2011 Annual Report - Italcementi Group

2011 Annual Report

Contents 

PRESENTATION 

Letter to the stakeholders 4 

Italcementi Group in the world 6 

Highlights 8 

Italcementi S.p.A. on the Stock Exchange 9 

GENERAL INFORMATION 

Professional profiles of the members of the Board of Directors and the Board of Statutory Auditors 15 

Notice of call 22 

ANNUAL REPORT 

Consolidated Annual Report 

Directors’ report 

Results and significant events for the year 29 

The international economy and industry trends 31 

Business and financial performance in 2011 32 

Risks and uncertainties 41 

Performance by country and business 45 

Energy project 51 

Dealings with related parties 53 

Information systems 54 

Engineering, technical assistance research and development 58 

Innovation 59 

E-business 59 

Disputes and pending proceedings 60 

Significant events after December 31, 2011 61 

Outlook 62 

Consolidated financial statements 

Financial statements 64 

Notes 69 

Annexes 137 

Representation pursuant to art. 154-bis paragraph 5 TUF 145 

Report of the Independent Auditors 146 

Italcementi S.p.A. Annual Report 


Results and significant events for the year 151 

Dealings with related parties 155 

Human resources 157 

Disputes and pending proceedings 161 

Italcementi Cav. Lav. Carlo Pesenti foundation 161 

Performance of the Ciments Français group 163 

Report on corporate governance and ownership structure 165 

Resolution 201 

Separate financial statements 

Financial statements 240 

Notes 245 

Annexes 299 

Representation pursuant to art. 154-bis paragraph 5 TUF 301 

Report of the Board of Statutory Auditors 302 

Report of the Independent Auditors 308 

EXTRAORDINARY SESSION 309 

This Annual Report has been prepared in English for the convenience of international readers. 

The original Italian documents should be considered the authoritative version.

2011 Annual Report 

Italcementi S.p.A. 

Via G. Camozzi, 124 - 24121 Bergamo - Italy 

Share Capital € 282,548,942 

Bergamo Companies Register 

Company subject to management 

and coordination activity by Italmobiliare S.p.A. 

The photos illustrating this report refer to the i.lab project, the Italcementi Group's new Research and Innovation Center in Bergamo, 

designed by architect Richard Meier. The i.lab building, which covers a surface area of 23,000 square meters, has been build under 

LEED standards, the most authoritative rating system assessing the energy and environmental sustainability of buildings.

Letter to the stakeholders 

Innovation, the lever for growth and competitiveness 

For the fifth year running, 2011 was a 

particularly difficult one which affected the 

construction business. In this context, the 

Group continued to counter the negative effects 

of lower turnover on profitability through cost 

containment and recovering industrial efficiency. 

The innate industrial spirit that has carried us 

through almost 150 years of operations in 

various economic conditions has once again 

been the catalyst to react against unfavourable 

situations, also as a result of the geographic 

diversification of the Group. 

We therefore look forward in the short term to 

fuse our traditional values with a focus on the 

future through innovation, the strategic lever 

the Group intends to use to develop its 

competitive advantage, while contributing to improved quality of life and the environment. 

Giampiero and Carlo Pesenti visiting the i.lab Research Centre 

Innovation and sustainability, together with a new programme of selective investments involving 

Group production in Bulgaria, Italy, India and Morocco, are the key aspects of 2012. 

This year saw the inauguration of i.lab, Italcementi’s new innovation and research centre, designed 

by the architect Richard Meier and built to be compliant with Leed, the leading energy and 

environmental certification standard for construction, which enables energy savings of up to 60%, 

compared to a traditional building. 

i.lab is an engine of growth and competitiveness, focusing on research and the transfer of 

technology to construction materials, where cement is the generator of sustainable architecture and 

intelligent buildings. 

i.lab offers the area and the community the Group’s core vocation for innovation and, at the same 

time, the message that industry can be the driver for sustainability, benefitting the economy, the 

environment and society. 

i.lab’s engineers, researchers and technical staff work together to integrate know-how with good 

practices and experience to drive technological innovation while implementing a strategy of 

sustainability. 

2012 marks ten years of Italcementi Group documenting sustainability policies with detailed 

publication of the results achieved and a continuous constructive relationship with all its 

stakeholders. 

4

The Group has decided to take a further step in this direction by publishing the Report on 

Sustainability together with the Directors’ Annual Report. 

In the ten-year period, the quality and detail of information have been improved, in line with the 

provisions of the Global Reporting Initiative, having adopted in 2010 the new United Nations Global 

Compact, which convenes global companies excelling in sustainability issues. 

Specifically, the Ten Principles of the Global Compact adopted have been confirmed as founding 

elements of Group Policies and the operating codes of good practice, and the annual Report on 

Sustainability publishes the Communication on Progress of all the initiatives implemented to 

contribute to the Millennium Development Goals. 

Alongside these initial commitments, based upon the new developments in a rapidly and continually 

evolving world, and an uncertain economic climate, in 2012 we shall continue the operating and 

industrial efficiency plans including rigorous financial management, in order to support the Group’s 

commitment to future growth. 

Giampiero Pesenti 

Chairman 

Carlo Pesenti 

Chief Executive Officer 

5 

www.italcementigroup.com

Italcementi Group 

in the world 

(as of December 31 st 2011) 

NORTH AMERICA 

ESSROC 

CIMENT QUEBEC 

ESSROC SAN JUAN 

RIVERTON 

ARROW 

CAMBRIDGE 

CRIDER & SHOCKEY 

FRANCE 

CIMENTS FRANCAIS 

CIMENTS CALCIA 

GSM 

UNIBÉTON 

AXIM 

SPAIN 

FINANCIERA Y MINERA 

ITALY 

ITALCEMENTI 

CALCESTRUZZI 

CTG 

AXIM ITALIA 

ITALGEN 

BELGIUM 

CCB 

TERMINALS 

Albania 

Gambia 

Sri Lanka 

Mauritania 

(grinding center) 

6


Presentation Italcementi Group in the world 6 

General information Highlights 8 

Annual Report Italcementi S.p.A. on the Stock Exchange 9 

Extraordinary session 309 

BULGARIA 

DEVNYA CEMENT 

VULKAN CEMENT 

GREECE 

HALYPS CEMENT 

TURKEY 

AFYON 

CYPRUS 

VASSILIKO CEMENT 

EGYPT 

SUEZ CEMENT 

TOURAH CEMENT 

HELWAN CEMENT 

RMB 

MOROCCO 

CIMENTS DU MAROC 

SAUDI ARABIA 

INTERNATIONAL CITY FOR 

READY MIX (JV) 

KUWAIT 

HILAL CEMENT COMPANY 

KAZAKHSTAN 

SHYMKENT CEMENT 

INDIA 

ZUARI CEMENT 

THAILAND 

JALAPRATHAN CEMENT 

ASIA CEMENT 

CHINA 

SHAANXI FUPING CEMENT 

www.italcementigroup.com 

7

Highlights 

Contribution to consolidated revenue by line of business 

(in millions of euro) 2011 2010 % % 

change change* 

Cement 3,056 3,315 (7.8) (2.7) 

Ready mixed 

concrete/Aggregates 1,388 1,038 33.8 3.5 

Other 277 307 (10.1) (2.2) 

Total 4,721 4,660 1.3 (1.3) 

* changes at constant size and exchange rates 

2011 2010 

64.7% 29.4% 5.9% 71.1% 22.3% 6.6% 

Recurring EBITDA 

(in millions of euro) 

Sales volumes and internal 

transfers by business 

53.7% 2.3% 

44.0% 

(1,9)% 

51,1 

Cemento 

52,1 

e clinker (Mt) 

2011 

58.0% 

2010 

Others 

North America 

Central Western Europe 

3.0% 

697 

39.0% 

842 

Group business and financial highlights 

(1,9)%* 

* change at constant size 

Inerti (Mt) 

Calcestruzzo 

(Mmc) 

(in millions of euro) 2011 2010 2009 2008 2007 

Revenue 4,721 4,660 5,006 5,776 6,001 

Recurring EBITDA 697 842 972 1,113 1,404 

EBITDA 738 839 957 1,103 1,405 

EBIT 129 370 443 607 958 

Profit (loss) for the period 91 197 215 277 612 

Profit (loss) attributable to owners of parent (3) 46 71 142 424 

Capital expenditure 402 542 742 988 999 

Total equity 4,895 4,986 4,692 4,622 4,760 

Equity attributable to owners of parent 3,495 3,525 3,353 3,330 3,479 

Net debt 2,093 2,231 2,420 2,679 2,418 

Number of employees at December 31 19,896 20,139 21,155 22,243 23,706 

3,7% 

(5,1)%* 

53,2% 

0,8%* 

9,5 

14,5 

38,1 

36,7 


2010 

8






Italcementi S.p.A. on the Stock Exchange 

1 Share capital and shareholders 

1.a Share capital at 12.31.2011 

At 12.31.2011, Italcementi S.p.A. share capital 

was € 282,548,942 represented by 282,548,942 

shares with a par value of € 1 each, of which 

177,117,564 ordinary shares and 105,431,378 

savings shares. 

1 Savings shares 37% 

2 Ordinary shares 63% 

1 

2 

1.b Ordinary shares 

Survey of shareholders with over 2% of share 

capital at 12.31.2011 (based on the 

shareholders' register, Consob 

communications and other information). 

1 Italmobiliare 60.363% 

2 Free float 34.683% 

3 Group First Eagle Funds (First Eagle 

Investment Management, LLC) - USA 2.812% 

4 Treasury shares 2.142% 

2 

3 

4 

1 

1.c Ordinary shares 

Breakdown of free float based 

on information in the 

shareholders' register for 

payment of the FY 2010 

dividend Shareholders listed in 

the register: 19,793 

1 Private Individuals 41.78% 7 Italian Funds 1.62% 

2 Foreign Funds 21.05% 8 Foreign Companies 1.82% 

3 Foreign Banks 6.36% 9 Foreign Insurance Co. 1.52% 

4 Italian Banks 4,41% 

10 Italian Insurance Co. 0.12% 

5 Brokers and Omnibus Accounts 15.59% 11 Other 2.02% 

6 Italian Companies 3.70% 

10 7 6 

11 8 

Ticker symbol Italcementi Italcementi bearer Italcementi registered 

ordinary shares savings shares savings shares 

BLOOMBERG: IT IM ITR IM - 

REUTERS: ITAI.MI ITAIn.MI - 

ISIN: IT0001465159 IT0001465167 IT0001465175 

1 

9 

2 

5 

3 

4 

2 Financial indicators 

Italcementi S.p.A. 2011 2010 2009 2008 2007 

(euro) 

Market prices (annual average official prices): 

- Ordinary share 5.855000 7.200000 8.893000 11.020000 20.022000 

- Savings share 2.899000 4.007000 4.793000 7.889000 13.238000 

Per share dividend: 

- Ordinary share 0.120000 (1) 0.120000 0.120000 0.180000 0.360000 

- Savings share 0.186478 (1) 0.120000 0.120000 0.210000 0.390000 

Dividend yield (on annual average official prices): 

- Ordinary share 2.05% 1.67% 1.35% 1.63% 1.80% 

- Savings share 6.43% 2.99% 2.50% 2.66% 2.95% 

(1) proposal of Board of Directors of March 2, 2012 

www.italcementigroup.com 

9

3 Share prices and market capitalization 

3.a Italcementi share prices and "FTSE MIB INDEX" (01.02.2007 - 02.29.2012) 

25 

23 

21 

19 

17 

15 

13 

11 

9 

7 

5 

3 

1 

45,000 

43,000 

41,000 

39,000 

37,000 

35,000 

33,000 

31,000 

29,000 

27,000 

25,000 

23,000 

21,000 

19,000 

17,000 

15,000 

13,000 

11,000 

2 Jan. 07 

11 Feb. 07 

23 Mar. 07 

2 May. 07 

11 June. 07 

21 July. 07 

30 Aug. 07 

9 Oct. 07 

18 Nov. 07 

28 Dec. 07 

6 Feb. 08 

17 Mar. 08 

26 Apr. 08 

5 June. 08 

15 July. 08 

24 Aug. 08 

3 Oct. 08 

12 Nov. 08 

22 Dec. 08 

31 Jan. 09 

12 Mar. 09 

21 Apr. 09 

31 May. 09 

10 July. 09 

19 Aug. 09 

28 Sep. 09 

7 Nov. 09 

17 Dec. 09 

26 Jan. 10 

7 Mar. 10 

16 Apr. 10 

26 May. 10 

5 July. 10 

14 Aug. 10 

23 Sep. 10 

2 Nov. 10 

12 Dec. 10 

21 Jan. 11 

2 Mar. 11 

11 Apr. 11 

21 May. 11 

30 June. 11 

9 Aug. 11 

18 Sep. 11 

28 Oct. 11 

7 Dec. 11 

16 Jan. 12 

FTSE MIB INDEX 

25 Feb. 12 

Italcementi ordinary shares 

Italcementi savings shares 

“FTSE MIB INDEX” 

3.b Italcementi shares and "FTSE MIB INDEX" performance (base 01.02.2007 = 100) 

120 

110 

100 

90 

80 

70 

60 

50 

40 

30 

20 

2 Jan. 07 

11 Feb. 07 

23 Mar. 07 

2 May. 07 

11 June. 07 

21 July. 07 

30 Aug. 07 

9 Oct. 07 

18 Nov. 07 

28 Dec. 07 

6 Feb. 08 

17 Mar. 08 

26 Apr. 08 

5 June. 08 

15 July. 08 

24 Aug. 08 

3 Oct. 08 

12 Nov. 08 

22 Dec. 08 

31 Jan. 09 

12 Mar. 09 

21 Apr. 09 

31 May. 09 

10 July. 09 

19 Aug. 09 

28 Sep. 09 

7 Nov. 09 

17 Dec. 09 

26 Jan. 10 

7 Mar. 10 

16 Apr. 10 

26 May. 10 

5 July. 10 

14 Aug. 10 

23 Sep. 10 

2 Nov. 10 

12 Dec. 10 

21 Jan. 11 

2 Mar. 11 

11 Apr. 11 

21 May. 11 

30 June. 11 

9 Aug. 11 

18 Sep. 11 

28 Oct. 11 

7 Dec. 11 

16 Jan. 12 

25 Feb. 12 



"FTSE MIB INDEX" 

10






3.c Italcementi share prices and "FTSE MIB INDEX" (01.03.2011 - 02.29.2012) 

8 

24,000 

7 

22,000 

6 

5 

4 

3 

20,000 

18,000 

16,000 

FTSE MIB INDEX 

2 

1 

14,000 

0 

12,000 

3 Jan. 11 

13 Jan. 11 

23 Jan. 11 

02 Feb. 11 

12 Feb. 11 

22 Feb. 11 

04 Mar. 11 

14 Mar. 11 

24 Mar. 11 

03 Apr. 11 

13 Apr. 11 




23 Apr 11 

03 May. 11 

13 May. 11 

23 May. 11 

02 June. 11 

12 June. 11 

22 June. 11 

02 July. 11 

12 July. 11 

22 July. 11 

01 Aug. 11 

11 Aug. 11 

21 Aug. 11 

31 Aug. 11 

10 Sep. 11 

20 Sep. 11 

30 Sep. 11 

10 Oct. 11 

20 Oct. 11 

30 Oct. 11 

09 Nov. 11 

19 nov. 11 

29 nov. 11 

09 Dec. 11 

19 Dec. 11 

29 Dec. 11 

08 Jan. 11 

18 Jan. 12 

28 Jan. 12 

07 feb. 12 

17 Feb. 12 

27 Feb. 12 

3.d Italcementi share and "FTSE MIB INDEX" performance (base 01.03.2011 = 100) 

120 

110 

100 

90 

80 

70 

60 

50 

40 

3 Jan. 11 

13 Jan. 11 

23 Jan. 11 

02 Feb. 11 

12 Feb. 11 

22 Feb. 11 

04 Mar. 11 

14 Mar. 11 

24 Mar. 11 

03 Apr. 11 

13 Apr. 11 

23 Apr 11 

03 May. 11 

13 May. 11 

23 May. 11 

02 June. 11 

12 June. 11 

22 June. 11 

02 July. 11 

12 July. 11 

22 July. 11 

01 Aug. 11 

11 Aug. 11 

21 Aug. 11 

31 Aug. 11 

10 Sep. 11 

20 Sep. 11 

30 Sep. 11 

10 Oct. 11 

20 Oct. 11 

30 Oct. 11 

09 Nov. 11 

19 nov. 11 

29 nov. 11 

09 Dec. 11 

19 Dec. 11 

29 Dec. 11 

08 Jan. 11 

18 Jan. 12 

28 Jan. 12 

07 feb. 12 

17 Feb. 12 

27 Feb. 12 




11 


3.e Share prices and market capitalization from 01.03.2011 to 02.29.2012 

Share price (euro) 

Capitalization (millions of euro) 

01.03.11 high low 02.29.12 01.03.11 high low 02.29.12 

Ordinary shares 6.529 7.647 4.081 5.703 1,156 1,354 723 1,010 

Savings shares 3.616 3.890 1.718 2.454 381 410 181 259 

Total 1,537 1,764 904 1,269 

“FTSE MIB INDEX” 20,436 23,178 13,474 16,351 

3.f Average monthly capitalization (January 2011 - February 2012) 




Total capitalization 

12






4 Trading volumes on the Italian Stock Exchange 

4.a Number of traded shares and weighted monthly average price 

Month Ordinary shares (euro) Savings shares (euro) 

Number Weighted Trade Number Weighted Trade 

of traded monthly value of traded monthly value 

shares average price shares average price 

January 2011 22,840,216 6.311 144,143,991 3,445,499 3.562 12,271,747 

February 22,793,639 6.672 152,077,627 4,302,879 3.571 15,364,715 

March 19,178,428 7.336 140,699,989 4,656,927 3.778 17,593,731 

April 9,360,220 7.170 67,109,451 1,961,600 3.710 7,278,120 

May 16,391,654 7.034 115,298,510 2,696,290 3.635 9,802,068 

June 9,103,404 6.322 57,547,710 2,922,009 3.096 9,047,518 

July 10,226,323 5.912 60,458,518 4,554,844 2.704 12,316,727 

August 13,849,651 4.960 68,688,529 3,293,559 2.335 7,691,421 

September 15,953,916 4.559 72,732,158 5,411,506 2.116 11,452,033 

October 12,186,079 4.707 57,362,988 2,625,846 2.210 5,804,094 

November 19,388,888 4.646 90,079,014 3,686,258 1.979 7,294,241 

December 5,653,626 4.491 25,390,706 1,925,830 1.786 3,438,864 

January 2012 6,407,382 5.073 32,506,972 2,817,268 2.049 5,772,373 

February 6,311,299 5.750 36,292,403 3,576,974 2.354 8,420,207 

4.b Monthly turnover (January 2011 - February 2012) 




13 


Corporate bodies 

Board of Directors 

(Term ends on approval of financial statements at 12.31.2012) 

Giampiero Pesenti 1 Chairman 

Pierfranco Barabani 1 Executive Deputy Chairman 

Lorenzo Renato Guerini 8 Deputy Chairman 

Carlo Pesenti 1-2 Chief Executive Officer - CEO 

Giulio Antonello 7 

Alberto Bombassei 4-7 

Giorgio Bonomi 

Alberto Clô 3-5-6-7 

Federico Falck 1-5-6-7 

Danilo Gambirasi 

Carlo Garavaglia 7 

Italo Lucchini 4 

Sebastiano Mazzoleni 

Yves René Nanot 1 

Marco Piccinini 

Ettore Rossi 7-9 

Attilio Rota 1-5-6-7 

Carlo Secchi 5-6-7 

Elena Zambon 7 

Emilio Zanetti 4-7 

Paolo Santinoli 10 Secretary to the Board 

Board of Statutory Auditors 

(Term ends on approval of financial statements at 12.31.2011) 

Acting Auditors 

Maria Martellini 

Mario Comana 

Luciana Gattinoni 

Substitute Auditors 

Fabio Bombardieri 

Carlo Luigi Rossi 

Leonardo Cossu 

Chief Operating Officer - COO 

Giovanni Ferrario 

Chairman 

Manager in charge of preparing the company’s financial reports 

Carlo Bianchini 

Independent Auditors 


KPMG S.p.A. 

14 

1 Member of the Executive Committee 

2 Executive Director responsible for overseeing the functioning of the internal control system 

3 Lead independent director 

4 Member of the Remuneration Committee 

5 Member of the Internal Control Committee 

6 Member of the Committee for Transactions with Related Parties 

7 Independent Director (in accordance with the Voluntary Code of Conduct and Legislative Decree no.58 of February 24, 1998) 

8 Independent Director (in accordance with the Legislative Decree no.58 of February 24, 1998) 

9 Member of the Compliance Committee 

10 Secretary to the Executive Committee


Presentation 4 

General information 

Professional profiles of the members of the Board of Directors 

Annual Report and the Board of Statutory Auditors 15 

Extraordinary session Notice of call 22 

Professional profiles of the members of the 

Board of Directors and the Board of Statutory Auditors 



Born in Milan, May 5, 1931 

Degree in mechanical engineering – Milan Polytechnic. 

1958, began working in the Technical Division of Italcementi S.p.A., the family firm 

established in 1864. 

1983, appointed Chief Operating Officer; 1984, Chief Executive Officer; since 2004 

Chairman of Italcementi S.p.A.. 

1984, appointed Chairman-Chief Executive Officer of Italmobiliare S.p.A., the holding 

company that controls Italcementi S.p.A., the Sirap Gema group and other finance and 

banking companies. 

Director of Mittel S.p.A., Allianz S.p.A., Compagnie Monegasque de Banque, Finter Bank 

Zurich and other companies in the Italmobiliare Group. 

Pierfranco Barabani 

Born in Milan, September 9, 1936 

Degree in civil engineering – Milan Polytechnic. 

Worked as an independent professional until 1970, when he joined Italcementi S.p.A., 

holding a variety of posts: Assistant to the Chief Operating Officer, Property Manager, 

Corporate General Affairs Manager. 

1993, appointed Chief Operating Officer and held the post until September 1999. 

Lorenzo Renato Guerini 

Born in Bergamo, September 10, 1949 

Degree in Business Economics – Bocconi University, Milan. 

Master from the “Wharton School” – University of Pennsylvania. 

Registered on the Bergamo Roll of Certified Accountants; registered on the National Roll 

of Account Auditors; technical consultant to the Bergamo Law Court. 

Began professional career in 1973 as an account auditor with Arthur Andersen. 

1978, joined the Montedison Group in a managerial post, handling management control for 

the Group’s international companies. 

1980, joined the KPMG Network and became a partner in 1984; 1989, set up KPMG 

auditing arm in Bergamo; 1994, appointed head of KPMG Network operations in Milan; 

1997, appointed Chairman of KPMG S.p.A., Chairman of the KPMG Italian Network and 

member of the Board of Directors of KPMG International, posts he held for 13 years until 

reaching the maximum allowed term of office. 

An independent professional since January 2011. April 2011, joined the Italcementi S.p.A. 

Board of Directors. 

Deputy Chairman of Italcementi S.p.A. since September 2011. 

15 


Carlo Pesenti 

Born in Milan, March 30, 1963 


Master in economics & management – Bocconi University, Milan. 

After joining the Italcementi Group, gained significant experience in a variety of Group 

production units and especially in the Corporate Finance, Administration & Control 

Division. 

Having held the post of Joint Chief Operating Officer, in May 2004 he was appointed 

Italcementi Chief Executive Officer. 

Chief Operating Officer of Italmobiliare. 

Giulio Antonello 

Born in Bari, April 12, 1968 

Degree in Finance from Wharton School, University of Pennsylvania, and MIA from 

Columbia University. 

Worked as an investment banker for the Crédit Agricole group in New York. 

On return to Europe, held a number of posts in the Ciment Portland SA cement group 

(now part of Holcim AG) in Switzerland. 

Was a member of the Board of Directors of companies including Concrete Milano S.p.A., 

Dolomite Colombo S.p.A. and Industriale Calce S.p.A. 

2006, CEO of Alerion Clean Power S.p.A., a company listed on the Milan stock exchange, 

which produces energy from renewable sources. 

1996-2011, also a member of the Board of Directors of Campisi SIM, Telelombardia S.p.A., 

Antenna 3 S.p.A., Enertad S.p.A. (today ERG Renew), SIAS S.p.A., Industria e 

Innovazione S.p.A. and Reno de Medici S.p.A. 

Alberto Bombassei 

Born in Vicenza, October 5, 1940 

Chairman and Chief Executive Officer of Brembo S.p.A., a worldwide market leader in 

braking systems and acknowledged innovator in disk brake technology. 

2003, awarded an honorary degree in mechanical engineering by the University of 

Bergamo 

2004, named a Cavaliere del Lavoro in Italy’s honors system. 

From June 2001 to May 2004, President of Federmeccanica. 

Since May 2004 Vice President of Confindustria for Industrial Relations and Social Affairs. 

Director of Atlantia S.p.A., Pirelli & C. S.p.A., Nuovo Trasporto Viaggiatori S.p.A. and Fiat 

Industrial S.p.A. 

16 


Born in Bergamo, November 2, 1955 

Degree in law – Milan State University. 

Practises law in Bergamo. Account auditor. 

As a specialist in distribution contracts, he has been involved in the creation of some of 

Italy’s most important purchasing consortia. Assists some of the leading Italian groups on 

advertising and mass merchandising, with a particular focus on growth and corporate 

disputes (M&A).







Alberto Clô 

Born in Bologna, January 26, 1947, where he lives. Married with two children 

Degree in political science – Bologna University. 

Full professor of Industrial Economics and Public Services Economics at Bologna 

University. 

1995-1996, Minister of Industry and interim Minister of Foreign Trade and President of the 

EU Council of Ministers of Industry and Energy during Italy’s six-month presidency. 

1996, named a Cavaliere di Gran Croce in Italy’s honors system. 

Federico Falck 

Born in Milan, August 12, 1949 – Married with two children 


Began his career in 1977 at the Acciaierie e Ferriere Lombarde Falck S.p.A. (now “Falck 

S.p.A.”); after internships in a number of US steel companies, he worked mainly in 

production and procurements for steel operations; Procurements Manager and Chief 

Operating Officer for many years. 

Currently Chairman of the Board of Directors of Falck S.p.A. and Falck Renewables 

S.p.A., a Falck Group company listed on the Milan Stock Exchange (STAR segment); 

Director of Banca Popolare di Sondrio; Regional Councilor and Milan Section Councilor of 

Unione Cristiana Imprenditori Dirigenti, member of the management committee of 

Assolombarda, Director Fondazione Sodalitas (association for development of social 

enterprise), Director of Fondazione Centesimus Annus. 

He was Chairman of ADR, Aeroporti di Roma – Director of Camfin, Credito Italiano, Banco 

Lariano, Cassa di Risparmio di Parma e Piacenza S.p.A., Viscontea Assicurazioni, 

Emittente Titoli and Chairman of Sodalitas. 


Born in Bergamo, January 22, 1932 

Science high-school degree. 

Italcementi S.p.A., first as Deputy Corporate Procurements Manager, later as International 

Relations & Fuel Procurement Manager until his retirement in 1997. 

Carlo Garavaglia 

Born in Legnano (Milan), May 15, 1943 

Degree in economics & commerce – Catholic University of Milan. 

Since 1972 member of Milan Roll of Public Accountants. 

Since 1979 an official account auditor, now a statutory auditor. 

From 1970 to 1976 a senior manager and partner of KPMG Peat Marwick in Milan. 

Founding partner of the L. Biscozzi – A. Fantozzi tax law firm, since 1998 founding partner 

of the Biscozzi Nobili legal and tax firm. 

Director of a number of listed and unlisted companies, honorary consul of Luxembourg for 

Lombardy. 

17 


Italo Lucchini 

Born in Bergamo, December 28, 1943 

Degree in economics & commerce – Bocconi University, Milan. 

Assistant lecturer at Bocconi University, non-tenured lecturer at Bergamo University, public 

accountant with a successful practice in Bergamo. 

Supervisory Director at Unione di Banche Italiane S.c.p.a. and Chairman of the Board of 

Statutory Auditors of BMW Financial Services Italia S.p.A. and BMW Italia S.p.A. and its 

subsidiaries, also of Fedrigoni S.p.A. and Cartiere Fedrigoni & C. S.p.A. 


Born in Milan, May 11, 1968 

Degree in geology – Milan State University. 

Master in Business Administration, Bocconi University, Milan. 

Began his professional career in 1996 with CTG S.p.A., as a research geologist with 

responsibility for assessing raw material reserves for cement production, coordinating work 

groups in Italy, France, Spain and Thailand. 

2000, moved to Italcementi S.p.A. as Project Manager in the Marketing Division, with joint 

responsibility for drawing up new product marketing plans and benchmark analyses for the 

development of competitive positioning models. 

2003, involved in the creation of the new Group New Product Marketing Division, where he 

was responsible for innovation management in the USA, Greece, Bulgaria, Turkey, Egypt, 

Thailand, Kazakhstan and India. He was also Group manager of the new project for 

enhancement of recoverable resources. 

Since 2010 active in non-profit and consultancy on innovation. 

Yves René Nanot 

Born in Asnières (France), March 27, 1937 

Degree in engineering – Paris. 

Master and Ph.D. in Business Administration from the University of California, Los 

Angeles. 

Held a variety of posts at Dupont de Nemours and then in the Total Group; 1993, joined 

Ciments Français where he is currently Chairman. 


Born in Rome, July 2, 1952 

Attended science high school and the faculty of architecture. Subsequently studied 

"International Negotiating Techniques” at the Institut des Hautes Etudes Internationales in 

Geneva. 

Director of a number of listed and unlisted companies active in automobiles and finance. 

Citizen of Monaco, advisor on finance and economy to the government of the Principality 

of Monaco. 

18







Ettore Rossi 

Born in Vicosoprano (Switzeland), August 4, 1934 

Degree in economics & commerce – Catholic University, Milan. 

Worked in the Italcementi company from September 1953 to December 31, 1999, in the 

Corporate Administration Division. 

A senior administration manager from 1967, he held the posts of Secretary to the 

Corporate Administration Division (1977/1985), Joint Corporate Administration Manager 

(1985/1986), Corporate Finance Administration & Control Manager (1986/1995), Deputy 

General Administration Manager (1995/1999). 

He has sat on the boards of directors and boards of statutory auditors of a number of 

Group companies. 

Attilio Rota 

Born in Bergamo, December 5, 1935 

Degree in law – Pavia University. 

Has sat on the boards of directors and boards of statutory auditors of companies in the 

publishing, cement, and agriculture sectors as well as on the boards of public and private 

bodies. 

Practicing barrister in Bergamo. 

Director-Controller of the Bergamo branch of Bank of Italy. 

Carlo Secchi 

Born in Mandello del Lario (Lecco), February 4, 1944 


Diploma in economic planning (Institute of Social Studies, The Hague, 1969-1970). 

Further studies at Netherlands Economic Institute and the Center for Development 

Planning, Erasmus University (Rotterdam, 1970-1972). 

Full professor in European Economic Policy since November 1, 1983, and director of the 

Institute for Latin American Studies and Countries in Transition (ISLA) at the Bocconi 

University, Milan. 

Conducts research work as a member of numerous scientific committees or boards of 

entities active in science and culture. 

Director of various listed and unlisted companies. 

19 


Elena Zambon 

Born in Vicenza, October 15, 1964 

Degree in Business Economics – Bocconi University, Milan. 

From 1989 to 1994 worked at Citibank N.A. where she was in charge of international 

investors on the Italian market and, subsequently, of reports and risk assessments for 

institutional clients (especially insurance, financial and world corporation groups). 

Currently Chairman of Zambon S.p.A., a pharmaceuticals multinational established in 

Vicenza in 1906, Deputy Chairman of ZaCh System – Zambon Advanced Fine Chemicals 

S.p.A. and Director of Zambon Company S.p.A., the group holding. 

Also Chairman of Secofind SIM S.p.A., the Multi-Family Office formed in 2000 to extend to 

other entrepreneurial families the expertise accumulated in wealth management for the 

Zambon family since 1994 in selection and control of asset managers. 

August 2011, member of Board of Directors of Fondo Strategico Italiano. 

Emilio Zanetti 

Born in Bergamo, October 26, 1931 

2002, honorary degree in economics & commerce from Bergamo University. 

1986, named a Cavaliere del Lavoro in Italy’s honors system. 

Since July 1985 Chairman of Banca Popolare di Bergamo S.p.A. (formerly Banca 

Popolare di Bergamo - Credito Varesino s.c.r.l.). 

Since 1993 director and Executive Committee member of Associazione Bancaria Italiana 

and formerly Vice President from 1998 to 2000. 

Since April 2007 Chairman of the Management Committee of UBI BANCA (Unione di 

Banche Italiane). 

Since October 1983 director of S.A.C.B.O. S.p.A. and Deputy Chairman since May 2008. 



Born in Rome, July 8, 1940 


Specialization in economics of industry, London School of Economics. 

Full professor of economics & corporate management. 

Certified accountant and account auditor. 

Director of a number of listed and unlisted companies. 

Mario Comana 

Born in Bergamo, January 22, 1957 

Degree in economics & commerce – Bergamo University. 

Specialization at Harvard University, Cambridge. 

Since 2000, full professor of financial intermediary economics at LUISS Guido Carli, 

Rome. 

Certified accountant and author of numerous banking publications; works as a consultant 

to financial intermediaries and as an independent and court-appointed consultant on 

financial questions and assessments. 

20








Born in Bergamo, November 29, 1950 


Has worked as a certified accountant since 1976, primarily on corporate and tax questions, 

and as a court consultant on insolvency procedures. 

She is also an auditor of a number of non-profit foundations and associations in the arts 

and science. 

Leonardo Cossu 

Born in Verona, May 23, 1958 

Degree in economics & commerce – University of Brescia. 

Registered on the roll of certified accountants and accountants and on the register of 

account auditors. 

Certified accountant, company assessor and technical consultant to the Brescia Law 

Court, advisor to corporate clients on consolidation, change, growth and development in 

general. 

Specific professional expertise in the corporate field; for more than fifteen years has been 

a director and independent director in companies listed on the Milan stock exchange, 

overseeing the operational aspects of the application for admission to trading and relations 

with shareholders. 

Chairman of the board of statutory auditors, acting auditor, director and chief executive 

officer of a number of companies active in finance, banking and industry. 

Chairman and coordinator for more than fifteen years of the Fee Liquidation Advisory 

Committee of the Brescia Roll of Certified Accountants and Accountants. 


Born in Alzano Lombardo (Bergamo), August 14, 1959 

Registered on the roll of certified accountants and accountants and on the register of 

account auditors. 

Holds a number of positions in the area of voluntary jurisdiction and insolvency 

procedures. 

Provides professional services mainly for medium-size companies. 

Director/auditor of companies in the credit and publishing fields and of a number of 

foundations and non-commercial entities. 


Born in Alzano Lombardo (Bergamo), October 11, 1947 

Degree in economics & commerce – Catholic University of Milan. 

June 1975, established the eponymous consultancy studio providing accounting, 

administrative, corporate and fiscal services. 

Holds a number of positions in the area of insolvency procedures. 

In the area of civil judicial proceedings, he works as a court-appointed technical 

consultant; for penal proceedings he works as a consultant to the state prosecutor. 

21 


Notice of Call 

The Shareholders are hereby called to attend the annual general Meeting on first call on 

April 18 th , 2012 at 10 a.m., in Bergamo, Via Madonna della Neve 8, and on second call on 

April 19 th , 2012, same time and place, to resolve upon the following 

Agenda 

Ordinary Items 

1) Board of Directors and Board of Statutory Auditors Reports on 2011 fiscal year: 

examination of financial statements at December 31 st , 2011 and consequent resolutions; 

2) Remuneration Report; 

3) Authorization to purchase and dispose of treasury shares; 

4) Supplement to the Board of Directors; 

5) Appointment of the Statutory Auditors, of the Chairman of the Board of Statutory 

Auditors and determination of its compensation; 

6) Proposal upon the increase of the total amount of rights allocated to the Long-term 

monetary incentive Plans for Officers, linked to the appreciation of the Italcementi 

shares. 

Extraordinary Items 

Proposal to amend articles 5 (Share capital), 15 (Appointment of the Board of Directors), 

16 (Replacement of Directors), 26 (Appointment of the Board of Statutory auditors) and 27 

(Replacement of Auditors) of the company bylaws. Ensuing and consequent resolutions. 

* * * 

Entitlement to take the floor: those who, according to the accounting entries of the 

Intermediary, are entitled to the voting rights at the end of the seventh open market day 

before the meeting date on first call (April 5 th , 2012), have the right to take the floor. 

Entitlement to take the floor at the Meeting and to exercise voting right is proved by a 

notice to the Company, served by the Intermediary in favour of who is entitled to the voting 

right. Credit and debit entries registered in the Intermediary accounts’ after the above 

mentioned deadline do not affect the entitlement of the voting right’s exercise at the 

Meeting. Therefore, holders of ordinary shares after such date are not entitled to take the 

floor or vote at the Meeting. 

Shareholders who own ordinary shares that have not been dematerialized must previously 

deliver them to an Intermediary, in time to be centralized in a dematerialization system. 

Vote by proxy: those who are entitled to take the floor at the Meeting can be represented 

by means of written proxy under current law provisions, and can use the form available at 

our registered offices (Via G. Camozzi 124, 24121 Bergamo ) and on the Company 

website: www.italcementigroup.com. The proxy can be notified to the Company by means 

of registered letter sent to the headquarters (Finance Department – Shareholders’ Office, 

at the above mentioned address) or by sending it to the address of certified electronic 

mail: soci.italcementi@legalmail.it. The representative can also deliver or send to the 

Company, instead of the original, a copy of the proxy, also on an IT support, stating, under 

his/her own responsibility, that the proxy is a copy of the original, and the identity of the 

delegating person. 

* * * 

22







Questions on the items on the agenda: shareholders can also submit questions on the 

items on the agenda before the Meeting. In order to facilitate the appropriate development 

and preparation of the Meeting, such questions must be received by the end of the fourth 

open market day before the Meeting date on first call (i.e. by April 12 th , 2012) by means of 

a registered letter sent to the headquarters (Corporate Affairs Department – at the above 

mentioned address) or by sending notice to the address of certified electronic mail: 

affarisocietari@italcementi.legalmail.it along with a certification issued by an Intermediary 

who can prove the entitlement of the voting right. Questions submitted before the Meeting 

are answered during the Meeting at the latest. The Company can provide with a sole 

answer to questions having the same content. 

Supplements to the agenda: according to the applicable law and the company bylaws, 

shareholders who, even jointly, own at least one fortieth of share capital represented by 

shares with voting rights, can request in writing, within 10 days from the publication of this 

notice of call, for supplements to the Meeting agenda, stating in their application which 

further issues are being suggested. Requests must be sent by means of registered letter 

to the headquarters (Corporate Affairs Department – to the above mentioned address) or 

by sending notice to the address of certified electronic email 

affarisocietari@italcementi.legalmail.it, along with a certification issued by an 

Intermediary who can prove the legitimacy to supplement the items on the agenda. A 

report on the items whose examination is proposed, must be delivered to the Board of 

Directors by the same deadline and following the same procedure. 

The supplement to the items on the agenda will be published, following the same 

procedure provided for the publication of this notice of call, at least 15 days before the 

Meeting date on first call; at the same time, the report drafted by shareholders who made 

the request will be publicly available, along with any remarks of the Board of Directors. 

A supplement to the agenda is not accepted for items on which the Meeting, under the 

applicable law, resolve upon proposal of the directors or based on Board’s project or 

report. 

* * * 

Supplements to the Board of Directors: It should be noted that, since this is a mere 

integration of the Board of Directors, the Meeting shall resolve upon the proposal 

according to legal majorities and therefore without the application of the List Vote. 

In order to facilitate the appropriate development of the Meeting, shareholders who, alone 

or together with other shareholders, that can prove they hold a percentage of the share 

capital with voting rights no lower than 2%, are invited to present their own candidates. 

Proposals may be filed by means of a registered letter sent to the headquarters (Corporate 

Affairs Department – at the above mentioned address) or by sending notice to the address 

of certified electronic mail: affarisocietari@italcementi.legalmail.it at least 5 days before 

the Meeting date on first call (i.e. by April 13 th , 2012) along with the following 

documentation: 

a) statements by which individual candidates accept their candidature and, under his/her 

own responsibility, state the non-existence of causes for ineligibility and the entitlement 

of the good reputation requirements established by the law; 

b) a brief resume on the personal and professional skills of each candidate with indication 

of their position as director and statutory auditor in other companies; 

c) statements by which individual candidate declare entitlement of the independence 

qualification required by the law and by the Code of Conduct; 

d) information on the identity of shareholders who have presented candidates; 

23 


e) a statement of the shareholders who do not hold, even jointly, a controlling or majority 

stake, bearing witness to the absence of any connection with the majority shareholder, 

as defined by the law in force. 

The intermediary certification proving ownership of the shareholding prescribed at the date 

on which candidates are presented may also be produced after the filing provided that it 

reaches the company within 5 days before the meeting date on first call (i.e. by April 13 th , 

2012). 

Candidates so presented will be timely made available to the market through publication 

on the Company website www.italcementigroup.it. 

In any case, shareholders can present candidates directly at the venue of the Meeting. 

* * * 

Appointment of the Board of Statutory auditors: the appointment of the Board of 

Statutory Auditors shall occur on the basis of lists. 

Lists may be presented only by shareholders who, alone or together with other 

shareholders, can prove they hold an overall percentage of the share capital with voting 

rights no lower than 2%. 

No shareholder may present or participate in the presentation of more than one list, 

neither through third parties or trust company. 

Shareholders belonging to the same group and shareholders who join a shareholders’ 

agreement on the company shares may not present or vote for more than one list, neither 

through third party or trust companies. 

Lists presented in violation of these restrictions will not be accepted. 

Each list shall be made up of two sections: one for candidates for the office of Acting 

Auditor, the other for the candidates for the office of Substitute Auditor. 

The names of no more than three candidates for the office of Acting Auditor and no more 

than three candidates for the office of Substitute Auditor must be listed in each section, by 

means of a progressive number. 

Each candidate may be presented on one list only under penalty of ineligibility. 

Lists must be filed with the company head office (Corporate Affairs Department – to the 

above mentioned address) or sent by means of certified electronic mail to: 

affarisocietari@italcementi.legalmail.it, at least 25 days before the meeting date on first 

call (i.e. by March 24 th , 2012), along with the following documentation: 

a) statements by which individual candidate accept their candidature and, under his/her 

own responsibility, state the non-existence of causes for ineligibility or incompatibility as 

well as the entitlement of further requirements established by the law, company bylaws 

and Code of Conduct; 

b) a brief resume on the personal and professional skills of each candidate with indication 

of their position as director and statutory auditor in other companies; 

c) information on the identity of shareholders who have presented lists; 

d) a statement of the shareholders who do not hold, even jointly, a controlling or majority 

stake, bearing witness to the absence of any connection with the majority shareholder, 

as defined by the law in force. 

24







The intermediary certification proving ownership of the shareholding prescribed at the date 

on which lists are presented may also be produced after the filing of the list provided that it 

reaches the company within 21 days before the meeting date on first call (i.e. by March 

28 th , 2012). 

A list presented not in compliance with the above provisions will be considered as not 

presented. 

In the event, by the deadline of 25 days before the date of the Meeting (i.e. by March 24 th , 

2012), a single list has been filed, or only lists presented by shareholders who are 

connected to each other under current regulations, further lists can be presented until the 

following third day, and the threshold of 2% above mentioned will be halved. 

* * * 

The Meeting Documents, required by applicable laws and regulations, will be made 

publicly available, according to legal deadlines, at the registered offices, at Borsa Italiana 

S.p.A. and on the Company website www.italcementigroup.com. 

In particular: 

* 1 st item on the agenda – ordinary items: 21 free days before the Meeting on first call; 

* 2 nd and 3 rd item on the agenda – ordinary items: 21 days before the Meeting on first 

call; 

* 4 th and 6 th item on the agenda – ordinary items: 30 days before the Meeting on first 

call; 

* 5 th item on the agenda – ordinary items: 40 days before the Meeting on first call; 

* sole item on the agenda – extraordinary items: 21 days before the Meeting on first call; 

Shareholders have the right to review all the documents filed with the registered offices, 

and to obtain a copy of them. 

* * * 

The regularity of the Meeting and the validity of its resolutions on the items on the agenda 

are governed by law. 

The company share capital is equal to € 282,548,942, divided into 177,117,564 ordinary 

shares and 105,431,378 savings shares with a face value of €1 each. When this notice is 

published, the number of ordinary shares representing share capital with voting rights, 

therefore net of 3,793,029 ordinary treasury shares held by the company, is equal to 

173,324,535. 

The Board of Directors 

((Notice published on 8 th March 2012 on “Il Sole - 24 Ore, Milano Finanza and Eco di Bergamo” and on the Company’s website) 

25 


Annual Report 

Consolidated Annual Report 

27 



Following the adoption by the European Union of Regulation no. 1606 of 2002, Italcementi 

consolidated financial statements for 2011, and the comparatives for 2010, have been 

drawn up in compliance with the International Financial Reporting Standards (IFRS). 

In accordance with the aforementioned Regulation, the principles to be adopted do not 

include the standards and interpretations published by the International Accounting 

Standards Board (IASB) and the International Financial Reporting Interpretations 

Committee (IFRIC) at December 31, 2011, but not endorsed by the European Union at that 

date. Furthermore, the European Union has endorsed additional standards/interpretations 

that Italcementi S.p.A. will apply at a subsequent time, having decided not to elect early 

application. 

The main changes with respect to the financial statements at December 31, 2010, are set 

out in detail in the notes, in the section “Statement of compliance with the IFRS”. 

With regard to the scope of consolidation, the Calcestruzzi group has been 

consolidated (on a line-by-line basis) as from January 1, 2011, while the Group operations 

in Turkey headed by Set Group were deemed available-for-sale (application of IFRS 5) as 

from the beginning of the year and subsequently sold at the end of March. In compliance 

with IFRS 5 the gains or losses relating to discontinued operations have been presented 

as a separate item on the income statement both for the period under examination and for 

2010. A similar presentation has been adopted for cash flows. In December, Axim-branded 

cement and concrete additives operations in Italy, France, USA, Canada, Morocco and 

Spain were sold. Full details about the changes in the scope of consolidation are provided 

in the notes (note 3). 

Earnings indicators 

To assist comprehension of its financial data, the Group employs a number of widely used 

indicators, which are not contemplated by the IFRS. 

Specifically, the income statement presents the following intermediate results / indicators: 

recurring EBITDA, EBITDA, EBIT, computed as the sum of the preceding items. On the 

face of the statement of financial position, similar considerations apply to net debt, whose 

components are detailed in the specific section of the notes. 

Since the indicators employed by the Group are not envisaged by the IFRS, their 

definitions may not coincide with and therefore not be comparable to those adopted by 

other companies/groups. 

