equivalents (479) (479) Total 484,492 333,698 229,800 189 190 268,191 1, 316,560 start 2012 end 2012 end 2013 end 2014 end 2015 end 2016 Committed available lines of credit 765,000 765,000 740,000 420,000 50,000 (*) exc luding fair value of derivatives At December 31, 2012, the average maturity of Italcementi S.p.A. gross debt was 3 years and 6 months. At December 31, 2012, Italcementi S.p.A. had 1,570 million euro of committed lines of credit of which 795 million euro undrawn and immediately available (1,345 and 765 million euro respectively at December 31, 278
2012 Annual Report Presentation 4 General information 14 Annual Report Consolidated Annual Report Directors’ report 146 Sustainability disclosure Italcementi S.p.A. Annual Report Separate financial statements 241 Extraordinary session 351 2011). At the same date the subsidiary Italcementi Finance S.A. had 725 million euro of committed undrawn bank lines of credit, although not contractually reserved exclusively for Italcementi S.p.A. requirements. 20.2.2. Covenants In addition to the customary clauses, some of the company’s financing contracts include covenants requiring compliance with financial ratios, fixed for the most part on the basis of Group consolidated results and verified at June 30 and December 31. The same applies to available lines of credit at the subsidiary Italcementi Finance S.A. and the intragroup lines granted by Italcementi Finance S.A. to Italcementi S.p.A.. The main financial ratios included in the covenants are “leverage” (net debt/recurring EBITDA), and “coverage” (recurring EBITDA/net financial costs, excluding capital gains/losses on the sale of equity investments). For bilateral lines of credit and borrowings, failure to comply with covenants leads to termination and consequent early repayment, although these clauses also include a stand-by period prior to actual execution. Lines of credit and financing contracts do not contain rating triggers that would lead to early repayment. Some financing contracts involve assumption of negative pledges to the counterparty, although these are limited to specific instances that do not substantially compromise the company’s ability to finance or refinance its operations. At December 31, 2012 lines of credit and loans subject to covenants stood at 360 million euro of total drawings represented by gross debt (1,375 million euro at December 31, 2012 expressed at nominal value, excluding the fair value effects of derivatives) and 795 million euro of total undrawn and immediately available lines of credit (795 million euro at December 31, 2012) At December 31, 2012, the company complied with all contractual commitments; covenant-related financial ratios were well within the contractual limits agreed in the loans in question. The company expects to comply with its covenants for the next 12 months and will provide information as appropriate should its financial situation deteriorate. 20.2.3. Credit risk In compliance with Italcementi S.p.A. procedures, customers electing extended terms of payment are vetted for credit worthiness before and during the life of the contract. Credit checks take the form of customer-balance monitoring by the administrative department, whose procedures also regulate provisions for overdue receivables at regular intervals. The concentration of trade credit risks is limited by virtue of Italcementi S.p.A.’s broadly based and uncorrelated customer portfolio. For this reason, management believes that no further provisions for credit risks will be necessary beyond the allowances normally provided for uncollectible and doubtful receivables. 20.2.4. Counterparty risk Exchange- and interest-rate instruments are transacted only with counterparties with high ratings, selected on the basis of a number of criteria: ratings attributed by specialist agencies, assets and equity as well as the nature and maturity of transactions. The majority of counterparties are leading international banks. No financial instruments are negotiated with counterparties in geographical regions exposed to political or financial risks. All counterparties are in Western Europe or in the USA. At December 31, 2012 Italcementi S.p.A.’s credit exposure (intragroup current accounts) to the Calcestruzzi group, standing at 199.1 million euro did not present risk in excess of that already contemplated in testing the Italcementi interest in the Calcestruzzi group for impairment. 279 www.italcementigroup.com
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2012 Annual Report
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Contents PRESENTATION Letter to the
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Letter to the stakeholders Consolid
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Italcementi Group in the world (as
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Highlights Contribution to consolid
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Share prices and market capitalizat
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E) Share prices and market capitali
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Italcementi S.p.A. Directors, Offic
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Lorenzo Renato Guerini (Director si
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Alberto Clô (Director since May 4,
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Yves René Nanot (Director since Ju
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Board of Statutory Auditors Maria M
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Notice of Call Those who are entitl
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Appointment of the Board of Directo
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Annual Report Consolidated Annual R
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2012 Annual Report Presentation 4 G
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Financial statements Statement of f
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Statement of comprehensive income N
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Statement of cash flows Notes 2012
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21. Deferred tax assets and Deferre
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Amendments to IAS 12 “Income taxe
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1.3. Basis of consolidation The con
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Changes in equity interests in subs
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Operating lease payments are recogn
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1.15. Cash and cash equivalents Cas
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1.18. Share-based payments The Grou
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1.24. Government grants Government
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4. Operating segment disclosure The
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The table below sets out segment re
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The table below sets out other segm
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The useful life adopted by the Grou
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Assumptions used for the computatio
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7. Intangible assets in thousands o
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10. Other non-current assets This c
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15. Reserves Translation reserve Th
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Net liabilities determined on the b
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The table below sets out key data f
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appeal and by the regional court of
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22.1 Financial liabilities Financia
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Bond loans f) The Italcementi Group
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The bond was assigned a Ba2 Moody
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At December 31, 2012 lines of credi
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22.3.1 Fair value of derivatives Th
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22.4 Interest-rate risk management
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The Group companies operate chiefly
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From 2008 to 2012, the Group transa
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26. Services Services amounted to 1
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29. Non-recurring income (expense)
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The income statement and the statem
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Diluted earnings per share Diluted
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36. Joint ventures The Group’s mo
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Net debt (in thousands of euro) amo
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Annex 1 The following table shows i
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Company Registered office Share cap
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Company Registered office Share cap
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Italcementi S.p.A. Annual Report 14
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Page 229 and 230: 2012 Annual Report Presentation 4 G
Page 243 and 244: Separated financial statements 241
Page 279: 2012 Annual Report Presentation 4 G
Page 305 and 306: Annexes 303 www.italcementigroup.co
Page 308 and 309: ITALCEMENTI S.P.A. REPORT OF THE BO
Page 310 and 311: We ascertained that the Remuneratio
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Page 316 and 317: Sustainability disclosure Italcemen
Page 318 and 319: In 2010, the Group reinforced its a
Page 320 and 321: 2 Looking forward 2.1 Targets 2015
Page 322 and 323: 3 Social responsibility 3.1 Valuing
Page 324 and 325: 2012 2011 2010 2012 2011 2010 Italy
Page 326 and 327: Trainees (%) 2012 2011 2010 Manager
Page 328 and 329: 3.3 Health and product responsibili
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The Social Initiatives Policy reinf
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In 2012, Energy Efficiency Certific
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Power consumption, concrete 2012 20
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4.3 Air emissions At the end of 201
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Water consumption, cement 2012 2011
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Quarry management, cement (*) Matur
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5.2 Quality The Group is committed
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5.4 Sustainable construction Italce
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6 Reporting and additional informat
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6.4 Boundaries and reporting method
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Training management system Hours of
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Extraordinary session 351 www.italc
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Summary of resolutions The Annual G
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at an extraordinary session: to ren
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April 2013 Project by LSVmultimedia
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2012 Annual Report - Italcementi Group

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