This report contains many financial and non-financial earnings indicators, including those 

mentioned above. The financial indicators, taken from the financial statements, are used in 

the tables summarizing the Group’s financial performance, in relation to comparative 

amounts and other amounts from the same period (e.g., change in revenue, recurring 

EBITDA and EBIT with respect to the previous year, and change in their return on 

revenue). The use of amounts not directly apparent from the financial statements (e.g., the 

exchange-rate effect on revenue and on earnings) and the presentation of comments and 

assessments assist qualification of the trends in the amounts concerned. 

28



General information 15 

Annual Report Consolidated Annual Report Directors’ report 28 

Extraordinary session Italcementi S.p.A. Annual Report Consolidated financial statements 63 

The directors’ report also provides a series of financial ratios (gearing, leverage, coverage) 

that are clearly of importance for a better understanding of Group performance, especially 

in comparison with previous periods. The non-financial indicators refer to external and 

internal elements: the general economic situation and the situation of the industry in which 

the Group operates, trends on the various markets and lines of business, trends in sales 

prices and key cost factors, acquisitions and disposals, other significant events in the 

period, organizational developments, the introduction of laws and regulations, etc.. In the 

notes, the section on the net debt provides information about the effects of changes in 

interest rates and the main exchange rates on the statement of financial position and the 

income statement. 

Results and significant events for the year 

Results 

Inevitably, the Group’s results were affected by the continuing difficulties in the international 

economic scenario in 2011. 

Sales volumes, on a like-for-like basis, were down in aggregates and cement, but grew 

slightly in ready mixed concrete. 

Revenue, at 4,720.5 million euro (4,660.0 million euro in 2010), was up 1.3% (-1.3% on a 

like-for-like basis and at constant exchange rates), largely due to the change in the Group 

scope of consolidation. 

Recurring EBITDA, at 697.3 million euro (841.7 million euro), was down 17.2%. 

After amortization and depreciation charges of 474.8 million euro (461.2 million euro) and 

impairment losses of 134.3 million euro (8.0 million euro), EBIT was 129.0 million euro 

(370.2 million euro), a reduction of 65.2%. 

Profit before tax, at 53.0 million euro (276.5 million euro), was down 80.8%. 

After income tax expense of 68.8 million euro (60.6 million euro), the loss relating to 

continuing operations amounted to 15.8 million euro (profit of 215.8 million euro in 2010). 

Thanks to the net gain of 106.9 million euro from the sale of Set Group, profit for the 

period was 91.2 million euro (197.1 million euro). The loss attributable to owners of the 

parent was 3.1 million euro (profit of 45.8 million euro), while profit attributable to noncontrolling 

interests decreased to 94.3 million euro, from 151.3 million euro in 2010. 

Net debt at December 31, 2011, amounted to 2,093.0 million euro, down by 137.9 million 

euro from December 31, 2010 (2,230.9 million euro). 

Total equity was 4,894.9 million euro, a decrease of 91.0 million euro from December 31, 

2010, while equity attributable to owners of the parent was 3,494.9 million euro, down 

by 30.2 million euro from December 31, 2010 (3,525.1 million euro). 

Significant events for the year 

Significant events in the first nine months of the year, previously illustrated in the halfyear 

financial report and the quarterly reports at the end of March and September, are 

described below. 

29 


The Calcestruzzi group returned to the scope of consolidation of Italcementi S.p.A. as 

from January 1, 2011. With a ruling on April 20, 2011, the court of Caltanissetta ordered the 

full cancellation of the preventive seizure on Calcestruzzi S.p.A. and the restitution of 

company assets to the owners. In May, the Calcestruzzi S.p.A. shareholders approved a 

share capital increase from 59.2 million euro to 110 million euro, which was 

subscribed and simultaneously paid in full by Italcementi S.p.A. for 99.90% and by 

SICIL.FIN.S.r.l. (now Italcementi Ingegneria S.r.l.) for 0.10%. 

At the end of January, in view of the political unrest in Egypt, the Group suspended local 

production operations for about one week. 

In March Set Group Holding was sold to the Turkish group Limak Holding and Italgen 

Elektrik Uretim was sold to Enerjisa (a Sabanci-Verbund joint venture). 

As a result of the sale on the stock market of the shares held in Afyon Cimento Sanayii 

Turk A.S., Ciments Français S.A. reduced its controlling interest from 76.51% to 51.0%. At 

the end of June, Mediobanca was engaged as financial advisor for sale of the entire 

remaining shareholding in the Turkish company. 

In August and September respectively, Moody’s Investor Services and Standard and 

Poor’s confirmed their Baa3 and BBB-/A-3 ratings assigned to Italcementi and Ciments 

Français, but downgraded the outlook from stable to negative. 

In September, through the Indian company Zuari Cement, the Group acquired from Zuari 

Industries a 74% stake in Gulbarga Cement, a company based in the region of 

Karnataka, which is planning to build a new cement plant with an annual cement capacity 

of 3 million metric tons. 

Significant events in the fourth quarter are described below, some of which were 

illustrated in the quarterly report at September 30, 2011. 

In October, Italcementi Finance S.A., the French company that acts as the Group’s 

treasury vehicle, received Banque de France authorization to launch commercial paper 

under a program for a maximum amount of 800 million euro. The program, with a shortterm 

Moody’s NP rating and Standard & Poor’s A3 rating, is unconditionally guaranteed by 

Italcementi S.p.A.. 

With regard to action to raise efficiency and optimize facilities, the Group formulated a 

series of measures on costs designed to strengthen profit margins. These initiatives – 

some of which were launched during the fourth quarter of the year – will bring benefits in 

the order of 160 million euro when fully implemented. 

In December, in line with the rating review policy adopted for almost all the major cement 

players, Moody’s Investor Services downgraded its long-term ratings for Italcementi and 

Ciments Français, and its senior unsecured ratings for Italcementi Finance and Ciments 

Français to Ba1. 

Also in December all operations in the sector of Axim-branded ready mixed concrete and 

cement additives were sold to the Swiss group Sika. The operations in question were 

organized in six companies with industrial facilities and commercial divisions active in Italy, 

France, USA, Canada, Morocco and Spain, with revenue of approximately 61 million euro 

in 2010 and 150 employees. The agreement also provides for a strategic partnership in 

R&D, sales and marketing and the supply of additives for the Group. 

30






The international economy and industry trends 

World economic trends in 2011 varied greatly, not only from one region to another, but also 

from one quarter to the next. The first half remained lively, but was followed by a 

significantly slower second half, due to financial stability risks in some euro zone countries, 

the restrictive fiscal policies adopted in most of the euro zone, the more cautious monetary 

policies in a number of emerging countries, as well as the geo-political unrest especially in 

the Middle East. For the year as a whole, global economic growth, which in 2010 had 

returned to more than 5%, was, according to preliminary estimates, once again close to its 

long-term values (around 3.5%); the growth rate in the advanced economies (1.6%) was 

half that of the previous year. 

Raw material prices largely reflected the general cyclical weakening; nevertheless, oil 

prices displayed a notable resistance to decline, influenced in part by the important 

recovery of the dollar. Falls in exchange rates, weak stock markets and tighter capital flows 

were the main features of many emerging countries in the last part of the year. Despite 

widespread moderation in wages and salaries, in the advanced area inflation rose faster 

than expected, due to the previous increases in the basic input prices and the rises in 

indirect taxation imposed by fiscal austerity policies. 

In the advanced economies, the deterioration in the macroeconomic climate hit the 

construction sector in the final phase of the longest recession of the postwar period, 

contributing, in many countries, to a further postponement in the upturn. Nevertheless, the 

most evident feature was the divergence in the cyclical positions of the countries in which 

the Group operates, both emerging and mature. Among the mature countries, there was a 

moderate construction recovery in France and Belgium, while the southern euro zone 

countries reported a further significant fall in activity. The USA was in an intermediate 

position, with the recessionary pressures of the last six years probably fading, but signs of 

a recovery, even from the very low levels reached, still appearing to be very weak. 

In the emerging countries, the economic trends in the construction sector were generally 

favorable; in some cases, however, signs of a slowdown emerged as economic policies 

paid greater attention to avoiding excessive speculative bubbles in real estate. The Group 

results in the area were also critically affected by events relating to the complex political 

transition taking place in Egypt, whose influence was also felt in the construction sector. 

31 


Financial performance in 2011 

Key consolidated figures 

2011 2010 % change 


(IFRS 5) vs. 2010 

Revenue 4,720.5 4,660.0 1.3 

Recurring EBITDA 697.3 841.7 (17.2) 

% of revenue 14.8 18.1 

Other operating income (expense) 40.7 (2.3) n.s. 

EBITDA 738.1 839.4 (12.1) 

% of revenue 15.6 18.0 

Amortization and depreciation (474.8) (461.2) 3.0 

Impairment losses on non-current assets (134.3) (8.0) n.s. 

EBIT 129.0 370.2 (65.2) 

% of revenue 2.7 7.9 

Finance costs (102.1) (89.8) 13.7 

Impairment losses 7.5 (21.0) n.s. 

Share of profit/(loss) 

of equity-accounted investees 18.6 17.1 9.3 

Profit before tax 53.0 276.5 (80.8) 


Income tax expense (68.8) (60.6) 13.5 

Profit (loss) relating to continuing operations (15.8) 215.8 n.s. 

Profit (loss) relating to discontinued operations 106.9 (18.8) n.s. 

Profit (loss) for the period 91.2 197.1 (53.7) 


attributable to: 

Owners of the parent (3.1) 45.8 n.s. 

Non-controlling interests 94.3 151.3 (37.7) 

Cash flow from operating activities 417.7 754.9 (44.7) 

Capital expenditure 402.4 542.2 (25.8) 

32






Quarterly trend 


Full year 


Q4 


Q3 


Q2 


Q1 


Revenue 4,720.5 1,120.3 1,148.2 1,298.8 1,153.2 

% change vs. 2010 1.3 2.9 (1.9) (3.8) 9.7 

Recurring EBITDA 697.3 133.4 191.8 241.7 130.4 

% change vs. 2010 (17.2) (24.6) (14.7) (19.6) (6.4) 

% of revenue 14.8 11.9 16.7 18.6 11.3 

EBITDA 738.1 154.7 193.0 242.3 148.0 

% change vs. 2010 (12.1) (13.5) (14.7) (18.7) 8.8 

% of revenue 15.6 13.8 16.8 18.7 12.8 

EBIT 129.0 (107.3) 78.3 122.4 35.6 

% change vs. 2010 (65.2) n.s. (27.3) (31.3) 17.6 

% of revenue 2.7 (9.6) 6.8 9.4 3.1 

Profit (loss) relating to continuing 

operations (15.8) (121.1) 26.7 60.2 18.5 

Profit (loss) for the period 91.2 (121.6) 25.0 60.2 127.6 

% of revenue 1.9 (10.9) 2.2 4.6 11.1 

Profit (loss) attributable to 

owners of the parent (3.1) (126.4) 8.2 34.3 80.7 

Net debt 2,093.0 2,093.0 2,218.6 2,256.7 2,166.4 

(at period end) 

Fourth-quarter sales volumes and internal transfers 

The figures and changes presented below do not include Set Group operations (Turkey), 

which were sold at the end of the first quarter of 2011; the figures and changes for ready 

mixed concrete and aggregates reflect the re-inclusion of the Calcestruzzi group in the 

scope of consolidation. 

Cement and clinker 

(millions of metric tons) 

Q4 


% change vs. 

Q4 2010 

Historic 

like-fo r- like 

basis 

Aggregates* 


Q4 


% change vs. 

Q4 2010 

Historic 

like-for-like 

basis 

Ready mixed concrete 

(millions o f m³) 

Q4 


% change vs. 

Q4 2010 

Historic 

like-f or-like 

basis 

Central Western 

Europe 4.3 (4.6) (4.6) 8.3 11.0 0.4 2.6 89.3 2.1 

North America 1.1 7.4 7.4 0.4 66.7 66.7 0.2 17.1 17.1 

Emerging Europe, 

North Africa and 

Middle East 4.0 (3.0) (3.0) 0.3 2.8 2.8 0.6 4.8 1.9 

Asia 2.6 (5.0) (5.0) n.s. n.s. n.s. 0.1 (31.6) (31.6) 


trading 0.7 (3.3) (3.3) - - - n.s. n.s. n.s. 

Eliminations (0.5) n.s. n.s. - - - - - - 

Total 12.2 (2.7) (2.7) 9.0 12.0 2.0 3.5 53.0 1.1 

Central Western Europe: Italy, France, Belgium, Spain, Greece - North America: USA, Canada - Emerging Europe, North Africa and 

Middle East : Egypt, Morocco, Bulgaria, Turkey, Kuwait, Saudi Arabia - Asia: India, Thailand, China, Kazakhstan 

Amounts refer to companies consolidated and proportionately consolidated 

(*) exc luding decreas es for process ing 

n.s. not significant 

33 


In cement and clinker, performance in the mature countries slowed, despite the progress 

reported in France – Belgium and North America. In Emerging Europe, North Africa and 

Middle East, the growth in Morocco and Bulgaria did not counterbalance the decline in 

Egypt. In Asia, the rise in sales volumes in India was not sufficient to cover the contraction 

on the other markets, which were also affected by the floods that hit Thailand. Trading 

operations also reported a downturn, primarily in intragroup trading. 

In aggregates, the growth achieved with respect to the fourth quarter of 2010 arose mainly 

from the strong performance in France – Belgium, Italy and North America, set against 

sharp falls in Greece and Spain. 

The small improvement in ready mixed concrete, on a like-for-like basis, arose in part 

from the trends already described for aggregates, with increases in France – Belgium, Italy 

and North America, and falls in Greece and Spain. The sector also reported strong 

progress in Morocco and Kuwait, and a significant contraction in Egypt. 

Fourth-quarter results 

Fourth-quarter revenue amounted to 1,120.3 million euro (+2.9%), with growth reported in 

Central Western Europe as a result of the upward trend in prices and the perimeter effect in 

Italy, and in North America, thanks to positive sales volumes. Conversely, a decline was 

reported on the emerging markets as a whole, penalized chiefly by Egypt and Thailand, 

despite the progress in Morocco and India. On a like-for-like basis and at constant 

exchange rates, revenue would have been 1.7% down from the fourth quarter of 2010. 

Recurring EBITDA, at 133.4 million euro, was down 24.6% from the year-earlier quarter. 

EBIT was negative at 107.3 million euro, compared with positive EBIT of 54.1 million euro 

in the year-earlier fourth quarter. The downturn arose mainly from significant impairment 

losses (134.4 million euro) on property, plant and equipment, intangible assets and 

goodwill, compared with 7.4 million euro in the year-earlier quarter. 

As a result of these impairment losses, a loss of 121.6 million euro was posted for the 

fourth quarter (profit of 63.6 million euro in the fourth quarter of 2010). 

Full-year sales volumes and internal transfers 

As noted in the remarks on the fourth quarter, the figures and changes in full-year volumes 

do not include Set Group operations, but reflect the re-inclusion of the Calcestruzzi group in 

the scope of consolidation. 

34






Sales volumes by geographical area 


(millio ns of metric tons) 

% change vs. 

% change vs. 

2011 2010 2011 2010 2011 

Historic 

like-fo r- like 

basis 

Historic 

like-for-like 

basis 

Historic 

like-f or-like 

basis 

Central Western 

Europe 18.8 (2.3) (2.3) 34.8 3.8 (5.8) 10.7 88.8 1.5 

North America 4.2 5.1 5.1 1.4 40.7 40.7 0.8 (1.4) (1.4) 

Emerging Europe, 

North Africa and 

Middle East 16.1 (5.4) (5.4) 1.7 (16.7) (16.9) 2.4 3.5 0.5 

Asia 11.1 0.3 0.3 0.2 3.3 3.3 0.7 (5.9) (5.9) 


trading 2.7 (27.1) (27.1) - - - - n.s. n.s. 

Eliminations (1.8) n.s. n.s. - - - - - - 

Total 51.1 (1.9) (1.9) 38.1 3.7 (5.1) 14.5 53.2 0.8 

Amounts refer to companies consolidated and proportionately consolidated 

(*) exc luding decreas es for process ing 


Aggregates* 


Ready mixed concrete 

(millions o f m³) 

% change vs. 

2010 

In cement and clinker, there was a mild slackening in the mature countries, arising from 

progress in France – Belgium and North America, offset by downturns in Italy, Greece and 

Spain. The small improvement in Asia was driven by India, while Thailand was stable 

(penalized in the fourth quarter as mentioned above) and the other countries slowed. The 

Emerging Europe, North Africa and Middle East area was influenced above all by the 

decline in Egypt, countered only in part by the healthy trend in Morocco. A reduction in 

sales volumes was reported for Trading, mainly on intragroup trading. 

The decline in aggregates, at constant size, stemmed from the general reduction in sales 

volumes in Central Western Europe (where only France – Belgium reported growth) and in 

Morocco. The downturn was contained in part by the progress in North America. 

In ready mixed concrete, on a like-for-like basis, there was a small improvement. The 

healthy performance in France – Belgium, Morocco and Kuwait more than made up for the 

decline in other markets. 

35 


Revenue and operating performance 

Contribution to consolidated revenue 

2011 2010 Change 


2011/10 

% % % % (*) 

Line of business 

Cement and clinker 3,056.3 64.7 3,315.0 71.1 (7.8) (2.7) 

Ready mixed concrete and aggregates 1,387.9 29.4 1,037.5 22.3 33.8 3.5 

Miscellaneous 276.4 5.9 307.4 6.6 (10.1) (2.2) 

Total 4,720.5 100.0 4,660.0 100.0 1.3 (1.3) 

Geographical area 

Central Western Europe 2,596.3 55.0 2,337.6 50.2 11.1 1.3 

North America 404.7 8.6 414.6 8.9 (2.4) 2.5 

Emerging Europe, North Africa and Middle 

East 1,009.5 21.4 1,237.7 26.6 (18.4) (13.2) 

Asia 497.9 10.5 445.3 9.5 11.8 16.2 

Cement and clinker trading 138.6 2.9 136.2 2.9 1.8 1.0 

Other 73.5 1.6 88.5 1.9 (16.9) (10.6) 

Total 4,720.5 100.0 4,660.0 100.0 1.3 (1.3) 

(*) at constant exchange rates and scope of consolidation 

Revenue and operating results by geographical area 


2011 % change 

vs. 2010 


vs. 2010 


vs. 2010 


vs. 2010 

Central Western Europe 2,680.8 11.4 307.1 (6.4) 340.3 3.4 (4.1) n.s. 

North America 405.1 (2.5) 16.3 (35.6) 23.0 5.8 (45.4) 5.8 

Emerging Europe, North 

Africa and Middle East 1,030.2 (17.2) 316.7 (24.6) 317.8 (23.8) 193.1 (34.2) 

Asia 499.4 11.2 81.8 19.9 82.8 22.3 38.1 90.5 

Cement and clinker trading 183.4 (20.0) 10.6 (25.6) 10.7 (25.5) 6.8 (40.0) 

Other 423.9 (0.2) (33.8) (>100.0) (35.0) (>100.0) (58.1) (>100.0) 

Eliminations (502.3) n.s. (1.4) n.s. (1.5) n.s. (1.4) n.s. 

Total 4,720.5 1.3 697.3 (17.2) 738.1 (12.1) 129.0 (65.2) 

n.s . not significant 

Revenue Recurring EBITDA EBITDA EBIT 

The 1.3% increase in revenue from 2010 arose from the business slowdown (-1.3%) and 

negative exchange-rate effect (-2.2%), countered by a material consolidation effect 

(+4.8%). 

A factor in revenue performance was the fall in sales volumes, countered in part by a 

favorable sales prices trend in some countries, notably India, Italy, Thailand and Morocco. 

At constant exchange rates and scope of consolidation, the mature countries reported an 

improvement, thanks to France – Belgium and North America. 

The negative exchange-rate effect arose chiefly from the depreciation of the Egyptian 

pound, US dollar and rupee against the euro. 

36






The operating performance was supported by industrial efficiency and growing profit 

margins in Italy, but adversely affected by events on the Egyptian market, the consolidation 

of the Calcestruzzi group and, at EBIT level, by heavy impairment losses. Compounding 

this complex situation were higher energy costs and the depreciation of some currencies 

against the euro, while a positive contribution came from CO 2 emission rights and the 

valorization of energy efficiency credits for a total of 87.6 million euro (55.2 million euro in 

2010). 

Recurring EBITDA was 697.3 million euro, down 17.2% from 2010. After net non-recurring 

income of 40.7 million euro (net expense of 2.3 million euro in 2010), EBITDA was 738.1 

million euro, a decrease of 12.1% from 2010. The non-recurring items were net gains from 

the sale of assets (66.3 million euro) and net expense for corporate restructurings (25.6 

million euro), mainly in Italy. 

After amortization and depreciation of 474.8 million euro (461.2 million euro) and 

impairment losses of 134.3 million euro (8 million euro), EBIT was 129.0 million euro, down 

65.2% from 2010. Impairment losses related to goodwill (82.6 million euro), property, plant 

and equipment (36.6 million euro) and intangible assets (15.1 million euro); details are 

provided in the notes. Impairment losses on goodwill referred to non-recent acquisitions in 

Spain, Greece and Italy, the countries most affected by the market crisis. 

Among the individual countries, the most significant progress in recurring EBITDA was 

reported in Morocco, India, Thailand, while by far the largest reduction was in Egypt. 

Finance costs and other items 

In 2011 net interest expense on net debt decreased to 85.4 million euro (90.4 million euro 

in 2010) as described in notes (note 30). 

Overall, finance costs net of finance income rose from 89.8 million euro to 102.1 million 

euro (+13.7%). 

The trend was also due to net exchange rate losses of 10.6 million euro (gains of 8.4 

million euro in 2010), with a negative increase of 19.0 million euro from 2010, and to net 

derivatives for hedges on CO 2 emission rights and Certified Emission Reductions (CERs), 

with a negative effect of 6.5 million euro. 

The share of profit/(loss) of equity-accounted investees, 18.6 million euro, was up from 

2010 (17.1 million euro). 

Reversal of impairment losses on financial assets amounted to 7.5 million euro (losses 

of 21.0 million euro in 2010). This arose as a result of the reversal, in the 2011 income 

statement after the consolidation of the Calcestruzzi group as from January 1, 2011, of the 

impairment loss on the Calcestruzzi group posted in the fair value reserve on December 

31, 2010. 

Profit for the period 

Profit before tax was 53.0 million euro, down by 80.8% from 2010 (276.5 million euro). 

Income tax expense, at 68.8 million euro, was up 13.5% from 2010 (60.6 million euro), 

largely as a result of the income contribution of countries with higher tax rates, nondeductible 

expense and the change in the tax rate in Egypt, which was increased to 25% at 

the end of June 2011 from the previous rate of 20%. 

37 


The loss relating to continuing operations came to 15.8 million euro (a profit of 215.8 

million euro in 2010). 

The net gain of 106.9 million euro from the sale of Set Group generated a profit for the 

period of 91.2 million euro (197.1 million euro), with a loss attributable to the owners of 

the parent of 3.1 million euro (profit of 45.8 million euro) and a profit attributable to noncontrolling 

interests of 94.3 million euro (151.3 million euro). 

Total comprehensive income 

Starting from the profit for the period, the comprehensive income for 2011 showed a 

negative balance of 57.9 million euro (a positive balance of 223.9 million euro in 2010) 

arising mainly from: translation losses of 26.2 million euro, fair value losses on availablefor-sale 

financial assets for 49.3 million euro, fair value gains on derivatives for 20.1 million 

euro. Considering the profit for the period of 91.2 million euro described in the previous 

section and the components described above, 2011 total comprehensive income was 

positive at 33.2 million euro (a negative amount of 47.2 million euro attributable to owners 

of the parent and a positive amount of 80.4 million euro attributable to non-controlling 

interests), compared with a positive total of 420.9 million euro in 2010 (200.9 million euro 

attributable to owners of the parent and 220.0 million euro attributable to non-controlling 

interests). 

The “statement of comprehensive income” provides a comparison with 2010. 

Capital expenditure 

Capital expenditure by geographical area (*) 

PPE+investment 

Total capital 

Financial assets 

Intangible assets 


property 

expenditure 

2011 2010 2011 2010 2011 2010 2011 2010 

Central Western Europe 2.9 4.0 171.5 207.7 20.8 16.6 195.2 228.3 

North America - 0.5 18.4 42.3 0.1 0.5 18.5 43.3 

Emerging Europe, North Africa 

and Middle East - 4.8 83.4 164.4 0.4 0.4 83.8 169.6 

Asia - 5.3 60.6 83.6 - - 60.6 88.9 

Cement and clinker trading - - 3.8 2.5 0.1 0.2 3.9 2.7 

Others and eliminations - 0.2 (0.1) 2.2 4.0 4.4 3.9 6.8 

Total 2.9 14.8 337.6 502.7 25.4 22.1 365.9 539.6 

Change in payables for noncurrent 

assets - 9.8 36.4 (7.2) - - 36.4 2.6 

Total capital expenditure 2.9 24.6 374.0 495.5 25.4 22.1 402.4 542.2 

(*) amounts refer to the area for which the investment is intended 

2011 capital expenditure amounted to 402.4 million euro, a decrease of 139.8 million euro 

from 2010 (542.2 million euro). 

Investments in property, plant and equipment and investment property totaled 374.0 million 

euro, down by 121.5 million euro from 2010 (495.5 million euro) due to the completion of 

strategic investments that had an impact in 2010; investments were largely in Italy, France- 

Belgium, India, Egypt and Morocco. 

38






Investments in intangible assets amounted to 25.4 million euro, an increase of 3.3 million 

euro from 2010 (22.1 million euro), and were chiefly for software development. 

Investments in financial assets were marginal, at 2.9 million euro (24.6 million euro in 

2010). 

Statement of financial position, cash flows and net debt 

Condensed statement of financial position 

(in millions of euro) 12.31.2011 12.31.2010 

Property, plant and equipment and investment property 4,470.8 4,628.2 

Goodwill and intangible assets 2,017.4 2,150.4 

Equity investments and other assets 670.4 651.6 

Non-current assets 7,158.5 7,430.3 

Current assets 2,572.3 2,590.8 

Total assets 9,730.8 10,021.1 

Equity attributable to owners of the parent 3,494.9 3,525.1 

Equity attributable to non-controlling interests 1,400.0 1,460.8 

Total equity 4,894.9 4,985.9 

Non-current liabilities 2,802.9 3,266.2 

Current liabilities 2,033.1 1,769.0 

Total liabilities 4,835.9 5,035.2 

Total equity and liabilities 9,730.8 10,021.1 

Condensed statement of cash flows 

(in millions of euro) 2011 2010 

Net debt at beginning of period (2,230.9) (2,419.9) 

Cash flow from operating activities: 

Cash flow before change in working capital 438.5 621.1 

Change in working capital (20.8) 133.8 

Total cash flow from operating activities 417.7 754.9 

Capital expenditure: 

PPE, investment property and intangible assets (399.5) (517.6) 

Financial assets (2.9) (24.6) 

Total capital expenditure (402.4) (542.2) 

Proceeds from the sale of non-current assets 184.2 143.2 

Dividends paid (142.6) (130.0) 

Calcestruzzi group net debt at January 1, 2011 (217.7) - 

Cash flow from discontinued operations (Set Group Holding) 279.2 (6.1) 

Other 19.5 (30.7) 

Change in net debt 137.9 189.0 

Net debt at end of period (2,093.0) (2,230.9) 

39 


Net debt breakdown 


Current financial assets (659.7) (835.6) 

Current financial liabilities 756.7 535.4 

Non-current financial assets (117.1) (65.0) 

Non-current financial liabilities 2,113.1 2,596.1 

Net debt 2,093.0 2,230.9 

Net debt at December 31, 2011, amounted to 2,093.0 million euro, a reduction of 137.9 

million euro from the end of 2010, despite the negative effect of 217.7 million euro arising 

from the consolidation of the Calcestruzzi group as from January 1, 2011. Given lower cash 

flow from operating activities, the improvement stemmed largely from the sale of assets no 

longer of strategic importance (mainly Turkey, Axim). 

Financial ratios 

(absolute amounts in millions of euro) 

12.31.2011 

12.31.2010 

Net debt 2,093.0 2,230.9 

Consolidated equity 4,894.9 4,985.9 

"Gearing"% 

42.8 

44.7 

Net debt 2,093.0 2,230.9 

Recurring EBITDA 697.3 836.3 

"Leverage" 

3.0 2.7 


2010 

Recurring EBITDA 697.3 836.3 

Net finance costs* 126.1 115.5 

"Coverage" 

5.5 

7.2 

* finance costs net of capital gains/loss es on sale of equity investments 

Equity 

Total equity at December 31, 2011, was 4,894.9 million euro, down by 91.0 million euro 

from December 31, 2010 (4,985.9 million euro). 

The main increases were: 

- profit for the period, 91.2 million euro; 

- gains of 62.8 million euro from the sale of Afyon shares, 

the decreases were: 

- dividends paid, 142.8 million euro; 

- the net change of 32.9 million euro in the hedging reserve and the fair value reserve; 

- the acquisition of Ciments Français treasury shares for 35.9 million euro; 

- the reduction of 25.0 million euro in the translation reserves. 

At December 31, 2011, there were no changes in treasury shares in portfolio with respect 

to December 31, 2010. Italcementi S.p.A. held 3,793,029 ordinary treasury shares (2.14% 

of ordinary share capital) servicing stock option plans and 105,500 savings treasury shares 

(0.1% of savings share capital). 

40






Reconciliation between parent’s profit for the year and equity and 

loss for the year and equity attributable to owners of the parent 

(in millions of euro) 2011 

Profit (loss) for the period of the parent (Italcementi S.p.A.) 7.0 

Consolidation adjustments: 

- Profit (loss) for the period of consolidated companies (in accordance with Group accounting 

policies) 562.0 

- Elimination of intragroup dividends collected during the year (507.2) 

- Reversal of impairment losses (revaluations) in consolidated equity investments 89.2 

- Elimination of intercompany (gains) losses and other changes (59.9) 

- Consolidated profit (loss) for the period 91.2 

- Attributable to non-controlling interests 94.3 

- Attributable to owners of the parent (3.1) 

December 31, 


Equity of the parent company (Italcementi S.p.A.) 1,784.6 

Consolidation adjustments: 

- Elimination of carrying amount of consolidated equity investments 

• Carrying amount of consolidated equity investments (8,464.4) 

• Equity of consolidated companies (in accordance with Group accounting policies) 11,574.6 

- Consolidated equity 4,894.9 

- Equity attributable to non-controlling interests 1,400.0 

- Equity attributable to owners of the parent 3,494.9 

Risks and uncertainties 

In May 2010, Italcementi S.p.A. formed a Risk Management Department, reporting to the 

Italcementi S.p.A. Chief Executive Officer, to improve its ability to create value for 

stakeholders by optimizing enterprise risk management (ERM). The mission of the function 

is to guarantee a structured approach to risk management, integrated with the Group 

growth strategy, and to support the improvement of Group performance by identifying, 

measuring, managing and controlling key risks. 

The creation of the Risk Management Department is part of the “Risk & Compliance” 

program set up in 2008, based on the methodology developed by the Committee of 

Sponsoring Organizations of the Tradeway Commission (COSO), and consisting of the 

following phases. 

1. Identification of the main areas of risk for Group strategic goals and development of 

methods and tools to analyze and assess the correlated risk events. 

2. Assessment, at country level and at aggregate level, of identified risk events in terms of 

impact, probability and timeframe, in order to acquire an overall vision of the Group risk 

portfolio. 

3. Selection of priority risks and definition of response strategies, Group governance rules 

and action to integrate and improve risk management systems; some operating risks are 

managed at individual company level, while others requiring specific competences or 

involving a variety of responsibilities are managed at Group level. 

41 


4. Implementation of defined mitigation strategies and action and development of the 

Enterprise Risk Management process. 

5. Reporting to Top Management and the governance bodies on the main risks, and their 

management and evolution; in this phase quantification of risks and opportunities is 

integrated with the enterprise management process, for example in the budget, in 

results forecasting reviews and in assessment of strategic projects. 

Sustainable development and risk management: protection of people and assets 

Sustainable development favors a corporate approach that balances economic growth, 

protection of the environment and social sustainability. By constantly pursuing an optimal 

balance among these elements and ensuring that benefits extend to everyone involved, 

companies enhance their long-term value, ability to survive and competitive advantage, 

thus helping to prevent industrial risks. 

The Group checks that its protection and prevention programs are consistently applied to 

all personnel in production sites (employees and other) and to all operations in its 

companies. 

Regulatory limits and Group sustainable development goals and initiatives are examined in 

a special report (Sustainability Report) and also summarized in a specific section in this 

report. 

The Asset Protection Program continued in 2011; it qualifies the importance of risks and 

develops a suitable prevention and protection policy, thereby limiting damage to assets and 

consequent operating losses. The program is now a consolidated Group process. 

Risks relating to the general economic and industry situation 

The economic and financial situation represents an element of risk for the Group, also in 

relation to its specific area of business, which is sensitive to changes in the economic 

situation. Household and business propensity to invest in construction is affected by the 

uncertainty and constraints of the general scenario. 

Risks associated with energy factors 

The cost of energy factors, which represents a large portion of Group variable costs of 

production, can vary significantly as a result of factors beyond the Group’s control. The 

Group has adopted measures to mitigate risks for certain energy factors by entering into 

medium-term supply contracts. Furthermore the centralized procurement organization 

enables the Group to benefit from more efficient relations with suppliers and to obtain 

competitive conditions. 

Risks relating to availability of raw materials 

The availability of raw materials is a strategic factor in investment decisions. The Group 

generally sources its raw materials – limestone, clay, gypsum, aggregates and other 

materials used in the production of cement, ready mixed concrete and aggregates – from 

quarries it owns (the majority) or quarries rented from third parties. For these and other 

significant materials, the Group has also reached specific agreements with suppliers to 

guarantee continuous, stable procurement, under terms and conditions at the best market 

levels. 

42






Environmental risks 

The “Sustainability Report” and the section on Sustainable Development in this report 

illustrate the measures taken by the Group to manage environmental risks and control and 

reduce emissions. With regard to CO 2 emissions, the Group’s European companies are 

exposed to price fluctuations on emission rights depending on its own rights surplus or 

deficit. The Group’s position is therefore constantly monitored to ensure correct risk 

management (see note 22 in the notes). 

Financial risks 

The current period of crisis puts corporate cash flows at risk, endangering companies’ selffinancing 

ability and creating difficulties for normal, orderly operations on the financial 

market. 

The Group procures sources of finance and manages interest rates, currency and 

counterparty risk, for all the companies in the scope of consolidation. The Group uses 

derivatives to reduce the risk of fluctuations in interest rates and exchange rates with 

respect to debt and its international operations. Detailed analysis of this type of risk is 

provided in note 22 of the notes, on net debt. 

Ratings risks 

The Group’s ability to compete successfully in the marketplace for funding depends on 

various factors, including its credit ratings assigned by recognized ratings agencies. Its 

credit ratings may change to reflect changes in its results, financial position, credit structure 

and liquidity profile. As a result, a rating downgrade may have negative repercussions on 

the Group’s ability to raise funding. 

Legal risks 

Suitable provisions and impairment losses have been applied with regard to existing risks 

and their related economic effects. Estimates and valuations are based on available 

information and are in any case regularly reviewed, with immediate recognition in the 

financial statements of any variations. 

Conformity risks 

The Group is subject to specific regulations concerning the quality of the products it 

markets; special monitoring activities have been set up to ensure compliance with the 

regulations in the countries where it operates. 

At a general level, the “Risk and Compliance” program has introduced specific training and 

circulates procedures and recommendations in the Group countries, to ensure compliance 

with legislation and with tax, social and environmental regulations. The program is reviewed 

on an annual basis to take account of regulatory changes. 

Political risks 

The Group has taken out insurance covers to limit the financial consequences of possible 

political measures that might prevent normal management of some subsidiaries in 

emerging countries. 

43 


Financial disclosure risks 

The main characteristics of the risk management system and the internal control system 

with respect to the financial disclosure process are illustrated in a specific chapter of the 

“Corporate Governance” report in the Italcementi S.p.A. annual report. 

Insurance 

In the interest of all Group subsidiaries, Italcementi has taken out policies with leading 

insurance companies to cover risks to people and assets, as well as product and general 

third-party liability covers. As part of its risk coverage policy, the Group aims to optimize 

risk management costs by assessing direct assumption and transfer to the market. All 

policies are negotiated under a framework agreement to ensure a balance between the 

probability of a risk occurring and the damage that would ensue for each subsidiary. 

44






Performance by country and business 

The Group in 2011 

Cement: 

No. 

full-cycle cement plants 54 

grinding centers 10 

trading terminals 5 

Aggregates: 

quarries 119 

Ready mixed concrete: 

plants 494 

Central Western Europe 

Italy 

France/ 

Belgium 

Spain 

Others (1) Total Central Western 

Europe 

Full-cycle cement plants 17 10 3 1 31 

Grinding centers 4 1 - - 5 

Quarries 28 77 6 1 112 

RMC plants 160 190 19 3 372 

2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 

Italy 918.1 689.5 (12.6) (36.3) 10.4 (33.3) (142.4) (122.6) 76.9 90.2 3,439 2,915 

France / 

Belgium 1,589.7 1,493.8 302.8 318.2 313.7 316.8 215.6 215.5 82.6 99.0 4,113 4,162 

Spain 155.4 176.5 18.5 31.6 17.6 31.1 (58.2) 7.7 7.6 11.0 597 634 

Others (1) 41.8 70.3 (1.6) 14.5 (1.4) 14.6 (19.0) 10.2 4.4 7.5 194 209 

Eliminations (24.2) (22.8) - - - - - - - - - - 

To tal 2,680.8 2,407.3 307.1 328.0 340.3 329.0 (4.1) 110.7 171.5 207.7 8,343 7,920 

(1) Greece 

Revenue 

Recurring 

EBITDA 

EBITDA 

EBIT 

Capital 

expenditure 

Employees 

Italy 

The results and the comparisons with 2010 are subject to the change in the scope of 

consolidation after the consolidation of the Calcestruzzi group as from the beginning of 2011. 

The difficult economic and financial situation provoked a strong slowdown in building, both 

in the private sector, due to the high level of unsold stock and the growing squeeze on 

credit, and in the public sector, due to the constraints of the stability pact and the resulting 

cut in capital spending. In 2011, demand for cement fell for the fifth year running, most 

notably in the second half of the year. On the trading front, material reductions emerged 

both in exports and in imports of cement. 

Our cement and clinker sales volumes fell by 6% from 2010, essentially due to the 

reduction in the second half of the year, with a more negative trend than the market, in part 

as a result of compliance with rigorous commercial risk assessment criteria. The sales price 

trend reversed as from the beginning of 2011, making further progress in the second half 

after the introduction of the new price list at the beginning of June, thus counterbalancing 

45 


the negative trend in sales volumes. The improvement in sales prices brought healthy 

progress in recurring EBITDA, which was also supported by management of CO 2 emission 

rights, valorization of energy efficiency credits (white certificates), income from power 

interruptability and savings on fixed costs as a result of measures already taken and due to 

continue in 2012. This was also achieved through a re-organization of HQ operations and 

the production and sales networks, providing for absorption of personnel surpluses with 

recourse to a series of welfare benefits. In connection with these measures, a net amount 

of 8.1 million euro was recognized in 2011 under non-recurring expense. Among negative 

effects, apart from the fall in sales volumes, there was an increase in variable costs, largely 

due to the rise in energy costs, counterbalanced by continuous efficiency improvements in 

production through use of alternative fuels, replacement raw materials and improvements in 

specific use. 

Overall operating results reflected the impact of the consolidation, as from the beginning of 

the year, of the ready mixed concrete and aggregates sector, with negative recurring 

EBITDA. The ready mixed concrete market has been experiencing a severe crisis for a 

number of years. In addition to the decline in demand, again a notable feature of 2011, 

other factors were the difficulties encountered by small and medium construction 

companies in obtaining credit. On a like-for-like basis, although Group sales recovered in 

the fourth quarter, they were down 2.7%, as a result of the general market decline, offset in 

part by the lively sales trend in major works. Trends in aggregates volumes were similar: a 

reduction of 4.1% for the year, with growth reported in the fourth quarter. In 2011, after regaining 

full control of operations, the Group drew up a plan to recover high levels of 

industrial efficiency and organizational effectiveness. To achieve this, a re-organization will 

begin in 2012 with the disposal of non-strategic plants, with recourse to welfare benefits to 

mitigate the impact on employees (recourse to state-subsidized layoff for a two-year 

period). Non-recurring expense was also provided for the ready mixed concrete and 

aggregates sector, for 14.6 million euro. 

France – Belgium 

In France and in Belgium cement consumption made good progress in 2011 thanks to very 

favorable meteorological conditions at the start and end of the year, and a healthy trend in 

residential building and public works. 

In France, Group overall cement and clinker sales volumes (including marginal export 

volumes) increased by 6.4%; in Belgium cement sales volumes grew by 10.0% (+8.4% 

including cement and clinker exports). 

Average sales prices fell slightly, in both France and Belgium, in part due to growing 

competitive pressures. 

Operating results in the cement sector slackened as operating expenses rose, especially 

for energy and maintenance, and as sales prices showed a slight decrease. These trends 

were offset only in part by the increase in sales volumes. 

In France Group ready mixed concrete sales volumes progressed by 10.5%, while 

aggregates were up 5.6%; in Belgium, on a like-for-like basis , ready mixed concrete sales 

volumes increased by 15.6%, while the rise in sales of aggregates was 2.7%. This positive 

trend fuelled the improvement in operating results. 

46






Spain 

In Spain the fall in cement demand continued in 2011, with another sharp reduction, 

stemming largely from the difficult situation in the residential sector and the difficult financial 

situation of the state administration, which had a negative impact on infrastructure. 

In these conditions, Group domestic cement sales volumes were down 16.3% on 2010. 

Exports, supported by Group Trading operations, made it possible to contain the reduction 

in cement and clinker sales at 6.8%. 

Average cement sales prices made good progress in southern Spain and fell slightly in the 

Basque Country. 

The crisis in the construction sector had a particular significant impact on sales volumes of 

ready mixed concrete and aggregates, which fell by 23.2% and 30.3% respectively. 

In a particularly difficult market, the Group proceeded with renewed energy with its support 

activities and measures to rationalize and improve the efficiency of industrial operations, 

which will continue during 2012. 

Overall operating results decreased due to the reduction in sales volumes and the rise in 

energy costs, counterbalanced only in part by measures to contain fixed costs and by the 

favorable sales prices trend on markets in southern Spain. 

Others 

In Greece, the economic crisis continued with no signs of a recovery. This was reflected in 

Group overall cement and clinker sales, which fell by approximately 40%. A significant 

reduction was also recorded in sales volumes in ready mixed concrete (-40.5%) and 

aggregates (-51.0%). Operating results, affected mainly by the large fall in sales volumes, 

declined sharply. 

NORTH AMERICA 

Total 

North America 

Full-cycle cement plants 6 

Grinding centers 1 

Quarries 3 

RMC plants 33 

Revenue 

Recurring 

EBITDA 

EBITDA 

Employees 


To tal 405.1 415.3 16.3 25.4 23.0 21.7 (45.4) (48.2) 18.4 42.3 1,485 1,686 

EBIT 

Capital 

expenditure 

In the USA, cement consumption on the Group markets improved in 2011, showing overall 

growth estimated at 2.8%, with a particularly positive performance in the fourth quarter 

thanks to good meteorological conditions and a recovery in the residential and commercial 

sectors. 

In this context, Group cement sales volumes improved by 5.1% from 2010, also helped by 

a gradual recovery of market share. 

Average revenue per unit slackened from 2010, due to more intense competition and 

higher logistic expenses. 

47 


Ready mixed concrete sales volumes were down 1.4%, while sales of aggregates rose 

by 40.7%, sustained by a series of major road works in Canada. 

Recurring EBITDA was down on 2010, reflecting the fall in sales prices and higher 

operating expense (primarily energy and maintenance), offset only in part by higher sales 

volumes and action to contain fixed costs. 

In preparation for the expected economic turnaround and consequent improvement in 

cement demand, the Group took further steps in its distribution and logistics reorganization. 

The program began in the fourth quarter and will begin to produce significant 

effects in the first half of 2012. 

Emerging Europe, North Africa and Middle East 

Egypt Morocco Others (1) Total Emerging 

Europe, North Africa 

and Middle East 

Full-cycle cement plants 5 3 3 11 

Grinding centers - 1 - 1 

Terminals - - 2 2 

Quarries - 3 1 4 

RMC plants 20 23 9 52 

Revenue 

Recurring 

EBITDA 

EBITDA 

EBIT 

Capital 

expenditure 

Employees 


Egypt 551.8 788.7 129.6 270.7 129.6 270.5 63.2 191.2 39.1 53.3 4,622 4,781 

Morocco 353.2 326.1 152.2 125.7 153.2 122.4 115.7 95.6 34.7 95.3 984 1,095 

Others (1) 125.5 130.3 34.8 23.9 35.0 24.0 14.2 6.8 9.6 15.8 895 902 

Eliminations (0.3) (0.5) - - - - - - - - - - 

To tal 1,030.2 1,244.6 316.7 420.2 317.8 416.9 193.1 293.6 83.4 164.4 6,501 6,778 

(1) Bulgaria, Turkey (Afyon), Kuwait, Saudi Arabia 

Egypt 

2011 was affected by the tensions that led to the overthrow of the political regime at the 

beginning of the year and by a climate of uncertainty throughout the year. 

Group overall cement and clinker sales volumes, including modest export flows, fell by 

10.9%, reflecting a fall in demand and, above all, the market entry of new production 

capacity. In an increasingly aggressive competitive environment, prices fell particularly 

significantly in the middle part of the year. 

Sales volumes in ready mixed concrete were down 20.1%. 

The sharp reduction in operating results arose from a number of factors. There was a 

significant fall in revenue (price and volume effects), higher energy costs, and higher 

payroll and general expenses, in part as a result of the policies introduced by the Group to 

help its employees during the most difficult period of the transition in 2011. Another 

negative factor was the depreciation of the Egyptian pound, reflected in the translation into 

euro of amounts denominated in local currency. 

48






Nevertheless, these trends were countered by continuing programs to recover industrial 

and procurement efficiency, associated with the elimination of clinker purchases. 

Morocco 

In Morocco, cement consumption in 2011 was very healthy, upheld chiefly by private 

investment in housing and by the public works sector. 

At the end of March, the Agadir plant was permanently shut down, replaced by the new 

cement plant in Ait Baha. In October, the Laâyoune wind farm was officially opened (5.25 

MW); the farm provides power for the neighboring grinding center. 

Group domestic cement sales volumes rose by 8.1%. The increase in overall cement and 

clinker volumes, including exports, was 9.1%. 

Sales volumes of ready mixed concrete, sustained largely by activities in the Casablanca 

area, were up 10.9%, while sales of aggregates fell by 17.0% on a highly competitive 

market. 

Operating results made significant progress, thanks to higher revenue (volume and price 

effects) and the sharp reduction in clinker purchases as a result of the additional capacity 

provided by the Ait Baha plant, whose overall efficiency produced benefits sufficient to 

counter the large increase in fuel costs. 

Others 

In Bulgaria, cement consumption decreased, but at a much slower rate than in 2010. 

Group overall cement and clinker sales volumes were significantly lower at the end of the 

first half but then made a strong recovery to keep the full-year reduction at 3.8%. Operating 

results made healthy progress thanks to management of CO 2 emission rights. 

In Kuwait, in an upbeat economic scenario, Group cement sales volumes increased by 

4.5%, although sales prices were affected by the large decrease at the end of 2010. 

Operating results were helped by sales in ready mixed concrete, in terms both of volumes 

(+22.8%), and of sales prices, and were up with respect to 2010. 

49 


ASIA 

Thailand India Others (1) Tot al Asia 

Full-cycle cement plants 2 2 2 6 

Grinding centers 1 1 - 2 

Quarries - - - - 

RMC plants 33 - 1 34 

Revenue 


Thailand 194.1 180.2 23.5 15.0 24.5 14.7 8.0 (7.3) 11.4 7.2 863 846 

India 223.5 169.8 57.2 36.0 57.2 35.9 38.7 20.2 42.7 68.9 797 787 

Others (1) 81.8 98.9 1.0 17.3 1.1 17.1 (8.6) 7.2 6.5 7.5 604 758 

Eliminations - - - - - - - - - - - - 

To tal 499.4 449.0 81.8 68.2 82.8 67.7 38.1 20.0 60.6 83.6 2,264 2,391 

(1) China and Kazakhstan 

Recurring 

EBITDA 

EBITDA 

EBIT 

Capital 

expenditure 

Employees 

Thailand 

The consequences of the floods that hit the country in the fourth quarter slowed the 

economy, which reported only modest progress in 2011; the policies adopted by the 

Government should stimulate new economic growth this year. 

In 2011 Group domestic cement sales volumes showed a small improvement (+0.4%); total 

cement and clinker sales were slightly down (-0.2%) as a result of lower clinker exports, 

offset only in part by cement sales to Cambodia. 

Average domestic cement sales prices were up on 2010, largely thanks to the first nine 

months of the year. 

Ready mixed concrete sales volumes fell by 7.2% from 2010. 

Overall operating results made progress, helped by the positive trend in sales prices, which 

counterbalanced the rise in costs for fuel and operating expenses. 

India 

In 2011 the economy slowed, with repercussions in the construction sector, where results 

failed to meet expectations. India was also troubled by inflationary pressures, which led to 

numerous interventions by the central bank, while the local currency depreciated 

significantly against the euro. Political instability and tensions contributed to the mood of 

uncertainty. 

In a competitive arena where pressure was intensified by the arrival of new production 

capacity, the healthy trend on markets in southern India in the fourth quarter meant the 

year closed with a slight increase in cement consumption compared with 2010. 

In June the Group began production at the Chennai grinding center and benefited from 

higher production levels in 2010. Its domestic cement sales increased by 7.8%, while total 

cement and clinker sales rose by 8.5%. 

After collapsing in the first nine months of the previous year, average sales prices made a 

significant recovery, which continued throughout the year, stabilizing in the fourth quarter. 

50






Operating results showed healthy progress largely due to the rise in average sales prices, 

countered only in part by the increase in the cost of coal (especially in the fourth quarter) 

and an unfavorable exchange-rate effect. 

Others 

In China, the economic growth of 2011 supported the construction sector. Group overall 

cement and clinker sales volumes, however, fell by 5.2%, due to the entry of new 

production capacity. The fall in average sales prices, associated with the negative volume 

effect and the rise in fuel costs, generated a sharp reduction in operating results. 

In Kazakhstan, despite higher demand, Group cement and clinker sales volumes dropped 

by 18.8% from 2010. This was due to the distance from the capital city, Astana, where 

major infrastructure projects were concentrated, and to the entry of new production 

capacity in the south of the country. Despite the healthy sales prices trend, the negative 

volume effect and the rise in operating expenses caused a large reduction in operating 

results. 

CEMENT AND CLINKER TRADING 

Total Cement and 

clinker trading 

Grinding centers 1 

Trading terminals 3 

RMC plants 2 

Revenue 

Recurring 

EBITDA 

EBITDA 

Employees* 


To tal 183.4 229.3 10.6 14.3 10.7 14.3 6.8 11.4 3.8 2.5 340 369 

EBIT 

Capital 

expenditure 

* the figure refers to all activities, including fuel trading 

2011 intragroup and third-party cement and clinker sales volumes fell by 27.1%, largely as 

a result of performance in the first half of the year. 

The sharp fall in sales volumes arose largely in intragroup clinker sales, particularly with 

regard to Egypt and Thailand. 

Operating results were down on 2010. 

Energy project 

As reported above, in March Italgen Elektric Uretim, the company that developed the 142.5 

MW wind farm project in Balikesir, Turkey, was sold to a third party. The main Italgen 

projects in 2011 are described below. 

Italy: Guiglia (Modena) – Photovoltaic plant (6 MW) 

At the end of July, two months ahead of schedule, work was completed on the photovoltaic 

plant in Guiglia (Modena), by the i.Fotoguiglia S.r.l. company owned 30% by Italgen and 

51 


70% by Fotowatio Italy, a subsidiary of the Spanish group Fotowatio Renewable 

Ventures S.A.. From July-December 2011, the plant, which involved a total investment of 

20 million euro and is run jointly by the two partners, generated 4,600 MWh of electrical 

energy, 30% above the forecast volume, thanks in part to very favorable meteorological 

conditions. The Italian Electric System Authority is currently assessing the project’s 

eligibility for government incentives. 

Morocco: Laayoune – Wind farm (5 MW) 

Consistently with the business model drawn up by Italgen and Ciments du Maroc, in 2011 

the Laayoune wind farm was completed. In the period July-December, it generated a total 

of approximately 7.5 GWh, in line with the volume projected in the feasibility study. 

Morocco: Ait Baha – Solar concentrator project (0.1 MW) 

At the beginning of 2011 preliminary studies began to assess installation of a solar 

concentrator plant next to the Ait Baha cement plant and a technical partner was identified 

with an innovative technology based on parabolic reflectors. The pilot plant will comprise 3 

solar modules with a total surface of approximately 6,000 m 2 . Planned peak power is 150 

kW and projected annual production is approximately 1 million kWh, for a total investment 

of 2.7 million euro. 

Egypt: Gulf El Zeit – Wind farm (120 MW) 

Despite some delays due to the political difficulties in Egypt, the authorization process for 

the project continued, the preliminary farm project was completed for the preparation of the 

documents and the tender specifications for the supply of the plant, and negotiations 

continued with the Egyptian authorities on the drafting of the usufruct agreement, which we 

hope will be signed in the next few months. 

Bulgaria: Kavarna I and Kavarna II – Wind farms (18 MW) 

During 2011 commercial operations began for the Kavarna II wind farm. The reliability test 

was completed successfully and in the first two months of activity the farm exceeded the 

contractually planned volume. Operations at the two farms were hampered, however, by 

unplanned interruptions caused by the inability of the local grid to cope with power 

generation peaks and low wind levels during the year. Total production was 32.5 GWh, 

20% below projected production. 

In 2011, Italgen S.p.A. reported revenue of 57.4 million euro, an increase of 22.4% from 

2010, thanks to higher volumes of transported power and the rise in the transportation 

charge. Recurring EBITDA was 17.7 million euro, 10.5% above 2010; profit for the year 

was 19.7 million euro, a sharp increase from 2010 (7.3 million euro), thanks to the gain 

from the above-mentioned sale of Italgen Elektric Uretim. Italgen closed 2011 by 

successfully meeting its “Zero accidents” target. 

52






Dealings with related parties 

For the purposes of the consolidated financial statements, dealings with related parties 

concerned: 

- the parent company Italmobiliare S.p.A. and the Italmobiliare group companies 

(subsidiaries, joint ventures, associates and their subsidiaries); 

- Italcementi S.p.A. subsidiaries not consolidated; 

- joint ventures and their subsidiaries; 

- associates and their subsidiaries; 

- other related parties. 

Key figures at December 31, 2011, for dealings with related parties are provided in the 

notes (note 36). 

Transactions with related parties reflect Italcementi S.p.A.’s interest in leveraging the 

synergies within the Group to enhance production and commercial integration, employ 

competencies efficiently and rationalize use of corporate divisions and financial resources. 

All dealings with related parties, whether financial or relating to the exchange of goods and 

services, are conducted at normal market conditions and comply with the Code of Conduct. 

No atypical or unusual transactions as defined by CONSOB Communication no. DEM / 

6064293 of July 28, 2006, took place during the year. 

Dealings with Italmobiliare S.p.A. and Italmobiliare group companies 

Italcementi S.p.A. is subject to management and coordination by Italmobiliare S.p.A.. 

Italcementi S.p.A. provides Italmobiliare S.p.A. and that company’s subsidiaries with 

personnel administration services and receives and provides services. It also provides 

Italmobiliare S.p.A. with a share register management service and administration services 

for shareholders' meetings. 

Following the introduction of the “tax consolidation” regime in Italian tax law, Italcementi 

S.p.A. and some of its Italian subsidiaries elected national tax consolidation as per articles 

117-129 of the Consolidated Income Tax Act (TUIR), with Italmobiliare S.p.A. as the 

consolidating company. 

Italcementi S.p.A. does not hold nor held during the year, directly or indirectly, Italmobiliare 

S.p.A. shares. 

Dealings with subsidiaries, joint ventures, associates and their subsidiaries 

Dealings with subsidiaries not consolidated and with the other companies are of a trading 

nature (exchange of goods and/or services) and a financial nature. 

Dealings with other related parties 

In 2011, Finsise S.p.A., whose majority shareholder is Italo Lucchini, a director of 

Italcementi S.p.A., provided administrative, financial, contractual, tax and corporate reorganization 

consultancy services for a consideration of 360,000 euro. A similar contract for 

an annual consideration of 10,500 euro exists between Finsise S.p.A. and the subsidiary 

Azienda Agricola Lodoletta S.r.l.. 

53 


During the year Italcementi S.p.A. and subsidiaries received legal services for 612,000 euro 

from the Dewey & LeBoeuf law firm, of which Luca Minoli, a director of Italmobiliare S.p.A., 

is a partner. 

Italcementi S.p.A. has a land occupation contract with River S.p.A. (which during the year 

became Kilometro Rosso S.p.A., a company in which the director Alberto Bombassei holds 

an investment), in connection with building works for the construction of its management 

office; the amount relating to 2011 was 42,000 euro. 

In 2011 Italcementi S.p.A. disbursed an amount of 600,000 euro to the Italcementi Cav. 

Lav. Carlo Pesenti foundation to cover management costs. With regard to the contract for 

the supply of corporate-administrative services and provision of staff, Italcementi S.p.A. 

charged the foundation an amount of 178,000 euro. CTG S.p.A. provided the foundation 

with services for 8,000 euro. 

Transactions with related parties are illustrated in the notes, while remuneration paid to the 

Italcementi S.p.A. Directors, Statutory Auditors, Chief Operating Officer and Manager in 

charge of preparing financial reports, for positions held within the Group are illustrated in 

the Remuneration Report. 

Information on dealings with related parties of the parent Italcementi S.p.A. is provided in 

the specific sections in the Italcementi S.p.A. directors’ report and notes to the financial 

statements. 

Information systems 

Important results were obtained in 2011 for the plan for the renewal of the Group 

information systems. 

The new management control model was activated in most of the main Group countries. 

The project aims to make performance analysis faster and more effective by rationalizing 

rules and automating information management and processing. The model roll-out will be 

completed by the end of 2012 with activation in the minor locations. 

At the end of 2011, application of an integrated budget and planning system was 

operational in the main Italian and French companies; the system will be rolled out to the 

rest of the Group by the end of 2012. 

The focus of the 2011 projects also targeted areas for efficiency improvements, with 

initiatives covering for example spares management and production control, and the 

commercial areas, with initiatives to build more effective relations with customers. The latter 

looks likely to be a constantly changing area for almost all Group countries, taking priority in 

development of IT solutions in 2012. 

With regard to compliance, further advances were made in internal procedures for Disaster 

Recovery, Management of transfer to production, and Segregation of Duties. 

2011 also saw a constant focus on efficiency and simplification, leading to a review of the 

main outsourcing contracts with a significant reduction in costs. 

54






Sustainable development 

In 2011, the Group maintained and strengthened its commitment to sustainable 

development in all countries and lines of business, with initiatives coordinated by the 

Group’s “Sustainable Development Steering Committee”. Details on objectives, initiatives 

and results are provided in the “Sustainability Report”. 

Membership of the United Nation Global Compact (UNGC) and participation in the World 

Business Council for Sustainable Development (WBCSD) are cornerstones of the Group 

commitment to sustainability. The Group companies also take an active part in the regional 

UNGC and WBCSD networks. The new Sustainability Policies adopted at the end of 2010 

are being introduced and implemented at local level. 

The Italcementi Group was reconfirmed in “The Sustainability Yearbook 2012”, the most 

complete publication on corporate sustainability issued annually by Sustainable Asset 

Management (SAM); it was ranked in the “SAM Bronze Class” category. 

Social initiatives 

The Group takes active steps to improve quality of life for its employees, support local 

communities and cooperate with customers and suppliers. No form of discrimination is 

applied in any area and employee health and safety are considered of fundamental 

importance. Key aspects of workers rights are managed with policies compliant with the top 

international standards, like the International Labor Organization regulations and the 

guidelines of the Organization for Economic Co-operation Development. With the 

contribution of the principles of the United Nations Global Compact, the implementation 

continued of the agreement signed by Italcementi S.p.A. with Building and Wood Workers 

International in 2008, to promote and safeguard worker rights. The Group is also 

completing formulation of a program to raise awareness of human rights and establish an 

internal reporting and monitoring system. 

Health and safety 

Improvement of safety is a constant Group objective. Since the introduction of the “Zero 

accidents” project in 2000, the accident frequency rate has fallen significantly (about 74%). 

Confirming the strength of its commitment to improving safety conditions not only for its 

own employees but also for its contractors’ workers, in order to prevent fatal accidents and 

foster a safety and awareness culture among its own workforce and other workers, the 

Group has decided to adopt a new approach promoting safety as a “way of life”, closely 

related to daily activities. Beginning with the new Safety Policy and applying the new Safety 

Management Manual, a growing number of compulsory standards have gradually been 

adopted by all the subsidiaries. 

Environmental management systems 

At the end of 2011, 47 plants out of 53 had ISO 14011 certification for their environmental 

management systems. Other certification procedures are in the final stage of 

implementation. Environmental management systems are being gradually extended to all 

Group operations in cement, aggregates, ready mixed concrete and other areas. 

Risk management is also handled through environmental audits conducted by the 

Sustainable Growth Division as part of a long-term program. In 2011, these audits covered 

cement plants in China, Egypt and North America. 

55 


Raw materials and alternative fuels 

To ensure responsible use of raw materials and fuels, many subsidiaries are taking action 

to increase use of alternative sources and thereby minimize impact on the environment and 

on the health and safety of employees and other parties using these materials. In 2011, the 

proportion of alternative fuels to total Group energy consumption increased with respect to 

2010. In Egypt and India, a number of promising activities began. 

Emissions control and reduction 

At the end of 2011, 59 out of 78 active kilns were equipped with complete continuous 

emissions monitoring systems to measure dust, NO x and SO 2 , in line with the requirements 

of the Cement Sustainability Initiative. The remaining kilns are kept under constant control 

through partial continuous systems or regular spot checks. In addition to dust, NO x and 

SO 2 , spot monitoring of minor elements such as volatile organic pollutants, metals and 

dioxins is conducted in a growing number of plants, in order to set improvement targets and 

keep ahead of future legislation. 

CO 2 emissions monitoring and European Union trading system 

The CO 2 emissions generated by Group operations directly (e.g., production) and indirectly 

(e.g., transport) are closely monitored. 2011 saw a significant improvement in CO 2 

emissions in countries where recently revamped plants resumed full operation. 

European clinker production plants are subject to the European Directive on greenhouse 

gas emissions trading, now in the second period of application (2008-2012). The downturn 

in the European cement market continued in 2011, leading to a fall in clinker production 

volumes and consequently in CO 2 emissions in all Group countries in Europe. In 2011, the 

Group had a quota surplus for more than 4 million metric tons of CO 2 , on a total allocation 

of approximately 18 million metric tons. The Group manages this availability compatibly 

with its carbon risk management strategy, covering the entire period from 2008 to 2020 (EU 

ETS application phases 2 and 3). The strategy includes EUA-CER forward swaps (forward 

EUA sales and CER forward purchases) to diversify and optimize the CO 2 emission rights 

portfolio, for use after 2012. 

Human resources 

The Group workforce stood at 19,896 persons at December 31, 2011, a decrease of 243 

from December 31, 2010. On a like-for-like basis, in relation above all to the re-inclusion of 

the Calcestruzzi group, the reduction would have been 830 heads (-4.1%). The downsizing, 

which was of significant proportions in the companies affected by the crisis, was achieved 

largely through special exit incentives, retirement support or restructuring agreements with 

the unions to limit social repercussions. This enabled the Group to maintain a healthy 

internal climate and keep strikes and forms of union unrest to an immaterial level. The 

corporate climate improvement projects drawn up after the 2010 “Group Opinion Survey” 

were introduced into the companies. 

The strong attention devoted to reducing fixed costs and jobs did not prevent the necessary 

personnel development measures, to enhance key competences and retain the most 

qualified employees. Although budgets were limited, new initiatives began at local and 

international level, especially for the professional “supply chain” family and to boost 

56






leadership and performance management. This helped the Group keep turnover of key 

personnel to a physiological minimum, confirming the strong sense of belonging in the 

organization, even during this difficult period. 

An important improvement was made in the personnel information systems with the 

introduction of the SAP system in the Egyptian subsidiary. 

In 2011, thanks in part to funding for training provided under current laws, the Group 

provided a total of 364,040 hours of training involving 18,524 people on at least one 

course for a total of 32,563 participants. 

Activities were developed consistently with the re-organization of the Training Management 

System, which covers four areas: Human Capital Development, Compliance and Risk 

Mitigation, Efficiency, Sustainable Development and Innovation. Also, for the 80 th 

anniversary of the “Studi & Ricerche” publication by Scuola Master F.lli Pesenti, a meeting 

was organized at Milan Polytechnic on synergies between the corporate sector and 

universities. In cooperation with the Cav. Del Lavoro Carlo Pesenti foundation, work 

continued with schools and universities, with the assignment of scholarships, internships, 

degree theses and visits for students to Group offices, laboratories and plants. 

Initiatives continued in 2011 to improve the corporate governance system, using a 

methodology that defines the organizational structure, responsibilities and powers and 

describes company processes, in order to identify suitable measures to prevent 

commission of offences and mitigate operating and compliance risks. 

Integration continued of the Management Systems (Quality, Environment, Safety) from a 

process viewpoint, and integration also began of the requirements for the Information 

Technology Infrastructure Library (ITIL) standard to provide IT solutions in line with the top 

international standards, in part to mitigate IT offences as per Legislative Decree 231/01. 

Implementation of the company processes was conducted in a more systematic fashion for 

all Group subsidiaries, which are equipped with their own improvement Action Plan in line 

with local business needs and corporate governance rules. In areas where the program 

has achieved the highest level of implementation, the spread of the corporate process 

culture is facilitating management of improvement, control and mitigation of activities at 

risk, and also generating a high level of employee engagement. 

To date, the availability of consolidated operating corporate governance tools together with 

the assessment reports from the various bodies and functions performing control activities 

is enabling the Group to direct the development and review of corporate processes to the 

areas at greatest risk. 

57 


Engineering, technical assistance, research and 

development 

(CTG S.p.A. – Group Technical Center) 

In 2011 CTG S.p.A. carried out engineering, construction, technical assistance and R&D 

activities for the Group companies in Italy and abroad, providing services for 55.2 million 

euro (61.8 million euro in 2010). 

Staff at December 31, 2011, numbered 398 (404 at December 31, 2010), of whom 306 in 

Bergamo, 86 in Guerville and 6 at Suez Cement in Egypt. 

Regarding projects set up in previous years and now in operation, Martinsburg (USA), 

Matera (Italy), Yerraguntla (India) and Ait Baha (Morocco), CTG S.p.A. played a limited role 

in realization, focusing more on fine-tuning; for the new projects too, its involvement was 

limited, since these projects are still in the early stages. 

With regard to the revamping of the Devnya cement plant in Bulgaria, work is focusing on 

engineering, in relation to the changed dimensions of the plant (4,000 mt of clinker per day) 

and on preparation of documentation to begin requests for tenders. For the revamping of 

the Rezzato plant in Italy (3,000 mt of clinker per day + 20% maximum), basic engineering, 

investment scheduling, preparation of the requests for tenders and approvals have been 

completed. 

Operations for the new plant in Gulbarga, India, comprised basic engineering and 

preparation of the request for tenders. 

Regarding the project for the opening of the Barry quarry (Belgium), work continued on 

basic engineering and approval applications; for the Gaurin – Milieu project, building work 

was completed and the plant was commissioned. 

Assistance operations included action to improve product quality and raise efficiency at a 

number of cement plants. 

R&D work focused on materials and processes; nine patent applications were filed during 

the year. 

New mortar and concrete formulations were developed and are currently being tested. 

Regarding TX Active products, work continued on new formulations, paint and roofing tests, 

as well as road paving formulations. 

Monitoring of the new technologies and assessment of their applications in the cement 

sector continued. Special attention was devoted to cement formulations and to the 

production of clinker with lower CO 2 emissions. 

Regarding process innovation, work is underway on filters for high-temperature gases, and 

dust recovery and treatment. 

58






Innovation 

In 2011 the Group continued to promote the use of innovative products, applications and 

services in its companies to contribute to the creation of value, guaranteeing the best 

construction material solutions in compliance with policies to respect the environment and 

optimize resources. 

The rationalization of operations and growing integration among the functions concerned 

led to a reduction in development times and a stronger research and assistance focus on 

the most promising and profitable areas, including new business areas. 

After finalization of agreements for marketing of i.light, the transparent panel used at the 

Italian Pavilion at Expo Shanghai 2010, the optimization and diversification of the basic 

product continued; alternative channels are also being studied to enhance the offer. 

Sales volumes of sulfoalluminate cement-based products (ALIPRE range) rose 

significantly, thanks in part to the gradual expansion of the range and markets. 

Development also continued of new products based on TX Active, especially for coatings. 

Despite the unfavorable scenario, revenue from products classified as innovative, based on 

the third-party certified internal procedure, was in line with targets, at approximately 180 

million euro in 2011. 

A project began during the year to valorize the link between innovation and sustainability. A 

sustainable production assessment process was developed using criteria consistent with 

the main international systems to determine the percentage of sustainable products in the 

Group. The Sustainable Production Index will be presented to the certifier by the end of 

March and tested in a number of countries during 2012 to become a fully operational 

parameter as from 2013. 

E-business 

In 2011 BravoSolution group revenue amounted to 55.5 million euro, an increase of 3.4% 

from 2010 (53.7 million euro). EBITDA was 6.8 million euro, as in 2010, while EBIT was 2.7 

million euro (2.9 million euro). Profit before tax was 2.2 million euro (2.6 million euro) and 

profit for the year was 1.1 million euro (1.4 million euro). 

Profit margins were maintained thanks to the improvement in revenue and costs compatible 

with business levels. Specific action was taken to contain overheads, without penalizing the 

acquisition of resources active in operating efficiency, customer service and development 

of new markets. 

During the year the BravoSolution group confirmed its excellent commercial positioning as 

a supplier of customized software platforms and professional value-added services. 

In 2011 BravoSolution S.p.A. posted revenue of 24.6 million euro (+1.0%) and further 

growth in earnings, confirming its undisputed leadership on the Italian market. On a market 

where customers encountered operating and financial difficulties, BravoBus S.r.l., which 

operates on the e-sourcing market in the Italian local public transport area and serves 

public companies and institutions in the Rome area, reported a reduction in revenue 

(-20.5%), but a substantial breakeven. 

BravoSolution France, which in 2008 merged with Mobile Workers S.A. (a spend analysis 

company acquired in 2007), reported revenue of 9.1 million euro (+4.4%) and a profit for 

the eighth consecutive year. 

59 


After a revenue decline in 2009 and in 2010, BravoSolution Espana S.A. reported growth 

in 2011 (+14.7%), and also managed to improve earnings by containing costs and 

developing commercial operations in South and Central America to support the Mexican 

subsidiary and move on to the Brazilian market. 

In 2011, despite the difficult economic and financial conditions, BravoSolution UK 

continued to operate profitably on the British market, with a reduction in revenue (-6.2%), 

but posted a profit for the year. 

The group of companies headed by BravoSolution US (USA, Canada, UK) closed 2011 

with consolidated revenue of 12.5 million euro, an increase of 7.4% from 2010, and positive 

EBITDA. 

The more recently established subsidiaries in Benelux, Mexico and China reported 

important growth in 2011. 

In February 2011, BravoSolution GmbH was established in Munich, to operate on 

German-speaking markets. The company began operations and posted its first revenue. 

BravoSolution do Brasil Servicos de Tecnologia Ltda, owned 99.99% by BravoSolution 

Mexico, was established in December as a commercial operation on the Brazilian market to 

begin work in 2012 with a tender for the Rio Olympics in 2016. 

Disputes and pending proceedings 

A summary of the main current disputes is provided below. Further details are provided in 

the notes (note 20). 

Europe 

Regarding the investigation begun in November 2008 by the European Commission into 

some cement producers, including Italcementi S.p.A. and the subsidiaries Ciments 

Français S.A., Ciments Calcia S.A. and Compagnie des Ciments Belges S.A., in December 

2010 the European Commission notified the decision for the formal opening of the 

proceeding to Italmobiliare S.p.A. (and, indirectly through Italmobiliare, to the above-named 

Group companies and the Spanish subsidiary Financiera Y Minera). 

In April 2011, the Commission served a further formal notice on Italmobiliare of its decision 

to request extensive additional economic, financial and commercial information. 

Italmobiliare provided the information within the required term and, simultaneously, lodged 

an appeal with the EU General Court against the decision. Both the investigation and the 

proceedings are still underway. 

Turkey 

As a result of the non-closure of the 2008 agreement for the sale of the Turkish operations 

(Set Group) by Ciments Français to Sibcem, a number of proceedings are pending. 

- Sibconcord, the main shareholder of Sibcem, has begun a proceeding in Russia to 

annul the agreement. On September 26, 2011, the ruling annulling the contract obtained 

in first instance by Sibconcord against which Ciments Français filed an appeal become 

effective. After an unsuccessful petition to the regional court of cassation, Ciments 

Français filed an appeal with the Russian Supreme Court. In December 2011, on the 

60






basis of the favorable ruling obtained in Russia, Sibconcord filed for compulsory 

execution in Kazakhstan, which was rejected by the courts in January 2012. Sibconcord 

has appealed against this ruling. 

- As contemplated by the contract, Ciments Français began arbitration proceedings (in 

Istanbul) in accordance with the regulation of the International Chamber of Commerce. 

On December 7, 2010, it obtained a favorable arbitration award recognizing the validity 

of the resolution of the contract by Ciments Français with the right to retain the 50 

million euro paid by Sibcem. On May 31, 2011, Sibcem obtained the annulment of the 

arbitration award from the territorially competent Turkish court; Ciments Français filed 

an appeal and in the meantime continued proceedings for the recognition of the award 

in a number of countries. 

Significant events after December 31, 2011 

In February, Ciments Français and the subsidiary Parcib s.a.s. signed an agreement with 

Cimsa Cimento Sanayi ve Ticaret A.S. for the sale of the outstanding 51% of the capital of 

Afyon Cimento Sanayii Turk A.S.. The overall value of the sale has been determined as 

57,530,000 Turkish lire, equivalent to approximately 25 million euro. The transfer of the 

shares and the payment will take place at closing, once the necessary approval has been 

obtained from the Antitrust Authority and all the conditions of the agreement have been 

fulfilled. The closing price will be subject to the usual contractual adjustment conditions. 

With the closing of this sale and following the sale of Set Group, the Group will have no 

further operations on the Turkish market as a cement producer. 

61 


Outlook 

The markets on which the Group operates should be relatively stable in 2012. Sales 

volumes will be slightly below the 2011 levels, with positive performance in North America 

and Morocco offsetting in part the slowdown expected on markets in Southern Europe and 

Italy. 

Sales prices should be positive, a trend already confirmed by performance in the early 

months of the year in Italy, Egypt and the USA. 

Inflationary pressures on production costs should be outweighed by the improvements in 

industrial efficiency planned by the Group and already introduced in part. Consequently, 

foreseeable operating results for 2012 will be up on 2011. The Group’s expectations of an 

improvement could, however, by influenced by the effects of the political transition in Egypt 

and by the adverse meteorological conditions that have already occurred since the 

beginning of the year. 

In 2012 the Group launched a new program of investments intended to bring further 

improvements in its industrial operations in Italy and Bulgaria and raise production capacity 

in India and Morocco. The program will be funded with internal resources and is not 

expected to affect the Group’s capital and financial ratios. 

Bergamo, March 2, 2012 

For the Board of Directors 

The Chairman 


62

Consolidated financial statements 

63 


Financial statements 

Statement of financial position 

(in thousands of euro) Notes 12.31.2011 12.31.2010 Change 

Non-current assets 

Property, plant and equipment 5 4,447,322 4,595,148 (147,826) 

Investment property 5 23,457 33,098 (9,641) 

Goodwill 6 1,919,288 2,016,614 (97,326) 

Intangible assets 7 98,083 133,817 (35,734) 

Equity accounted investees 8 216,742 212,261 4,481 

Other equity investments 9 88,246 200,172 (111,926) 

Deferred tax assets 21 76,217 52,995 23,222 

Other non-current assets 10 289,183 186,214 102,969 

Total non-current assets 7,158,538 7,430,319 (271,781) 

Current assets 

Inventories 11 740,991 726,152 14,839 

Trade receivables 12 857,327 738,555 118,772 

Other current assets including derivatives 13 295,271 248,410 46,861 

Tax assets 29,348 52,621 (23,273) 

Equity investments, bonds and financial assets 36,022 249,852 (213,830) 

Cash and cash equivalents 38 613,334 575,220 38,114 

Total current assets 2,572,293 2,590,810 (18,517) 

Total assets 9,730,831 10,021,129 (290,298) 

Equity 

Share capital 14 282,549 282,549 - 

Share premium 14 344,104 344,104 - 

Reserves 15 131,764 175,652 (43,888) 

Treasury shares 16 (58,690) (58,690) - 

Retained earnings 17 2,795,189 2,781,467 13,722 

Equity attributable to owners of the parent 3,494,916 3,525,082 (30,166) 

Non-controlling interests 18 1,399,975 1,460,851 (60,876) 

Total equity 4,894,891 4,985,933 (91,042) 

Non-current liabilities 

Financial liabilities 22 2,099,268 2,567,468 (468,200) 

Employee benefits 19 202,955 184,822 18,133 

Provisions 20 248,790 241,240 7,550 

Deferred tax liabilities 21 222,086 239,460 (17,374) 

Other non-current liabilities 29,788 33,203 (3,415) 

Total non-current liabilities 2,802,887 3,266,193 (463,306) 

Current liabilities 

Loans and borrowings 22 189,296 222,985 (33,689) 

Financial liabilities 22 543,934 293,493 250,441 

Trade payables 648,178 588,572 59,606 

Provisions 20 1,993 3,537 (1,544) 

Tax liabilities 42,299 55,542 (13,243) 

Other current liabilities 23 607,353 604,874 2,479 

Total current liabilities 2,033,053 1,769,003 264,050 

Total liabilities 4,835,940 5,035,196 (199,256) 

Total equity and liabilities 9,730,831 10,021,129 (290,298) 

64






Income statement 

Notes 2011 % 2010 (IFRS 5) % Change % 2010 

(published) 

(In thousands of euro) 

Revenue 4 4,720,542 100.0 4,660,007 100.0 60,535 1.3 4,790,944 

Other revenue 37,213 33,156 33,697 

Change in inventories (241) 27,128 25,917 

Internal work capitalized 32,108 58,746 58,745 

Raw materials and supplies 25 (1,976,767) (1,934,461) (2,019,558) 

Services 26 (1,138,246) (1,046,683) (1,075,499) 

Employee expense 27 (947,037) (896,253) (916,261) 

Other operating income (expense) 28 (30,239) (59,942) (61,723) 

Recurring EBITDA 4 697,333 14.8 841,698 18.1 (144,365) -17.2 836,262 

Net gains from sale of non current assets 29 66,275 9,384 9,864 

Non-recurring income (expense) 

for re-organizations 29 (25,566) (11,850) (12,001) 

Other non-recurring income (expense) 29 35 153 153 

EBITDA 4 738,077 15.6 839,385 18.0 (101,308) -12.1 834,278 

Amortization and depreciation 4 (474,826) (461,178) (472,543) 

Impairment 5 - 6 (134,280) (7,982) (7,982) 

EBIT 4 128,971 2.7 370,225 7.9 (241,254) -65.2 353,753 

Finance income 30 74,202 65,797 66,685 

Finance costs 30 (158,852) (160,104) (161,844) 

Exchange-rate differences and derivatives 30 (17,445) 4,497 4,523 

Impairment on financial assets 31 7,524 (21,014) (21,014) 

Share of profit (loss) of equity accounted 

investees 8 18,638 17,052 17,052 

Profit before tax 4 53,038 1.1 276,453 5.9 (223,415) -80.8 259,155 

Income tax expense 32 (68,811) (60,608) (62,087) 

Profit (loss) relating to continuing 

operations (15,773) -0.3 215,845 4.6 (231,618) -107.3 197,068 

Profit (loss) relating to discontinued operations 33 106,927 (18,777) - 

Profit (loss) for the period 91,154 1.9 197,068 4.2 (105,914) -53.7 197,068 

Attributable to: 

Owners of the parent (3,147) 45,780 (48,927) 106.9 45,780 

Non-controlling interests 94,301 151,288 (56,987) -37.7 151,288 

Earnings per share 35 

- Basic 

savings shares 0.007 € 0.183 € 0.183 € 

ordinary shares -0.023 € 0.153 € 0.153 € 

- Diluted 

savings shares 0.007 € 0.183 € 0.183 € 

ordinary shares -0.023 € 0.153 € 0.153 € 

65 


Statement of comprehensive income 

Notes 2011 % 2010 (IFRS 5) % Change 2010 (published) 

(in thousands of euro) 

Profit (loss) for the period 91,154 1.9 197,068 4.2 (105,914) 197,068 

Fair value gains (losses) on: 

Available-for-sale financial assets (49,336) 12,796 12,796 

Derivatives 20,144 11,750 11,750 

Translation differences (26,234) 181,105 189,838 

Share of other comprehensive income of 

equity accounted investees 649 11,373 11,373 

Tax on other comprehensive income (3,142) (1,901) (1,901) 

Other comprehensive income (expense) 

relating to continuing operations 34 (57,919) 215,123 (273,042) 223,856 

Other comprehensive income (expense) 

relating to discontinued operations - 8,733 (8,733) - 

Total comprehensive income 33,235 0.7 420,924 9.0 (387,689) 420,924 


Owners of the parent (47,159) 200,893 (248,052) n.s. 200,893 

Non-controlling interests 80,394 220,031 (139,637) -63.5 220,031 

66






Consolidated statement of changes in equity 

Non- Total 

Attributable to owners of the parent 

controlling shareholders’ 

(in millions of euro) interests equity 

Reserves 

Share Share Fair value Hedging Other Translation Treasury Retained Total 

capital premium reserve reserve reserves reserve shares earnings share 

capital and 

reserves 

Balances at December 31, 2009 282.5 344.1 47.6 (18.9) 105.1 (116.5) (58.7) 2,767.9 3,353.1 1,339.1 4,692.2 

Profit (loss) for the period 45.8 45.8 151.3 197.1 

Total other comprehensive income 6.4 8.8 139.9 155.1 68.7 223.9 

Stock options 3.1 3.1 0.5 3.6 

Distribution of profits: Dividends (33.4) (33.4) (96.6) (130.0) 

% change in control and scope of 

consolidation 0.2 1.2 1.4 (2.2) (0.8) 

Balances at December 31, 2010 282.5 344.1 54.0 (10.1) 108.3 23.5 (58.7) 2,781.5 3,525.1 1,460.9 4,985.9 

Profit (loss) for the period (3.1) (3.1) 94.3 91.2 

Total other comprehensive income (41.9) 15.2 (17.2) (44.0) (13.9) (57.9) 

Stock options 0.1 0.1 (0.2) (0.1) 

Distribution of profits: Dividends (33.4) (33.4) (109.4) (142.8) 

% change in control and scope of 

consolidation 0.0 50.3 50.2 (31.7) 18.6 

Balances at December 31, 2011 282.5 344.1 12.0 5.1 108.5 6.3 (58.7) 2,795.2 3,494.9 1,400.0 4,894.9 

67 


Statement of cash flows 

Notes 2011 2010 (IFRS 5) 


A) Cash flow from operating activities 

Profit before tax 53,038 276,453 

Adjustments for: 

Amortization, depreciation and impairment 602,509 490,824 

Reversal of non-distributed profit (loss) of associates (2,936) 1,506 

Capital (gains) losses on sale of fixed assets (90,249) (30,542) 

Change in employee benefits and other provisions (5,446) 8,303 

Stock options (183) 3,566 

Reversal of finance costs 107,391 121,728 

Cash flow from operating activities before tax, 

finance income/costs and change in working capital 664,124 871,838 

Change in working capital 38.4 (20,805) 133,811 

Cash flow from operating activities before tax 

and finance income/costs 643,319 1,005,649 

Net finance costs paid (107,486) (117,944) 

Taxes paid (118,100) (132,803) 

Total A) 417,733 754,902 

B) Cash flow from investing activities 


Intangible assets (25,449) (22,130) 

Property, plant and equipment and investment property (374,077) (495,442) 

Financial assets (equity investments) net of cash acquisitions (*) 38.2 (2,599) (24,647) 

Total capital expenditure (402,125) (542,219) 

Proceeds from the sale of fixed assets 38.3 182,469 142,644 

Total sales 182,469 142,644 

Change in other long-term financial assets and liabilities (3,756) (407) 

Total B) (223,412) (399,982) 

C) Cash flow from financing activities 

Increase in non-current financial liabilities 128,586 790,292 

Repayments of non-current financial liabilities (315,854) (823,508) 

Change in current financial liabilities (62,089) (135,011) 

Dividends paid (142,620) (129,989) 

Other changes in equity 757 (7,831) 

Changes in interests in subsidiaries 24,766 (791) 

Other sources and applications (38,704) (38,051) 

Total C) (405,158) (344,889) 

D) Translation differences and other changes (7,902) 17,848 

E) Cash flow from discontinued operations 33 256,853 68 

F) Cash flows for the period (A+B+C+D+E) 38,114 27,947 

G) Cash and cash equivalents at beginning of period 575,220 547,273 

Cash and cash equivalents at end of period (F+G) 38.1 613,334 575,220 

(*) cash of acquired and consolidated companies 280 18 

68






Contents 

Notes 

1. Accounting policies 

2. Exchange rates used to translate the financial statements of foreign operations 

3. Changes in the scope of consolidation 

4. Operating segment disclosure 

5. Property, plant and equipment and Investment property 

6. Goodwill and Business combinations 

7. Intangible assets 

8. Equity accounted investees 

9. Other equity investments 

10. Other non-current assets 

11. Inventories 

12. Trade receivables 

13. Other current assets including derivatives 

14. Share capital and Share premium 

15. Reserves 

16. Treasury shares 

17. Retained earnings, dividends paid 

18. Non-controlling interests 

19. Employee benefits 

20. Provisions 

69 


21. Deferred tax assets and Deferred tax liabilities 

22. Net debt 

23. Other current liabilities 

24. Commitments 

25. Raw materials and supplies 

26. Services expense 

27. Employee expense and Stock options 

28. Other operating income (expense) 

29. Non-recurring income (expense) 

30. Finance income (costs), exchange-rate differences and derivatives 

31. Impairment on financial assets 

32. Income tax expense 

33. Profit (loss) relating to discontinued operations 

34. Other comprehensive income 

35. Earnings per share 

36. Transactions with related parties 

37. Joint ventures 

38. Statement of cash flows 

39. Non-recurring transactions 

40. Audit fees 

41. Events after December 31, 2011 

70






Notes 

The Italcementi S.p.A. consolidated financial statements as at and for the year to December 31, 2011, were 

approved by the Board of Directors on March 2, 2012. At the meeting the Board authorized publication of a 

press release dated March 2, 2012, containing key information from the financial statements. 

Italcementi S.p.A. is a legal entity established in accordance with the laws of the Republic of Italy. It has been 

listed on the Stock Exchange since 1925 and is subject to management and coordination by Italmobiliare 

S.p.A., whose key data from the most recently approved financial statements are provided in an annex to the 

parent’s separate financial statements. 

Italcementi S.p.A. and its subsidiaries form the “Italcementi Group”, an international player whose main lines of 

business are hydraulic binders, ready mixed concrete and aggregates. The Group is also active in other areas, 

some of which are instrumental to its core businesses: materials for the construction industry, transport, 

energy, engineering and e-business. 

The financial statements have been drawn up on a going-concern basis. Despite the difficult economic and 

financial situation, by virtue of the measures already in place to respond to the changes in demand, and its 

business and financial flexibility the Group has no material uncertainties about its ability to continue as a going 

concern . 


1.1. Statement of compliance with the IFRS 

These consolidated financial statements have been drawn up in compliance with the International Accounting 

and Financial Reporting Standards (IAS/IFRS) applicable at December 31, 2011, endorsed by the European 

Commission. 

In compliance with European Regulation no. 1606 of July 19, 2002, the policies adopted do not include the 

standards and interpretations published by the IASB and the IFRIC through December 31, 2011, that had not 

been endorsed by the European Union at that date. 

Since December 31, 2010, the following standards, amendments and interpretations endorsed by the 

European Union have come into force and have been applied in the 2011 financial statements: 

IAS 24 revised “Related party disclosures” which simplifies disclosure requirements relating to related 

parties in which public entities are present and provides a new definition of related parties that also includes 

the subsidiaries of associates and joint ventures. 

Amendment to IAS 32 “Financial instruments presentation” regarding classification of rights issues. The 

changes permit classification of rights issues (e.g., options and warrants) as equity instruments 

independently of the currency in which the exercise price is denominated. 

Amendment to IFRS 1 “First-time adoption of IFRS” and the related amendment to IFRS 7 “Financial 

instruments: disclosures” relating to the exemption from comparative disclosure allowed by IFRS 7 on firsttime 

adoption. The amendment exempts the reporting entity, on first-time adoption of IFRS, from providing 

the comparative data required by IFRS 7 for fair value measurement and liquidity risk. 

Amendments to a number of IAS/IFRS/IFRIC as part of the improvement of the same: IFRS 1 “First-time 

adoption of IFRS”, IFRS 3 “Business combinations”, IFRS 7 “Financial instruments: disclosures”, IAS 1 

“Presentation of financial statements”, IAS 27 “Consolidated and separate financial statements”, IAS 34 

“Interim financial reporting”, IFRIC 13 “Customer loyalty programs”. The above changes had no material 

effects for the Group. 

Amendment to IFRIC 14 “Prepayments of a minimum funding requirement” governing cases where an entity 

subject to a minimum funding requirement on defined benefit plans, makes prepayments to guarantee the 

71 


limits in question. The benefits arising from the prepayments may be recognized as assets. This case does 

not apply to the Group. 

IFRIC 19 “Extinguishing financial liabilities with equity instruments” which provides guidelines for accounting 

treatment of extinction of a financial liability through issue of own equity instruments. The difference 

between the carrying amount of the financial liability to be extinguished and the initial measurement of the 

equity instruments to be issued must be reflected in the income statement. 

The application of the new standards, amendments and interpretations has not had a material impact on the 

Group’s annual accounts. 

At December 31, 2011, the European Union had approved an amendment to IFRS 7 “Financial instruments: 

disclosures” concerning disclosures to be made on the transfer of financial assets. This amendment is not yet 

in effect and the Group has not elected early application. It will be applicable as from the financial statements 

as at and for the year ending December 31, 2012, and will not have a material effect on the Group accounts. 

Standards, amendments and interpretations published by the IASB but not yet endorsed by the European 

Union are: 

Amendment to IAS 1 “Presentation of financial statements” relating to the presentation of other components 

recognized under equity. 

Amendment to IAS 12 “Income taxes” with reference to deferred tax: recovery of underlying assets. 

Amendments to IAS 19 “Employee benefits”. The main change is the elimination of the “corridor” for defined 

benefit plans with obligatory immediate and full recognition of actuarial gains and losses in the statement of 

comprehensive income. 

Review of IAS 27 “Consolidated and separate financial statements” and IAS 28 “Investments in associates”. 

Amendment to IAS 32 “Financial instruments presentation”, offsetting financial assets and financial liabilities. 

Amendments to IFRS 1 “First-time adoption of IFRS” for situations subsequent to hyperinflationary periods 

and suppression of fixed dates on first-time adoption. 

IFRS 10 “Consolidated financial statements”. This new standard replaces IAS 27 “Consolidated and 

separate financial statements” with regard to consolidated financial statements. IAS 27 has been renamed 

“Separate financial statements” and deals exclusively with preparation of separate financial statements. 

IFRS 11 “Joint arrangements”. The new standard replaces IAS 31 “Interests in joint ventures”, and identifies 

two categories of arrangement, with separate accounting treatments. 

IFRS 12 “ Disclosure of interests in other entities” which re-organizes and supplements disclosures on 

subsidiaries, associates, joint ventures and other equity investments. 

IFRS 13 “Fair value measurement”. This new standard provides guidelines for measurement and disclosure 

of fair value. 

IFRIC 20 “Stripping costs in the production phase of a surface mine”. 

1.2. Accounting policies and basis of presentation 

The consolidated accounts adopt the cost principle, with the exception of derivatives and financial assets held 

for trading or for sale, which are stated at fair value. The carrying amounts of hedged assets and liabilities are 

adjusted to reflect changes in fair value on the basis of the hedged risks. The consolidated financial statements 

are presented in euro. All amounts in the accounting schedules and in the notes are rounded to thousands of 

euro, unless otherwise specified. 

72






The basis of presentation of the Group financial statements is as follows: 

current and non-current assets and current and non-current liabilities are presented as separate 

classifications on the face of the statement of financial position. Current assets, which include cash and 

cash equivalents, are assets that the Group intends to realize, sell or consume during its normal business 

cycle; current liabilities are liabilities that the Group expects to settle during the normal business cycle or in 

the twelve months after the end of the reporting period; 

on the income statement, costs are analyzed by the nature of the expense; 

with regard to comprehensive income, the Group presents two statements: the first statement reflects 

traditional income statement components and the profit (loss) for the period, while the second statement, 

beginning with the profit (loss) for the period, presents other components of comprehensive income, 

previously reflected only in the statement of changes in consolidated equity: fair value gains/losses on 

available-for-sale financial assets and derivatives, currency translation differences; 

on the statement of cash flows, the indirect method is used. 

Use of estimates 

The preparation of the consolidated financial statements and the notes in conformity with the international 

financial reporting policies requires management to make discretional assessments and estimates that affect 

the carrying amounts of assets, liabilities, income and expense, such as amortization, depreciation and 

provisions, and the disclosures on contingent assets and liabilities in the notes. 

Since these estimates are determined on a going-concern basis, using the information available at the time, 

they could diverge from the actual future results. This is particularly evident in the present financial and 

economic crisis, which could generate situations diverging from those estimated today and require currently 

unforeseeable adjustments, including adjustments of a material nature, to the carrying amounts of the items in 

question. 

Assumptions and estimates are particularly sensitive with regard to measurement of non-current assets, which 

depend on forecasts of future results and cash flows, measurement of contingent liabilities, provisions for 

disputes and restructurings and commitments in respect of pension plans and other long-term benefits. 

Management conducts regular reviews of assumptions and estimates, and immediately recognizes any 

adjustments in the financial statements. 

Given that the Italcementi Group applies IAS 34 “Interim financial reporting” to its half-year reports, with 

consequent identification of a six-month interim period, any reductions in amounts are recorded at closure of 

the half year. 

1.3. Basis of consolidation 

The consolidated financial statements are based on the statements of the parent Italcementi S.p.A. and the 

consolidated companies as at and for the year ended December 31 2011. Where necessary, the financial 

statements are adjusted to ensure alignment with the Group’s classification criteria and accounting policies. 

Subsidiaries 

Subsidiaries are companies in which the Group has the power to determine, directly or indirectly, 

administrative and management decisions and to obtain the benefits thereof. Generally speaking, control is 

assumed to exist when the Group holds, directly or indirectly, more than one half of voting rights, including 

potential voting rights deriving from convertible securities. 

Subsidiaries are consolidated on a line-by-line basis as from the date at which control is obtained and until 

control is transferred out of the Group. 

73 


Associates 

Associates are companies in which the Group has significant influence over administrative and management 

decisions even though it does not hold control. Generally speaking, significant influence is assumed to exist 

when the Group holds, directly or indirectly, at least 20% of voting rights or, even if it holds a lower percentage 

of voting rights, when it is entitled to take part in financial and management policy decisions by virtue of a 

specific juridical status including, but not limited to, participation in voting trusts or other forms of material 

exercise of rights of governance. Investments in associates are measured using the equity method, whereby 

they are recognized initially at cost, and subsequently adjusted to reflect changes in the Group’s interest in the 

associate’s equity. The Group’s share of an associate’s profit or loss is recognized in a specific income 

statement line item from the date at which the Group exerts significant influence until it relinquishes such 

influence. 

Joint ventures 

Joint ventures are companies whose business operations are controlled by the Group jointly with one or more 

other parties, under contractual arrangements. Joint control presupposes that strategic, financial and 

management decisions are taken with the unanimous consent of the parties that control the venture. 

Interests in joint ventures are consolidated on a proportionate basis, whereby assets, liabilities, income and 

expense are recognized proportionately to the Group’s interest. 

The equity and income of joint ventures are consolidated from the date on which joint control is assumed and 

until such control is relinquished. 

Transactions eliminated during consolidation 

All intragroup balances and transactions, including any unrealized gains in respect of third parties, are 

eliminated. Unrealized losses deriving from intragroup transactions are eliminated, except in cases where it will 

not subsequently be possible to recover such losses. 

Unrealized gains deriving from transactions with associates are eliminated against the equity investment 

carrying amount, while losses are eliminated proportionately to the Group’s interest, unless it will not 

subsequently be possible to recover such losses. 

Scope of consolidation 

A list of the companies consolidated on a line-by-line basis, on a proportionate basis and with the equity 

method is provided in the annex to these notes. 

Non-current assets held for sale and discontinued operations 

Assets and liabilities held for sale and discontinued operations are classified as such when their carrying 

amount will be recovered chiefly through sale rather than through continuing use; such operations must be an 

important autonomous business operation or geographical area of operation. 

The conditions indicated are deemed to exist when the sale is considered highly likely and the assets and 

liabilities are immediately available for sale in their current condition. 

Available-for-sale assets are recognized at the lower of net carrying amount and fair value less costs to sell. 

Once property, plant and equipment and intangible assets have been classified as available-for-sale, no further 

amortization and depreciation may be applied. 

In the consolidated income statement, profit (loss) relating to discontinued operations, together with profit or 

loss from fair value measurement net of costs to sell and the profit or loss arising from the sale of the 

operation, are reflected in a single item separately from profit (loss) relating to continuing operations. 

Cash flows relating to discontinued operations are shown separately in the statement of cash flows. 

A similar disclosure is also presented for the comparative period. 

74






1.4 Business combinations 

On first-time adoption of the IFRS, as allowed by IFRS 1, the Group elected not to apply IFRS 3 retrospectively 

to business combinations that took place before January 1, 2004. 

Until December 31, 2009, business combinations were accounted for with the purchase method in IFRS 3. 

Since January 1, 2010, business combinations have been accounted for with the acquisition method in IFRS3 

revised. 

Cost of business combinations 

Under IFRS 3 revised, acquisition cost is the sum of the acquisition-date fair value of the contingent 

consideration and the amount of any non-controlling interests in the acquired entity. For each business 

combination, any non-controlling interests in the acquired entity must be measured at fair value or in proportion 

to their interest in the identifiable net assets of the acquired entity. 

IFRS 3 revised provides that costs relating to the acquisition be expensed in the periods in which they are 

incurred and the services are received. 

Allocation of the cost of business combinations 

Goodwill is measured as the positive difference between: 

the aggregate of the consideration transferred, the amount of any non-controlling interests in the acquired 

entity, the acquisition-date fair value of the acquirer’s previously held equity interest in the acquired entity, 

with respect to 

the net amount of identifiable assets acquired and liabilities assumed at the acquisition date. 

If the difference is negative, it is recognized in the income statement. 

If on initial recognition the acquisition cost of a business combination can only be determined provisionally, the 

allocated amounts are adjusted within twelve months of the acquisition date (measurement period). 

Business combinations achieved in stages 

When a business combination is achieved in stages, through a series of share purchases, for each transaction 

the fair value of the previously held interest is re-determined and any gain or loss is taken to the income 

statement. 

Changes in equity interests in subsidiaries 

Acquisitions of additional shares after acquisition of control do not require re-determination of identifiable asset 

and liability amounts. The difference between the cost and the acquired equity interest is recognized as equity 

attributable to owners of the parent. Transactions that reduce the percentage interest held without loss of 

control are treated as sales to non-controlling interests and the difference between the interest sold and the 

price paid is recognized in equity attributable to owners of the parent. 

Purchase commitments on non-controlling interests 

A put option granted to non-controlling interests of a company controlled by the Group is initially recognized by 

recording the acquisition amount as a liability, since the amount in question is the present value of the put 

option exercise price. 

The complementary acquisition of non-controlling interests with put options is in the financial statements: 

the non-controlling interests are reclassified under liabilities and the difference between the fair value of the 

purchase commitment liabilities and the carrying amount of the non-controlling interests is recognized under 

equity attributable to owners of the parent; 

subsequent changes in liabilities are recognized under equity attributable to owners of the parent with the 

exception of adjustments to the present value, which are taken to the income statement. 

75 


1.5 Translation of foreign currency items 

The functional currency of the subsidiaries located outside the euro zone is usually the local currency. 

Foreign currency transactions 

Foreign currency transactions are initially translated to the functional currency using the exchange rate at the 

transaction date. At the reporting date, foreign currency monetary assets and liabilities are translated to the 

functional currency at the closing rate. Exchange rate gains and losses are taken to the income statement. 

Non-monetary foreign currency assets and liabilities measured at cost are translated at the exchange rate 

ruling at the transaction date; those measured at fair value are translated with the exchange rate at the date 

fair value was determined. 

Translation of the financial statements of foreign entities 

At the reporting date, the assets, including goodwill, and liabilities of consolidated companies that report in 

currencies other than the euro are translated to the presentation currency of the Group’s consolidated financial 

statements at the exchange rate ruling at such date. Income statement items are translated at the average rate 

for the period. Gains and losses arising from the translation of opening equity at the closing rates and those 

arising from the different method used to translate profit or loss for the period are recognized in a specific 

equity caption. In the event of subsequent disposal of a foreign entity, the cumulative translation differences 

are taken to the income statement. 

As allowed under IFRS 1, cumulative translation differences at the date of first-time adoption of the IFRS have 

been reclassified in “Retained earnings” under equity and therefore will not be taken to the income statement in 

the event of subsequent disposal. 

1.6 Property, plant and equipment 

Recognition and measurement 

Property, plant and equipment are recognized at cost, less accumulated depreciation and impairment losses. 

Cost includes the purchase or production cost and the directly attributable costs of bringing the asset to the 

location and the conditions required for its operation. Production cost includes the cost of materials and direct 

labor costs. Finance costs relating to the purchase, construction and production of qualifying assets are 

capitalized. 

The carrying amount of some assets existing at the IFRS first-time adoption date of January 1, 2004, reflects 

revaluations applied in prior periods in connection with specific local laws, based on the real economic value of 

the assets in question. Assets acquired through business combinations are stated at fair value, determined on 

a provisional basis at the acquisition date and subsequently adjusted within the following twelve months. 

Subsequent to initial recognition, property, plant and equipment are carried at cost and depreciated over the 

asset’s useful life, less any impairment losses. 

Assets under construction are recognized at cost; depreciation begins when the assets enter useful life. 

When an asset consists of components with a significant cost and different useful lives, initial recognition and 

subsequent measurement are carried out separately for each component. 

Subsequent expense 

Repair and maintenance expense is normally recognized as incurred. Component replacement costs are 

treated as separate assets and carrying amount of the replaced component is expensed. 

76






Depreciation 

Depreciation is generally calculated on a straight-line basis over the estimated useful life of each component of 

an asset. Land is not depreciated, with the exception of land used for quarrying operations. 

Asset useful life determines the depreciation rate until a subsequent review of residual useful life. The useful 

life range adopted for the various categories of assets is disclosed in the notes. 

Quarries 

Costs for the preparation and excavation of land to be quarried are amortized as the economic benefits of such 

costs are obtained. 

Quarry land is depreciated at rates reflecting the quantities extracted in the period in relation to the estimated 

total to be extracted over the period in which the quarry is to be worked. 

The Group makes specific provision for quarry environmental restoration obligations. Since the financial 

resources required to settle such obligations are directly related to the degree of use, the charge cannot be 

defined at inception with a balancing entry to the asset cost, but is provided to reflect the degree of use of the 

quarry. 

1.7 Leases 

Finance leases, which substantially transfer to the Group all risks and rewards incidental to ownership of the 

leased asset, are recognized from the lease inception date at the lower of the leased asset fair value or the 

present value of the lease payments. Lease payments are apportioned between finance costs and reductions 

against the residual liability so as to obtain a constant rate of interest on the outstanding liability. 

The policies used for depreciation and subsequent measurement of leased assets are consistent with those 

used for the Group’s own property, plant and equipment. 

Leases where all risks and rewards incidental to ownership are retained by the lessor are classified as 

operating leases. 

Operating lease payments are recognized as expense on a straight-line basis over the lease term. 

1.8 Investment property 

Investment property is land and/or buildings held to earn rental income and/or for capital appreciation, rather 

than for use in the production or supply of goods and services. Investment property is initially recognized at 

cost, including costs directly attributable to the purchase. Subsequent to initial recognition, investment property 

is measured at amortized cost, based on asset useful life less any impairment losses. 

1.9 Goodwill 

Goodwill recognized in accordance with IFRS 3 revised is allocated to the cash-generating units that are 

expected to benefit from the synergies created by the acquisition. Goodwill is stated at the original value less 

any impairment losses identified as a result of tests conducted on an annual basis or more frequently if 

indications of impairment emerge. 

When goodwill is allocated to a cash-generating unit part of whose assets are disposed of, the goodwill 

associated with the sold assets is taken into account when determining the gain or loss arising from the 

transaction. 

1.10. Intangible assets 

Intangible assets purchased separately are capitalized at cost, while those acquired through business 

combinations are recognized at provisionally estimated fair value at the acquisition date and adjusted where 

necessary within the following twelve months. 

77 


Subsequent to initial recognition, intangible assets are carried at cost amortized over the asset’s useful life. 

Other than goodwill, the Group has not identified intangible assets with an indefinite useful life. 

1.11. Impairment 

Goodwill is tested for impairment on an annual basis or more frequently if indications of impairment emerge. 

Property, plant and equipment and investment property, and amortizable intangible assets, are tested for 

recoverability if indications of impairment emerge. 

Impairment is the difference between the asset carrying amount and its recoverable amount. Recoverable 

amount is the greater of fair value, less costs to sell, of an asset or cash-generating unit, and its value in use, 

determined as the present value of future cash flows. Fair value less costs to sell is determined through 

application of relevant valuation models adopting appropriate income multipliers, quoted share prices on an 

active market for similar enterprises, comparable transactions on similar assets or other available fair value 

indicators applicable to the assets being measured. 

In determining value in use, assets are measured at the level of cash-generating units on a continuing 

operations basis. Estimated future cash flows are discounted at a rate determined for each cash-generating 

unit using the weighted average cost of capital method (WACC). 

If an impairment loss on an asset other than goodwill subsequently reverses in full or in part, the asset carrying 

amount is increased to reflect the new estimated recoverable amount, which may not exceed the amount that 

would have been reflected in the absence of the impairment loss. Impairment losses and reversals of 

impairment losses are taken to the income statement. 

Impairment losses on goodwill cannot be reversed. 

1.12. Financial assets 

All financial assets are recognized initially at cost at the trade date. Cost corresponds to fair value plus 

additional costs attributable to the purchase. 

Subsequent to initial recognition, assets held for trading are classified as current financial assets and carried at 

fair value; any gains or losses are taken to the income statement. 

Held–to-maturity investments are classified as current financial assets, if they mature within one year; 

otherwise they are classified as non-current assets and subsequently carried at amortized cost. Amortized cost 

is determined using the effective interest rate method, taking account of any acquisition discounts or 

premiums, which are apportioned over the entire period until maturity, less any impairment losses. 

Other financial assets are classified as available for sale and measured at fair value. Any gains or losses are 

shown in a separate equity caption until the assets are sold, recovered or discontinued, or until they are found 

to be impaired, in which case the cumulative gains or losses in equity are taken to the income statement. 

Equity instruments that are not listed on an active market and whose fair value cannot be measured reliably 

are carried at cost. 

1.13. Inventories 

Inventories are measured at the lower of purchase/production cost (using the weighted average cost method) 

and net realizable value. 

Purchase cost includes costs incurred to bring assets to their present location, less allowances for obsolete 

and slow-moving items. 

Production cost of finished goods and semi-finished goods includes the cost of raw materials, direct labor and 

a portion of general production costs, determined on the basis of normal plant operations. Financial costs are 

not included. 

The net realizable value of raw material, consumables and supplies is their replacement cost. 

78






The net realizable value of finished goods and semi-finished goods is the estimated selling price in the ordinary 

course of business, less estimated cost of completion and estimated costs to sell. 

1.14. Trade receivables and other receivables 

Trade receivables and other receivables are stated at fair value plus transaction costs, less allowances for 

uncollectible amounts, which are provided as doubtful debts are identified. 

Derecognition of financial assets: 

The Group derecognizes all or part of the financial assets when: 

the contractual rights on the assets in question have expired; 

it transfers the near totality of the risks and rewards incidental to ownership of the asset or does not 

transfer and does not even substantially maintain all the risks and rewards but transfers control of the 

assets. 

1.15. Cash and cash equivalents 

Cash and cash equivalents consists of cash on hand, bank demand deposits and other treasury investments 

with original maturity of not more than three months. Current account overdrafts are treated as financing and 

not as a component of cash and cash equivalents. 

The definition of cash and cash equivalents in the statement of cash flows is identical to that in the statement 

of financial position. 

1.16. Income taxes 

Current income taxes are provided in accordance with local tax laws in the countries where the Group 

operates. Deferred tax is recognized using the liability criterion, based on temporary differences between the 

tax base of assets and liabilities and their carrying amount in the statement of financial position. 

Deferred tax liabilities are recognized on all taxable temporary differences. Deferred tax assets are recognized 

for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is 

probable that future taxable income will be available against which such differences, losses or credits may be 

reversed. 

Taxable or deductible temporary differences do not generate recognition of deferred tax liabilities or assets 

only in the following cases: 

taxable temporary differences arising from the initial recognition of goodwill, unless goodwill is taxdeductible; 

taxable or deductible temporary differences arising from initial recognition of an asset or a liability in 

transactions that are not business combinations and affect neither accounting profit nor taxable profit at the 

transaction date; 

equity investments in subsidiaries, associates and joint ventures when: 

a) the Group is able to control the timing of the reversal of the taxable temporary differences and it is 

probable that such differences will not reverse in the foreseeable future; 

b) it is not probable that the deductible temporary differences will reverse in the foreseeable future and that 

taxable income will be available against which the temporary difference can be used; 

deferred tax assets are reviewed at the end of every reporting period and reduced to the extent that 

sufficient taxable income is no longer likely to be available in the future against which the assets can be 

used in full or in part. 

Deferred tax assets and liabilities are determined at tax rates expected to apply when the deferred tax asset 

(liability) is realized (settled), based on rates that have been enacted or substantially enacted at the reporting 

date. 

Taxes relating to items recognized directly in equity are recognized in equity, not in the income statement. 

79 


Deferred tax assets and deferred tax liabilities are not discounted to present value. 

1.17. Employee benefits 

The Group operates pension plans, post-employment medical benefit plans and post-employment benefits. It 

also has other commitments, in the form of bonuses payable to employees on the basis of length of service in 

some Group companies (“Other long-term benefits”). 

Defined contribution plans 

Defined contribution plans are structured post-employment benefit programs where the Group pays fixed 

contributions to an insurance company or pension fund and will have no legal or constructive obligation to pay 

further contributions if the fund does not dispose of sufficient assets to pay all the employee benefits accruing 

in respect of services rendered during the current year and in previous years. These contributions are paid in 

exchange for the services rendered by employees and recognized as expense as incurred. 

Defined benefit plans 

Defined benefit plans are structured post-employment benefit programs that constitute a future obligation for 

the Group. In substance, the company assumes the actuarial and investment risks of the plan. In accordance 

with IAS 19, the Group uses the unit credit projection method to determine the present value of obligations and 

the related current service cost. 

These actuarial calculations require use of consistent and objective actuarial assumptions about demographic 

variables (mortality rate, personnel turnover rate) and financial variables (discount rate, future increases in 

salaries and medical benefits). 

When a defined benefit plan is funded in full or in part by contributions paid to a fund that is a separate legal 

entity or to an insurance company, the plan assets are estimated at fair value. 

Benefit obligations are therefore recognized net of the fair value of the plan assets that will be used to settle 

the obligations. 

The post-employment benefits of Italian companies (TFR, trattamento di fine rapporto) are treated in the same 

way as benefit obligations arising from defined benefit plans. 

Termination benefits 

Termination benefits include provisions for restructuring costs recognized when the Group company in 

question has approved a detailed formal plan that has already been implemented or notified to the third parties 

concerned. 

Actuarial gains and losses 

Actuarial gains and losses on post-employment defined benefit plans may arise as a result of changes in the 

actuarial assumptions used in two consecutive periods or as a result of changes in the obligation value or in 

the fair value of any plan asset in respect of the actuarial assumptions used at the beginning of the period. 

The Group uses the corridor method whereby actuarial gains and losses are recognized as income or expense 

when their unrecognized cumulative net value, for each plan, at the end of the previous period exceeds 10% of 

the greater of present value of the defined benefit obligation or the fair value of plan assets at that date. These 

gains or losses are taken to profit or loss over the estimated average residual working life of the employees 

participating in the plans. 

Actuarial gains and losses relating to “Other long-term benefits” (service medals, length of service benefits) 

and to early retirement benefits are recognized as income or expense immediately. 

80






Past service cost 

Changes in liabilities resulting from a change to an existing defined benefit plan are recognized as expense on 

a straight-line basis over an average period until the benefits have vested. Costs for benefits that vest 

immediately upon changes to a plan are recognized as expense as incurred. 

Curtailment and settlement 

Gains or losses on the curtailment or settlement of a defined benefit plan are recognized as income or expense 

when the curtailment or settlement occurs. The gain or loss includes changes in the present value of the 

obligation, changes in the fair value of plan assets, actuarial gains or losses and past service costs not 

previously accounted for. 

At the curtailment or settlement date, the obligation and the fair value of the plan assets are re-measured using 

current actuarial assumptions. 

1.18. Share-based payments 

The Group has applied IFRS 2 as from January 1, 2004. 

Options for the subscription and purchase of shares granted by Group companies to employees and directors 

give rise to recognition of a cost classified under employee expense, with a corresponding increase in equity. 

In accordance with IFRS 2, only options granted after November 7, 2002, whose rights had not vested at 

December 31, 2003, have been measured and recognized at the transition date. Options for the subscription 

and purchase of shares are measured at fair value at the grant date and amortized over the vesting period. 

Fair value is determined using the binomial method, and taking account of dividends. Future volatility is 

determined on the basis of historic market prices, after adjustment for extraordinary events or factors. 

The cost of granted options is reviewed on the basis of the actual number of options that have vested at the 

beginning of the exercise period. 

1.19. Provisions for risks and charges 

The Group recognizes provisions for risks and charges when a present legal or constructive obligation arises 

as a result of a past event, the amount of which can be reliably estimated, and use of resources is probable to 

settle the obligation. Provisions reflect the best estimate of the amount required to settle the obligation or 

transfer it to third parties at the reporting date. If the present value of the financial resources that will be used is 

material, provisions are determined by discounting expected future cash flows at a rate that reflects the current 

market assessment of the time value of money and, where appropriate, the risks specific to the liability. When 

discounting is performed, movements in provisions due to the effect of time or changes in interest rates are 

recognized in financial items. 

Changes in estimates are recognized in the income statement for the period. 

The Group recognizes a separate provision for environmental restoration obligations on land used for quarry 

work, determined in relation to the use of the quarry in question. 

Pending publication of a standard/interpretation on accounting treatment of greenhouse gas emission 

allowances, after the withdrawal of IFRIC 3 by the International Accounting Standards Board, the Group 

recognizes a separate provision when emissions are greater than the allowance. 

1.20. Loans and borrowings 

Loans and borrowings are initially recognized at the fair value of the consideration paid/received less charges 

directly attributable to the financial asset/liability. 

After initial recognition, loans and borrowings are measured at amortized cost using the effective interest rate 

method. 

81 


1.21. Trade payables and other payables 

Trade payables and other payables are stated at the fair value of the original consideration received. 

1.22. Derivatives 

The Group uses derivatives such as foreign currency forward contracts and interest-rate swaps and options to 

hedge currency and interest-rate risks. Derivatives are measured and recognized at fair value. 

The fair value of foreign currency forward contracts is determined on the basis of the current forward exchange 

rates for contracts with similar maturity profiles. The fair value of interest-rate contracts is determined on the 

basis of discounted flows using the zero coupon curve. 

Hedging transactions 

Derivatives are designated as hedging instruments or as non-hedging instruments. Transactions that qualify for 

application of hedge accounting are classified as hedging transactions; other transactions are designated as 

trading transactions, even if they are performed for the purposes of risk management. 

For accounting purposes, hedging transactions are classified as “fair value hedges” if they cover the risk of 

changes in the fair value of the underlying asset or liability; or as "cash flow hedges” if they hedge cash flows 

arising from an existing asset or liability or from a future transaction, which are exposed to variability. 

With regard to fair value hedges, fair value gains and losses on the derivatives are taken to the income 

statement immediately. Similarly, the underlying assets or liabilities are measured at fair value and any gain or 

loss attributable to the hedged risk is recognized as an income or expense balancing entry. 

If the movement refers to an interest-bearing financial instrument, it is amortized in the income statement until 

maturity. 

With regard to cash flow hedges (foreign currency forward contracts, fixed-rate interest swaps), the effective 

component of a change in the fair value of the hedging instrument is reflected in a separate equity caption, 

while time-based changes and the non-effective hedge component are recognized in the income statement. 

The effective component and non-effective component are calculated using the methods indicated in IAS 39. 

Gains or losses arising from changes in the fair value of derivatives designated for trading are recorded as 

income or expense. 

When the financial instrument matures, is sold, settled, exercised or no longer qualifies for hedge accounting, 

the derivative is no longer treated as a hedging contract. In this case, gains or losses on the derivative are 

retained in equity until the hedged transaction takes place. If the Group no longer expects the hedged 

transaction to take place, the net gain or loss in equity is taken to the income statement. 

1.23. Revenue, other revenue, interest income and dividends 

Sale of goods and services 

Revenue is recognized to the extent that it is probable that the economic benefits associated with the sale of 

goods or rendering of services are collected by the Group and the amount in question can be reliably 

determined. Revenue is recognized at the fair value of the consideration received or due, taking account of any 

trade discounts given and volume discounts. 

Revenue from the sale of goods is recognized when the company transfers the material risks and rewards 

incidental to ownership of the goods to the purchaser. 

Rental income 

Rental income is recognized as other revenue, as received. 

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Interest income 

Interest income is classified as finance income on an accrual basis using the effective interest method. 

Dividends 

Dividends are recognized as finance income as shareholders’ right to receive payment arises, in accordance 

with local laws. 

1.24. Government grants 

Government grants are recognized when there is a reasonable certainty that they will be received and all the 

requirements on which receipt depends have been fulfilled. 

Grants related to the purchase or production of non-current assets (grants related to assets) are recognized as 

deferred income and taken to the income statement over the useful life of the underlying assets. 

1.25. Management of capital 

The Group monitors its capital using the gearing ratio: net financial position/equity. The net financial position 

reflects financial liabilities less cash and cash equivalents and other financial assets (as described in note 22). 

Equity consists of all the items presented in the statement of financial position. 

Group strategy aims to keep the gearing ratio at a level such as to ensure the smooth running of business 

operations, funding of investments and creation of maximum value for shareholders. 

To maintain or modify its capital structure, the Group may decide to vary the amount of dividends paid to 

shareholders, redeem capital, issue new shares, raise or reduce its investment in subsidiaries, purchase or sell 

investments. 

83 


2. Exchange rates used to translate the financial statements of foreign operations 

Exchange rates for 1 euro: 

Average rate 

Closing rate 

Currencies 

Full year 


Full year 

2010 

December 31, 


December 31, 

2010 

Albania lek 140.32192 137.74003 139.03600 138.86000 

Saudi Arabia riyal 5.22099 4.97226 4.85236 5.01060 

Canada dollar 1.37598 1.36508 1.32150 1.33220 

Egypt pound 8.27659 7.47113 7.80328 7.75751 

GB sterling 0.86785 0.85805 0.83530 0.86075 

India rupee 64.90042 60.58486 68.71300 59.75800 

Kazakhstan tenge 204.12404 195.38110 191.88500 196.96400 

Kuwait dinar 0.38460 0.38019 0.36056 0.37594 

Libya dinar 1.71332 1.67844 1.62823 1.67606 

Morocco dirham 11.26142 11.15625 11.11290 11.17980 

Mauritania ouguiya 391.22452 365.68685 374.09200 377.75700 

Mexico peso 17.28784 16.73637 18.05120 16.54750 

Moldavia leu 16.32856 16.38605 15.15860 16.24000 

Qatar riyal 5.06924 4.82647 4.71164 4.86375 

People's Republic of China renminbi 8.99687 8.97294 8.15880 8.82200 

Sri Lanka rupee 153.84847 149.85278 147.38600 148.24700 

USA dollar 1.39213 1.32588 1.29390 1.33620 

Switzerland franc 1.23297 1.38063 1.21560 1.25040 

Thailand baht 42.43201 42.02675 40.99100 40.17000 

Turkey lira 2.32564 1.98756 2.45920 2.04910 

The exchange rates used to translate the financial statements of the foreign operations are those published by 

the Bank of Italy and by the Turkish central bank. 

3. Changes in the scope of consolidation 

Sale of operations in Turkey 

Through the subsidiary Ciments Français, on March 25, 2011, the Group sold the companies in Set Group 

Holding – Turkey; consequently the operations in question have been accounted for in compliance with IFRS 5 

“Non-current assets held for sale and discontinued operations” presenting separate items in the income 

statement and the statement of cash flows reflecting the earnings and the cash flows arising from the sale. 

Also in compliance with IFRS 5, the amounts in the income statement and the statement of cash flows for 2010 

have been restated accordingly. 

To ensure clarity, for comparative purposes the income statement and the statement of comprehensive income 

present both the information restated as required by IFRS 5 and as published in the 2010 consolidated financial 

statements. 

During 2011, through its subsidiary Ciments Français the Group reduced its controlling interest in the listed 

Turkish company Afyon Cimento from 76.5% to 51.0% for proceeds, net of tax, of 60.8 million euro; the 

difference between the carrying amount of the sold equity investment and the sum collected was recognized 

under equity attributable to owners of the parent. 

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Changes in the scope of consolidation 

The main changes in 2011 were: 

the line-by-line consolidation of the Calcestruzzi group – Italy, as from January 1, 2011. At December 31, 

2011, the Calcestruzzi group comprised the subsidiaries: Calcestruzzi S.p.A., Esa Monviso S.p.A. 

(consolidated on a line-by-line basis), the associates: Mantovana Inerti S.r.l. and Ecoinerti S.r.l. 

(consolidated on a proportionate basis) and the associates: General Cave S.r.l., Safra S.r.l. and 

Commerciale Inerti S.r.l. (accounted for with the equity method); 

the withdrawal of Set Group Holding – Turkey and its subsidiaries: Set Cimento and Met Teknik Servis, after 

the sale to third parties on March 25, 2011; 

the withdrawal of Bares and Italgen Elektrik – Turkey, after the sale to third parties on March 31, 2011; 

the withdrawal, after the sale to third parties in December, of the six companies in the Axim group, active in 

additives for ready mixed concrete and cement in Italy, France, USA, Canada, Morocco and Spain. 

The main changes in 2010 were 

the line-by-line consolidation as from January 1 of Beton Ata LLP (Kazakhstan) in the ready mixed concrete 

sector; 

the withdrawal from the Group of Cementos Capa S.L. (Spain) after the sale in January; 

the line-by-line consolidation as from August of the Star. Co. S.r.l. company (Italy) in the ready mixed 

concrete sector; 

the measurement with the equity method of the Gardawind S.r.l. group (Italy) as from September 30. 

Gardawind is active in wind energy and is part of the Italgen group. 

The equity investments in subsidiaries, joint ventures and associates, and the respective method of 

consolidation, are listed in the annex. 

85 


4. Operating segment disclosure 

The Group operating segments are: 

Italy 

France-Belgium 

Spain 

Others Central Western Europe (C.W.E.) - Greece 

North America 

Egypt 

Morocco 

Others Emerging Europe, North Africa and Middle East (EE.NA.ME.) - Bulgaria, Turkey, Kuwait and Saudi Arabia 

Thailand 

India 

Others Asia - China and Kazakhstan 

Cement and clinker trading 

Other operations 

Cement & clinker trading includes cement and clinker marketing activities in countries where Group terminals 

are located: Gambia, Mauritania, Sri Lanka and Albania, as well as direct exports to markets not covered by 

Group subsidiaries. 

The “Other operations” segment comprises the operations of the Ciments Français S.A. sub-holding, consisting 

essentially of provision of services to subsidiaries. It also includes liquid and solid fuel procurement operations 

for Group companies, the BravoSolution in the e-business sector, Italcementi Finance S.A., other international 

holdings and other minor operations in Italy. 

The Group management and organizational structure essentially reflects the operating segment structure. 

Finance income and costs, impairment on financial assets and income taxes are not allocated to the operating 

segments. 

The Group business sectors are: 

operations relating to the production and sale of cement/clinker, 

operations relating to construction materials: ready mixed concrete and aggregates, 

other operations such as: transport, engineering, e-business and energy. 

The operating segments and business sectors are organized and managed by country. The operating 

segments consist of the fixed assets of the individual entities located and operating in the countries indicated 

above; sales refer mainly to the local market, exports are generally with other Group entities; exports to 

external countries are conducted through the Group companies of the international Trading segment. 

Consequently the revenue of the entities in each operating segment, net of revenue within the Group, arise 

essentially in the areas in which the non-current assets are located. 

The cement/clinker business delivers a portion of its production to the ready mixed concrete segment. The 

transfer prices applied to trading of goods and services among the segments are regulated on the basis of 

arm’s length transactions. 

Consolidated cement/clinker revenue is present in all the operating segments with the exception of “Other 

operations”, which consists largely of fuel sales and e-business revenue. 

Consolidated ready mixed concrete and aggregates revenue is present in almost all the operating segments 

with the exception of: Bulgaria, India and China. 

Revenue of other operations refer mainly to e-business revenue and energy revenue in the Italy segment and 

fuel sales. 

86






With regard to dependence on the main Group customers, no single customer accounts for more than 10% of 

consolidated revenue. 

Operating segments 

The table below sets out segment revenue and results for 2011: 

(in thousands of 

euro) 

Revenue 

Intragroup 

sales 

Contributive 

revenue 

Recurring 

EBITDA 

EBITDA EBIT Finance 

income 

(costs) 

exch.rate 

differences 

and 

derivatives 

Impairment 

on financial 

assets 

Share of 

profit (loss) 

of equity 

accounted 

investees 

Italy 918,060 (59,439) 858,621 (12,601) 10,443 (142,448) (1,534) 

France-Belgium 1,589,687 (10,984) 1,578,703 302,780 313,741 215,563 (221) 

Spain 155,440 (33,564) 121,876 18,494 17,579 (58,218) - 

Others C.W.E. 41,786 (4,706) 37,080 (1,571) (1,440) (18,969) 155 

Eliminations (24,208) 24,208 - - - - - 

C.W.E. 2,680,765 (84,485) 2,596,280 307,102 340,323 (4,072) (1,600) 

North America 405,111 (446) 404,665 16,345 22,970 (45,363) 12,772 

Egypt 551,832 (16,543) 535,289 129,642 129,618 63,192 644 

Morocco 353,164 (2,547) 350,617 152,176 153,187 115,687 7,904 

Others 

EE.NA.ME. 125,466 (1,869) 123,597 34,848 34,963 14,175 (32) 

Eliminations (239) 239 - - - - - 

EE.NA.ME. 1,030,223 (20,720) 1,009,503 316,666 317,768 193,054 8,516 

Thailand 194,142 - 194,142 23,538 24,542 8,018 - 

India 223,475 (1,453) 222,022 57,229 57,218 38,732 - 

Others Asia 81,762 (1) 81,761 1,025 1,057 (8,601) - 

Eliminations - - - - - - - 

Asia 499,379 (1,454) 497,925 81,792 82,817 38,149 - 

Profit Income tax 

before tax expense 

Cement and 

clinker trading 183,423 (44,774) 138,649 10,649 10,655 6,820 (1,050) 

Other 

operations 423,861 (350,341) 73,520 (33,780) (34,980) (58,141) - 

Unallocated 

items - - - - - - (102,095) 7,524 - 53,038 (68,811) 

Eliminations (502,220) 502,220 - (1,441) (1,476) (1,476) - 

Total 4,720,542 - 4,720,542 697,333 738,077 128,971 (102,095) 7,524 18,638 53,038 (68,811) 

87 


The table below sets out segment revenue and results for 2010: 

(in thousands of 

euro) 

Revenue 

Intragroup 

sales 

Contributive 

revenue 

Recurring 

EBITDA 

EBITDA EBIT Finance 

income 

(costs) 

exch.rate 

differences 

and 

derivatives 

Impairment 

on financial 

assets 

Share of 

profit (loss) 

of equity 

accounted 

investees 

Italy 689,475 (46,528) 642,947 (36,339) (33,337) (122,626) (1,359) 

France-Belgium 1,493,788 (13,444) 1,480,344 318,229 316,756 215,547 (250) 

Spain 176,458 (24,729) 151,729 31,604 31,094 7,657 - 

Others C.W.E. 70,262 (7,687) 62,575 14,549 14,573 10,176 (1,561) 

Eliminations (22,643) 22,643 - (12) (42) (43) - 

C.W.E. 2,407,340 (69,745) 2,337,595 328,031 329,044 110,711 (3,170) 

North America 415,295 (670) 414,625 25,387 21,717 (48,167) 10,911 

Egypt 788,682 (5,764) 782,918 270,665 270,518 191,150 1,162 

Morocco 326,066 (1,298) 324,768 125,661 122,422 95,586 8,730 

Others 

EE.NA.ME. 130,328 (312) 130,016 23,921 23,985 6,847 (476) 

Eliminations (518) 518 - - - - - 

EE.NA.ME. 1,244,558 (6,856) 1,237,702 420,247 416,925 293,583 9,416 

Thailand 180,236 (3,635) 176,601 14,959 14,740 (7,306) - 

India 169,806 - 169,806 36,015 35,903 20,162 - 

Others Asia 98,926 - 98,926 17,264 17,089 7,170 - 

Eliminations 1 (1) - (1) - - - 

Asia 448,969 (3,636) 445,333 68,237 67,732 20,026 - 

Profit Income tax 

before tax expense 

Cement and 

clinker trading 229,286 (93,056) 136,230 14,304 14,296 11,375 (105) 

Other 

operations 424,634 (336,112) 88,522 (14,489) (9,990) (16,966) - 

Unallocated 

items - - - - - - (89,810) (21,014) - 276,453 (60,608) 

Eliminations (510,075) 510,075 - (19) (339) (337) - 

Total 4,660,007 - 4,660,007 841,698 839,385 370,225 (89,810) (21,014) 17,052 276,453 (60,608) 

88






The table below sets out other segment data at December 31, 2011: 


Operating 

assets 

December 31, 2011 

Operating 

liabilities 

Investments 

in associates 

Depreciation 

PPE and investment 

property and 

amortization 

intangible assets 

Impairment 

Italy 1,506,212 406,230 5,750 (110,547) (42,344) 

France-Belgium 1,967,922 514,483 7,612 (96,398) (1,781) 

Spain 458,459 41,865 - (18,956) (56,841) 

Others C.W.E. 76,013 12,156 61,223 (4,507) (13,022) 

Eliminations (4,603) (4,588) - - - 

C.W.E. 4,004,003 970,146 74,585 (230,408) (113,988) 

North America 1,099,162 122,417 91,971 (64,769) (3,564) 

Egypt 1,264,346 222,849 5,127 (66,426) - 

Morocco 630,262 95,878 40,717 (37,501) - 

Others EE.NA.ME. 305,901 24,927 1,279 (15,106) (5,681) 

Eliminations (23) (23) - - - 

EE.NA.ME. 2,200,486 343,631 47,123 (119,033) (5,681) 

Thailand 344,259 37,924 - (22,812) 6,288 

India 448,525 76,919 - (18,486) - 

Others Asia 122,787 12,984 - (9,658) - 

Eliminations - - - - - 

Asia 915,571 127,827 - (50,956) 6,288 


trading 79,062 30,485 3,063 (2,734) (1,101) 

Other operations 147,788 162,359 - (6,926) (16,234) 

Unallocated items - - - - - 

Eliminations (123,569) (127,472) - - - 

Total 8,322,503 1,629,393 216,742 (474,826) (134,280) 

89 


The table below sets out other segment data at December 31, 2010: 


Operating 

assets 

December 31, 2010 

Operating 

liabilities 

Investments 

in associates 

Depreciation 

PPE and investment 

property and 

amortization 

intangible assets 

Impairment 

Italy 1,173,675 285,394 4,498 (90,626) 1,337 

France-Belgium 1,958,148 491,672 7,876 (99,902) (1,308) 

Spain 547,913 58,570 - (20,547) (2,890) 

Others C.W.E. 101,708 20,746 61,605 (4,396) - 

Eliminations (5,822) (5,814) - - - 

C.W.E. 3,775,622 850,568 73,979 (215,471) (2,861) 

North America 1,127,477 122,122 86,331 (69,883) - 

Egypt 1,306,461 223,198 5,862 (76,338) (3,030) 

Morocco 630,146 116,810 40,706 (26,836) - 

Others EE.NA.ME. 521,267 63,702 1,269 (15,836) (1,302) 

Eliminations (266) (266) - - - 

EE.NA.ME. 2,457,608 403,444 47,837 (119,010) (4,332) 

Thailand 355,035 40,250 - (22,019) (26) 

India 455,201 61,045 - (15,742) - 

Others Asia 116,772 15,782 - (9,175) (744) 

Eliminations - - - - - 

Asia 927,008 117,077 - (46,936) (770) 


trading 80,720 35,658 4,114 (2,921) - 

Other operations 171,446 135,001 - (6,957) (19) 

Unallocated items - - - - - 

Eliminations (96,261) (101,644) - - - 

Total 8,443,620 1,562,226 212,261 (461,178) (7,982) 

Operating assets and liabilities include all current and non-current assets and liabilities with the exception of tax 

and financial assets and liabilities. 

The table below sets out revenue and recurring EBITDA for “Other countries”: 

Revenue 

Recurring EBITDA 

(in thousands of euro) 2011 2010 2011 2010 

Greece 41,786 70,262 (1,571) 14,549 

Others C.W.E. 41,786 70,262 (1,571) 14,549 

Bulgaria 51,515 55,917 29,962 17,067 

Turkey 20,111 23,256 (1,687) 1,664 

Kuwait 50,799 49,744 6,245 5,489 

Saudi Arabia 3,041 1,411 420 (60) 

Others - - (92) (239) 

Others EE.NA.ME. 125,466 130,328 34,848 23,921 

China 43,061 52,070 (2,063) 7,952 

Kazakhstan 38,701 46,856 3,088 9,312 

Others Asia 81,762 98,926 1,025 17,264 

90






Assets 


5.1 Property, plant and equipment 

Land and 

buildings 

Quarries 

Technical plant 

materials and 

equipment 

Other PPE 

and assets under 

construction 

Total 


Carrying amount at Dec. 31, 10 1,028,145 359,890 2,608,514 598,599 4,595,148 

Gross amount 2,170,392 565,302 7,624,901 965,037 11,325,632 

Accumulated depreciation (1,142,247) (205,412) (5,016,387) (366,438) (6,730,484) 


Additions 20,305 11,408 117,775 188,001 337,489 

Change in scope of consolidation, 

Reclassifications, Other 78,061 21,392 187,367 (201,607) 85,213 

Disposals (3,496) (102) (18,423) (1,140) (23,162) 

Depreciation and impairment losses (61,033) (18,260) (384,055) (34,110) (497,458) 

Translation differences (13,846) 1,157 (25,103) (12,116) (49,908) 


Gross amount 2,235,135 626,028 7,737,796 924,743 11,523,702 

Accumulated depreciation (1,187,000) (250,543) (5,251,721) (387,116) (7,076,380) 


Additions were mainly in Italy, France/Belgium, India, Egypt and Morocco. 

Assets under construction at December 31, 2011, was 458,245 thousand euro (511,629 thousand euro at 

December 31, 2010); the decrease for the year, in the line “Change and other”, related mainly to the 

reclassifications to the final categories of assets relating to the productions sites in Morocco, India, 

France/Belgium and North America. 

“Depreciation and impairment losses” includes net impairment losses arising from impairment losses of 36.3 

million euro (8.0 million euro in 2010, of which 5.2 million euro largely in Egypt and Saudi Arabia) relating to 

production sites in Italy for 27.5 million euro, Bulgaria, North America and Spain. 

Property plant and equipment held under finance leases and rental contracts were carried at a net amount of 

27.8 million euro at December 31, 2011 (27.7 million euro at December 31, 2010). They consist of plant and 

machinery for 25.3 million euro and buildings for 2.4 million euro. 

Expenses included under “Property, plant and equipment” amounted to 28.9 million euro at December 31, 2011 

(58.7 million euro at December 31, 2010). 

Property plant and equipment pledged as security for bank loans were carried at 195.8 million euro at 

December 31, 2011 (200 million euro at December 31, 2010). 

The useful life adopted by the Group for the main asset categories is as follows: 

Civil and industrial buildings 

10 – 33 years 

Plant and machinery 

5 – 30 years 

Other property, plant and equipment 3 – 10 years 

The range between the above minimum and maximum limits indicates the presence of components with 

separate useful lives within each asset category. 

91 




Carrying amount at Dec. 31,10 33,098 

Gross amount 58,147 

Accumulated depreciation (25,049) 

Carrying amount at Dec. 31,10 33,098 

Additions 150 

Disposals (8,553) 

Depreciation and impairment losses (683) 

Translation differences (452) 

Reclassifications (103) 

Carrying amount at Dec.31,11 23,457 


Accumulated depreciation (23,384) 

Carrying amount at Dec.31,11 23,457 

Investment property is carried at cost net of amortization; fair value at December 31, 2011, was 114 million 

euro (134.3 million euro at December 31, 2010). 

The decrease arose largely as a result of the sale of a building in Thailand. 

6. Goodwill 


Carrying amount at Dec. 31, 10 2,016,614 

Acquisitions and changes in scope of consolidation 5,240 

Sales (42) 

Impairment losses (87,536) 

Translation differences (14,988) 

Carrying amount at Dec. 31, 11 1,919,288 

The material reduction in goodwill arose mainly from impairment losses as a result of impairment testing and 

from currency translation differences generated by the depreciation of some currencies against the euro; for 

impairment losses and goodwill on CGU by country, see note 6.2. 

“Acquisitions and changes in scope of consolidation” refers mainly to the Calcestruzzi group for 26.0 million 

euro less Set Group Holding – Turkey for 12.6 million euro and Bares – Turkey for 7.3 million euro. 

6.1 Business combinations 

6.1.1 Calcestruzzi group 

The Calcestruzzi group has again been included in the Italcementi scope of consolidation since January 1, 

2011, after the necessary conditions were fulfilled, as described in the directors’ report in the section on 

significant events in the period. 

The companies in the Calcestruzzi group have been consolidated and treated as if they were being 

consolidated for the first time; consequently, in compliance with the acquisition method contemplated by IFRS 3 

revised, they have been measured at fair value. 

The net assets of the Calcestruzzi group as at January 1, 2011, are stated at fair value estimated on the basis 

of market transactions with the assistance of a fairness opinion issued by an independent consultant. 

92






The table below sets out the amounts of the main property, plant and equipment categories for which fair value 

was estimated: 


Carrying amonut of the 

companies in the 

scope of consolidation 

Fair value adjustment 

Attributed fair value 

Net property, plant and equipment 

Land 32,368 9,275 41,643 

Quarries 19,959 20,288 40,247 

Buildings 22,077 22,077 

Plant and equipment 44,245 17,863 62,108 

Other 8,279 8,279 

Net deferred tax assets/(liabilities) 10,146 (14,892) (4,746) 

Goodwill 20,862 5,146 26,008 

Trade receivables 173,549 173,549 

Trade payables (89,748) (89,748) 

Other assets/(liabilities) 3,147 3,147 

Net financial position (217,688) (217,688) 

Badwill (5,253) 

Fair value of net assets 37,680 59,623 

Equity investment in Calcestruzzi S.p.A. 59,792 

During the expert assessment, the fair value attributed to Speedybeton was higher than its carrying amount; 

the difference has been taken to income in compliance with IFRS 3 revised. 

The effects of the consolidation of the Calcestruzzi group on the 2011 consolidated income statement are as 

follows: 


Revenue * 324.0 

Recurring EBITDA (32.4) 

EBIT (88.7) 

Profit (loss) for the period attributable to owners of the parent (73.9) 

* after intragroup eliminations 

6.2 Goodwill impairment testing 

Goodwill acquired in business combinations is allocated to the cash-generating units (CGUs). The Group tests 

goodwill recoverability at least once a year or more frequently if indications of impairment emerge. The 

methods used to determine the recoverable amount of CGUs are described in the basis of consolidation under 

the section “Impairment” (note 1.11). 

The recovery slowdown that emerged in 2010 intensified during 2011, especially in the construction industry; 

consequently, while the measures contemplated in the 2010-2014 Business Plan remain valid, a number of 

macroeconomic and sector assumptions in the Plan have been reviewed. For the purposes of impairment 

testing, determination of the future cash flows to be used was based on the 2012 Budget and, where necessary 

for future year projections, on new assumptions and economic assessments deemed to reflect the new 

conditions on the Group markets. 

93 


As in 2010, for the CGUs in the EU countries and North America, a 9-year explicit forecast period was used; in 

this way we believe that projected cement consumption is structurally balanced and aligned with the related 

long-term estimate implicit in the cement structural demand curve for each country. 

For the CGUs in the emerging countries, also subject in part to a change in cyclical patterns compared with the 

recent past, but with cement consumption more likely to be influenced by exogenous factors relating to specific 

macroeconomic events, the tests were based on expected growth in cement demand over a five-year period. 

Terminal value was generally estimated on the basis of CGU activity on its mid-cycle market and takes account 

of the market cycle and the changes in the country in question after the explicit forecast period. 

The projections are management’s best estimate of future trends and possible economic conditions in the 

countries in which the Group operates. 

For all CGUs, recoverable value coincides with value in use, with the exception of the CGUs in Turkey and 

China, for which fair value less costs to sell, determined on the basis of comparable market transactions or 

offers received from third parties, was used. 

The discount rates, determined country by country, are obtained by applying the estimated long-term inflation 

rate, adjusted in some cases with the country-risk premium, to the weighted average cost of capital (WACC). 

WACCs are computed on the basis of the market value of own funds and of sector debt, to which the mean 

sector coefficient based on the debt/stock market capitalization ratio is applied. 

The assumptions used for the computation for the CGUs in the main countries are set out below: 

(in %) 

Discount rate 

before tax 

Growth rate 

including inflation 

Cash-generating units by country 2011 2010 2011 2010 

Italy 8.9 7.7 2.0 1.1 

France/Belgium 9.4 8.7 2.0 1.1 

Spain 9.3 8.5 2.0 1.0 

Greece 14.0 11.0 2.0 1.2 

North America 7.7 7.4 1.8 1.2 

Egypt 13.2 13.4 5.0 6.0 

Morocco 10.7 9.8 2.5 2.4 

Kuwait 9.8 9.2 3.5 3.4 

Thailand 10.6 9.5 3.5 2.5 

India 14.5 12.3 6.3 5.0 

Goodwill testing for 2011 generated a goodwill impairment loss of 54.4 million euro for Spain and of 12.1 million 

euro for Greece. The Group considered the specific potential risks of the sector of activity, any market values 

on the basis of comparable transactions and conducted a sensitivity analysis on recoverable amount in the 

event of an increase in the discount rates. 

94






The table below sets out the most significant goodwill amounts for Group CGUs by country: 


Carrying amount of goodwill 

Cash-generating units by country December 31, 2011 December 31, 2010 

Italy* 31,664 26,519 

France/Belgium 587,244 587,383 

Spain 171,086 225,564 

Greece - 12,100 

North America 144,728 140,398 

Egypt 583,980 594,289 

Morocco 108,327 107,679 

Kuwait 29,277 24,706 

Thailand 88,502 90,310 

India 88,004 98,640 

Others 86,476 109,026 

Total 1,919,288 2,016,614 

* in 2011 the Italy CGU comprised cement, ready mixed concrete and aggregates operations 

Finally, since the Italcementi Group has costs not allocated to individual CGUs, a second-level impairment test 

was conducted to check recoverability for the Group as a whole. The test included all assets and cash flows 

that cannot be specifically allocated to an individual CGU. No indications of impairment emerged from the test. 

Market capitalization 

Like most of the companies in the sector listed on markets in the mature countries, during the year Italcementi 

S.p.A. recorded a material reduction in market capitalization with respect to 2010, which has eased somewhat 

since December 31, 2011. 

Equally, the results of the impairment tests conducted at December 31, 2011, found a significant reduction in 

the Group’s aggregate recoverable value compared with the tests conducted in 2010; the decrease in 

recoverable value was, however, smaller than the reduction in market capitalization. 

The impairment tests take account of the long-term expectations in cement consumption that can be assumed 

from the structural demand curve and, for this reason, are less influenced overall by short-term changes. Shortterm 

changes, on the other hand, correspond to the timeframe now typically adopted by many investors and, 

together with the volatility in risk propensity levels, have an incisive influence on share prices, which are 

particularly sensitive during exceptional periods of financial panic such as the closing months of 2011. 

We therefore believe that the differential in relative evolution found in the two valuations, which in any case is 

consistent as indication of a trend, can be considered normal. 

95 


Sensitivity analysis 

With reference to the current and expected industry situation and to the results of the 2011 impairment tests, a 

sensitivity analysis was conducted on recoverable amount, using the discounted cash flow method. 

At December 31, 2011, a 1% increment in the WACC would determine a surplus difference in carrying amount 

with respect to recoverable amount for the following CGUs: Italy 41 million euro, Spain 59.1 million euro, 

Greece 9.0 million euro, North America 73.0 million euro and Kuwait 10.5 million euro. 

A 5% reduction in demand in the explicit forecast period with respect to the projections would determine a 

surplus difference in carrying amount with respect to recoverable amount for the following CGUs: Spain 19.7 

million euro and Greece 5.4 million euro. 

On the basis of this analysis, the Group deems it unnecessary to reduce the goodwill of the CGUs in question. 

The discount rates that equate the CGUs’ recoverable amount with carrying amount are as follows: Italy 9.59%, 

Spain 9.3%, Greece 14.0%, North America 8.3% and Kuwait 9.9%. 


Patents, IT 

development 

Concessions and 

other 


Carrying amount at December 31, 2010 25,330 108,487 133,817 

Gross amount 115,638 126,522 242,160 

Accumulated amortization (90,308) (18,035) (108,343) 

Carrying amount at December 31, 2010 25,330 108,487 133,817 

Additions 19,875 5,574 25,449 

Disposals (5,539) (384) (5,924) 

Amortization and impairment losses (11,054) (18,646) (29,699) 

Translation differences 176 842 1,019 

Change in scope of consolidation and other 2,820 (29,399) (26,579) 

Carrying amount at December 31, 2011 31,609 66,475 98,083 

Gross amount 127,503 88,960 216,463 

Accumulated amortization (95,895) (22,485) (118,380) 

Carrying amount at December 31, 2011 31,608 66,475 98,083 

Total 

The year’s additions refer essentially to project development work for the standardization of internal Group 

processes. 

Disposals include 30.2 million euro for the sale to third parties of the Bares licenses in Turkey. 

During the year impairment losses of 15.1 million euro were applied to intangible assets in Libya. 

Expenditure recognized under intangible assets for IT development amounted to 3.2 million euro at December 

31, 2011. 

“Concessions” are amortized over the life of the conventions in question; amortization of quarrying concessions 

is determined at rates reflecting the ratio of extracted material to total to be extracted. 

96






8. Equity accounted investees 

This caption reflects equity accounted investees, including goodwill of 34.4 million euro at December 31, 2011 

(31.7 million euro at December 31, 2010). 

The main investments in associates are listed below: 

Carrying amount 

Share of profit (loss) 

December 31, 2011 December 31, 



2010 

Ciment Québec (Canada) 92.0 86.3 10.4 9.7 

Vassiliko Cement Works (Cyprus) 61.2 61.6 0.2 (1.6) 

Asment Cement (Morocco) 40.7 40.7 7.9 8.7 

R.C.S. Mediagroup S.p.A. (Italy) - - - (1.3) 

Tecno Gravel (Egypt) 5.1 5.9 0.6 1.2 

Acquitaine de transformation (France) 4.1 4.1 - - 

Others 13.6 13.7 (0.5) 0.4 

Total 216.7 212.3 18.6 17.1 

Tests on goodwill recoverability did not generate any impairment losses. 

Amounts for the main equity accounted investees, adjusted for compliance with Group policies, are set out 

below: 

Total assets Total liabilities Revenue Profit (loss) for period 

(in millions of euro) 2011 2010 2011 2010 2011 2010 2011 2010 

Ciment Québec (Canada) 210.9 202.1 38.9 40.4 139.4 123.7 19.9 19.5 

Vassiliko Cement Works (Cyprus) 351.4 368.9 130.7 137.6 90.3 93.3 0.6 (6.3) 

Asment (Morocco) 114.0 115.0 28.4 29.3 98.0 93.0 21.4 23.6 

9. Other equity investments 

Other equity investments reflects equity investments in the “available-for-sale” category as required by IAS 39. 


At December 31, 2010 200,172 

Acquisitions 17 

Sales (11,834) 

Changes in fair value taken to equity reserve (41,693) 

Translation differences 386 

Other and reclassifications (58,802) 

At December 31, 2011 88,246 

“Sales” refers to 11% of the capital of Goltas Cimento - Turkey for 33.2 million euro and the entire investment in 

Bursa – Turkey (1.2% of capital) for 2.9 million euro. The gains of 25 million euro were taken to finance income. 

“Changes in fair value taken to equity reserve” refers in the main to Goltas shares for 41.5 million euro. 

“Other” includes the reversal of the equity investment in Calcestruzzi (59.8 million euro at December 31, 2010) 

after consolidation as from January 1, 2011. 

97 


Other equity investments at December 31, 2011, were as follows: 

% share December 31, 2011 

of total capital 


Equity investments in listed companies 

Goltas (Turkey) 24.0 35,069 

Equity investments in non-listed companies 53,177 

Total 88,246 

The fair value of listed companies is determined on the basis of the official share price on the last accounting 

day. 

A variety of methods was used to measure investments in non-listed companies, depending on their 

characteristics and available data, in compliance with IAS 39. 


This caption reflects: 

December 31, 2011 December 31, 2010 


Derivatives 104,815 50,864 

Concessions and licenses paid in advance 162 174 

Non-current receivables 137,420 92,357 

Guarantee deposits 34,457 32,952 

Securities and bonds 11,828 9,357 

Pension plan assets 501 510 

Total 289,183 186,214 

Derivatives are discussed in note 22.3.1. 

“Non-current receivables” includes receivables of 115.4 million euro (74.9 million euro at December 31, 2010) 

due from the parent Italmobiliare S.p.A. to the Italian Group companies that elected tax consolidation; the 

receivables have been classified as non-current in view of the change in expected recovery time; as a result, 

the receivables recognized in 2010 have been reclassified from current to non-current. 




Raw materials, consumables and supplies 441,258 422,637 

Work in progress and semifinished goods 153,494 156,439 

Finished goods 124,700 129,510 

Payments on account 21,539 17,566 

Total 740,991 726,152 

Inventories are carried net of write-down provisions totaling 102.7 million euro (105.2 million euro at December 

31, 2010) mainly against the risk of slow-moving supplies, spare parts and consumables. Spare parts at 

December 31, 2011, were carried at 188.6 million euro (189.8 million euro at December 31, 2010). 

98









Gross amount 952,946 822,024 

Provision for bad debts (95,619) (83,469) 

Net amount 857,327 738,555 

At the end of December 2011, Ciments Calcia and Unibeton renewed their factoring contracts for a further five 

years. 

At December 31, 2011, factored receivables of these two companies totaled 133.5 million euro (118.8 million 

euro at December 31, 2010). The risk of approximately 90% of the factored amount is transferred when 

receivables are factored. 

After this transaction, the statement of financial position continued to reflect: 

- subordinate additional deposits for 24.8 million euro (21.0 million euro at December 31, 2010) reflected 

under other current assets; 

- non-transferred receivables in the form of arranged guarantees for 11 million euro reflected under trade 

receivables, with a balancing entry of 9.1 million euro in bank loans and borrowings and 2.1 million euro 

against miscellaneous receivables. 

At December 31, 2011, Calcestruzzi S.p.A. had trade receivables factored without recourse with factoring 

companies for 4.9 million euro. 

Provision for bad debts 

The provision for bad debts is determined using Group procedures, and taking account of bank guarantees and 

collateral given. At the reporting date, the Group companies analyze doubtful overdue receivables on a 

customer-by-customer basis. The amount of overdue receivables at risk is adjusted accordingly. 


This caption reflects: 



Receivables from tax and social security authorities 93,444 93,997 

Receivables from the sale of non-current assets 3,014 3,565 

Concessions and licenses paid in advance 34,895 31,046 


Other 135,282 113,348 

Total 295,271 248,410 


99 


14. Share capital and Share premium 

14.1 Share capital 

At December 31, 2011, the parent’s fully paid-up share capital amounted to 282,548,942 euro represented by 

282,548,942 shares with a par value of 1 euro each, as follows: 

Number of shares December 31, 2011 December 31, 2010 Change 

Ordinary shares 177,117,564 177,117,564 - 

Savings shares 105,431,378 105,431,378 - 

Total 282,548,942 282,548,942 - 

14.2 Share premium 

Share premium amounted to 344,104 thousand euro, unchanged from December 31, 2010. 

15. Reserves 

Translation reserve 

This reserve reflects differences on the translation of the financial statements of consolidated foreign 

companies. At December 31, 2011, it stood at 6.3 million euro (23.5 million euro at December 31, 2010), 

referring to the following currencies: 


Change 


Egypt (pound) (34.9) (32.1) (2.8) 

USA and Canada (dollar) 19.8 12.3 7.5 

Thailand (baht) 36.4 40.4 (4.0) 

Morocco (dirham) 1.5 (1.3) 2.8 

India (rupee) (28.8) 2.5 (31.3) 

Turkey (lira) (5.3) (10.0) 4.7 

Other countries 17.6 11.8 5.8 

Total 6.3 23.5 (17.2) 


At December 31, 2011, the carrying amount of Italcementi S.p.A. treasury shares was 58,690 thousand euro, 

reflected in the treasury share reserve. No movements took place in the reserve during the year: 

No. ordinary 

shares 

par value 1 € 

Total 

carrying 

amount 

(000 euro) 

No. savings 

shares 

par value 1 € 

Total 

carrying 

amount 

(000 euro) 

Total 

carrying 

amount 

(000 euro) 

December 31, 2010 3,793,029 58,342 105,500 348 58,690 

Additions - - - - - 

Disposals - - - - - 

December 31, 2011 3,793,029 58,342 105,500 348 58,690 

100






17. Retained earnings dividends paid 

Dividends declared by the parent company Italcementi S.p.A in 2011 and 2010 are detailed below: 


(euro per share) 

2010 


Dec.31, 2011 

(000 euro) 

Dec.31, 2010 

(000 euro) 

Ordinary shares 0.120 0.120 20,799 20,799 

Savings shares 0.120 0.120 12,639 12,639 

Total dividends 33,438 33,438 

Dividends paid in 2011 amounted to 33,433 thousand euro (33,432 thousand euro in 2010). 

18. Non-controlling interests 

Equity attributable to non-controlling interests at December 31, 2011, stood at 1,400 million euro, down by 60.9 

million euro from December 31, 2010. 

In 2011 profit for the period attributable to non-controlling interests decreased by 57 million euro, from 151.3 

million euro in 2010 to 94.3 million euro in 2011; the decrease arose largely on the Group results in Egypt; the 

change in the translation reserve had a negative impact of 7.8 million euro on equity attributable to noncontrolling 

interests, as a result of the performance of the euro against the currencies in countries with large 

non-controlling interests, including Egypt. 


Employee benefits at December 31, 2011, amounted to 202,955 thousand euro (184,822 thousand euro at 

December 31, 2010). 

The Group’s main employee benefit plans are described below. 


The Group operates pension plans, post-employment medical benefit plans and post-employment benefit 

plans. 

The most important pension plans are in the USA and France; they are financed by contributions paid by the 

company and by employees to external entities responsible for the administration and management of the 

pension funds; early retirement schemes also operate, pursuant to local laws, in France and Belgium. 

With regard to the post-employment benefits for staff of the Group’s Italian companies (TFR), liabilities in 

respect of TFR accrued and optioned by employees as from 2007 no longer qualify as defined benefit plans. 

They are treated as quotas of defined contribution plans. 

Some Group companies in the USA operate plans providing post-employment medical and life insurance 

benefits. In France and, to a lesser extent, in Belgium similar benefits are provided for certain classes of 

workers, specifically the companies pay a portion of contributions to the insurance company, which then 

reimburses workers, after retirement, for a portion of medical expenses. 

In some companies in France and Italy, the Group also recognizes liabilities in respect of future commitments, 

in the form of bonuses payable to employees on the basis of length of service; these liabilities are measured 

with actuarial assumptions. Net liabilities for pension plans and post-employment benefit plans are determined 

with actuarial calculations performed by independent actuaries. 

101 


Net liabilities determined on the basis of actuarial calculations at December 31, 2011, are set out below: 

Pension plans and other longterm 

benefits 

Post-employment medical 

benefits 


Dec.31, 11 Dec.31, 10 Dec.31, 11 Dec.31, 10 Dec.31, 11 Dec.31, 10 

Discounted value of funded plans 148.9 129.7 - - 148.9 129.7 

Fair value of plan assets (88.1) (86.1) - - (88.1) (86.1) 

Discounted net value of funded plans 60.8 43.6 - - 60.8 43.6 

Discounted value of unfunded plans 66.9 71.0 91.0 81.7 157.9 152.7 

Net value of obligation 127.7 114.6 91.0 81.7 218.7 196.3 

Unrecognized actuarial losses (51.3) (29.5) (12.2) (5.8) (63.5) (35.3) 

Unrecognized past service costs (1.3) (1.6) (0.7) (0.5) (2.0) (2.1) 

Net liabilities 75.01 83.5 78.2 75.5 153.2 159.0 

of which: 

Liabilities 75.4 84.0 78.2 75.5 153.6 159.4 

Assets 0.4 0.4 - - 0.4 0.4 

Net (assets)/liabilities 75.0 83.5 78.2 75.5 153.2 159.0 

Total 

With reference to “post-employment medical benefits”, a change of +/- 1 percentage point in the rates relating 

to changes in medical expenditure would generate changes of +0.4 and -0.3 million euro respectively in 

liabilities on the statement of financial position and +4.5 and -3.8 million euro respectively in related expense. 

The movements in net liabilities during the year are analyzed below: 


benefits 


benefits 



Opening net liabilities 83.5 87.1 75.5 70.5 159.0 157.6 

Pension costs 10.8 11.7 5.2 5.6 16.0 17.3 

Contributions or services paid (14.4) (17.8) (3.6) (3.2) (18.1) (21.0) 

Translation differences (0.2) 2.2 1.3 2.6 1.1 4.8 

Plans acquired/(sold) on changes in scope of 

consolidation (4.7) 0.4 ( 0.2) - (4.9) 0.4 

Closing net liabilities 75.0 83.5 78.2 75.5 153.2 159.0 

Total 

Costs for the year, all recognized under employee expense, are detailed below: 



benefits 


benefits 

2011 2010 2011 2010 2011 2010 

Current cost of services (3.8) (4.2) (1.8) (1.7) (5.6) (5.8) 

Finance costs on obligations (9.2) (10.5) (3.9) (4.0) (13.2) (14.5) 

Revenue expected from plan assets 5.7 5.5 - 5.7 5.5 

Net actuarial losses recognized in year (2.3) (1.6) (0.2) (0.1) (2.4) (1.7) 

Cost of prior-period services (0.7) (1.3) 0.2 0.2 (0.5) (1.0) 

Plan settlement or curtailment (losses)/gains ( 0.4) 0.4 0.5 - 0.1 0.4 

Total (10.8) (11.7) (5.2) (5.6) (16.0) (17.3) 

Actual yield on assets 3.7 9.0 - - 3.7 9.0 

Total 

102






The movements in defined benefit obligations during the year are set out below: 


benefits 


benefits 



Opening present value of defined benefit 

obligations 200.7 189.0 81.7 72.1 282.4 261.0 

Current cost of services 3.8 4.2 1.8 1.7 5.6 5.8 

Finance costs on obligations 9.2 10.5 3.9 4.0 13.2 14.5 

Employee contributions - 0.2 0.3 0.2 0.3 

Cost of prior-period services 0.5 1.1 - - 0.5 1.1 

Actuarial losses 19.8 10.7 6.4 4.7 26.2 15.4 

Amounts paid ( 17.2) ( 19.4) ( 3.8) ( 3.6) ( 21.0) ( 22.9) 

Plan curtailments 0.0 0.2 ( 0.5) - ( 0.5) 0.2 

Plan settlements ( 1.0) ( 4.7) - ( 1.0) ( 4.7) 

Changes in scope of consolidation ( 4.2) 0.4 ( 0.2) - ( 4.4) 0.4 

Translation differences and other 4.0 8.8 1.6 2.5 5.6 11.3 

Closing present value of defined benefit 

liabilities 215.8 200.7 91.0 81.7 306.8 282.4 

Total 

The movements in plan asset fair values are set out below: 


benefits 


benefits 



Opening fair value of plan assets 86.1 78.9 - - 86.1 78.9 

Expected yield 5.7 5.5 - - 5.7 5.5 

Actuarial gains (losses) (2.0) 3.5 - - (2.0) 3.5 

Employer contributions 14.4 17.8 3.6 3.2 18.1 21.0 

Employee contributions - 0.2 0.3 0.2 0.3 

Benefits paid (17.2) (19.4) (3.8) (3.6) (21.0) (23.0) 

Plan settlements (1.0) (4.7) - - (1.0) ( 4.7) 

Changes in scope of consolidation (0.1) (0.0) - - (0.1) ( 0.0) 

Translation differences and other 2.2 4.6 - - 2.2 4.6 

Closing fair value of plan assets 88.1 86.1 - - 88.1 86.1 

Total 

The Group’s estimated contribution to defined benefit plans in 2012 is 5.7 million euro. 

The table below sets out the main plan asset categories as percentages of total fair value: 


Shares 38.4% 40.0% 

Bonds 49.5% 53.9% 

Investment property 0.4% 0.8% 

Other 11.8% 5.3% 

103 


The table below sets out key data for pension plans and other long-term benefits in the last two years: 

December 31, 




Discounted value of funded plans 306.8 282.4 

Fair value of plan assets (88.1) (86.1) 

Net value of funded plans 218.7 196.3 

Difference between actual asset yield and asset yield expected 

at beginning of period (experience adjustments) 1.9 2% (3.5) -4.0% 

Change in value of funded plans other than experience adjustments 8.3 3% (0.8) 0.2% 

Actuarial assumptions 

The actuarial assumptions used to determine obligations arising from pension plans and other long-term 

benefits are set out below: 

(in %) 

Europe North America Other countries 

2011 2010 2011 2010 2011 2010 

Expected yield on assets 3.50 - 4.70 3.50 - 4.00 7.72 7.71 7.50 7.50 

Future wage and salary increases 1.00 - 3.50 2.75 - 3.50 n.a. n.a. 3.50 - 8.50 3.50 - 8.50 

n.a.: not applicable 

Discount rate (in %) 2011 2010 

Europe 

Long-term euro zone 4.60 5.00 

Medium-term euro zone 4.60 4.75 

Short-term euro zone 4.60 4.25 

Bulgaria 5.50 5.75 

North America 

USA 4.19 5.10 

Canada 4.75 4.75 

Other countries 

Morocco 4.50 4.50 

Turkey 10.00 10.00 

Thailand 3.50 4.00 

India 8.40 8.20 


The Group’s defined contribution plans are pension plans and medical plans; expense relating to these plans in 

2011 was 51.4 million euro (48.7 million euro in 2010). 

Termination plans 

At December 31, 2011, provisions for termination plans totaled 37.5 million euro (24.5 million euro in 2010) and 

related mainly to Italy for 31.8 million euro in connection with re-organization plans affecting the Calcestruzzi 

group and Italcementi S.p.A. in particular. 

104







Non-current and current provisions totaled 250,783 thousand euro at December 31, 2011, an increase of 6,006 

thousand euro from December 31, 2010, as follows: 

December 31, Additions Decreases Reversed Translation Other changes Total changes December 31, 

2010 

unused differences and reclassifications 



amounts 

Environmental restoration 84,896 11,612 (8,140) (948) (244) 4,594 6,874 91,770 

Disputes 88,871 15,723 (15,922) (4,139) (1,323) 11,158 5,497 94,368 

Other provisions 71,010 13,957 (18,541) (9,759) (178) 8,157 (6,365) 64,645 

Total 244,777 41,291 (42,602) (14,846) (1,745) 23,909 6,006 250,783 

Non-current portion 241,240 41,034 (39,223) (14,846) (1,590) 22,176 7,550 248,790 

Current portion 3,537 257 (3,379) - (155) 1,733 (1,544) 1,993 

“Disputes” reflects provisions for fiscal risks deemed probable as a result of tax audits and adjustments to tax 

returns, provisions for disputes with employees and provisions for restoration of urban and industrial areas. 

“Other changes and reclassifications” refers mainly to Calcestruzzi group provisions after consolidation on 

January 1, 2011. 

Contingent liabilities 

The main contingent liabilities relating to disputes and proceedings pending at December 31, 2011, for which 

amounts were not provided, are described below. The Group is not aware of other disputes, legal controversies 

or other exceptional facts that might have a material impact on its financial position, results and operations. 

Europe 

Regarding the investigation begun in November 2008 by the European Commission into some cement 

producers, including Italcementi S.p.A. and the subsidiaries Ciments Français S.A., Ciments Calcia S.A. and 

Compagnie des Ciments Belges S.A., in December 2010 the European Commission notified the decision for 

the formal opening of the proceeding to Italmobiliare S.p.A. (and, indirectly through Italmobiliare, to the abovenamed 

Group companies and the Spanish subsidiary Financiera Y Minera). 

In April 2011, the Commission served a further formal notice on Italmobiliare of its decision to request extensive 

additional economic, financial and commercial information. Italmobiliare provided the information within the 

required term and, simultaneously, lodged an appeal with the EU General Court against the decision. Both the 

investigation and the proceedings are still underway. 

Regarding the proceeding begun in 2009 by the General Directorate of the Belgian Competition Authority 

against cement producers (including Compagnies des Ciments Belges (CCB), no further developments have 

taken place after the charges were formally notified in April 2010. The parties exchanged briefs and hearings 

took place. The Belgian Competition Authority is expected to make a decision in the first half of 2012. 

Turkey 

As a result of the non-closure of the 2008 agreement for the sale of the Turkish operations (Set Group) by 

Ciments Français to Sibcem, a number of proceedings are pending. 

Sibconcord, the main shareholder of Sibcem, has begun a proceeding in Russia to annul the agreement. On 

September 26, 2011, the ruling annulling the contract obtained in first instance by Sibconcord against which 

Ciments Français filed an appeal become effective. After an unsuccessful petition to the regional court of 

cassation, Ciments Français filed an appeal with the Russian Supreme Court. In December 2011, on the basis 

105 


of the favorable ruling obtained in Russia, Sibconcord filed for compulsory execution in Kazakhstan, which was 

rejected by the courts in January 2012. Sibconcord has appealed against this ruling. 

As contemplated by the contract, Ciments Français began arbitration proceedings (in Istanbul) in accordance 

with the regulation of the International Chamber of Commerce. On December 7, 2010, it obtained a favorable 

arbitration award recognizing the validity of the resolution of the contract by Ciments Français with the right to 

retain the 50 million euro paid by Sibcem. On May 31, 2011, Sibcem obtained the annulment of the arbitration 

award from the territorially competent Turkish court; Ciments Français filed an appeal and in the meantime 

continued proceedings for the recognition of the award in a number of countries. 

India 

On the proceedings begun in 2006 by the Indian Antitrust Authority, Zuari Cement Ltd. has drawn up its 

defense. No new developments took place. 

For the investigation begun in August 2010 by the Indian Antitrust Authority against cement producers, 

including the Zuari Cement Ltd. and Sri Vishnu Cement companies, for alleged unfair trading, no developments 

took place after the response to the request for information. 

At the end of 2007, Zuari signed a contract with Larsen & Toubro (L&T) concerning civil and mechanical works 

for the Yerraguntla cement plant. During execution of the contract, L&T requested an additional amount for 

alleged extra costs and extended duration of work. In turn, the contract awarder, Zuari Cement, presented a 

request for compensation of 29 million euro including penalties for delays and breaches in execution of the 

work; also, in July 2011, Zuari Cement terminated the contract for non-fulfillment. In August 2011 L&T sent 

Zuari a request for arbitration followed in January 2012 by a request for compensation of 31 million euro. The 

proceeding, which is taking place in India, is still underway. 

21. Deferred tax assets and Deferred tax liabilities 

Total net deferred tax liabilities are analyzed below: 

December 31, 2010 Results Other changes December 31, 2011 


Benefit on tax loss carryforwards 37.7 2.1 18.1 57.9 

Property, plant and equipment (334.0) 9.9 (11.7) (335.8) 

Inventories (13.9) 0.5 (1.6) (15.0) 

Non-current provisions and Employee benefits 90.9 1.2 10.1 102.2 

Other 32.8 20.1 (8.1) 44.8 

Total net deferred taxes (186.5) 33.8 6.8 (145.9) 

of which: 

Deferred tax assets 53.0 76.2 

Deferred tax liabilities (239.5) (222.1) 

At December 31, 2011, deferred tax liabilities reflected in equity reserves amounted to 1.5 million euro 

(deferred tax assets of 1.7 million euro at December 31, 2010). 

Off-balance sheet deferred tax assets relating to losses for the year and previous years amounted to 

approximately 143.3 million euro (102.4 million euro at December 31, 2010). They related to Group company 

losses, reversal of which is not considered reasonably certain at the present time. 

106






22. Net debt 

An itemized correlation of net debt with the statement of financial position is set out below: 


Financial asset and liability category 


caption 


Current financial assets (659,685) (835,610) 

Cash and cash equivalents Cash and cash equivalents (613,334) (575,220) 

Current loan assets 

Equity investments, bonds and 

financial assets (35,733) (249,561) 

Other current financial assets Other current assets (4,625) (6,122) 

Derivatives Other current assets (5,993) (4,707) 

Current financial liabilities 756,719 535,418 

Bank overdrafts and short-term 

borrowings Loans and borrowings 189,296 222,985 

Loans and short-term borrowings Financial liabilities 543,934 293,493 

Derivatives Other current liabilities 23,489 18,940 

Non-current financial assets (117,073) (65,021) 

Securities and bonds Other non-current assets (21,816) (17,266) 

Derivatives Other non-current assets (95,257) (47,755) 

Non-current financial liabilities 2,113,054 2,596,108 

Loans and long-term borrowings Financial liabilities 2,099,268 2,567,468 

Derivatives Other non-current liabilities 13,786 28,640 

Net debt 2,093,015 2,230,895 

The net debt at December 31, 2011, determined in compliance with Consob communication no. DEM/6064293 

of July 28, 2006 (i.e., excluding non-current financial assets), amounted to 2,210,088 thousand euro (2,295,916 

thousand euro at December 31, 2010). 

Current financial receivables at December 31, 2010, reflected the current account relationship between 

Italcementi S.p.A. and the Calcestruzzi group companies for 217.7 million euro. 

107 


22.1 Financial liabilities 

Financial liabilities are shown below by category, subdivided by non-current and current liabilities: 

Effective 

interest rate 

Nominal 

value at 

Dec.31, 2011 

Maturity 

December 

31, 2011 

December 

31, 2010 


Bank overdrafts and drawings on lines of credit 743,152 1,068,451 

Italcementi S.p.A. 614,688 859,195 

Other Group companies 128,464 209,256 

Bond loans 1,318,260 1,281,663 

Issued by Italcementi Finance: EMTN 750 mln euro 5.375% 5.55% 739,000 2020 782,728 741,177 

Issued by Ciments Français S.A.: EMTN 500 mln euro 4.75% 4.84% 500,000 2017 520,532 513,138 

For private investors EMTN 15 mln euro 4.47% 4.50% 15,000 2013 15,000 15,000 

For private investors 180 mln USD 5.63% 5.79% 2012 - 12,348 

Convertible bonds 1.72% 2012 - 3,776 

Other loans and borrowings 23,678 199,731 

Billets de trésorerie issued by Ciments Français S.A. 1.08% - 177,000 

Other (0% - 3.67%) 23,678 22,731 

Finance lease payables 14,178 13,847 

Non-current financial liabilities 2,099,268 2,567,468 

Fair value of hedging derivatives 13,786 28,640 

Total non-current financial liabilities 2,113,054 2,596,108 

Bond loans 

For private investors 50 mln euro 3.50% 12,761 9 

Convertible bonds 3,805 - 

Other 

Amounts due to banks 114,300 157,984 

Bank overdrafts and drawings on lines of credit 458,443 281,600 


Billets de trésorerie issued by Ciments Français S.A. 70,000 - 

Finance lease payables 5,115 3,705 

Accrued interest expense 47,174 47,734 



Total current financial liabilities 756,719 535,418 

Total financial liabilities 2,869,773 3,131,526 

At December 31, 2011, bank overdrafts and drawings on lines of credit secured by mortgages and liens on 

property, plant and equipment amounted to 119.3 million euro, of which 25.7 million euro short-term and 93.6 

million euro medium/long-term. 

At December 31, 2011, current “Other loans and borrowings” included 9.1 million euro relating to factoring 

programs (8.2 million euro at December 31, 2010). 

“Billets de trésorerie”, previously linked to medium/long-term lines of credit, were reclassified under current 

financial liabilities at December 31, 2011. 

108






Italcementi S.p.A. has been assigned a public rating since 2006, by the Moody’s and Standards & Poors 

ratings agencies. At December 31, 2011, the rating was, respectively, Ba1 outlook negative-NP and BBBoutlook 

negative-A3. During 2011 the ratings were reviewed on, respectively, September 14, 2011, by 

Standards & Poor’s, which confirmed the rating and downgraded the outlook from stable to negative, and 

December 15, 2011, by Moody’s, which downgraded the long-term rating from Baa3 to Ba1, outlook negative. 

Non-current financial liabilities by currency: 



Euro 1,957.6 2,332.8 

US and Canadian dollar 25.8 14.6 

Moroccan dirham 29.7 108.2 

Indian rupee 77.7 92.4 

Saudi Arabian riyal - 8.0 

Egyptian pound 1.6 2.6 

Others 6.9 8.9 

Total 2,099.3 2,567.5 

Non-current financial liabilities by maturity: 



2012 - 359.1 

2013 409.1 456.8 

2014 271.9 166.7 

2015 32.8 204.5 

2016 3.7 - 

Beyond 1,381.8 1,380.4 

Total 2,099.3 2,567.5 

The main medium/long-term loans and borrowings in 2011 and 2010 are described below. 

Bank loans and drawings on lines of credit: 

a) On April 29, 2011, Italcementi Finance S.A. arranged a 50 million euro floating-rate five-year bilateral line of 

credit, guaranteed by Italcementi S.p.A.. No drawings had been made at December 31, 2011; 

b) During 2011, Italcementi Finance S.A. arranged bilateral lines of credit with leading international banks for a 

total amount of 200 million euro at 364 days. No drawings had been made at December 31, 2011; 

c) During 2010, Italcementi S.p.A. arranged a three-year line of credit for an original amount of 100 million euro, 

subsequently reduced to 25 million euro after the counterparty joined the syndicated line of credit headed by 

Italcementi Finance S.A. No drawings had been made at December 31, 2011; 

d) in the third quarter of 2010, Italcementi Finance S.A. was granted a five-year floating-rate 920 million euro 

syndicated line of credit guaranteed by Italcementi S.p.A. The group of banks was coordinated by Bank of 

America, BNP Paribas, Credit Agricole, Intesa Sanpaolo, Natixis, Société Générale, The Royal Bank of 

Scotland and Unicredit. 

The arrangement of the syndicated line of credit extinguished the similar facility for 700 million euro granted to 

Ciments Français S.A. in May 2005. 

109 


No drawings had been made on the syndicated line of credit at December 31, 2011; 

e) On November 30, 2010, Zuari Cement Ltd. refinanced a 4.2 billion rupee amortizable syndicated line of 

credit, negotiating bilateral lines of credit with a pool of international banks for a total amount of 5.1 billion 

Indian rupees, repayable in five years. It also arranged a bilateral line of credit repayable in five years for 20 

million US dollars (approximately 900 million rupees). Full drawings had been made on these long-term 

facilities at December 31, 2011. 

Bond loans 

f) The Italcementi Group covers its financial requirements through recourse to diversified instruments. It covers 

its long-term financing requirements largely through bond issues. Specifically, Italcementi S.p.A. has launched 

a Euro Medium Term Notes program (EMTN) targeting qualified investors on the European market, for a 

maximum amount of 2 billion euro. This replaces the program previously in operation at Ciments Français S.A.. 

The launch of the program, on March 9, 2010, is part of a broader project to optimize management of financial 

operations, under which Italcementi S.p.A. has been assigned a greater role as parent responsible for the 

coordination and direct implementation of financing programs for all Group operations. 

Under this program, on March 16, 2010, Italcementi Finance S.A., a French subsidiary of Italcementi S.p.A., 

closed the placement of a ten-year bond loan at a fixed rate of 5.375%, for a nominal value of 750 million euro. 

The bond, guaranteed by Italcementi S.p.A., is listed on the Luxembourg Stock Exchange. The program 

reference material was renewed on June 30, 2011. The placement was managed by Banca IMI, BNP Paribas, 

Bank of America Merrill Lynch, Société Générale and Unicredit. The proceeds from the issue have been 

transferred to Italcementi S.p.A. and Ciments Français S.A. through medium/long-term intercompany loans for 

210 million euro and 540 million euro respectively. 

The terms and issue conditions of the program include a coupon step-up clause for 125 basis points should the 

rating go beneath “investment grade”. After the downgrade of the Moody’s rating on December 15, 2011, the 

clause will be applied as from the next annual coupon due on March 19, 2013. 

At December 2011, Italcementi S.p.A had effected a partial repurchase of the bonds for an overall nominal 

value of 11 million euro; 

g) Ciments Français S.A. covers its long-term financial requirements largely through Italcementi Finance S.A., 

the company that coordinates and implements programs to provide funding for the entire Italcementi Group. 

Consequently, it has not renewed the EMTN program reference material since July 17, 2008. The maximum 

amount authorized under this program is 1,500 million euro. At December 31, 2011, notes issued under the 

program totaled 515 million euro, including 500 million euro issued on March 21, 2007, assisted by ABN Amro, 

Natixis and The Royal Bank of Scotland, at a fixed rate of 4.75% with a ten year maturity; 

h) on February 24, 2010, Ciments Français S.A. launched an offer for holders of its 2002 and 2006 US private 

placements to repurchase any and all outstanding notes. It also reached an agreement with the note holders 

permitting it to borrow funds from the parent Italcementi S.p.A. and from subsidiaries of the parent. On April 7, 

2010, the offer obtained an uptake for a nominal value of 183.5 million US dollars out of a total 200 million US 

dollars of notes issued in 2002, and for a nominal value of 300 million US dollars out of a total of 300 million US 

dollars of notes issued in 2006. Ciments Français S.A. repurchased all the tendered notes at a price of 1,065 

US dollars for each note with a nominal value of 1,000 US dollars, in addition to accrued interest. The amount 

was paid on April 14, 2010. The remaining notes for 16.5 million US dollars relate to the ten-year issue of 

110






November 15, 2002, at a fixed rate of 5.63%. They continue to be regulated by the issue contracts and related 

supplementary agreements; 

Billets de Trésorerie issue program 

i) On October 17, 2011, Italcementi Finance S.A. was authorized by the Bank of France to issue a Billets de 

Trésorerie program for a maximum amount of 800 million euro. The program, guaranteed by Italcementi S.p.A., 

has an NP Moody’s rating and an A3 Standards & Poors rating. The operation was managed by Natixis, with 

Bred Banque Populaire, Credit Agricole CIB, Credit Industriel et Commercial, HSBC France, ING Belgium S.A., 

Natixis and Société Générale as bookrunners. The program was granted a STEP label on October 24, 2011. 

The program (reference number #0002214) meets the criteria of the STEP market convention. 

Main intragroup relations 

j) In 2011, after finalization of a bilateral bank line of credit arranged by Italcementi Finance S.A., Italcementi 

S.p.A. obtained from Italcementi Finance S.A. a 50 million euro five-year renewable line of credit. No drawings 

had been made on the line at December 31, 2011; 

k) In the third quarter of 2011, Ciments Français S.A. obtained a 200 million euro short-term line of credit from 

Italcementi Finance S.A. maturing on July 31, 2012, replacing the previous facilities at 364 days. No drawings 


l) In the first half of 2010, concomitantly with the Italcementi Finance S.A. bond issue, Italcementi S.p.A. 

obtained two ten-year loans from Italcementi Finance S.A., one at a fixed rate and one at a floating rate, for a 

total amount of 210 million euro; 

m) During the first half of 2010, Italcementi S.p.A. took part in financing the repurchase offer on the Ciments 

Français S.A. US Private Placements, granting Ciments Français S.A. a long-term 5-year floating-rate loan for 

100 million euro; 

n) In the third quarter of 2010, concomitantly with the finalization of the Italcementi Finance S.A. syndicated 

line of credit, Italcementi S.p.A. obtained from Italcementi Finance S.A. a five-year 220 million euro renewable 

line of credit. No drawings had been made on the line at December 31, 2011. 

o) In the first half of 2010, Ciments Français S.A. financed the repurchase of the US Private Placements and 

the reimbursement of part of the short-term loans with a five-year long-term floating-rate loan granted by 

Italcementi S.p.A. for an amount of 100 million euro and with a ten-year long-term floating-rate loan granted by 

Italcementi Finance S.A. for an amount of 540 million euro; 

p) In the third quarter of 2010, Ciments Français S.A. replaced the 700 million euro five-year syndicated line of 

credit maturing in May 2012, with a 700 million euro five-year renewable line of credit granted by Italcementi 

Finance S.A. This made it possible to extend the average life of available lines of credit, giving Ciments 

Français S.A. debt coverage for the following 4 years. No drawings had been made on the line at December 

31, 2011; 

All loans and lines of credit between Ciments Français S.A., Italcementi S.p.A. and their subsidiaries are 

arranged at arm’s length conditions. 

111 


As a result of the Moody’s rating downgrade on December 15, 2011, the loans granted by Italcementi Finance 

S.A. to Italcementi S.p.A. and Ciments Français S.A. respectively for a total amount of 210 million euro and 

540 million euro, will be subject to the applicable interest rate-increase of 125 basis points, in compliance with 

the step-up clause of the 750 million euro bond issued by Italcementi Finance. The rating downgrade had no 

other direct consequences on the cost of Group financing. 

22.2 Management of liquidity, credit and counterparty risks 

22.2.1 Liquidity risk 

Cash and cash equivalents for 613.3 million euro at December 31, 2011, consist largely of short-term assets 

such as short-term deposits, certificates of deposit, mutual funds. At December 31, 2011, the maximum 

exposure to a single counterparty was 20%. 

Due to currency regulations in Egypt, Morocco, Thailand and India, the cash and cash equivalents of the Group 

companies in these countries may not be immediately available to the Ciments Français S.A. holding (note 

38.1). 

Group centralized financial policy is designed to ensure that at any time debt maturing in less than two years is 

less than or equal to undrawn confirmed lines of credit and liquidity. 

As from 2010, under the financial policy review, Italcementi S.p.A. and Ciments Français S.A. are the recipients 

of the fund-raising activities of Italcementi Finance S.A., enabling them to improve their 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. and Ciments Français S.A. obtain refinancing from Italcementi Finance S.A. 

through short- and long-term intragroup loans, arranged at arm’s length conditions. 

112






The tables below compare net debt (excluding the fair value of derivatives and current financial assets) by 

maturity with available lines of credit at the end of each period 

At December 31, 2011 * 

Maturity less Maturity Maturity Maturity Maturity Maturity more Total 

than 1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years 

than 


5 years 

Non-current financial liabilities - 409.1 271.9 32.8 3.7 1,381.8 2,099.3 

Current financial liabilities (**) 581.0 581.0 

Amount due to banks 152.2 152.2 

Cash and cash equivalents (613.3) (613.3) 

Total 119.9 409.1 271.9 32.8 3.7 1,381.8 2,219.2 

Confirmed lines of credit, 

1,687.0 1,490.0 1,170.0 100.0 - - 

available at end of each period 

(*) excluding fair value of derivatives 

(**) of which "billets de trésorerie" 70 

At December 31, 2010 * 

Maturity less Maturity Maturity Maturity Maturity Maturity more Total 

than 1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years 

than 


5 years 

Non-current financial liabilities - 359.1 456.8 166.7 204.5 1,380.4 2,567.5 

Current financial liabilities (**) 358.5 358.5 

Amount due to banks 158.0 158.0 

Cash and cash equivalents (575.2) (575.2) 

Total (58.7) 359.1 456.8 166.7 204.5 1,380.4 2,508.8 

Confirmed lines of credit, 

available at end of each period 

1,670.0 1,670.0 1,373.0 973.0 - - 


(**) of which "billets de trésorerie" linked to medium/long term confirmed lines 

of credit 

127 50 177.0 

At December 31, 2011, the average maturity of Group gross debt was 4 years and 7 months (5 years and 4 

months at December 31, 2010). 

Short-term liabilities included billets de trésorerie for 70 million euro (177 million euro at December 31, 2010, 

classified under long-term liabilities). 

At December 31, 2011 the Group had 2,506 million euro of confirmed lines of credit, of which 1,907 million euro 

undrawn and immediately available (2,777 and 2,061 million euro respectively at December 31, 2010). 

22.2.2 Covenants 

In addition to the customary clauses, some of the Group’s financing contracts include covenants requiring 

compliance with financial ratios, fixed for the most part at the year end. For bilateral or syndicated lines of credit 

and borrowings, failure to comply with covenants leads to termination and consequent early repayment, 

however 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 Group’s ability to finance or refinance its operations. 

113 


At December 31, 2011, lines of credit and loans subject to covenants accounted for 14% of total drawings 

represented by gross debt (2,721 million euro at December 31, 2011, expressed at nominal value, excluding 

the fair value effects of derivatives). 

At December 31, 2011, the Group complied with all contractual commitments; covenant-related financial ratios 

were well within the contractual limits agreed by the loans in question. The Group expects to comply with its 

covenants for the next 12 months and will provide information as appropriate should its financial situation 

deteriorate. 

22.2.3 Credit risk 

In compliance with Group 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 the Group’s broadly based and uncorrelated 

customer portfolio. For this reason, management believes that no further provisions for credit risks will be 

necessary beyond the amounts normally provided for uncollectible and doubtful receivables. 

22.2.4 Counterparty risk 

Currency 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. 

114






22.3 Financial assets and liabilities 

The table below sets out the carrying amount and fair value of financial assets and liabilities at December 31, 

2011: 


Fair Value Carrying Fair Value Carrying 


amount 

amount 

FINANCIAL ASSETS AT FAIR VALUE 

Assets originally designated at fair value 

Cash and cash equivalents without short-term deposits (note 38.1) 355.6 355.6 239.1 239.1 

Assets classified as held for trading 

Fair value of derivatives (note 22.3.1) 101.2 101.2 52.5 52.5 

HELD-TO-MATURITY INVESTMENTS 

LOANS AND RECEIVABLES 

Short-term deposits (note 38.1) 257.7 257.7 336.2 336.2 

Trade receivables (note 12) 857.3 857.3 738.6 738.6 

Other current assets 2.9 2.9 3.0 3.0 

Other financial assets without concessions, licenses paid in advance and 

derivatives (note 10) 193.8 193.8 138.3 138.3 

Equity investments, bonds and financial assets 36.0 36.0 249.9 249.9 

AVAILABLE-FOR-SALE FINANCIAL ASSETS 

Other equity investments (note 9) 88.2 88.2 200.2 200.2 

FINANCIAL LIABILITIES AT FAIR VALUE 

Liabilities originally designated at fair value - - - - 

Liabilities classified as held for trading 

Fair value of derivatives (note 22.3.1) 37.3 37.3 47.6 47.6 

OTHER FINANCIAL LIABILITIES 

Trade payables 648.2 648.2 588.6 588.6 

Other current liabilities 70.6 70.6 113.4 113.4 

Finance lease payables 19.3 19.3 17.6 17.6 

Floating-rate financial liabilities 1,288.4 1,288.4 1,469.3 1,469.3 

Fixed-rate financial liabilities 1,456.5 1,395.6 1,461.9 1,422.2 

Amounts due to banks 114.3 114.3 158.0 158.0 

Other short-term financing 14.9 14.9 16.9 16.9 

Purchase commitments on non-controlling interests 67.8 67.8 63.7 63.7 

Trade receivables and payables are current assets and liabilities and are carried at amounts that are 

reasonable approximations of their fair value. 

Derivatives are measured and recognized at fair value. The fair value of interest-rate contracts is determined 

on the present value of cash flows using the zero coupon curve. 

The fair value of forward currency purchase contracts is based on the current exchange rates of contracts with 

similar maturity profiles. 

The fair value of foreign currency payables and receivables is determined using closing rates. The fair value of 

fixed-rate payables and receivables is based on a fixed rate with no credit margin, net of transaction costs 

directly related to the financial asset or liability. 

115 


22.3.1 Fair value of derivatives 

The table shows the fair value of financial instruments reflected in the statement of financial position, 

subdivided by type of hedge: 


(in thousands of euro) Assets Liabilities Assets Liabilities 

Derivatives - interest rates 379 3,023 200 5,368 

Future cash flow hedges 379 2,728 - 5,017 

Trading - 295 200 351 

Derivatives - exchange rates 5,614 20,466 4,507 13,572 

Future cash flow hedges 4,237 37 1,393 882 

Fair value hedges 1,377 20,301 3,079 12,359 

Trading - 128 35 331 

Total current instruments 5,993 23,489 4,707 18,940 

Derivatives - interest rates 95,257 13,786 46,986 28,640 

Future cash flow hedges - 5,498 105 8,716 

Fair value hedges 95,257 8,288 46,881 19,924 

Derivatives - exchange rates - - 769 - 

Fair value hedges - - 769 - 

Total medium/long-term instruments 95,257 13,786 47,755 28,640 

Total 101,250 37,275 52,462 47,580 

Medium/long-term derivatives on interest rates reflected under assets for 95.3 million euro mainly refer to fixedrate 

to Euribor-indexed floating-rate interest-rate swaps hedging part of the 500 million euro bond loan issued 

by Ciments Français S.A. for 22.0 million euro and part of the 750 million euro debenture issued by Italcementi 

Finance S.A. for 72.4 million euro; both bond loans were fixed-rate issues under the respective EMTN 

programs; at December 31, 2010, the derivatives were carried under assets at 15.0 million euro and 15.6 

million euro respectively. 

The Group does not set up hedges on sales and purchases of shares. 

Derivatives on trading exchange rates and interest rates refer to assets that do not qualify for recognition with 

hedge accounting criteria. 

The fair value of derivatives relating to EUA and CER transactions was 6.6 million euro at December 31, 2011, 

of which -13.9 million euro reflected under “Other current liabilities”, 22.6 million euro under “Other current 

assets”, -11.7 million euro under “Other non-current liabilities” and 9.6 million euro under “Other non-current 

assets”. 

2011 derivative transactions on emission rights had a negative impact of 5.9 million euro on profit before tax 

and an impact of 11.0 million euro on equity. 

The fair value of derivatives relating to transactions on electricity at December 31, 2011, was –0.5 million euro, 

reflected under “Other current liabilities” for –0.8 million euro and “Other current assets” for 0.3 million euro. 

In 2011 derivative transactions on electricity generated an immaterial impact on profit before tax and an impact 

of -0.5 million euro on equity. 

The fair value of derivatives relating to transactions on tin(II) sulfate at December 31, 2011, was immaterial. 

116






22.3.2 Fair value – hierarchy 

In determining and documenting the fair value of financial instruments, the Group uses the following hierarchy 

based on different measurement methods: 

level 1: financial instruments with prices quoted on active markets; 

level 2: prices quoted on active markets for similar financial instruments, or fair value determined with other 

measurement methods where all significant inputs are based on observable market data; 

level 3: fair value determined with measurement methods where no significant input is based on observable 

market data. 

At December 31, 2011, financial assets and liabilities stated at fair value were subdivided as follows: 

December 31, 


Level 1 Level 2 Level 3 


Mutual funds (note 38.1) 252.0 252.0 

Derivatives - assets (note 22.3.1) 101.2 101.2 

Equity investments, bonds and financial assets 9.1 9.1 

Other equity investments (note 9) 88.2 35.1 53.1 

Derivatives - liabilities (note 22.3.1) 37.3 37.3 

Purchase commitments on non-controlling interests (note 23) 67.8 67.8 

No portfolio reclassifications of financial assets from categories measured at fair value to categories measured 

at amortized cost were made by the Group, either in 2011 or in 2010. 

22.4 Interest-rate risk management 

The Group interest-rate risk management policy is designed to minimize the cost of net financial liabilities and 

reduce exposure to fluctuation risks. It hedges two types of risk: 

1. The risk of variations in the market value of fixed-rate borrowing and lending transactions. Group fixed-rate 

debt is exposed to an “opportunity cost” risk in the event of a fall in interest rates. A change in interest rates will 

affect the market value of fixed-rate assets and liabilities and impact the consolidated profit or loss in the event 

of liquidation or early repayment of these instruments; 

2. The risk linked to future flows arising from floating-rate borrowing and lending transactions. A change in 

interest rates will have a negligible impact on the market value of floating-rate financial assets and liabilities but 

will affect finance costs and, consequently, future profits. 

The Group manages this dual risk as part of its general policy, performance targets and risk reduction targets 

by giving priority to hedges on future flows over the short- and medium-term and to hedges against the market 

value risk over the long term, within the specified limits. 

It hedges interest-rate risks mainly by arranging interest-rate swaps, forward-rate agreements and interest-rate 

options with top-ranking banks. Exposure in derivatives may never exceed the value of the underlying. 

117 


22.4.1 Interest-rate risk hedging 

The table below sets out the notional value of interest-rate derivatives by maturity: 

Maturity Maturity Maturity Maturity Total 

less then 1 to 2 2 to 5 more then 

(millions of euro) 

1 year years years 5 year 

Fair value hedges 

SWAPs riceive Fixed / pay Floating 

165 M€ 4,75% Euribor 3M+ 0,626% - - - 165.0 165.0 

650 M€ 5,375% Euribor 3M+2.284% - - - 650.0 650.0 

Total - - - 815.0 815.0 

Cash flow hedges 

SWAPs riceive Floating / pay Fixed 

200 M€ Euribor 3M 2,479% 100.0 - 100.0 - 200.0 

100,6 M€ Euribor 6M 2,697% 25.2 25.2 50.2 - 100.6 

25 MUSD Libor 3M 2,06% 19.3 - - - 19.3 

133,5 MUSD Libor 3M 1,25% 100.7 - - - 100.7 

Cash flow hedges OPTIONS - 

Cap/Floor Euribor 3M 120.0 120.0 

Total 365.2 25.2 150.2 - 540.6 

Trading 

SWAPs riceive Floating / pay Floating 

114 M€ Euribor 3M + 0,50% - Euribor 3M+ 0,325% - - - - 

SWAPs riceive Floating / pay Fixed - 

0,8 M€ Euribor 3M 1,95% 0.2 0.2 0.4 - 0.8 

- 

Trading OPTIONS - 

Cap/Floor Euribor 3M 75.0 

Total 75.2 0.2 0.4 - 75.8 

Total 440.4 25.4 150.6 815.0 1,431.4 

22.4.2 Exposure to interest-rate risk 

At December 31, 2011, 56% of Group net debt (not including the fair value of derivatives) was at a fixed rate or 

hedged against the risk of rate increases. 42% of fixed-rate commitments arose from swapped contracts 

initially arranged at floating rates. 

Hedges are stated at nominal value for the period in question (consistently with instrument maturity) and do not 

include fixed-rate to fixed-rate contracts. 

118






22.4.3 Net debt at inception and after interest-rate hedging 

The evolution of net debt at December 31, 2011, is illustrated in the table below: 

Maturity 

(in millions of euro) 12.31.2011 < 1 year 1 - 2 years 2 - 5 years Beyond 

Fixed-rate financial liabilities 1,403.9 46.4 32.3 6.0 1,319.2 

Fixed-rate financial assets - - - - - 

Fixed-rate ND at inception 1,403.9 46.4 32.3 6.0 1,319.2 

Fixed- to floating-rate hedges (815.0) (815.0) 

Floating- to fixed-rate hedges 421.4 245.4 25.4 150.6 - 

Fixed-rate ND after hedging 1,010.3 291.8 57.7 156.6 504.2 

Floating-rate financial liabilities 1,428.6 686.8 376.7 301.9 63.2 

Floating-rate financial assets (675.5) (653.6) - (5.4) (16.5) 

Floating-rate ND at inception 753.1 33.2 376.7 296.5 46.7 

Fixed- to floating-rate hedges 815.0 - - - 815.0 

Floating- to fixed-rate hedges (421.4) (245.4) (25.4) (150.6) - 

Optional hedges (195.0) (195.0) - - - 

Floating-rate ND after hedging 951.7 (407.2) 351.3 145.9 861.7 

Optional hedges 195.0 195.0 - - - 

Fair value of derivatives, net (64.0) 17.6 2.4 8.2 (92.2) 

Net debt 2,093.0 97.2 411.4 310.7 1,273.7 

At December 31, 2011, a +0.5% change in the interest-rate curve would have an impact of –4.8 million euro, 

that is, 5.6 % of 2011 net finance costs. The impact on interest-rate derivatives in portfolio would be +5.9 

million euro on equity and -3.8 million euro on profit before tax; the latter effect would be countered by an effect 

of +4.4 million euro on fixed-rate liabilities with fair value hedges. 

At December 31, 2011, a -0.5% change in the interest-rate curve would have an impact of +4.8 million euro, 

that is, 5.6% of 2011 net finance costs. The impact on interest-rate derivatives in portfolio would be -6.2 million 

euro on equity and -5.0 million euro on profit before tax; the latter effect would be countered by an effect of -4.5 

million euro on fixed-rate liabilities with fair value hedges. 

22.5 Management of currency risk 

The Group companies are structurally exposed to currency risk on cash flows from business operations and 

financing operations denominated in currencies other than their respective reporting currencies. 

The Group companies operate chiefly on their respective local markets. Consequently, invoiced amounts and 

operating expenses are denominated in the same currency and exposure of operating cash flows to currency 

risk is not particularly significant, with the exception of fuel, spare parts and investments for construction of new 

plants. 

Group policy requires borrowings or investments to be made in local currency, except in the case of hedges of 

foreign-currency cash flows. However, the Group may adapt this general policy to take account of specific 

macro-economic conditions in certain geographical areas (hyperinflation, high interest rates, liquidity, 

translations). 

119 


With regard to financing for subsidiaries, the Group may also arrange facilities in a currency other than that of 

the loan to the subsidiary. 

Group policy is to hedge exposure whenever the market makes this possible. Net exposure of each entity is 

determined on the basis of expected net operating cash flows over one to two years and financing 

denominated in currencies other than the local currency. 

The Group hedges exposure to currency risk with forward currency purchase and sale contracts, currency 

swaps that translate loans and borrowings generally denominated in euro at inception into foreign currency, as 

well as options. 

These hedges are arranged with leading banks. 

The impact of foreign currency translation on subsidiaries’ equity is recorded in a separate equity caption. 

22.5.1 Exposure to currency risk 

Consolidated net exposure by currency of financial assets and liabilities denominated in currencies other than 

the local currency is illustrated below: 

(in millions of euro) Euro (*) USD (*) Other (*) 

Financial assets (°) 3.1 689.5 9.8 

Financial liabilities (°) (27.8) (39.5) (97.8) 

Derivatives - (566.7) 89.2 

Net exposure (24.7) 83.3 1.2 

(*) assets and liabilities are expressed at nominal value in euro when the local currency is not euro 

(°) excluding trade payables and receivables 

Foreign currency exposure refers mainly to the US dollar, the Thai baht, the Moroccan dirham, the Egyptian 

pound and the Indian rupee. No hedging is set up on net investments in these subsidiaries. 

At December 31, 2011, a 1% change in the exchange rate with the euro, in cases where the local currency is 

not euro, would have had an impact of +35.6 million euro on equity, of which +8.3 million euro on noncontrolling 

interests. 

At December 31, 2011, a 10% rise in the US dollar would have an impact on exchange-rate derivatives in 

portfolio of +9.9 million euro on equity and -39.3 million euro on profit before tax. A 10% decrease in the US 

dollar would have an impact on exchange-rate derivatives in portfolio of -9.9 million euro on equity and +39.3 

million euro on profit before tax. 

120






22.5.2 Currency risk hedges 

Currency risk hedges stated at the closing rates are illustrated below: 


Forward purchases 


December 31, 


December 31, 

2010 

US dollars 98.9 35.1 

Others 0.4 - 



Others 100.7 40.1 

Trading 

US dollars - 

Others - 

Total 206.4 117.0 

Forward sales 


US dollars 489.4 500.2 

Others 11.5 10.9 

Trading 


Total 503.7 512.4 

Options 




US dollars - - 

Trading 

US dollars - 8.1 

Total 0.0 39.8 

Cross currency swaps 


US dollars 103.2 100.7 

Total 103.2 100.7 

TOTAL 813.3 769.9 

All currency risk hedges expire within 12 months. 

22.6 Management of commodity risk 

CO 2 

The Group’s European subsidiaries are exposed to market fluctuations on CO 2 emission rights prices, in 

connection with their surplus or deficit on the quotas allocated by their respective national governments. 

Trades on emission rights markets are transacted by the parent, Italcementi S.p.A., which since 2010 has also 

operated on behalf of the Group’s other European subsidiaries under an agency basis. 

From 2008 to 2011, the Group transacted forward EUA-CER swaps (forward EUA sales and forward CER 

purchases) distributed in the period 2009-2013, to diversify and optimize its CO 2 emission rights portfolio. 

Furthermore, in 2010 and 2011, the Group arranged price risk hedges with respect to the sales of surplus 

emission rights planned in the fourth quarter of 2010 for 2011 and 2012. 

121 


In 2011, in view of the surplus accumulated and the macroeconomic and industry scenario, the Group sold 

EUAs on the spot market for 62.1 million euro (55.8 million euro in 2010). 

Electricity 

In 2011, the Group arranged price risk hedges on electric power purchases for 2011 and 2012. 

Tin(II) sulfate 

In 2011, the Group arranged a modest volume of price risk hedges on tin(II) sulfate purchases for 2011 and 

2012. 

22.7 Management of equity risk 

The Group is exposed to market fluctuations on listed shares held in portfolio recognized under “Other equity 

investments”. Treasury shares held by Italcementi S.p.A. are measured at cost and deducted against equity 

under the “Treasury shares” reserve (note 16). 

Equity investments treated as available-for-sale financial assets are recognized under “Other equity 

investments” (see note 9) and refer mainly to the Goltas Cimento listed equity investment. 

The risk of fluctuations in the value of these equity investments is not actively managed with financial hedging 

instruments. 

22.8 Hedge Accounting 

The effects arising from application of hedge accounting rules are summarized below. 

The specific equity reserve reflects fair value gains and losses on the effective component of cash flow hedges 

only. 

New derivatives recognized in equity totaled +3.3 million euro at December 31, 2011 (+2.2 million euro at 

December 31, 2010). The eliminated portion of the reserve relating to instruments that expired in 2010 

amounted to +12.0 million euro at December 31, 2011, compared with +21.4 million euro at December 31, 

2010. The changes in equity relating to derivatives traded in 2010 and still in portfolio at December 31, 2011, 

amounted to -1.8 million euro (-12.0 million euro at December 31, 2010). 

The non-effective component of cash flow hedges in portfolio at December 31, 2011, recognized in profit or 

loss was immaterial in both 2011 and 2010. 

With reference to fair value hedges in portfolio at December 31, 2011, the amount taken to profit or loss totaled 

+3.1 million euro for 2011 (+6.5 million euro for 2010). Recognized amounts attributable to underlying risk 

hedged during the year totaled -3.3 million euro at December 31, 2011 (-6.7 million euro at December 31, 

2010). These amounts are taken to profit or loss as gains and losses on interest-rate and currency derivatives 

(note 30). 

122









Due to employees 105,577 108,268 

Due to social security authorities 56,652 55,291 

Due to tax authorities 80,321 75,627 


Purchase commitments on non-controlling interests 67,768 63,749 

Advances from customers 73,522 61,283 

Other amounts due 186,171 220,818 

Total 607,353 604,874 


“Other amounts due” comprises amounts due to suppliers for non-current assets. 




Collateral given 

- Pledges 12.6 10.0 

- Liens and mortgages 119.3 89.0 

Total collateral given 131.9 99.0 

Deposits, guarantees, sureties and other 117.8 118.3 

Total 249.7 217.3 

At December 31, 2011, collateral consisted mainly of mortgages and liens securing loans and borrowings at the 

Indian subsidiaries. 

Contracts and orders issued for investments amounted to 83.6 million euro at December 31, 2011. They 

referred mainly to property, plant and equipment, as follows: 


December 31, 2011 less than 1 year 1 to 5 years more than 5 years 

Commitments for property, plant and equipment purchases 83.6 71.3 12.3 - 


Raw materials and supplies amounted to 1,976,767 thousand euro, as follows: 

(in thousands of euro) 2011 2010 Change 

Raw materials and semifinished goods 556,444 466,446 89,997 

Fuel 525,976 532,021 (6,045) 

Packaging materials, machinery 290,065 270,723 19,343 

Finished goods 123,945 170,957 (47,012) 

Electricity, water, gas 473,238 470,334 2,904 

Change in inventories of raw materials, consumables, other 7,099 23,980 (16,882) 

Total 1,976,767 1,934,461 42,306 

123 


26. Services 

Services amounted to 1,138,246 thousand euro, as follows: 


External services and maintenance 364,207 348,605 15,603 

Transport 499,441 428,970 70,471 

Legal fees and consultancy 48,084 53,508 (5,423) 

Rents 85,150 72,419 12,731 

Insurance 36,806 38,569 (1,764) 

Other 104,558 104,612 (54) 

Total 1,138,246 1,046,683 91,563 

"Other” consisted mainly of postal and telephone expenses, cleaning and surveillance expenses, and 

communication/marketing expenses. 

27. Employee expense 

Employee expense totaled 947,037 thousand euro, as follows: 


Wages and salaries 637,331 603,384 33,947 

Social security contributions and pension fund provisions 210,662 195,374 15,288 

Cost of stock option plans (183) 3,566 (3,749) 

Other costs 99,228 93,929 5,299 

Total 947,037 896,253 50,784 

“Other costs” related mainly to costs of temporary personnel, canteen costs, employee insurance costs and 

personnel training and recruitment. 

The number of employees is shown below: 

(heads) 2011 2010 

Number of employees at period end 19,896 20,139 

Average number of employees 20,524 20,432 

27.1 Stock options 

The terms and conditions of Italcementi S.p.A. stock option plans for directors and managers at December 31, 

2011, are set out below: 

No. options 

granted 

Exercise period 

Exercised 

options 

Cancelled 

options 

Unexercised 

options 

Unit subscription 

price 

Grant date 

March 7, 2003 965,945 1.1.2006 - 12.31.2012 924,820 - 41,125 € 8.627 

March 17, 2005 1,053,600 3.17.2008 - 3.16.2015 6,475 28,900 1,018,225 € 13.387 

March 7, 2006 631,403 3.7.2009 - 3.6.2016 4,187 50,325 576,891 € 16.890 

March 7, 2007 1,020,200 3.7.2010 - 3.6.2017 - 49,525 970,675 € 23.049 

June 20, 2007 701,250 6.20.2010 - 6.19.2015 - 701,250 - € 23.706 

March 26, 2008 623,300 3.26.2011 - 3.25.2018 - - 623,300 € 12.804 

June 4, 2008 1,564,750 6.4.2011 - 6.3.2018 - - 1,564,750 € 13.355 

Total 6,560,448 935,482 830,000 4,794,966 

124






With reference to the stock option plan granted on June 4, 2008, for senior managers, the Board of Directors 

meeting of March 4, 2011, assessed the performance targets assigned at inception, which provided for a 

maximum grant of 2,000,000 options. Based on targets achieved, the Board granted a total of 1,564,750 

options; the difference with respect to the maximum number of 2,000,000 generated a reduction in the plan 

value of 1,709 thousand euro, with a net gain of 611 thousand euro on the 2011 income statement. 

The grant date is the date of the Board of Directors’ meeting that approved the stock option plan. 

The average residual life of unexercised options is approximately 2 years and 7 months. 

The number and average exercise price of Italcementi S.p.A. options in the periods in question are set out 

below: 


number of options average subscription 

price 

number of options average subscription 

price 

Unexercised options at beginning of year 5,230,216 € 15.447 6,280,216 € 16.828 

Granted during year 

Cancelled during year * (435,250) (1,050,000) 

Exercised during year 

Expired during year 

Unexercised options at end of year 4,794,966 € 15.637 5,230,216 € 15.447 

Vested options at end of year 4,794,966 2,606,916 

* in 2011, a lower number of options granted on the June 4, 2008 plan; in 2010, waiver of grant 

The average ordinary share price in financial year 2011 was 5.9 euro (7.2 euro in 2010). 

The option exercise price at December 31, 2011, was between 8.627 euro and 23.049 euro. 

Only options granted after November 7, 2002, that had not vested at December 31, 2003, were measured and 

recognized at the date of transition to the IFRS. 

The following table sets out the details of all Group stock option plans and their cost, carried under “employee 

expense”: 


Grant date 

Company 

No. options 

granted 

Vesting period 

Employee expense 


March 7, 2007 Italcementi S.p.A. 1,020,200 3 years - 350 

March 23, 2007 Ciments Français S.A. 166,400 3 years - 477 

June 20, 2007 Italcementi S.p.A. 701,250 3 years - (1,407) 

March 26, 2008 Italcementi S.p.A. 623,300 3 years 120 555 

April 14, 2008 Ciments Français S.A. 152,900 3 years 308 1,080 

June 4, 2008 Italcementi S.p.A. 1,564,750 3 years (611) 2,620 

Total 4,228,800 (183) 3,675 

Stock option plan fair value at the grant date is estimated using a binomial model that takes dividends into 

account. The total option term is ten years. Volatility projections assume that past volatility, determined as the 

annual average for the past period net of extraordinary events, is indicative of future trends. 

No other stock option plan feature is taken into consideration when measuring fair value. 

125 



Other operating expense net of other operating income amounted to 30,239 thousand euro, as follows: 


Other taxes 79,850 76,346 3,504 

Provision for bad debts 25,901 11,552 14,348 

Provision for environmental restoration, quarries, other 66,460 71,515 (5,055) 

Miscellaneous income (141,972) (99,472) (42,500) 

Total 30,239 59,942 (29,704) 

2011 “Miscellaneous income” included net capital gains of 59.8 million euro on CO 2 emission rights trading 

(55.2 million euro in 2010) and income from reimbursement of “new entry” CO 2 quotas assigned to Italcementi 

S.p.A. for the period 2008-2012; the amount, 18.9 million euro, represents the present value of the receivable 

at December 31, 2011. 


Non-recurring income net of non-recurring expense amounted to 40,744 thousand euro and referred chiefly to 

gains from the sale of property, plant and equipment and intangible assets, employee expense for reorganizations 

and industrial restructurings, fines and penalties. 

(in thousands of euro) 2011 2010 

Net gains from the sale of non-current assets 66,275 9,384 

Non-recurring expenses for re-organizations (25,566) (11,850) 

Other non-recurring income (expense) 35 153 

Total non-recurring income (expense) 40,744 (2,313) 

Net gains included the gain from the sale of Axim operations for 33.6 million euro and the net gain of 14.0 

million euro from the sale of Italgen Turkey and Bares, whose main asset was the license for the Balikesir wind 

farm project in Turkey. 

In 2011 expense for re-organizations referred mainly to Italy, specifically the Calcestruzzi group for 14.2 million 

euro and Italcementi S.p.A. for 8.1 million euro, as well as to North America for 2.6 million euro and Spain for 

1.4 million euro; the item also includes the surplus of 3.3 million euro on the Calcestruzzi S.p.A. risk provision 

for fines imposed by the Competition and Market Authority. 

126







Finance costs net of finance income and exchange-rate differences and derivatives were as follows: 


(in thousands of euro) Income Costs Income Costs 

Interest income 27,883 27,508 

Interest expense (110,475) (133,836) 

Sub total 27,883 (110,475) 27,508 (133,836) 

Net interest in respect of net financial position (82,592) (106,328) 

Dividends and other income from equity investments 26,036 29,831 

Other finance income 20,283 8,458 

Capitalized finance costs 670 8,370 

Other finance costs (49,047) (34,638) 

Total finance income (costs) 74,202 (158,852) 65,797 (160,104) 

Gains/(losses) on interest-rate derivatives (6,852) (3,945) 

Gains/(losses) on exchange-rate derivatives (11,072) 1,140 

Net exchange-rate differences 479 7,302 

Exchange-rate differences and derivatives - (17,445) 4,497 - 

Total finance income (costs), 

exchange-rate differences and derivatives (102,095) (89,810) 

Net finance costs not considering exchange-rate differences and derivatives, amounted to 84.7 million euro 

(94.3 million euro in 2010, of which 21.4 million euro relating to the buyback of the US Private Placements” 

notes). 

Net interest in respect of the net financial position included, in 2011, net income of 2.8 million euro on the 

partial repurchase of bonds and, in 2010, net costs of 15.9 million euro as the share of the cost for the 

repurchase of the above-mentioned notes. 

Excluding these components, net interest in respect of net debt decreased to 85.4 million euro, from 90.4 

million euro in 2010. 

31. Impairment on financial assets 

The caption reflects an amount of 7,524 thousand euro for the reversal of the impairment loss recognized on 

the Calcestruzzi group at December 31, 2010, in the fair value reserve, which was taken to income after the 

consolidation of the Calcestruzzi group as from January 1, 2011. 


Income tax expense for the period was 68,811 thousand euro, as follows: 


Current tax 97,638 110,285 (12,647) 

Deferred tax (33,735) (45,703) 11,968 

Prior-year tax and net non-recurring tax items 4,908 (3,973) 8,882 

Total 68,811 60,608 8,203 

In Italy, the IRES, income tax rate, applied by the parent on estimated taxable income for the year was 27.5%, 

as in 2010. Taxes for Group companies in other countries are calculated using local tax rates. 

127 


The reconciliation between the tax charge reflected in the income statement and the theoretical tax charge 

does not consider IRAP, since IRAP uses a taxable base other than profit before tax. 

The reconciliation between the theoretical tax charge, determined using theoretical tax rates applicable in Italy, 

and the effective tax charge reflected in the consolidated income statement is set out below: 

(in thousands of euro) 2011 

Consolidated profit before tax 53,038 

Applicable IRES tax rate % 27.5% 

Theoretical tax charge 14,585 

Effect of difference between parent tax rate and tax rate for the other companies (1) 4,556 

Effect of tax rate reduction for tax relief/allowances - 

Tax effect on permanent differences (3,564) 

Net effect for the year of unrecognized deferred taxes on temporary differences (2) 30,922 

Effect of change in tax rates (3) 11,558 

Withholdings at source 3,669 

Effect of change in estimate on previously recognized/unrecognized deferred tax (1,817) 

Other taxes - 

Tax on profit for the year reflected in income statement, exclusing IRAP (a) 59,909 

Effective tax rate, excluding IRAP and other tax items not related to the profit for the year n.s. 

Other tax items not related to the profit for the year (b) 4,908 

IRAP (c) 3,994 

Tax on profit for the year reflected in income statement (a+b+c) 68,811 

Effective tax rate 

n.s. 

n.s. = not significant 

(1) The difference between the Italian tax rate for the parent and the rates in the foreign countries where the Group operates refers principally to 

France, Belgium and the USA. 

(2) Refers mainly to unrecognized deferred tax assets on losses for the year in the USA: 

(3) The effect of the change in tax rates refers largely to Egypt. 

128






33. Profit (loss) relating to discontinued operations 

On March 25, 2011, the Group sold the companies in Set Group Holding – Turkey, as reported in note 3 

“Changes in the scope of consolidation”. The net sale price of 269.7 million euro generated a consolidated net 

gain of 106.9 million euro after tax of 3.6 million euro. 

The income statement and the statement of cash flows of the sold Set Group Holding operations are set out 

below: 


Income statement 2011 2010 

Revenue - 131.0 

Recurring EBITDA - (5.4) 

EBITDA - (5.1) 

EBIT - (16.5) 

Profit before tax - (17.3) 

Income tax expense - (1.5) 

Profit (loss) relating to discontinued operations 106.9 (18.8) 


Owners of the parent 89.1 (15.4) 

Non-controlling interests 17.8 (3.4) 


Statement of cash flows 2011 2010 

Cash flow from operating activities - (7.0) 

Cash flow from divesting (investing) activities - (4.8) 

Cash flow from financing activities - 11.5 

Translation differences - 0.3 

Net cash flows from discontinued operations 256.9 (0.0) 

34. Other comprehensive income 

(in thousands of euro) Gross amount Tax Net amount 

Other comprehensive income at December 31, 2010 69,851 1,688 71,539 


Available-for-sale financial assets (49,336) (49,336) 

Derivatives 20,144 (3,142) 17,002 

Translation differences (26,234) (26,234) 

Share of other comprehensive income of equity accounted investees 649 649 

Other comprehensive income (54,777) (3,142) (57,919) 

Other comprehensive income at December 31, 2011 15,074 (1,454) 13,620 

129 


35. Earnings per share 

Earnings per share are determined on the profit for the period attributable to owners of the parent and are 

stated separately for ordinary shares and savings shares. 

Basic earnings per share 

Basic earnings per share are computed by dividing profit for the period attributable to ordinary and savings 

shareholders by the weighted average number of outstanding ordinary and savings shares for the period. 

Earnings per savings shares are increased with respect to earnings per ordinary shares by an amount 

equivalent to 3% of the share nominal value. 

The weighted average number of shares and attributable profit are shown below: 


ordinary savings 

savings 

ordinary shares 

(no. shares in thousands) 

shares shares 

shares 

No. shares at beginning of period 177,118 105,431 177,118 105,431 

Treasury shares at beginning of period (3,793) (106) (3,793) (106) 

Weighted average number of treasury shares purchased in period 

Weighted average number of treasury shares sold in period 

Weighted average number of shares at end of period 173,325 105,326 173,325 105,326 


Attributable profit (loss) for the period (3,923) 776 26,510 19,270 

(euro) 

Basic earnings per share -0.023 0.007 0.153 0.183 

Profit (loss) attributable to continuing operations (59,379) (32,923) 36,085 25,088 

(euro) 

Basic earnings per share attributable to continuing operations -0.343 0.313 0.208 0.238 

130






Diluted earnings per share 

Diluted earnings per share are computed in the same way as basic earnings per share, taking account of the 

dilutive effect of stock options; in 2011 this effect was zero. 

The weighted average number of shares and attributable profit are set out below: 


ordinary savings 

savings 

ordinary shares 

(no. shares in thousands) 

shares shares 

shares 


Dilutive effect of stock options 1 - 



Attributable profit (loss) for the period for diluted earnings per share (3,923) 776 26,510 19,270 

(euro) 

Diluted earnings per share -0.023 0.007 0.153 0.183 

Profit (loss) attributable to continuing operations (59,379) (32,923) 36,085 25,088 

(euro) 

Diluted earnings per share attributable to continuing operations -0.343 -0.313 0.208 0.238 

131 



Transactions with related parties in 2011 and 2010 are illustrated in the tables below: 


Revenue 

Trade 


(purchases) 

goods and 

services 

Other 

income 

(expense) 

Interest 

income 

(expense) 

and other 

receivables 

(payables) 

Financial 

assets 

(liabilities) 

Parent Italmobiliare S.p.A. 322 - 1 115,542 - 

(4,869) - (15) (6,551) (612) 

Jointly controlled 8,185 - - 2,267 - 

companies (*) (22) - - (22) - 

Subsidiaries 63,207 25 555 15,063 38,619 

and associates (35,799) (1,020) (148) (5,156) (512) 

Other related parties 178 30 - 63 - 

(1,614) - - (164) - 

Total 71,892 55 556 132,935 38,619 

(42,304) (1,020) (163) (11,893) (1,124) 

% impact on financial statements items 1.5% 0.1% 0.7% 9.2% 5.9% 

1.0% 3.4% 0.1% 0.9% 0.0% 

(*) subsidiaries of Italmobiliare S.p.A. 

2010 

Revenue 

Trade 


(purchases) 

goods and 

services 

Other 

income 

(expense) 

Interest 

income 

(expense) 

and other 

receivables 

(payables) 

Financial 

assets 

(liabilities) 

Parent Italmobiliare S.p.A. 349 25 18,557 75,036 4 

(5,052) - (180) (3,016) (602) 

Jointly controlled 7,852 6 - 2,114 - 

companies (*) (13) - - (13) - 

Subsidiaries 41,709 1,091 241 2,603 24,275 

and associates (17,803) (1,092) (5) (1,817) (461) 

Calcestruzzi group companies 93,417 2,239 2,176 28,538 223,996 

(19) (1) (64) (58) (6,321) 

Other related parties 1,831 49 - 403 - 

(1,215) - - (171) - 

Total 145,158 3,410 20,974 108,694 248,275 

(24,102) (1,093) (249) (5,075) (7,384) 

% impact on financial statements items 3.1% 8.0% 31.9% 9.3% 30.1% 

0.6% 1.8% 0.2% 0.4% 0.2% 

(*) subsidiaries of Italmobiliare S.p.A. 

Statement of financial position and income statement transactions with the companies in the Calcestruzzi group 

in 2010 are treated as transactions with related parties; those in 2011 were eliminated following the 

consolidation of the group as from January 1, 2011. 

Receivables and payables in respect of the parent Italmobiliare S.p.A. mainly refer to the effects of the tax 

consolidation and to the convertible bond issued by BravoSolution S.p.A., underwritten for a nominal value of 

611,554 thousand euro. 

Revenue and purchases of goods and services with respect to subsidiaries and associates mainly concern 

transactions with companies consolidated on a proportionate basis, notably Société des Carrieres du 

Tournaisis, Les Calcaires Girondins S.a.s., Medcem S.r.l., Atlantica de Graneles and Société Parisienne des 

132






Sablières S.A., and with companies valued with the equity method, including the Ciments Quebec Inc. group, 

Vassiliko Cement Ltd. and Cementi della Lucania S.p.A.. 

Details of other transactions with other related parties are provided in the section “Dealings with other related 

parties” in the Directors’ report. 

Dividends paid to the parent Italmobiliare S.p.A. in 2011 amounted to 13,169 thousand euro (13,169 thousand 

euro in 2010). 

36.1 Compensation to managers with strategic responsibilities 

The table below sets out compensation paid during the year to managers with strategic responsibilities: the 

directors, the chief operating officer and the manager in charge of preparing the financial reports (for 2011 only) 

of Italcementi S.p.A. for positions held in the Group: 


Short-term benefits: compensation and remuneration 11,813 9,558 

Post-employment benefits: provision for leaving and end-of-term entitlements 1,260 1,257 

Other long-term benefits: length-of-service bonuses and incentives 3,624 2,409 

Share-based payments (stock options) 3 809 

Total 16,700 14,033 

37. Joint ventures 

The Group’s most significant joint ventures in 2011 were French construction materials companies, the 

Medcem S.r.l. shipping company and the Saudi Arabian company International City for Ready Mix, active in the 

ready mixed concrete industry. 

The following table sets out the portion of assets and liabilities and revenue and expense reflected in the Group 

consolidated financial statements: 



Current assets 30.7 30.9 

Non-current assets 92.0 89.7 

Total assets 122.7 120.6 

Current liabilities 23.3 25.9 

Non-current liabilities 14.4 21.5 

Total liabilities 37.7 47.4 


Revenue 43.4 41.9 

Expense (44.6) (43.3) 

Profit before tax (1.3) (1.4) 

133 


38. Statement of cash flows 

38.1 Cash and cash equivalents 

Cash and cash equivalents include: 



Bank/postal demand accounts and cash on hand 103,683 111,005 

of which held by: Italcementi S.p.A. 479 946 

Italcementi Finance SA - 18 

Ciments Français SA 3,008 17,543 


Mutual funds 251,962 128,048 

of which held by: Italcementi S.p.A. - - 

Italcementi Finance SA 19,566 19,976 

Ciments Français SA 151,990 40,415 


Short-term deposits 257,689 336,167 

of which held by: Italcementi S.p.A. - - 

Italcementi Finance SA - - 

Ciments Français SA - - 


Total 613,334 575,220 

Short-term deposits have varying maturities within three months, in relation to the Group’s cash requirements; 

interest accrues at the respective short-term rates. 

As a result of laws in force in Egypt, Morocco, Thailand and India, the cash and cash equivalents of the Group 

companies in those countries are not immediately available to the holding Ciments Français S.A.. At December 

31, 2011, they amounted to 368.1 million euro (377.7 million euro at December 31, 2010). 

38.2 Equity investments net of cash acquisitions 

The table below itemizes the main equity investments included in the corresponding item on the statement of 

cash flows: 


Company 

Masoni - France - 9.1 

Sable Wilson - Canada - 0.2 

Gardawind - Italy - 1.2 

Star. Co. - Italy - 2.8 

Shifeng - China - 5.3 

Al Badia - Syria - 4.7 

Commerciale Inerti - Italy 2.3 - 

Others 0.3 1.3 

Total 2.6 24.6 

Equity investments are shown net of the cash of the acquired companies and the change in payables for equity 

investment purchases. 

134






38.3 Proceeds from the sale of non-current assets 

The main proceeds were those realized on the sale of Axim operations for 49.9 million euro, the sale of Goltas 

shares for 33.2 million euro and Bursa shares for 2.9 million euro and the sale of Italgen Turkey and Bares for 

54.2 million euro. 

38.4 Change in working capital 

The change in working capital is illustrated in the table below: 



Change in inventories (19,600) (21,923) 

Change in trade receivables (31,423) 151,752 

Change in trade payables 25,684 37,595 

Change in other assets/liabilities 4,534 (33,613) 

Total (20,805) 133,811 


The following tables itemize the most significant non-recurring transactions and their impact on the Group’s 

equity, financial position and results of operations: 


Equity Profit for the period Net debt 


amount % amount % amount % 

Carrying amounts 4,894,891 91,154 2,093,015 

Net gains from the sale of non-current assets 66,275 1.4% 66,275 72.7% 103,988 5.0% 

Non-recurring expense for re-organizations (25,566) 0.5% (25,566) 28.0% - 0.0% 

Other non-recurring income (expense) 35 0.0% 35 0.0% - 0.0% 

Income tax on non-recurring transactions (5,964) 0.1% (5,964) 6.5% - 0.0% 

Total 34,780 0.7% 34,780 38.2% 103,988 5.0% 

Figurative amount without non-recurring transactions 4,860,111 56,374 2,197,003 

Net debt 


amount % amount % amount % 

Carrying amounts 4,985,933 197,068 2,230,895 

Net gains from the sale of non-current assets 9,384 0.2% 9,384 4.8% 23,385 1.0% 

Non-recurring expense for re-organizations (11,850) 0.2% (11,850) 6.0% - 0.0% 

Other non-recurring income (expense) 153 0.0% 153 0.1% - 0.0% 

Income tax on non-recurring transactions 647 0.0% 647 0.3% - 0.0% 

Non-recurring taxes 2,763 0.1% 2,763 1.4% - 0.0% 

Total 1,097 0.02% 1,097 0.6% 23,385 1.0% 

Figurative amount without non-recurring transactions 4,984,836 195,971 2,254,280 

Equity 

2010 

Profit for the period 

135 



(as per CONSOB Resolution no.11971, May 14, 1999, art. 149-duodecies, par 1): 

Details of the fees paid by the Italcementi Group in financial year 2011 to the Independent Auditors KPMG 

S.p.A. and to the companies of the KPMG network: 

Services provided to the Group 


KPMG S.p.A. 

Other italian companies 

in the KPMG 

network 

Other foreign companies 

in the KPMG 

network 

Audit services 638 - 1,251 

Other attestation services 5 - 56 

Other legal, fiscal and corporate services - 315 72 

Total 643 315 1,379 


No significant events have taken place since closure of the financial year that require amendments to or 

additional comments on the Group’s financial position and results of operations as at and for the year ended 

December 31, 2011. 

In 2012 

In February the Group signed an agreement with Cimsa Cimento Sanayi ve Ticaret A.S. for the sale of the 

remaining 51% of the capital of Afyon Cimento Sanayi Turk A.S. The overall sale price has been set at 

57,530,000 Turkish lire, equivalent to approximately 25 million euro. The shares will be transferred to Cimsa 

and the payment made after approval has been obtained from the authorities and all conditions of the 

agreement fulfilled. The final price may be subject to the usual contractual adjustments. 



The Chairman 


136

Annexes 

137 


Annex 1 

The following table has been prepared in accordance with CONSOB Resolution no. 11971, art. 126, of May 

14, 1999, which requires listed companies to disclose their investments in unlisted companies when such 

investments exceed 10% of the companies' voting capital. 

The table also indicates the consolidation method and shows investments valued with the equity method. 

Interest held by Group companies 

Company 

Registered office 

Share capital 

Method 

Direct Indirect % 

Parent company 

Italcementi S.p.A. Bergamo I € 282,548,942.00 Line-by-line 

Aliserio S.r.l. Bergamo I € 2,270,000.00 90.00 - 90.00 Italcementi S.p.A. Line-by-line 

Azienda Agricola Lodoletta S.r.l. Bergamo I € 10,400.00 75.00 - 75.00 Italcementi S.p.A. 

B2E Markets France S.A.R.L. Paris F € 20,000.00 - 100.00 100.00 BravoSolution US, Inc. Line-by-line 

BravoBus S.r.l. Bergamo I € 600,000.00 - 51.00 51.00 BravoSolution S.p.A. Line-by-line 

BravoSolution Benelux B.V. Almere NL € 250,000.00 - 100.00 100.00 BravoSolution S.p.A. Line-by-line 

BravoSolution Brasil Serviços 

de Tecnologia Ltd.a 

Sao Paulo BR BRL 500.00 - 99.99 99.99 BravoSolution Mexico S.r.l. de C.V. 

BravoSolution China Co. Ltd. Shanghai PRC CNY 80,000.00 - 100.00 100.00 BravoSolution S.p.A. Line-by-line 

BravoSolution Espana S.A. Madrid E € 120,400.00 - 99.99 99.99 BravoSolution S.p.A. Line-by-line 

BravoSolution France S.a.s. Boulogne F € 3,254,150.00 - 100.00 100.00 BravoSolution S.p.A. Line-by-line 

Billancourt 

BravoSolution GmbH Unterhaching D € 1,000,000.00 - 100.00 100.00 Bravosolution S.p.A. Line-by-line 

BravoSolution Mexico S.r.l. de C.V. Mexico City MEX MXN 3,200,000.00 - 100.00 99.99 BravoSolution S.p.A. Line-by-line 

0.01 BravoSolution Espana S.A. 

BravoSolution S.p.A. Bergamo I € 29,302,379.00 83.01 - 83.01 Italcementi S.p.A. Line-by-line 

BravoSolution Software, Inc. Wilmington USA - - - 100.00 100.00 BravoSolution US, Inc. Line-by-line 

BravoSolution UK Ltd. London GB GBP 50,000.00 - 100.00 100.00 BravoSolution S.p.A. Line-by-line 

BravoSolution US, Inc. Harrisburg USA USD 1.00 - 100.00 100.00 BravoSolution S.p.A. Line-by-line 

BravoSolution Technologies Ltd. Guildford GB GBP 50,000.00 - 100.00 100.00 BravoSolution US, Inc. Line-by-line 

C.T.G. S.p.A. Bergamo I € 500,000.00 50.00 50.00 50.00 Italcementi S.p.A. Line-by-line 

50.00 Ciments Français S.A. 

C.T.G. Devnya EAD Devnya BUL BGN 200,000.00 - 100.00 100.00 C.T.G. S.p.A. Line-by-line 

CTG USA LLC Nazareth USA - - - 100.00 90.00 C.T.G. S.p.A. Line-by-line 

10.00 Essroc Cement Corp. 

Calcementi Jonici S.r.l. Siderno (RC) I € 9,000,000.00 99.90 0.10 99.90 Italcementi S.p.A. Line-by-line 

0.10 Italcementi Ingegneria S.r.l. 

Calcestruzzi S.p.A. Bergamo I € 110,000,000.00 99.90 0.10 99.90 Italcementi S.p.A. Line-by-line 


Cava delle Capannelle S.r.l. Bergamo I € 31,200.00 - 49.00 49.00 Calcestruzzi S.p.A. 

Cementi della Lucania S.p.A. Potenza I € 619,746.00 30.00 - 30.00 Italcementi S.p.A. Equity 

Cementificio di Montalto S.p.A. Bergamo I € 10,000,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

Commerciale Inerti S.r.l. Casalpusterlengo(LO) I € 52,000.00 - 33.00 33.00 Esa Monviso S.p.A. Equity 

E.S.A. Monviso S.p.A. Bergamo I € 1,340,000.00 - 100.00 100.00 Calcestruzzi S.p.A. Line-by-line 

Ecoinerti S.r.l. Recanati (MC) I € 91,800.00 - 50.00 50.00 Calcestruzzi S.p.A. Proportionate 

Gardawind S.r.l. Vipiteno (BZ) I I 100,000.00 - 49.00 49.00 Italgen S.p.A. Equity 

Generalcave S.r.l. Fiumicino (RM) I € 31,200.00 - 50.00 50.00 Calcestruzzi S.p.A. Equity 

Gruppo Italsfusi S.r.l. Savignano s/P. (MO) I € 156,000.00 99.50 0.50 99.50 Italcementi S.p.A. Line-by-line 


i.FotoGuiglia S.r.l. Turin I € 14,290.00 - 30.00 30.00 Italgen S.p.A. Equity 

I.GE.PO. - Impresa Gestione Vibo Valentia I € 25,500.00 18.00 - 18.00 Italcementi S.p.A. 

Porti S.r.l. - winding up 

Ing. Sala S.p.A. Sorisole (BG) I € 5,858,722.00 - 100.00 99.90 Nuova Sacelit S.r.l. Line-by-line 


International City for Ready Mix Jeddah SA SAR 100,000,000.00 50.00 - 50.00 Italcementi S.p.A. Proportionate 

Italcementi Finance Puteaux F € 20,000,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

Italcementi Ingegneria S.r.l. Bergamo I € 650,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

138






Company 


Share capital 


Method 


Italgen Maroc Ener S.A. Casablanca MAR MAD 8,000,000.00 - 100.00 99.99 Italgen S.p.A. Line-by-line 

0.01 Procimar S.A. 

Italgen Maroc S.A. Casablanca MAR MAD 300,000.00 - 99.87 99.87 Italgen S.p.A. Line-by-line 

Italgen Misr for Energy SAE Cairo EGY LE 35,000,000.00 - 100.00 98.00 Italgen S.p.A. Line-by-line 

1.00 Helwan Cement Co. 

1.00 Suez Cement Company SAE 

Italgen S.p.A. Bergamo I € 20,000,000.00 99.90 0.10 99.90 Italcementi S.p.A. Line-by-line 


Italterminali S.r.l. Bergamo I € 10,000.00 - 100.00 99.50 Cementificio di Montalto S.p.A. Line-by-line 


Les Ciments de Zouarine S.A. - in liq. Tunis TN TND 80,000.00 49.93 - 49.93 Italcementi S.p.A. 

Mantovana Inerti S.r.l. Castiglione delle I € 702,000.00 - 50.00 50.00 Calcestruzzi S.p.A. Proportionate 

Stiviere (MN) 

Nuova Sacelit S.r.l. Sorisole (BG) I € 7,500,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

Procalmi S.r.l. winding up Milan I € 51,000.00 - 11.52 11.52 Calcestruzzi S.p.A. 

S.A.F.R.A. S.r.l. - winding up Bologna I € 51,480.00 - 33.33 33.33 Calcestruzzi S.p.A. Equity 

SAMA S.r.l. Bergamo I € 1,000,000.00 99.00 1.00 99.00 Italcementi S.p.A. Line-by-line 


San Francesco S.c.a r.l. Foligno (PG) I € 5,000,000.00 - 40.00 40.00 Calcestruzzi S.p.A. 

Shqiperia Cement Company Shpk Tirana ALB LEK 74,250,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

Silos Granari della Sicilia S.r.l. Bergamo I € 7,980,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

Société Internationale Italcementi Luxembourg L € 1,771,500.00 99.87 0.13 99.87 Italcementi S.p.A. Line-by-line 

(Luxembourg) S.A. 0.13 Italcementi Ingegneria S.r.l. 

SO.RI.TE. S.r.l. Turin I € 100,000.00 - 25.00 25.00 Calcestruzzi S.p.A. 

Star.co S.r.l. Naples I I 118,000.00 100.00 - 100.00 Italcementi S.p.A. Line-by-line 

Vert Tech LLC Wilmington USA - - - 100.00 100.00 BravoSolution US, Inc. Line-by-line 

Ciments Français S.A. Puteaux F € 143,114,304.00 83,20 0.21 83.20 Italcementi S.p.A. Line-by-line 


(voting rights: 

90.74 Italcementi S.p.A.) 

3092-0631 Quebec Inc. St. Basile CAN CAD 6,250.00 - 100.00 100.00 Ciment Quebec Inc. Equity 

Afyon Cimento Sanayi Tas Istanbul TR YTL 3,000,000.00 - 51.00 51.00 Ciments Français S.A. Line-by-line 

Al Badia Cement JSC Damascus SY SYP 12,200,000,000.00 - 12.00 12.00 Menaf S.a.s. 

Al Mahaliya Ready Mix Concrete WLL Safat KWT KWD 500,000.00 - 51.00 51.00 Hilal Cement Company Line-by-line 

Al Manar Cement Holding S.a.s. Puteaux F € 3,300,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Arrowhead Investment Company Carson City USA USD 1,000.00 - 100.00 100.00 Essroc Corporation Line-by-line 

Asia Cement Energy Conservation Ltd. Bangkok TH BT 1,001,000,000.00 - 39.52 39.52 Asia Cement Public Co., Ltd. (*) Line-by-line 

Asia Cement Products Co., Ltd. Bangkok TH BT 10,000,000.00 - 39.52 39.52 Asia Cement Public Co., Ltd. (*) Line-by-line 

Asia Cement Public Co., Ltd. Bangkok TH BT 4,670,523,072.00 - 39.53 25.43 Ciments Français S.A. Line-by-line 

14.10 Vaniyuth Co. Ltd. (*) 

Asment Temara S.A. Temara MAR MAD 495,000,000.00 - 37.01 19.99 Ciments Français S.A. Equity 


Atlantica de Graneles y Moliendas S.A. Vizcaya E € 5,000,000.00 - 50.00 50.00 Sociedad Financiera y Minera S.A. Proportionate 

Axim for Industrials SAE Cairo EGY LE 15,000,000.00 - 100.00 90.00 Suez Cement Company SAE Line-by-line 


5.00 Tourah Portland Cement Company SAE 

Betomar S.A. Casablanca MAR MAD 84,397,800.00 - 99.99 99.99 Ciments du Maroc S.A. Line-by-line 

Beton.Ata LLP Almaty KAZ TEN 416,966,426.00 - 75.50 75.50 Shymkent Cement Line-by-line 

Béton Contrôle de Gascogne S.A. Soorts Hossegor F € 40,000.00 - 37.00 37.00 Béton Contrôle du Pays Basque S.a.s. 

Béton Contrôle de l'Adour S.a.s. Bayonne F € 150,000.00 - 59.96 59.96 Béton Contrôle du Pays Basque S.a.s. Line-by-line 

Béton Contrôle des Abers S.a.s. Lannilis F € 104,000.00 - 34.00 34.00 Unibéton S.a.s. Equity 

Béton Contrôle du Pays Basque S.a.s. Bayonne F € 120,000.00 - 59.98 59.98 Unibéton S.a.s. Line-by-line 

Béton Mercier Inc. Chateaugauy CAN - - - 100.00 100.00 Ciment Quebec Inc. Equity 

139 


Company 


Share capital 


Method 


Bonafini S.a.s. Argences F € 45,392.00 - 100.00 96.79 Tratel S.a.s. Line-by-line 

3.21 Larricq S.a.s. 

Cambridge Aggregates Inc. Cambridge CAN CAD 10.00 - 60.00 60.00 Essroc Canada Inc. Line-by-line 

Canteras Aldoyar S.L. Olazagutia E € 1,508,510.00 - 20.00 20.00 Hormigones y Minas S.A. 

Capitol Cement Corporation Winchester USA USD 1,000,000.00 - 100.00 100.00 Riverton Investment Corporation Line-by-line 

Carrières Bresse Bourgogne Epervans F € 387,189.00 - 66.48 66.48 Dragages et Carrières S.A. Proportionate 

Centro Administrativo y de Malaga E € 60,200.00 - 99.99 99.99 Sociedad Financiera y Minera S.A. Line-by-line 

Servicios de Malaga S.A. 

Cie pour l’Investissement Puteaux F € 7,350,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Financier en Inde 

Ciment Quebec Inc. St. Basile CAN CAD 19,461,161.70 - 100.00 100.00 Groupe Ciment Quebec Inc. Equity 

Cimento de Bissau Limitada Guinea Bissau GNB XOF 2,000,000.00 - 99.00 99.00 Tercim S.A. 

Ciment du Littoral S.A. Bassens F € 37,000.00 - 99.99 99.99 Ciments Calcia S.a.s. Line-by-line 

Ciments Calcia S.a.s. Guerville F € 593,836,525.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Ciments du Maroc S.A. Casablanca MAR MAD 1,443,600,400.00 - 62.31 58.79 Cocimar S.a.s. Line-by-line 


Ciments du Nord Nouadhibou MAU OUG 1,340,000,000.00 - 15.00 15.00 Ciments du Maroc 

Ciments Français Europe N.V. Amsterdam NL € 392,596,275.00 - 100.00 67.99 Sodecim S.a.s. Line-by-line 


CIMFRA (China) Limited Puteaux F € 62,116,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Ciminter S.A. Luxembourg L € 53,800,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Cocimar S.a.s. Puteaux F € 72,957,690.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Codesib S.a.s. Puteaux F € 5,037,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Compagnie des Ciments Belges S.A. Tournai B € 295,031,085.00 - 100.00 39.74 Ciments Français S.A. Line-by-line 

38.78 Ciments Français Europe N.V. 

21.40 Ciments Calcia S.a.s. 

0.08 Compagnie Financière et de Participations S.A. 

Compagnie Financière et de Participations S.a.s. Puteaux F € 18,000,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Compania General de Canteras S.A. Malaga E € 479,283.69 - 99.41 96.12 Sociedad Financiera y Minera S.A. Line-by-line 

3.29 Sax S.a.s. 

Conglomerantes Hidraulicos Especiales S.A. Madrid E € 2,361,960.00 - 85.00 85.00 Sociedad Financiera y Minera S.A. Line-by-line 

De Paepe Béton N.V. Ghent B € 500,000.00 - 99.99 99.99 Compagnie des Ciments Belges S.A. Line-by-line 

DECOM Egyptian Co for Development Cairo EGY LE 63,526,401.28 - 99.99 99.99 Ready Mix Production Universal Company Line-by-line 

of Building Materials SAE 

Decoux S.a.s. Beaucaire F € 120,000.00 - 100.00 100.00 Tratel S.a.s. Line-by-line 

Development for Industries Co. SAE Cairo EGY LE 15,000,000.00 - 100.00 90.00 Suez Cement Company SAE Line-by-line 



Devnya Bulk Services EAD Devnya BUL LEV 50,000.00 - 100.00 100.00 Devnya Cement AD 

Devnya Cement AD Devnya BUL LEV 1,028,557.00 - 99.97 99.97 Marvex Bulgaria EOOD Line-by-line 

Devnya Finance A.D. Devnya BUL LEV 5,000,000.00 - 50.00 50.00 Devnya Cement AD Equity 

Dobrotitsa BSK A.D. Dobrich BUL LEV 88,954.00 - 26.40 26.40 Devnya Cement AD 

Dragages et Carrières S.A. Epervans F € 1,000,000.00 - 49.99 49.99 GSM S.a.s. Proportionate 

Dragages Transports & Travaux La Rochelle F € 3,947,894.00 - 50.00 33.33 GSM S.a.s. Proportionate 

Maritimes S.A. 16.67 Granulats Ouest - GO 

Dunkerque Ajouts Snc Paris F € 6,000.00 - 34.00 34.00 Ciments Calcia S.a.s. 

Ecocim S.a.s. Casablanca MAR MAD 2,000,000.00 - 55.00 30.00 Ciments du Maroc S.A. 

25.00 Asment Temara S.A. 

Entreprise Lorraine d’Agriculture Heillecourt F € 10,000.00 - 100.00 100.00 GSM S.a.s. 

ELDA S.A.R.L. 

Essroc Canada Inc. Mississauga CAN CAD 258,135,174.00 - 100.00 100.00 Essroc Corporation Line-by-line 

Essroc Cement Corp. Nazareth USA USD 8,330,000.00 - 100.00 100.00 Essroc Corporation Line-by-line 

140






Company 


Share capital 


Method 


Essroc Corporation Nazareth USA USD 1,000.00 - 100.00 100.00 Essroc International Line-by-line 

Essroc International Puteaux F € 244,398,096.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Essroc Ready Mix Corp Nazareth USA USD 1.00 - 100.00 100.00 Essroc Cement Corp. Line-by-line 

Essroc San Juan Inc. Espinosa P.RICO USD 10,000.00 - 100.00 100.00 Essroc Cement Corp. Line-by-line 

Eurarco France S.A. Le Crotoy F € 1,520,000.00 - 64.99 64.99 GSM S.a.s. Line-by-line 

Eurocalizas S.L. Cantabria E € 723,030.00 - 33.33 33.33 Hormigones y Minas S.A. 

Eurotech Cement S.h.p.k. Durres ALB LEK 273,214,000.00 - 84.00 84.00 Halyps Building Materials S.A. Line-by-line 

Fraimbois Granulats S.A.R.L. Moncel les Luneville F € 75,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Gacem Company Limited Serrekunda GAM GMD 4,500,000.00 - 80.00 80.00 Tercim S.A. Line-by-line 

Goltas Goller Bolgesi Cimento Isparta TR YTL 20,000,000.00 - 24.03 24.03 Ciments Français S.A. 

Sanayi ve Ticaret 

Granulats de la Drôme S.a.s. Saint Jean de Vedas F € 645,600.00 - 51.01 51.01 GSM S.a.s. Line-by-line 

Granulats Ouest - GO Saint Herblain F € 784,657.44 - 100.00 100.00 GSM S.a.s. Line-by-line 

Graves de l’Estuaire de la Gironde L.G.E.G. St. Jean de Blaignac F - - - 50.00 50.00 GSM S.a.s. Proportionate 

Greyrock Inc. Nazareth USA USD 1,000.00 - 100.00 100.00 Essroc Cement Corp. Line-by-line 

Groupe Ciment Quebec Inc. St. Basile CAN CAD 57,000,000.00 - 50.00 50.00 Essroc Canada Inc. Equity 

GSM S.a.s. Guerville F € 18,675,840.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Gulbarga Cement Limited Bengaluru IN INR 231,257,000.00 - 74.00 74.00 Zuari Cement Ltd. Line-by-line 

Gulf Ready Mix Concrete Company WLL Kuwait KWT KWD 100,000.00 - 100.00 99.90 Al Mahaliya Ready Mix Concrete WLL Line-by-line 

0.10 Hilal Cement Company 

Halyps Building Materials S.A. Aspropyrgos GR € 48,821,060.64 - 99.91 59.89 Ciments Français S.A. Line-by-line 

40.02 Sociedad Financiera y Minera S.A. 



39.99 Sociedad Financiera y Minera S.A.) 

Helwan Cement Co. Cairo EGY LE 583,875,425.00 - 99.47 99.47 Suez Cement Company SAE Line-by-line 

Helwan Bags Company SAE Helwan EGY LE 6,000,000.00 - 71.00 70.00 Helwan Cement Co. Line-by-line 

1.00 Development for Industries Co. SAE 

Hilal Cement Company Safat KWT KWD 6,987,750.00 - 51.00 51.00 Suez Cement Company SAE Line-by-line 

Hormigones Olatzi S.A. Olazagutia E € 283,804.22 - 25.00 25.00 Hormigones y Minas S.A. 

Hormigones Txingudi S.A. San Sebastian E € 240,560.22 - 33.33 33.33 Hormigones y Minas S.A. 

Hormigones y Minas S.A. Malaga E € 8,689,378.20 - 99.99 99.99 Sociedad Financiera y Minera S.A. Line-by-line 

ICS Danube Cement S.r.l. Chisinau MD MDL 556,000.00 - 100.00 100.00 Devnya Cement AD Line-by-line 

Immobilière des Technodes S.a.s. Guerville F € 8,024,400.00 - 100.00 59.97 Ciments Français S.A. Line-by-line 


Industrie Sakia el Hamra “Indusaha” S.A. Laayoune MAR MAD 81,680,000.00 - 91.00 91.00 Ciments du Maroc Line-by-line 

Innocon Inc. Richmond Hill CAN CAD 18,300,000.20 - 50.00 50.00 Essroc Canada Inc. Equity 

Innocon Partnership Agreement Inc. Richmond Hill CAN CAD 2,003.00 - 51.50 48.50 Essroc Canada Inc Equity 

3.00 Innocon Inc. 

Interbulk Egypt for Export SAE Cairo EGY LE 250,000.00 - 100.00 98.00 Interbulk Trading S.A. Line-by-line 

1.00 Menaf S.a.s. 

1.00 Tercim S.A. 

Interbulk Trading S.A. Lugano CH CHF 7,470,600.00 - 99.99 84.99 Ciminter S.A. Line-by-line 


Intercom S.r.l. Bergamo I € 2,750,000.00 - 100.00 99.50 Interbulk Trading S.A. Line-by-line 


Inversiones e Iniciativas en Aridos S.L. Madrid E € 3,010.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Investcim S.A. Puteaux F € 110,405,840.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Italcementi for Cement Manufacturing Libyian Tripoli LAR LYD 20,000,000.00 - 50.00 50.00 Al Manar Cement Holding S.a.s. Proportionate 

Italmed Cement Company Ltd. Limassol CYP € 21,063,780.00 - 100.00 100.00 Halyps Building Materials S.A. Line-by-line 

Jalaprathan Cement Public Co., Ltd. Bangkok TH BT 1,200,000,000.00 - 58.96 12.42 Asia Cement Public Co., Ltd. (*) Line-by-line 


9.54 Vesprapat Holding Co., Ltd. (*) 

141 


Company 


Share capital 


Method 


Jalaprathan Concrete Products Co., Ltd. Bangkok TH BT 280,000,000.00 - 58.95 58.95 Jalaprathan Cement Public Co., Ltd. (*) Line-by-line 

Johar S.a.s. Luxemont et Villotte F € 1,221,632.00 - 100.00 100.00 Tratel S.a.s. Line-by-line 

JTC Bangkok TH BT 10,400,000.00 - 58.95 58.95 Jalaprathan Concrete Products Co. Ltd. (*) 

Kuwait German Company for Ready Kuwait KWT KWD 824,000.00 - 100.00 99.00 Al Mahaliya Ready Mix Concrete WLL Line-by-line 

Mix Concrete WLL 1.00 Hilal Cement Company 

Larricq S.a.s. Airvault F € 508,000.00 - 100.00 100.00 Tratel S.a.s. Line-by-line 

Les Calcaires Girondins S.a.s. Cenon F € 100,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Les Calcaires Sud Charentes Cherves Richemont F € 1,524.50 - 34.00 34.00 GSM S.a.s. 

Les Graves de l’Estuaire S.a.s. Le Havre F € 297,600.00 - 33.33 33.33 GSM S.a.s. Proportionate 

Les Quatre Termes S.a.s. Salon de Provence F € 40,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Les Sables de Mezieres S.a.s St Pierre des Corps F € 40,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Les Sabliers de l’Odet S..a.s. Quimper F € 134,400.00 - 97.47 94.93 Dragages Transports & Travaux Maritimes S.A. Proportionate 

2.54 GSM S.a.s. 

Lyulyaka E.A.D. Devnya BUL LEV 759,372.00 - 100.00 100.00 Devnya Cement AD Line-by-line 

Marvex Bulgaria EOOD Devnya BUL LEV 89,424,100.00 - 100.00 100.00 Sociedad Financiera y Minera S.A. Line-by-line 

Mauritanienne des Batiments et Routes S.A. Nouakchott MAU OUG 690,000,000.00 - 99.42 99.42 Mauritano-Française des Ciments Line-by-line 

Mauritano-Française des Ciments Nouakchott MAU OUG 1,111,310,000.00 - 51.11 51.11 Ciments Français S.A. Line-by-line 

Medcem S.r.l. Naples I € 5,500,000.00 - 50.00 50.00 Intercom S.r.l. Proportionate 

Menaf S.a.s. Puteaux F € 352,500,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

MTB - Maritime Trading & Brokerage Srl Genoa I € 70,000.00 - 33.33 33.33 Interbulk Trading S.A. Equity 

Naga Property Co Bangkok TH BT 100,000,000.00 - 58.95 58.95 Jalaprathan Cement Public Co. Ltd. (*) Line-by-line 

Neuciclaje S.A. Bilbao E € 396,669.00 - 30.00 30.00 Sociedad Financiera y Minera S.A. 

Novhorvi S.A. Vitoria E € 180,300.00 - 25.00 25.00 Hormigones y Minas S.A. 

Parcib s.a.s. Puteaux F € 40,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Procimar S.A. Casablanca MAR MAD 27,000,000.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Ready Mix Production Company SAE Cairo EGY LE 5,000,000.00 - 52.00 52.00 Suez Cement Company SAE Line-by-line 

Ready Mix Production Universal Co. SAE Cairo EGY LE 15,000,000.00 - 52.00 52.00 Suez Cement Company SAE Line-by-line 

Riverton Corporation Winchester USA USD 859,310.00 - 100.00 100.00 Riverton Investment Corporation Line-by-line 

Riverton Investment Corporation Winchester USA USD 8,340.00 - 100.00 100.00 Essroc Cement Corp. Line-by-line 

S.A. Dijon Béton Dijon F € 184,000.00 - 15.00 15.00 GSM S.a.s. Equity 

Saarlandische Zementgesellschaft MBH Saarbrucken D € 52,000.00 - 80.00 80.00 Ciminter S.A. Line-by-line 

Sablimaris S.a.s. Lanester F € 4,094,776.00 - 100.00 66.28 Dragages Transports & Travaux Maritimes S.A. Proportionate 

33.72 Les Sabliers de l’Odet 

Sable Classifie et Equipement 

de Wilson Ltèe 

Alcove CAN CAD 12,100.00 - 100.00 100.00 Essroc Canada Inc. Line-by-line 

Sas des Gresillons Paris F € 60,000.00 - 35.00 35.00 GSM S.a.s. Proportionate 

Sax S.a.s. Guerville F € 482,800.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

SCI de Balloy Avon F € 20,310.00 - 100.00 100.00 GSM S.a.s. Line-by-line 

SCI de Barbeau Bray sur Seine F € 8,000.00 - 49.00 49.00 GSM S.a.s. 

SCI des Granets Cayeux sur M. F € 4,575.00 - 33.33 33.33 GSM S.a.s. 

SCI du Colombier Rungis F € 2,000.00 - 63.00 63.00 GSM S.a.s. 

SCI Lepeltier S. Doulchard F € 6,150.00 - 100.00 100.00 GSM S.a.s. Line-by-line 

SCI Taponnat Cherves Richemont F € 1,500.00 - 50.00 50.00 GSM S.a.s. 

Scori S.A. Plaisir F € 1,092,800.00 - 13.95 13.95 Ciments Calcia S.a.s. 

Shaanxi Fuping Cement Co. Ltd. Shaanxi Province PRC CNY 597,000,000.00 - 100.00 100.00 CIMFRA (China) Limited Line-by-line 

Shaanxi Shifeng Cement Co. Ltd. Shaanxi Province PRC CNY 100,000,000.00 - 35.00 35.00 Shaanxi Fuping Cement Co. Ltd. 

Shymkent Cement Shymkent KAZ TEN 380,660,000.00 - 92.88 92.88 Ciments Français S.A. Line-by-line 

Sider Navi S.p.A. Naples I € 22,000,000.00 - 20.00 20.00 Medcem S.r.l. Equity 

Singha Cement (Private) Limited Colombo SRI L. LKR 397,395,770.00 - 80.16 80.16 Ciments Français S.A. Line-by-line 

Sitapuram Power Limited Hyderabad IN INR 480,000,000.00 - 50.99 50.99 Zuari Cement Ltd. Line-by-line 

142






Company 


Share capital 


Method 


Sociedad Financiera y Minera S.A. Madrid E € 39,160,000.00 - 99.94 56.58 Sodecim S.a.s. Line-by-line 

39.87 Ciments Français Europe N.V. 

3.02 Hormigones y Minas S.A. 

0.47 Sociedad Financiera y Minera S.A. 


58.61 Sodecim S.a.s. 

41.30 Ciments Français Europe N.V.) 

Société Calcaires Lorrains Heillecourt F € 40,000.00 - 49.92 49.92 GSM S.a.s. Proportionate 

Société Civile Bachant le Grand Bonval Guerville F € 1,500.00 - 80.00 80.00 GSM S.a.s. 

Société Civile d'Exploitation Rheims F € 3,000.00 - 90.00 50.00 Société Civile Bachant le Grand Bonval 

Agricôle de l'Avesnois 40.00 GSM S.a.s. 

Société de la Grange d'Etaule Gray F € 3,750.00 - 99.60 99.60 Ciments Calcia S.a.s. Line-by-line 

Société des Calcaires de Souppes 

sur Loing S.C.S.L. 

Souppes sur Loing F € 2,145,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Société des Carrières Tournai B € 12,297,053.42 - 65.00 23.90 Ciments Français Europe N.V. Proportionate 

du Tournaisis S.C.T. S.A. 18.79 Ciments Français S.A. 


6.00 Compagnie des Ciments Belges S.A. 

Société Foncière de la Petite Seine S.a.s. Saint Sauveur les Bray F € 50,000.00 - 40.00 40.00 GSM S.a.s. 

Société Immobilière Marguerite VIII S.r.l. Casablanca MAR MAD 100,000.00 - 98.00 98.00 Ciments du Maroc S.A. Line-by-line 

Société Immobilière Marguerite X S.r.l. Casablanca MAR MAD 100,000.00 - 98.00 98.00 Ciments du Maroc S.A. Line-by-line 

Société Parisienne des Sablières S.A. Pont de L’Arche F € 320,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Socli S.a.s. Izaourt F € 144,960.00 - 99.99 99.99 Ciments Calcia S.a.s. Line-by-line 

Sodecim S.a.s. Puteaux F € 458,219,678.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Sodramaris S.n.c. La Rochelle F € 7,001,000.00 - 50.00 50.00 GSM S.a.s. Proportionate 

Soficem S.n.c. Puteaux F € 1,000.00 - 100.00 99.00 Ciments Français S.A. Line-by-line 

1.00 

Compagnie Financière et de 

Partecipations S.a.s. 

Srt Rouennaise de Transformation Grand Couronne F € 7,500.00 - 60.00 60.00 Ciments Calcia S.a.s. Line-by-line 

Ste Aquitaine de Transformation S.a.s. Saint Cloud F € 10,000,000.00 - 40.00 40.00 Ciments Calcia S.a.s. Equity 

Ste Extraction & Amenagement Avon F € 40,000.00 - 56.40 56.40 GSM S.a.s. Proportionate 

de la Plaine de Marolles S.a.s. 

Stinkal S.a.s. Ferques F € 1,540,000.00 - 35.00 35.00 GSM S.a.s. Equity 

St. Basile Transport Inc. St. Basile CAN CAD 9,910.00 - 100.00 100.00 Ciment Quebec Inc. Equity 

Suez Bag Company SAE Cairo EGY LE 20,250,000.00 - 57.84 53.32 Suez Cement Company SAE Line-by-line 


Suez Bosphorus Cimento Sanayi Ticaret Istanbul TR YTL 50,000.00 - 99.99 99.99 Suez Cement Company SAE Line-by-line 

Suez Cement Company SAE Cairo EGY LE 909,282,535.00 - 55.07 26.05 Menaf S.a.s. Line-by-line 


11.66 Ciments du Maroc S.A. 

5.00 Tercim S.A. 

Suez for Import & Export Company SAE Cairo EGY EGP 3,750,000.00 - 100.00 40.00 Axim for Industrials SAE Line-by-line 

40.00 Development for Industries Co. SAE 

20.00 Suez for Transportation & Trade SAE 

Suez for Transportation & Trade SAE Cairo EGY LE 10,000,000.00 - 100.00 55.00 Helwan Cement Co. Line-by-line 

35.00 Suez Cement Company SAE 


Suez Lime SAE Cairo EGY LE 7,390,000.00 - 50.00 49.00 Suez Cement Company SAE Proportionate 


Tameer Betoon for Trading Doha Q QAR 200,000.00 - 49.00 49.00 Hilal Cement Company Equity 

and Contracting LLC 

143 


Company 


Share capital 


Method 


Technodes S.a.s. Guerville F € 3,200,000.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Tecno Gravel Egypt SAE Cairo EGY LE 15,000,000.00 - 45.00 45.00 Suez Cement Company SAE Equity 

Tercim S.A. Puteaux F € 55,539,000.00 - 100.00 99.99 Ciments Français S.A. Line-by-line 

0.01 Sax S.a.s. 

Tomahawk Inc. Wilmington USA USD 100.00 - 100.00 100.00 Essroc Cement Corp. Line-by-line 

Tourah Portland Cement Company SAE Cairo EGY LE 357,621,000.00 - 71.93 66.12 Suez Cement Company SAE Line-by-line 

5.81 Menaf S.a.s. 

Trabel Affretement Gaurain Ramecroix B € 61,500.00 - 100.00 99.84 Tratel S.a.s. Line-by-line 


Trabel Transports S.A. Gaurain-Ramecroix B € 750,000.00 - 100.00 89.97 Tratel S.a.s. Line-by-line 

10.03 Compagnie des Ciments Belges S.A. 

Tragor S.a.s. Pessac F € 892,048.00 - 100.00 100.00 Tratel S.a.s. Line-by-line 

Tratel S.a.s. Guerville F € 6,025,580.00 - 100.00 100.00 Ciments Calcia S.a.s. Line-by-line 

Unibéton Luxembourg S.A. Luxembourg L € 35,000.00 - 100.00 100.00 Unibéton S.a.s. 

Unibéton S.a.s. Guerville F € 27,159,732.00 - 99.99 99.99 Ciments Français S.A. Line-by-line 

Unibéton Var S.a.s. Lambesc F € 40,000.00 - 100.00 100.00 Unibéton S.a.s. Line-by-line 

Uniwerbéton S.a.s. Heillecourt F € 160,000.00 - 70.00 70.00 Unibéton S.a.s. Line-by-line 

Valoise S.a.s. Pierrelaye F € 37,570.00 - 60.00 60.00 GSM S.a.s. Proportionate 

Vaniyuth Co. Ltd. Bangkok TH BT 100,000.00 - 48.80 48.80 Investcim S.A. Line-by-line 

Vassiliko Cement Works Ltd. Nicosia CYP € 30,932,457.21 - 24.65 14.94 Italmed Cement Company Ltd. Equity 

9.71 Compagnie Financière et de Participations S.A. 

Ventore S.L. Malaga E € 14,400.00 - 100.00 99.56 Sociedad Financiera y Minera S.A. Line-by-line 

0.44 Hormigones y Minas S.A. 

Vesprapat Holding Co. Ltd. Bangkok TH BT 20,000,000.00 - 49.00 49.00 Sax S.a.s. Line-by-line 

Vulkan Cement S.A. Dimitrovgrad BUL LEV 452,967.00 - 98.40 70.00 Ciments Français S.A. Line-by-line 

28.40 Devnya Cement A.D. 

Xinpro Limited Puteaux F € 37,000.00 - 100.00 100.00 Ciments Français S.A. Line-by-line 

Yuzhno-Kyrgyzsky Cement Batken Oblast KG KGS 528,317,200.00 - 11.00 11.00 Codesib S.a.s. 

Zuari Cement Ltd. Andra Pradesh IN INR 4,279,614,000.00 - 99.99 80.14 Ciments Français S.A. Line-by-line 

19.85 Cie pour l’Investissement Financier en Inde 


99.99 Ciments Français S.A.) 

(*) Percentage interest held by the Ciments Français group 

144

Representation form pursuant to art. 154-bis, par. 5 TUF in relation to the 

consolidated financial statement (pursuant to art. 81-ter of Consob Regulation 

n° 11971/99, and subsequent modifications and integrations) 

1. The undersigned Carlo Pesenti, Chief Executive Officer and Carlo Bianchini, the Manager 

in charge of preparing the company’s financial reports, of Italcementi S.p.A., having also 

taken into account the provisions of Article 154-bis, paragraphs 3 and 4, of the Italian 

Legislative Decree February no. 58 of 24 February 1998, hereby certify: 

the adequacy in relation to the legal entity features and 

the effective implementation 

of the administrative and accounting procedures for the preparation of the consolidated 

financial statement over the course of the period from January 1 st , 2011 and December 31 st , 

2011. 

2. The representation of the adequacy of the administrative and accounting procedures 

adopted in the preparation of consolidated financial statements as at December 31 st , 2011 is 

based on a form identified by Italcementi according to the CoSO framework (illustrated in the 

CoSO Report) and also takes into account the document “Internal Control over Financial 

Reporting – Guidance for Smaller Public Companies”, both issued by the Committee of 

Sponsoring Organizations of the Treadway Commission, representing a generally accepted 

international framework. 

3. It is also certified that: 

3.1 the consolidated financial statement: 

a) has been drawn up in accordance with the international accounting standards 

recognised in the European Union under the EC regulation 1606/2002 of the 

European Parliament and of the Council of 19 July 2002; 

b) is consistent with the entries in the accounting books and records; 

c) is capable of providing a true and fair representation of the assets and liabilities, 

profits and losses and financial position of the issuer and the group of companies 

included in the consolidation. 

3.2 The directors’ report includes a reliable analysis of the performance and the results of 

operations, and the overall situation of the issuer and the group of companies included 

in the consolidation, together with a description of the main risks and uncertainties they 

are exposed to. 

Signed by: Carlo Pesenti, Chief Executive Officer 

Signed by: Carlo Bianchini, Manager in Charge 

March 2 nd , 2012 

This report has been translated into the English version solely for the convenience of international 

readers 

145 


148

Italcementi S.p.A. Annual Report 

149 



Any changes in the standards and regulations, compared to 2010, are detailed in the notes 

under the heading “Statement of compliance with the IFRS”. In accordance with the 

provisions of European Union Regulation no. 1606 of 2002, the principles to be adopted do 

not include the standards and interpretations published by the International Accounting 

Standards Board (IASB) and the International Financial Reporting Interpretations 

Committee (IFRIC) at December 31, 2011, but not endorsed by the European Union at that 

date. Furthermore, the European Union has endorsed additional standards/interpretations 

that Italcementi S.p.A. will apply at a subsequent time, having decided not to elect early 

application. 

Earnings indicators 

To assist comprehension of its financial data, Italcementi S.p.A. employs a number of 

widely used indicators, which are not contemplated by the IFRS. 

Specifically, the income statement presents the following intermediate results / indicators: 

recurring EBITDA, EBITDA, EBIT, computed as the sum of the preceding items. On the 

face of the statement of financial position, similar considerations apply to net debt, whose 

components are detailed in the specific section of the notes. 

Since the indicators employed by the company are not envisaged by the IFRS, their 

definitions may not coincide with and therefore not be comparable to those adopted by 

other companies/groups. 

This report contains many financial and non-financial earnings indicators, including those 

mentioned above. The financial indicators, taken from the financial statements, are used in 

the tables summarizing Italcementi S.p.A.’s financial performance, in relation to 

comparative amounts and other amounts from the same period (e.g., change in revenue, 

recurring EBITDA and EBIT with respect to the previous year, and change in their return on 

revenue). The use of amounts not directly apparent from the financial statements (e.g., 

amounts of subsidiaries’ financial statements) and the presentation of comments and 

assessments assist qualification of the trends in the amounts concerned. 

The non-financial indicators refer to external and internal elements: the general economic 

situation and the situation of the industry in which the company operates, trends in sales 

prices and key cost factors, acquisitions and disposals, other significant events in the 

period, organizational developments, the introduction of laws and regulations, etc.. In the 

notes, the section on the net debt provides information about the effects of changes in 

interest rates and the main exchange rates on the statement of financial position and the 

income statement. 

150





Extraordinary session Italcementi S.p.A. Annual Report Separate financial statements 239 

Results and significant events for the year 

Results 

Italcementi S.p.A. ended 2011 with a 7.0 million euro profit (against a 34.4 million euro loss 

in 2010) primarily as a result of a positive sales price effect, income relating to CO 2 

emission rights, an increase in finance income, while being penalized by higher impairment 

losses on financial assets. 

Condensed income statement 



on 2010 

Revenue 613.8 614.1 - 

Recurring EBITDA (0.5) (54.5) n.s. 

% of revenue (0.1) (8.9) 

Other non-recurring income/expense 8.2 3.1 >100.0 

EBITDA 7.7 (51.4) n.s. 

% of revenue 1.3 (8.4) 

Amortization and depreciation (81.6) (80.7) 1.2 

Impairment losses on non-current assets (0.7) 1.7 

EBIT (74.6) (130.3) 42.7 

% of revenue (12.2) (21.2) 

Finance income 109.8 78.8 39.4 

Impairment losses (52.3) (38.2) 36.8 

Profit (loss) before tax (17.1) (89.7) 81.0 

% of revenue (2.8) (14.6) 

Income tax expense 24.1 55.4 (56.5) 

Profit (loss) for the period 7.0 (34.4) n.s. 

% of revenue 1.1 (5.6) 

Cash flow from operating activities 36.1 54.8 (34.1) 

Capital expenditure 131.6 142.4 (7.6) 

n.s.: not significant 

In 2011, the Italian economy did not capitalize on the hints of recovery seen the year 

before. After a positive – albeit considerably slower – first half, the second part of the year 

saw the return of recessionary conditions. At the core of the new downward cycle was the 

progressive decline in foreign demand and, above all, a contraction in domestic demand. 

Specifically, consumer demand was affected by a further employment deterioration and 

measures to further contain public spending, which immediately affected confidence, and 

finally by the considerable reduction in household spending power as a result of the losses 

witnessed in all types of business. In the second half of the year, production and 

investments were significantly affected by the tightening of lending conditions resulting from 

the sovereign debt crisis in some euro zone countries. 

The construction recession was severe, if partially alleviated in the first few months of the 

year by favorable weather conditions. The decline in business indices slowed down only in 

the residential construction segment – largely due to contributions towards restructuring, 

151 


which remained the most dynamic component of demand as a result of confirmed tax 

incentives – while it was accentuated in the other segments, especially in public works, 

which suffered from the increasing restrictions regarding both local and central public 

spending. 

In 2011, cement consumption fell for the fifth year running, down some 30% from its peak, 

to below 33 million metric tons, according to the most recent estimates. One needs to go 

back to the early 1970s to find such weak demand. It is worth noting that this drop 

compares to a smaller contraction in construction during the same five-year period; the 

difference is largely attributable to a shift in construction towards areas requiring less 

cement (in particular, to the increase in the proportion of restructuring projects to the total, 

while the proportion of civil engineering projects decreased). 

Cement production fell even more sharply, although somewhat irregularly from a 

geographical viewpoint. International cement trading also fell, and the trade surplus by 

volume was essentially halved, as a result of a more rapid contraction in exports; 

meanwhile, clinker imports increased slightly. 

Domestic production * 

2011 2011/2010 


(% change) 

Northern Italy 15.5 (3.2) 

Central Italy 6.5 (0.2) 

Southern Italy 7.6 (5.1) 

Italian islands 3.2 (14.7) 

Total 32.8 (4.3) 

* source: AITEC 

In this scenario, Italcementi S.p.A. recorded revenue of 613.8 million euro, comparable to 

2010 (614.1 million euro), as a result of a considerable recovery in prices and a fall in sales 

volumes. This situation led to a substantial breakeven in recurring EBITDA (-0.5 million 

euro), against -54.5 million euro in 2010. 

The improvement in recurring EBITDA was primarily achieved on better prices, as well as 

on income from CO 2 emissions rights, regarding both rights trading, and income from 

reimbursement of “new entrant” CO 2 quotas, awarded to three production plants for the 

period 2008-2012. Other important contributions arrived from energy efficiency credits 

(white certificates) and income from electricity interruptibility. 

Additional savings were achieved in overheads, part of a plan started in 2008, which will 

continue in 2012, in part through a re-organization of central activities, as well as those of 

the production and marketing networks. This plan aims to absorb excess personnel by 

implementing various redundancy arrangements, such as the special state-subsidized layoff 

fund (CIGS) and a mobility procedure, with a view to limiting the ensuing social 

repercussions. 

Beyond the drop in volumes, other negative aspects were the increase in variable costs, 

primarily due to an increase in energy items, leading to continued efforts to boost efficiency 

in production, for example through increased use of alternative fuels, substitute raw 

materials and energy savings, assisted by the new clinker production line at the cement 

plant in Matera coming fully on-line. 

152






EBITDA was 7.7 million euro (-51.4 million euro in 2010), with a return on revenue of 1.3% 

(-8.4% in 2010). The 2011 figure includes a non-recurring expense for a net amount of 8.1 

million euro, relating to the re-organization plan described above. 

After amortization and depreciation of 81.6 million euro, a slight increase (+1.2%) 

compared to the previous year (80.7 million euro), and impairment losses of 0.7 million 

euro (reversals of impairment losses of 1.7 million euro in 2010), EBIT was -74.6 million 

euro (a 42.7% reduction compared to the negative EBIT of 130.3 million euro in 2010). 

Net finance income was 109.8 million euro (78.8 million euro in 2010). Alongside a 3.7% 

reduction from 32.6 million euro to 31.4 million euro in net finance costs relating to the net 

financial position, the largest contributing item to the increase in net finance income was 

dividends received, which totaled 148.7 million euro (+42.5%, compared to 104.3 million 

euro in 2010). 

Loss before tax amounted to 17.1 million euro (89.7 million euro in 2010). The figure was 

affected by impairment losses on financial assets for 52.3 million euro (38.2 million euro 

in 2010), primarily relating to Calcestruzzi S.p.A. (38.4 million euro), which was returned to 

Italcementi S.p.A. at the beginning of the year, and Nuova Sacelit S.r.l. (10.0 million euro). 

After a 24.1 million euro positive income tax effect (a positive effect of 55.4 million euro in 

2010), 2011 closed with a 7.0 million euro profit (against a loss of 34.4 million euro in 

2010). 

In 2011, the items which, starting from the profit/loss for the period, determine 

comprehensive income showed a negative balance of 2.7 million euro (-22.2 million euro 

in 2010) comprising: fair value losses on available-for-sale financial assets for 7.5 million 

euro, fair value gains on derivatives for 2.9 million euro and a related positive tax effect of 

1.9 million euro (for a comparison with 2010, see the statement of comprehensive income 

in the “Financial statements” section). Considering the 7.0 million euro profit for the period 

and the items described above, total comprehensive income for 2011 was 4.3 million euro, 

compared to a total comprehensive expense of 56.5 million euro in 2010. 

Significant events 

Significant events during the period and after December 31, 2011, are illustrated in the 

relevant sections of the consolidated directors’ report. 

Capital expenditure 

Investments in property, plant and equipment and investment property totaled 61.9 million 

euro in 2011 (83.7 million euro in 2010). They related to extensive industrial safety and 

rationalization projects, and the establishment of the new i.lab research and innovation 

center at the Kilometro Rosso. 

Investments in intangible assets were 18.9 million euro (15.0 million euro), primarily related 

to software development associated with the various IT projects implemented in 2011. 

Equity investments of 50.8 million euro (43.7 million euro) referred almost entirely to the 

increase in share capital at Calcestruzzi S.p.A.. 

153 


Statement of financial position, cash flows and net debt 

Condensed statement of financial position 


Property, plant, equipment and investment property 594.9 609.2 

Intangible assets 28.6 19.9 

Equity investments and other assets 1,954.6 1,931.2 

Non-current assets 2,578.1 2,560.3 

Current assets 841.2 789.8 

Total assets 3,419.3 3,350.1 

Equity 1,784.6 1,814.3 

Non-current liabilities 927.9 1,157.8 

Current liabilities 706.8 377.9 

Total liabilities 1,634.7 1,535.7 

Total equity and liabilities 3,419.3 3,350.1 

Condensed statement of cash flows 


Net debt at beginning of period (745.8) (751.1) 

Cash flow from operating activities: 

Cash flow before change in working capital 114.0 (1.6) 

Change in working capital (77.9) 56.4 

Total cash flow from operating activities 36.1 54.8 


PPE, investment property and intangible assets (80.8) (98.7) 

Financial assets (50.8) (43.7) 

Total capital expenditure (131.6) (142.4) 

Proceeds from the sale of non-current assets 41.5 123.8 

Dividends paid (33.4) (33.4) 

Other (5.8) 2.5 

Change in net debt (93.2) 5.3 

Net debt at end of period (839.0) (745.8) 

Equity and net debt 

Compared to December 31, 2010, Italcementi S.p.A.’s equity decreased by 29.7 million 

euro, from 1,814.3 million euro to 1,784.6 million euro, as a result of: 

- the 7.0 million euro profit; 

- dividends of 33.4 million euro, paid following the shareholders’ resolution of April 

19, 2011; 

- the net decrease of 3.2 million euro in reserves, primarily attributable to the 

impairment losses on available-for-sale financial assets. 

Net debt was 839.0 million euro, an increase of 93.2 million euro, compared to December 

31, 2010 (745.8 million euro). Cash flow from operating activities (36.1 million euro) was 

down on 2010 (54.8 million euro), after a negative change in working capital. Capital 

expenditure was lower than the previous year (131.6 million euro against 142.4 million 

154






euro), but the reduction in proceeds from the sale of non-current assets was even greater, 

41.5 million euro against 123.8 million euro. 

Dealings with related parties 

Italcementi S.p.A. had dealings with the following related parties: 

- the parent Italmobiliare S.p.A., and companies of the Italmobiliare group (subsidiaries, 

joint ventures, associates and their subsidiaries); 

- subsidiaries, joint ventures, associates and their subsidiaries; 

- other related parties. 

Transactions with related parties reflect Italcementi S.p.A.’s interest in leveraging the 

synergies within the Group to enhance production and commercial integration, employ 

competencies efficiently and rationalize use of corporate divisions and financial resources. 

No atypical or unusual transactions took place during the year. 

All dealings with related parties, whether financial or relating to the exchange of goods and 

services, are conducted at normal market conditions and comply with the Code of Conduct. 

The figures pertaining to dealings with related parties and their effect on the company’s 

financial position and results of operations are provided in the notes (note 32). 

As regards corporate governance, Italcementi S.p.A. has adopted the “Procedures for 

dealings with related parties”, detailed in the section dedicated to “Corporate governance”. 

Dealings with Italmobiliare S.p.A. and Italmobiliare group 

companies 

Italcementi S.p.A. is subject to management and coordination by Italmobiliare S.p.A.. 

Italmobiliare S.p.A.’s management and coordination activities and the intragroup dealings 

with Italmobiliare S.p.A. and the other companies subject to its management and 

coordination have positively influenced operations and financial results, creating an efficient 

use of resources and skills present in and of mutual interest to the two companies. 

Italcementi S.p.A. provides Italmobiliare S.p.A. and that company’s subsidiaries with 

personnel administration services and receives and provides services. It also provides 

Italmobiliare S.p.A. with a share register management service and administration services 

for shareholders' meetings. 

Following the introduction of the “tax consolidation” regime in Italian tax law, Italcementi 

S.p.A. and some of its Italian subsidiaries elected national tax consolidation as per articles 

117-129 of the Consolidated Income Tax Act (TUIR), with Italmobiliare S.p.A. as the 

consolidating company. 

Italcementi S.p.A. does not hold nor held during the year, directly or indirectly, Italmobiliare 

S.p.A. shares. 

155 


Dealings with subsidiaries, joint ventures, associates and their 

subsidiaries 

Italcementi S.p.A. has current business dealings with and provides technical and/or 

administrative services to subsidiaries, joint ventures, associates and their subsidiaries. 

There were also dealings between Italcementi S.p.A. and Ciments Français S.A. and its 

subsidiaries regarding the exchange of personnel services, with the aim of optimizing the 

use of existing professional resources and developing common projects. Costs incurred by 

Italcementi S.p.A. for organizational, international development, insurance and IT projects 

were recharged to Ciments Français S.A. for the amounts attributable to it. 

A service contract exists between Italcementi S.p.A. and Ciments Français S.A. for 

allocation of the costs relating to those group functions that carry out activities in favor of 

both companies or in favor of the entire Group. 

Financially, Italcementi S.p.A. provides support to its subsidiaries both as a lender and as a 

guarantor and optimizes treasury management with intragroup current accounts and loans. 

Dealings with other related parties 

In 2011, Finsise S.p.A., whose majority shareholder is Italo Lucchini, a director of 

Italcementi S.p.A., provided administrative, financial, contractual, tax and corporate reorganization 

consultancy services for a consideration of 360,000 euro. 

Italcementi S.p.A. received legal services during the year for 230,000 euro from the law firm 

Dewey & LeBoeuf, of which Luca Minoli, a director of Italmobiliare S.p.A., is a partner. 

Italcementi S.p.A. has a land occupation contract with River S.p.A. (which during the year 

became Kilometro Rosso S.p.A., a company in which the director Alberto Bombassei holds 

an investment), in connection with building works for the construction of its management 

office; the amount relating to 2011 was 42,000 euro. 

In 2011 Italcementi S.p.A. disbursed an amount of 600,000 euro to the Italcementi Cav. 

Lav. Carlo Pesenti foundation to cover management costs. With regard to the contract for 

the supply of corporate-administrative services and provision of staff, Italcementi S.p.A. 

charged the foundation an amount of 178,000 euro. 

Equity investments in Italcementi S.p.A. and its subsidiaries held by Directors, Statutory 

Auditors, the Chief Operating Officer and the Manager in charge of preparing financial 

reports, as well as their remuneration for positions held within the Group, are illustrated in 

the Remuneration Report. 

Sustainable research and development 

Italcementi S.p.A. research and development activities are handled by CTG S.p.A. for 

Group companies in Italy and abroad; CTG activities are illustrated in the directors’ report in 

the consolidated annual report. 

With regard to Integrated Environmental Authorizations (Autorizzazioni Integrate Ambientali 

- AIA), a renewal was obtained for the revamping of the cement plant in Rezzato. Renewal 

documents were prepared and sent for various production units, with participation in the 

related services conferences; additional documentation was prepared to meet the requests 

of various local authorities and bodies. 

156






External monitoring and renewal audits were carried out on the company’s cement plants’ 

environmental certificates. 

The proportion of alternative fuels to the total mix was greater than in 2010, especially as a 

result of the increase in fuels obtained from the processing of tires, urban solid waste and 

animal flours; this raised the ensuing financial contribution, which continues to be a major 

factor in reducing production energy costs. 

The increase in the financial contribution arising from the use of substitute raw materials 

was also significant. 

Human resources 

The Italcementi S.p.A. workforce stood at 2,511 persons at December 31, 2011, a 

decrease of 146 from the end of 2010 (2,657). 

(heads) 2011 2010 

Managers 150 153 

Middle managers and clerical staff 1,012 1,065 

Blue collar 1,349 1,439 

Total 2,511 2,657 

Recourse to special state-subsidized layoff benefits (Cassa integrazione guadagni 

ordinaria e straordinaria) totaled 181,156.00 hours in 2011 (197,783.5 hours in 2010). 

On March 9 and October 25, 2011, documents were signed by FEDERMACO with the 

national trade unions jointly recognizing the severe crisis in the sector, a direct 

consequence of the wider construction crisis. These documents were the basis for the 

contacts made by the Italian cement industry association, AITEC, with the Ministry for 

Production and the Environment pressing for projects and subsidies to combat the negative 

situation. 

On March 9, 2011, another agreement was signed between FEDERMACO and the trade 

unions, extending throughout 2011 the validity of the group collective agreements 

regarding performance incentives. 

During the year, initiatives continued to manage the personnel surpluses resulting from the 

termination of operations at the grinding centers in Savignano sul Panaro, Civitavecchia, 

Catania (converted into a delivery center) and Scala di Giocca, as well as the kiln line in 

Borgo San Dalmazzo. 

In agreement with the trade unions, to limit social repercussions, recourse was made to 

special state-subsidized layoff benefits and, during the period in question, to intragroup relocations, 

exit incentives and retirement support. 

Close control was exercised to limit overtime work and ensure use of vacation days, paid 

leave (retribuzione orario lavoro, ROL) and former holidays. 

Italcementi S.p.A., as the provider of treatment, states that the Data Protection Document 

was updated for 2011, in compliance with the provisions of law 196/2003 and the minimum 

security measures technical specifications. 

157 


Risks and uncertainties 

Italcementi S.p.A.’s management of risks (internal and external, social, industrial, political, 

financial) is an integral part of Group growth strategy and a key element of the continuous 

process of evolving the governance system. Risk management, in part through 

improvement of rules of conduct, aims to respect the environment, protect stakeholders 

(employees, customers, suppliers, shareholders), and protect corporate assets. 

Italcementi operates in a sector exposed to risks and uncertainties of various kinds 

(connected with external factors, operational, financial, organizational, compliance with 

regulations, etc.). 

In May 2010, Italcementi S.p.A. formed a Risk Management Department, reporting to the 

Chief Executive Officer, to improve its ability to create value for stakeholders by optimizing 

enterprise risk management (ERM). The mission of the function is to guarantee a 

structured approach to risk management, integrated with the Group growth strategy, and to 

support the improvement of Group performance by identifying, measuring, managing and 

controlling key risks. 

The creation of the Risk Management Department is part of the “Risk & Compliance” 

program set up in 2008 and consists of the following phases: 

1. identification of the main areas of risk for Group strategic goals and development of 

methods and tools to analyze and assess the correlated risk events; 

2. assessment, at country level and at aggregate level, of identified risk events in terms of 

impact, probability and timeframe, in order to acquire an overall vision of the Group risk 

portfolio; 

3. selection of priority risks and definition of response strategies, Group governance rules 

and action to integrate and improve risk management systems; 

4. implementation of defined mitigation strategies and action and development of the 

Enterprise Risk Management process; 

5. reporting to Top Management and the governance bodies on the main risks, and their 

management and evolution; in this phase quantification of risks and opportunities is 

integrated with the enterprise management process, for example in the budget, in 

results forecasting reviews and in assessment of strategic projects. 

Sustainable development and risk management: protection of people and assets 

Sustainable development favors a corporate approach that balances economic growth, 

protection of the environment and social sustainability. By constantly pursuing an optimal 

balance among these elements and ensuring that benefits extend to everyone involved, 

companies enhance their long-term value, ability to survive and competitive advantage, 

thus helping to prevent industrial risks. 

The Group checks that its protection and prevention programs are consistently applied to 

all personnel in production sites (employees and other) and to all operations in its 

companies. 

Regulatory limits and Group sustainable development goals and initiatives are examined in 

a special report (Sustainability Report) and also summarized in a specific section in the 

consolidated annual report. 

158






The Asset Protection Program continued in 2011; it qualifies the importance of risks and 

develops a suitable prevention and protection policy, thereby limiting damage to assets and 

consequent operating losses. The program is now a consolidated Group process. 

Risks relating to the general economic and industry situation 

The economic and financial situation represents an element of risk for the Group, also in 

relation to its specific area of business, which is sensitive to changes in the economic 

situation. Household and business propensity to invest in construction is affected by the 

uncertainty and constraints of the general scenario. 

Risks associated with energy factors 

The cost of energy factors, which represents a large portion of Group variable costs of 

production, can vary significantly as a result of factors beyond the Group’s control. The 

Group has adopted measures to mitigate risks for certain energy factors by entering into 

medium-term supply contracts. Furthermore the centralized procurement organization 

enables the Group to benefit from more efficient relations with suppliers and to obtain 

competitive conditions. 

Risks relating to availability of raw materials 

The availability of raw materials is a strategic factor in investment decisions. The Group 

generally sources its raw materials – limestone, clay, gypsum, aggregates and other 

materials used in the production of cement, ready mixed concrete and aggregates – from 

quarries it owns (the majority) or quarries rented from third parties. For these and other 

significant materials, the Group has also reached specific agreements with suppliers to 

guarantee continuous, stable procurement. 

Environmental risks 

The “Sustainability Report” and the section on Sustainable Development in the 

consolidated annual report illustrate the measures taken by the Group to manage 

environmental risks and control and reduce emissions. With regard to CO 2 emissions, the 

Group’s European companies are exposed to price fluctuations on emission rights 

depending on its own rights surplus or deficit. The Group’s and Italcementi S.p.A.’s 

positions are constantly monitored to ensure correct risk management (see note 19 in the 

Italcementi S.p.A. notes). 

Financial risks 

The current period of crisis puts corporate cash flows at risk, endangering companies’ selffinancing 

ability and creating difficulties for normal, orderly operations on the financial 

market. 

The Group procures sources of finance and manages interest rates, currency and 

counterparty risk, for all the companies in the scope of consolidation. The Group uses 

derivatives to reduce the risk of fluctuations in interest rates and exchange rates with 

respect to debt and its international operations. Detailed analysis of this type of risk is 

provided in the notes, specifically in note 19 dedicated to net debt. 

159 


Ratings risks 

The Group’s ability to compete successfully in the marketplace for funding depends on 

various factors, including its credit ratings assigned by recognized ratings agencies. Its 

credit ratings may change to reflect changes in its results, financial position, credit structure 

and liquidity profile. As a result, a rating downgrade may have negative repercussions on 

the Group’s ability to raise funding. 

Legal risks 

Suitable provisions and impairment losses have been applied with regard to existing risks 

and their related economic effects. Estimates and valuations are based on available 

information and are in any case regularly reviewed, with immediate recognition in the 

financial statements of any variations. 

A review of the main current disputes (legal and tax-related) may be found in the relevant 

sections of this report and in the consolidated annual report, with specific details in the 

notes. 

Conformity risks 

The Group is subject to specific regulations concerning the quality of the products it 

markets; special monitoring activities have been set up to ensure compliance with the 

regulations in the countries where it operates. 

At a general level, the “Risk and Compliance” program has introduced specific training and 

circulates procedures and recommendations in the Group countries, to ensure compliance 

with legislation and with tax, social and environmental regulations. The program is reviewed 

on an annual basis to take account of regulatory changes. 

Political risks 

The Group has taken out insurance covers to limit the financial consequences of possible 

political measures that might prevent normal management of some subsidiaries in 

emerging countries. 

Financial disclosure risks 

The main characteristics of the risk management system and the internal control system 

with respect to the financial disclosure process are illustrated in a specific section of the 

“Report on corporate governance and ownership structure” in the Italcementi S.p.A. annual 

report. 

Insurance 

In the interest of all Group subsidiaries, Italcementi has taken out policies with leading 

insurance companies to cover risks to people and assets, as well as product and general 

third-party liability covers. As part of its risk coverage policy, the Group aims to optimize 

risk management costs by assessing direct assumption and transfer to the market. All 

policies are negotiated under a framework agreement to ensure a balance between the 

probability of a risk occurring and the damage that would ensue for each subsidiary. 

160






Disputes and pending proceedings 

With regard to the most important tax disputes arising from tax inspections and audits 

(covering financial years 1996 to 1999) in July 2011 the Italian Supreme Court of Cassation 

rejected the appeals filed by the State and confirmed in full the rulings of the Milan 

Regional Tax Commission. The proceedings therefore closed with an additional tax charge 

of 0.8 million euro, compared with the initial amount of 68 million euro for additional tax and 

fines requested by the tax authorities. 

As regards financial years where the findings were upheld, Italcementi S.p.A. has complied 

with the inspections, thereby obtaining a reduction in the fines imposed. 

The inspections relating to financial years 1987 and 2003 to 2006 are still open, with 

proceedings so far in favor of the company. 

Italcementi Cav. Lav. Carlo Pesenti foundation 

The Italcementi Cav. Lav. Carlo Pesenti foundation is an independent non-profit entity 

established in 2004 by Italcementi and Italmobiliare, with the aim of “promoting scientific 

research and education with a special emphasis on the sustainable economic and social 

development of enterprises”. The foundation’s mission also envisages the promotion and 

implementation of humanitarian aid for communities struck by natural disasters or in other 

emergency situations. 

In 2011, as in the previous year, the foundation employed the resources made available to 

it by the founding members primarily to develop and complete major projects initiated in 

previous years. 

Specifically, in the most important sector of activities, “school and university education 

and training”, the fourth and last of the three-year research doctorates in “Logistics and 

Supply Chain Management”, funded by the foundation at the University of Bergamo, in 

collaboration with the Bocconi University and the Zaragoza Logistics Center, a partner of 

Boston’s M.I.T., began. In 2011, the four students of the first three-year course were 

awarded their doctorates by an international commission. The foundation continued 

providing grants for university education at the MIP-School of Management of Milan 

Polytechnic and, in collaboration with the Intercultura association, grants for overseas 

studies for the children of Group employees. A significant initiative implemented in 2011 

involved financial support along with other organizations and entities of the “Adopt talent” 

project of the University of Bergamo, which aims to attract foreign talent, promote 

international mobility and establish three teaching degrees in the English language. 

Regarding humanitarian projects, the new Professional Training Center inaugurated in Sri 

Lanka with an investment of 3 million euro, providing local youths with accommodation, 

education and the skills to succeed in the workplace, commenced operations at the 

beginning of 2011 and is developing its academic curriculum. The students attend 

specialized courses in worksite topography, planning, duties and accounting. Preparatory 

English-language courses for students already in possession of the diploma required to 

attend the Professional Training Center were also promoted. 

Some of the activities envisaged by the foundation’s charter are the promotion and 

organization of conferences and seminars on current social and economic topics. In this 

regard, the foundation has, since its creation, organized important annual conferences 

attended by leading institutional, business and academic figures. A conference was held in 

161 


January 2011 entitled “Europe at the limits of development” with discussions on the 

strengths and weaknesses that may affect the future of Europe. In January 2012, the 

foundation’s annual conference focused on the role of the real economy and industry from 

the present day to the near future, with an interesting debate on the possibility of doing 

business to create value and employment, and to recover Italy’s competitiveness. 

The above initiatives and a variety of other recurring projects, such as support for the 

“Bergamo Scienza” show, involved an overall financial commitment of about 850,000 

euro in 2011 (1.6 million euro in 2010). 

162






Performance of the Ciments Français group 

Key consolidated figures 



on 2010 

Revenue 3,886.3 4,040.3 (3.8) 

Recurring EBITDA 702.4 880.0 (20.2) 

Other non-recurring income (expense) 19.0 (9.5) n.s. 

EBITDA 721.3 870.5 (17.1) 

Amortization, depreciation and impairment losses (412.0) (372.7) 10.5 

EBIT 309.3 497.8 (37.9) 

Finance income and costs (50.7) (66.5) (23.6) 

Share of profit of equity-accounted investees 20.1 18.3 9.8 

Profit before tax 278.7 449.7 (38.0) 

Income tax expense (111.4) (113.0) (1.4) 

Profit (loss) relating to continuing operations 167.3 336.6 (50.3) 

Profit (loss) relating to discontinued operations 106.9 18.7 n.s. 

Profit (loss) for the period 274.2 317.9 (13.7) 

Profit attributable to owners of the parent 215.3 202.3 6.4 

Total equity 4,257.7 4,268.0 (0.2) 

Equity attributable to owners of the parent 3,422.0 3,419.8 0.1 

Net debt 1,021.4 1,411.6 (27.6) 

As already specified in the Italcementi consolidated annual report, Ciments Français 

operations in Turkey headed by Set Group were also considered as available-for-sale and 

subsequently sold at the end of March. In compliance with IFRS 5, profit relating to 

discontinued operations was posted in a separate item in the income statement, in both 

2011 and 2010. 

In 2011, Ciments Français S.A. consolidated revenue was 3,886.3 million euro, down 3.8% 

compared to 2010 (-1.4% at constant exchange rates and on alike-for-like basis). This fall 

in revenue was determined by a volume effect combined with a drop in sales prices in 

some countries (notably Egypt) and by an unfavorable exchange-rate effect (-2.4%) 

relating to Egypt, North America and India in particular. Revenue increased in France- 

Belgium, Morocco, Thailand and India. 

Recurring EBITDA stood at 702.4 million euro, a 20.2% decrease compared to 2010. After 

net non-recurring income of 19.0 million euro (net expense of 9.5 million euro in 2010), 

EBITDA was 721.3 million euro, down 17.1% on 2010. EBIT was 309.3 million euro 

(-37.9% compared to 2010), after amortization and depreciation totaling 358.6 million euro 

(364.7 million euro) and impairment losses of 53.4 million euro. 

Net finance costs of 50.7 million euro were substantially reduced (-23.6%). 

Profit relating to continuing operations amounted to 167.3 million euro (336.6 million euro in 

2010). 

Profit for the period was 274.2 million euro, a decrease of 13.7% compared to 2010 (317.9 

million euro). 

163 


Ciments Français S.A. profit for the period was 296.3 million euro, a substantial increase 

from 2010, when profit was 145.7 million euro, arising primarily from the gain realized on 

the sale of Set Group. 

A dividend of 3 euro per share will be proposed at the annual general meeting of Ciments 

Français S.A. on April 13, 2012, of which 1.5 euro was already paid in August 2011. 

164






Report on Corporate Governance and ownership structure 

ITALCEMENTI S.P.A. PROFILE 

The Corporate Governance system adopted by Italcementi S.p.A. is based not only on the company by-laws, 

but also on the following codes and/or polices: 

1) Code of Conduct; 

2) Code of Ethics; 

3) Treatment of Confidential Information; 

4) Internal Dealing Code of Conduct; 

5) Procedure for Transactions with Related Parties; 

6) «Insider register» Procedure; 

6) Regulation for the manager in charge of preparing the company’s financial reports; 

7) Organizational, Management and Control Model. 

The above documents are all available on the company’s website www.italcementigroup.com, except for the 

Regulation for the manager in charge of preparing the company’s financial reports, available to all the Group 

companies on the company intranet and for the special part of the Organizational, Management and Control 

Model. 

The Company has been actively committed in modernizing its business culture over the years in order to 

respond to the challenges arising from developments in corporate governance rules. This process fostered and 

enhanced the sharing of values and the recognition that the adoption of good rules of governance goes hand in 

hand with the dissemination of a business culture built on transparency, adequate management and effective 

controls. 

As part of the broader process of integrating and agreeing common principles and rules within the Group, the 

company’s Board of Directors, at its meeting of December 22, 2010, resolved to adopt a common Framework 

of corporate governance (Corporate Governance Framework) representing the minimum corporate governance 

principles applicable to Group companies. 

These principles were elaborated on the basis of a comparative review of national and international best 

practices as well as taking into account the different local laws of the countries where the Group is present. 

The Corporate Governance Framework has been initially distributed to 22 companies operating in 14 

countries, which are considered a sufficiently representative sample on the basis of pre-set relevance 

indicators (revenues, assets, EBIT and employees). 

Next step of the project is the definition and dissemination of Group guidelines drafted to better clarify 

Framework principles and criteria and to facilitate its application in both the parent company and in its 

subsidiaries. The proper execution of these guidelines will be further verified by means of a yearly audit plan 

which foresees, at the beginning, the 22 “in-scope companies” and, gradually, the other group companies. 

The corporate governance structure of the Company, as set up in the binding articles of the by-laws and in the 

provisions of the above mentioned codes and policies confirms and bears witness to Italcementi S.p.A.’s 

commitment to comply with generally agreed national and international best practices. 

165 


INFORMATION ON OWNERSHIP STRUCTURE 

This section includes the information required by art. 123-bis of Leg. Decree no. 58 of February 24, 1998 

(«TUF»). 

a) Share capital structure, indicating the various share categories, related rights and obligations, as 

well as the percentage of share capital represented 

Italcementi S.p.A. share capital is equal to 282,548,942 euro, divided into 282,548,942 shares with a 

nominal value of 1 euro each, of which 177,117,564 are ordinary shares, equal to 62.69% of the entire 

share capital, and 105,431,378 are savings shares, equal to 37.31% of the entire share capital. 

Ordinary shares carry voting rights at the Company’s ordinary and extraordinary shareholders’ meetings. 

Shareholders who, even jointly, own at least one fortieth of the share capital represented by shares with 

voting rights, may ask, within the deadlines envisaged by the law in force, for the items on the agenda of the 

shareholders’ meeting to be supplemented, stating in their request which further issues are being 

suggested. In addition, shareholders who, individually or with other shareholders, can prove that they hold 

an overall stake in the share capital with voting rights that is no lower than that established by the law in 

force, have the right to present lists for the appointment of the Board of Directors and the Board of Statutory 

Auditors in accordance with the provisions of the law and the by-laws. 

Savings shares do not carry voting rights. 

In the event of an increase in share capital against consideration for which option rights have not been 

excluded or limited, the holders of savings shares have option rights on the newly issued savings shares or, 

in their absence or to cover the difference, on other categories of shares. Resolutions to issue new savings 

shares with the same characteristics as those already outstanding, either through a share capital increase 

or through the conversion of other categories of shares, do not require approval by the meetings of the 

holders of the different share categories. Should ordinary and/or savings shares be excluded from trading, 

savings shares maintain the rights granted to them by law and by the by-laws, unless otherwise provided for 

by the shareholders’ meeting. 

When the net profit for the year is allocated, savings shares are entitled to a dividend up to 5% of the 

nominal share value, increased with respect to that of ordinary shares, by an amount equivalent to 3% of 

the nominal share value. When in a financial year a lower dividend than the one indicated in article 32 of the 

by-laws is allocated to savings shares, the difference is calculated as an increase to the savings dividend 

paid in the following two years. 

In the event of distribution of reserves, savings shares have the same rights as other shares. A reduction in 

share capital owing to losses does not cause a reduction in the nominal value of the savings shares, except 

for that part of the loss in excess of the overall nominal value of the other shares. In case of dissolution of 

the company, savings shares have priority in the repayment of the share capital for the full nominal value. 

The Company does not have outstanding stock option plans either for directors or for officers. However, 

based on the assignments resolved in the last few years for the stock option plans in force from time to 

time, as at the date hereof 960,900 options on the stock option plan for directors – 2001, 2,269,316 options 

on the stock option plan for officers – 2000 and 1,564,750 options on the stock option plan for officers – 

2008 are exercisable. Outstanding options granted to directors can only be exercised through assignment to 

the recipients of treasury shares, while those granted to officers can also be exercised through the 

execution of the power, recognized to directors as per art. 2443 of the Italian civil code, to increase the 

share capital. 

166






No additional categories of financial instruments granting rights to subscribe newly issued shares, other 

than the above mentioned options, have been issued by the Company. 

b) Restrictions on share transfers 

No restrictions exist on share transfers or on acceptance clauses. 

c) Significant shareholders as disclosed pursuant to article 120 of Leg. Dec. no. 58 of February 24, 

1998 

Shareholder 

Total 

No. shares 

% of share capital 

overall 

ordinary 

EFIPARIND B.V. (indirectly through Italmobiliare S.p.A.) 

This figure does not take into account the 3,793,029 treasury shares 

with voting rights held by the Company 

FIRST EAGLE INVESTMENT MANAGEMENT LLC 

(as manager, among other things, of the «First Eagle Global 

Fund» which holds 2.188% of the ordinary share capital) 

106,734,000 37.78 60.26 

3,932,129 1.39 2.22 

ITALCEMENTI S.p.A. (treasury shares) 3,793,029 1.34 2.14 

d) Shares that confer special control rights 

No shares conferring special control rights have been issued. 

e) Shareholding of employees: mechanism for exercise of voting rights 

There is no specific system for employees to have shareholdings. 

f) Restrictions on voting rights 

The by-laws does not provide for restrictions on the exercise of voting rights. 

g) Agreements among shareholders, pursuant to article 122 of Leg. Decree 58/98, of which the 

company is aware 

As far as the Company is aware, there are no agreements of any kind regarding the exercise of voting rights 

and the transfer of such shares or any of the situations envisaged by art. 122 of TUF. 

h) Significant agreements which the company or its subsidiaries are parties to, that become effective, 

are modified or expire should there be a change in the control of the company and their effects, and 

by-laws provisions on takeover bid 

Within the policy aimed at supporting its business and development, Italcementi S.p.A. and its subsidiaries 

have entered into loan agreements, some of which grant to the lender the right, in case of a of the Company, to terminate the loan agreement in advance or to withdraw from it and have the 

consequent right to demand principal and the accrued interest or, lastly, in the case of derivative-based 

agreements, the right to terminate the outstanding derivative agreements. 

As far as takeover bids are concerned, the Company by-laws do not provide for the waiver of the provisions 

of TUF related to the passivity rule nor is the breakthrough rule stated therein. 

i) Agreements between the company and the directors that envisage compensation in the case of 

resignation or unfair dismissal or if the office ends following a takeover bid 

For this information, please refer to the Report on Remuneration, published in compliance with art. 123-ter 

TUF. 

167 


l) Laws applicable to the appointment and replacement of directors and to amendments of the by-laws 

Appointment of directors 

For this information, please refer to section «The Code of Conduct and corporate governance rules – A) 

Organizational structure – Board of Directors». 

m) Delegated powers for share capital increases pursuant to article 2443 of the Italian Civil Code or 

power granted to directors to issue active financial instruments 

Delegated powers for share capital increases 

The Board of Directors has the right, on one or more times within five years of the shareholders’ resolution 

made at their extraordinary shareholders’ meeting of April 28, 2008: 

a) pursuant to art. 2443 of the Italian Civil Code, to increase the share capital up to a maximum nominal 

amount of 500,000,000 euro, free of charge and/or by means of payment, through the issue of ordinary 

and/or savings shares and/or warrants for their later subscription; 

b) pursuant to art. 2420-ter of the Italian Civil Code, to issue bonds convertible into ordinary and/or savings 

shares or with purchase or subscription rights, up to a maximum amount of 500,000,000 euro, within the 

limits allowed by law from time to time, 

all with full powers in this regard, including the powers to offer shares and convertible bonds or convertible 

bonds in the form as set out in the penultimate paragraph of art. 2441 of the Italian Civil Code; to reserve up 

to a quarter of such shares, bonds and warrants pursuant to art. 2441 of the Italian Civil Code, last 

paragraph; to identify the funds and reserves to be allocated to capital in the case of a free of charge 

increase; to establish the issue price, conversion ratios, terms and method of execution of transactions. 

By resolution of April 19, 2011 at their extraordinary meeting, the shareholders granted to the Board of 

Directors: 

- the power, pursuant to art. 2443 of the Italian Civil Code, to increase the share capital, free of charge 

and/or by means of payment, on one or more times within five years of the aforementioned resolution, for 

a maximum amount of 6,000,000 euro through the issue of a maximum 6,000,000 ordinary and/or savings 

shares, to be reserved, pursuant to art. 2441 of the Italian Civil Code, paragraph 8: 

* for employees of Italcementi S.p.A. and its subsidiaries, in the case of a free allocation, 

* for employees of Italcementi S.p.A. and its subsidiaries, as well as for employees of its parent 

companies and other subsidiaries of the latter, in the case of a subscription offer, 

both in Italy and abroad and in compliance with the regulations in force in the countries of the beneficiaries; 

- the power, consequently, to establish the entitlement rights to the shares, to establish the timeframes, 

method, characteristics and conditions of the offer to employees and to set the issue price of the shares, 

including the related share premium. 

By resolution of June 20 th , 2007 at their extraordinary meeting, the shareholders granted to the Board of 

Directors: 

- the power, pursuant to art. 2443 of the Italian Civil Code, to increase the share capital against 

consideration, on one or more times within five years of the above resolution date, for a maximum amount 

of 3,000,000 euro through the issue of a maximum 3,000,000 ordinary and/or savings shares, with a 

nominal value of 1 euro each, excluding option rights pursuant to art. 2441 of the Italian Civil Code, 

paragraph 5, to serve the incentives plan for directors of the Company and of subsidiaries vested with 

special powers in compliance with the articles of association or who perform specific operational duties; 

168






- the power, consequently, to establish the entitlement rights to the shares, to establish the timeframes, 

method, characteristics and conditions of the offer and to set the issue price of the shares, including the 

related share premium. 

Financial equity instruments 

The Company has not issued financial equity instruments of any kind, nor do the by-laws grant any power 

for their issue to directors as of the date hereof. 

Authorizations for the purchase of treasury shares 

At their ordinary meeting of April 19, 2011, the shareholders renewed the Company’s authorization to buy 

and dispose of treasury shares for a period of 18 months from the date of the resolution. 

Within the scope of the above authorization, since that date the Company has not purchased any ordinary 

or savings treasury shares, nor have shares held in its portfolio been used to grant them to beneficiaries of 

stock options, since no vested rights have been exercised by directors or officers. 

Therefore, on December 31, 2011, the Company held: 

- 3,793,029 ordinary treasury shares, equal to 2.14% of the share capital represented by ordinary shares, to 

be used to serve the “Stock option plan for directors” and the “Stock option plan for officers”; 

- 105,500 savings treasury shares, equal to 0.1% of the share capital represented by savings shares. 

MANAGEMENT AND COORDINATION ACTIVITY 

As noted at point «C» above, at the time of writing, Italcementi S.p.A.’s majority shareholder, with a 

shareholding, net of the treasury shares held by the Company, equal to 60.26% of ordinary shares, is 

Italmobiliare S.p.A., whose own majority shareholder is Efiparind B.V. 

Italmobiliare S.p.A. is also the company which exercises management and coordination activity over 

Italcementi S.p.A. pursuant to art. 2497 ff. of the Italian Civil Code. 

FEATURES OF THE RISK MANAGEMENT AND INTERNAL CONTROL SYSTEM REGARDING THE 

FINANCIAL DISCLOSURE PROCESS 

1. Foreword 

As already noted in the section on “Risks and uncertainties”, in 2010 Italcementi S.p.A. set up the Risk 

Management Department with the aim of improving the creation of value for stakeholders, also by optimizing 

enterprise risk management. This initiative is part of the Group’s “Risk & compliance” program launched in 

2008, which classified risks related to the financial disclosure process as one of the key risks. For this type of 

risks, in 2010 the following were realized: appropriate mitigation measures, the assignment of responsibility to 

a main reference point (“Primary Risk Owner”), the definition of common guidelines, actions and controls for 

the various risk areas (“Risk Management Guidelines”), the definition of strategies and the realization of 

measures to align risk management systems to the standards sought. 

The setting up of the Risk Management Department is part of the “Risk&Compliance” program launched in 

2008, which followed the COSO methodology (Committee of Sponsoring Organizations of the Treadway 

Commission) which is structured on the following phases: 

- Identification of the main risk areas in relation to the Group strategic targets and definition of methodologies 

and tools for the analysis and evaluation of the events of risk related thereto; 

- Evaluation, both at country and Group level, of identified events of risk in terms of impact, chance of 

happening and time frame, in order to have an overall picture of the Group risks; 

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- Selection of priority risks and definition of relevant reaction strategies, of the governance rules within the 

Group as well as the necessary actions necessary to supplement and improve risk management systems; 

several risks are managed locally at the subsidiaries, while the management of those requiring specific 

expertise or a cross coordination, is centralized; 

- Implementation of the mitigation actions/strategies defined from time to time and development of the 

Enterprise Risk Management process; 

- Report to the top management and control bodies on the main risks and their management and evolution. 

The risk quantification and occurrence are integrated in the management system, like budget, provisions 

and analysis studies on the most important investment projects. 

The risk management and internal control system relating to the financial disclosure process also benefited 

from: 

- the continuous development of an integrated organizational governance system (organization notices, job 

descriptions, corporate powers and processes) whose tools are available in a Knowledge Management 

Database, B.E.S.T. (Business Excellence Support Tool), which allows easy access to information and 

encourages cross-circulation within the Group; 

- a more timely organization and planning relating to the provisions of Law no. 262 of December 28, 2005, 

stating “Provisions for the protection of savings and the regulation of the financial markets” and the following 

corrective decrees (hereinafter the “Law on Savings”) issued by lawmakers with the aim of increasing the 

transparency of corporate disclosure and enhancing the internal control system of listed companies. 

In regard to this law, far-back Italcementi S.p.A. launched a series of activities, described in section 2 below, 

which are included in an action plan integrated into the Company’s processes. The existing control procedures 

guarantee the effectiveness of the current system and the data reliability. The Company therefore believes to 

comply with legal requirements, and guarantees the completeness and reliability of its financial disclosures. 

2. Description of the main features of the system 

2.1 Stages in the risk management and internal control system 

Italcementi has established its own model for the assessment of the internal control system relating to 

disclosure about financial position and results of operations (hereinafter the “Operational model”) and has 

established the operational approach for undertaking these activities. This model is based on the CoSO 

framework, issued by the Committee of Sponsoring Organizations of the Tradeway Commission (CoSO), and 

also takes into account the document “Internal Control over Financial Reporting - Guidance for Smaller Public 

Companies”, which was also drafted by the CoSO. 

The Operational model defined by Italcementi is based on the following main elements: 

a) Preliminary analysis. This is undertaken annually or whenever considered necessary and aims to identify 

and assess risks relating to the internal control system with regard to financial position and results of 

operations’ disclosure , so as to establish the priorities for documenting, assessing and testing the 

administrative and accounting procedures and the related controls. Identification of the relevant entities and 

processes is based on quantitative elements (weight of revenues and assets of a single entity on 

consolidated amounts, amount of the consolidated financial statement items related to a particular process) 

and on qualitative elements (country where an entity operates, specific risks, risk levels attributed to the 

various items); 

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b) Operational planning. Every year the activities are planned on the basis of the priorities identified through 

the preliminary analysis and any other assumptions; 

c) Analysis of company controls. The individual entities in the area for action identified in the preliminary 

analysis are responsible for assessing the effectiveness of the internal control system in relation to the 

governance principles used at entity level (Entity Level Controls), as well as for the overall management of 

the information systems used in the main financial reporting processes and the related IT structure 

(Information Technology General Controls). This must be carried out in accordance with the deadlines 

established during operational planning and on the basis of the guidelines, instructions and templates 

provided; 

d) Analysis of controls at process level. The individual entities in the area for action identified in the 

preliminary analysis are responsible for: a) documenting, with varying levels of detail depending on the level 

of risk allocated, the administrative and accounting processes which have been identified, b) performing 

tests to check the effective operation of the key controls, in accordance with the deadlines established 

during operational planning and on the basis of the guidelines, instructions and templates provided by the 

manager in charge; 

e) Assessment of the adequacy and effective operation of the administrative and accounting 

procedures and the related controls: in order to guarantee compliance with the key requirements for 

financial reporting (“financial statement assertions”), the manager in charge, on the basis of the results of 

the work carried out and the documentation obtained, assesses the overall adequacy and effective 

operation of the system of administrative and accounting procedures and the related controls, and more 

generally, the internal control system for these areas. 

2.2. Roles and Functions involved 

The financial disclosure related to the risk management system is supervised by various Company 

bodies/functions, each with specific roles and responsibilities. In particular, as already stated in other sections 

of this corporate governance report: 

1) The Board of Directors, to which the Code of Conduct assigns, among other things, the task of: 

a) checking and approving the strategic, business and financial plans of the company; 

b) assessing the forecasts on operations and the adequacy of the organizational, administrative and 

general accounting system of the company and subsidiaries; 

c) evaluating and approving the periodic accounting reports; assessing the company’s operational 

structure; 

d) establishing the guidelines for the internal control system so that the main risks for the company and the 

subsidiaries are correctly identified, as well as adequately measured, managed and monitored, and, 

also, determining criteria for the suitability of these risks with safe and appropriate management of the 

company; 

e) assessing, at least on an annual basis, the adequacy, effectiveness and effective functioning of the 

internal control system with respect to the characteristics of the company. 

2) The Chief Executive Officer, who, as executive director responsible for overseeing the functioning of the 

internal control system, has the task of: 

a) identifying the main company risks, taking into account the characteristics of the activities carried out by 

the company and by the subsidiaries, and periodically submitting them for examination to the Board of 

Directors; 

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) implementing the guidelines defined by the Board of Directors, taking care of the planning, achievement 

and management of the internal control system, constantly checking its overall adequacy, effectiveness 

and efficiency; also, adapting this system to changes in operating conditions and the legal and regulatory 

framework; 

c) issuing, with the manager in charge, certificates on the adequacy and effective application of the 

administrative and accounting procedures, the compliance of documents with applicable IFRS, the 

correspondence of documents to entries in the accounting books and records, the suitability of 

documents in providing a true and fair representation of financial position and results of operations of the 

company and Group, etc. 

3) The Internal control committee, to which the Code of Conduct assigns, among other things, the task of: 

a) assessing, together with the manager in charge of preparing the company’s financial reports and the 

external auditors, the correct application of accounting policies and their uniformity for the purposes of 

preparing the consolidated financial statements; 

b) examining the audit plan and periodic reports prepared by the controller; 

c) reporting, at least every six months, to the Board of Directors called to approve the financial statements 

and the half-year report, on the activities undertaken and on the adequacy of the internal control system; 

4) The Chief Operating Officer, who is responsible, among other things, for overseeing Italcementi S.p.A. 

activities and the activities of the industrial companies directly or indirectly controlled by Italcementi S.p.A. 

and of the companies in which the latter has, directly or indirectly, an equity interest which enables the 

exercise of significant influence. Moreover, the Chief Operating Officer and the Deputy Chief Operating 

Officer, together with the heads of functions who report directly to them and who are involved in the process 

of drafting financial disclosures have to issue specific attestations on the data and information provided, 

both in relation to their correct representation and in relation to the effective and efficient application of the 

administrative and accounting procedures in their areas of assignment; 

5) The Manager in charge of preparing the company’s financial reports, who, as envisaged in the 

regulation approved by the Board of Directors, is responsible, among other things, for: 

a) planning adequate administrative and accounting procedures for the drafting of the financial statements, 

the limited half-year financial statements and the consolidated financial statements, as well as any other 

financial communication, by updating such procedures and ensuring dissemination and compliance, as 

well as verifying their effective application; 

b) assessing, together with the Internal Control Committee and the external auditors, the correct application 

of accounting policies and their uniformity for the purposes of the consolidated financial statements; 

c) handling the periodic reporting to senior management and the Board of Directors on the activities 

undertaken; 

d) managing the periodic review of the assessment activities and updating the risk map relating to financial 

disclosure; 

e) taking part in the development of information systems that have an impact on the company’s financial 

positions and results of operations. 

6) The Controller, who has the task of verifying that the internal control system is always adequate, fully 

operational and functional. The controller has direct access to all the information required to perform this 

task, is not responsible for any operational area and does not report to any manager in the operational 

areas, including administration and finance. The controller reports on the way risk management is handled, 

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in compliance with the plans established to contain such risks and, in compliance with the legally prescribed 

terms and procedures, to the Internal Control Committee, the executive director in charge of overseeing the 

functioning of the internal control system, and the Board of Statutory Auditors and states his opinion on the 

suitability of the internal control system to achieve an acceptable overall risk profile. 

7) Compliance committee, who is responsible for continuously overseeing the effective functioning and 

enforcement of the organizational, management and control model pursuant to Leg. Dec. 231/01, liaising 

with, among others, the manager in charge of preparing the financial reports with reference to relevant 

issues in terms of financial disclosure; 

8) the various company functions, which, as already specified in regard to the Chief Operating Officer, must 

guarantee the correct representation of the information provided, as well as the effective and efficient 

application of the administrative and accounting procedures in the areas they are responsible for. 

Finally, against this background and in connection with the duties assigned by law, the Board of Statutory 

Auditors oversees, among other things, the financial disclosure process and the effectiveness of the internal 

control system, the internal audit and the risk management. 

The circulation and integration of the information produced in the various areas is ensured by a structured 

information flow. In this sense, an important role is played, for example, by the quarterly report of the manager 

in charge, setting out, among other things, the results of the activities undertaken, problems that came out, the 

action plans established and their progress. 

THE CODE OF CONDUCT AND THE CORPORATE GOVERNANCE RULES 

Italcementi complies with the Code of Conduct of the Italian Corporate Governance committee, promoted by 

the Italian stock exchange, Borsa Italiana S.p.A., since its first edition. The Company adopted its own Code of 

Conduct (the “Code”), last updated by the Company Board of Directors in February 2007, which constitutes a 

self-regulation system including legal and regulatory framework provisions, which Italcementi S.p.A. and its 

corporate bodies voluntarily comply with. Its end is to highlight the corporate governance model of the 

Company established to achieve its primary goal of maximizing value for shareholders. 

The Code is based on the Code of Conduct, in its version of March 2006. The Code of Conduct of the Italian 

Corporate Governance committee was updated in March 2010 with reference to the sole art. 7 and, further, in 

December 2011, it has been completely renewed also to the extent of eliminating discrepancies with current 

law provisions. The Company, although it did not include the new art. 7 provisions (subsequently remunerated 

in art. 6) in its Code, has already been complying with them, submitting to the examination (i) of the Board of 

Directors in March 2011, upon proposal of the Remuneration Committee, the Remuneration policy for 

directors, officers and managers vested with special powers and (ii) of the shareholders at their meeting in 

April 2011, the Report on remuneration policy. On the other hand, the Company will comply with the new 

recommendations within the deadline envisaged therein. 

The Code envisages the establishment of corporate bodies and offices as well as the adoption of specific 

procedures and conduct, with the sole exceptions described below and with the amendments required by the 

specific features of Italcementi S.p.A. 

The Board of Directors, moreover, is always willing to assess further trends introduced in the Code of Conduct 

and their possible implementation in the Company’s Corporate Governance system, provided that, in respect 

with the current company situation, the recommendations allow the Company’s standing with investors to be 

further enhanced. 

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A) ORGANIZATIONAL STRUCTURE 


The Company by-laws provide for the company to be managed by a Board of Directors consisting of 11 up to 

21 directors who serve for the period established on their appointment, and in any case no more than three 

financial years, and who terminate their office on the date of the shareholders’ meeting called to approve the 

financial statements for the final year of their appointment, they may be re-elected. 

The Company by-laws, in compliance with the law currently in force, provide for the appointment of the Board 

of Directors to occur on the basis of lists that ensure for minority shareholders the minimum number of 

directors envisaged by the law. 

In addition, the Code of Conduct recommends that this must occur in accordance with a transparent procedure 

to ensure, among other things, timely and adequate information on the personal and professional skills of 

candidates. 

The lists must be filed at the company head offices at least 25 days before the date set for the shareholders’ 

meeting on first or single call; this, together with the conditions and minimum stake required to file the lists, 

must be mentioned in the notice of call. 

Lists may be filed only by shareholders who, alone or together with other shareholders, are able to provide 

evidence that they hold a percentage of the share capital with voting rights no lower than that determined by 

CONSOB pursuant to the regulations in force. For 2012, the threshold established for the presentation of 

candidates’ lists for the election of the Board of Directors of Italcementi S.p.A. is 2% of the ordinary share 

capital. 

No shareholder may file or participate in the filing of more than one list, directly or through third parties or trust 

company, or vote for different lists. 

Shareholders belonging to the same group and shareholders who join a shareholders’ agreement on the 

Company shares may not file or vote for more than one list, neither through third party or trust companies. 

Lists filed in violation of these restrictions will not be accepted. 

Each candidate may be filed on one list only under penalty of ineligibility. 

At the time of their filing, lists must include: 

a) statements by which individual candidates: 

* accept their candidature 

* under his/her own responsibility state: 

- the non-existence of causes for ineligibility 

- entitlement of the good reputation requirements established by the law 

- entitlement of the independence qualification required by the law and by the Code of Conduct, if any; 

b) a brief resume on the personal and professional skills of each candidate with indication of their position as 

director and statutory auditor in other companies; 

c) information on the identity of shareholders who have presented lists. The intermediary certification or 

statement proving ownership of the shareholding prescribed by the law in force when the list is presented 

may also be produced after the filing of the list provided that it reaches the Company within the term 

envisaged by the regulation in force for the publication of lists by the Company; 

d) a statement of the shareholders who do not hold, even jointly, a controlling or majority stake, bearing 

witness to the absence of any connection with the majority shareholder, as defined by the law in force. 

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The Company by-laws do not provide for good reputation or independence qualification requirements 

additional to those required for the Statutory Auditors by TUF. 

A list filed not in compliance with the above provisions will be considered as not presented. 

At least 21 days before the shareholders’ meeting date, the Company shall make available at the Company 

premises, at the stock exchange and on its website, the lists of candidates which have been filed by 

shareholders along with supporting documentation. 

In the event of filing of more than one list: 

- all the directors are elected from the list that obtains the highest number of votes at the shareholders’ 

meeting, in the order in which they are listed, except for the minimum number reserved by law for the minority 

shareholders’ list; 

- the minimum number of directors reserved by law to minority shareholders are elected from the minority 

shareholders’ list that obtains the highest number of votes and is not connected in any way, directly or 

indirectly, with the majority shareholders; 

- should more than one list obtain the same number of votes, a runoff is held on these lists among all the 

shareholders present at the shareholders’ meeting, and the candidates are elected from the list that obtains 

the majority of the share capital represented at the shareholders’ meeting. 

For the purposes of the apportioning of the directors to be elected, the lists that have not achieved a 

percentage of votes at least equal to half of the percentage required for the presentation of lists will not be 

considered. 

Should a party connected to a majority shareholder vote for a list of the minority shareholders, the connection 

is significant for the purposes of excluding the minority shareholders’ elected director, only if this vote was 

crucial for the election of the said director. 

Should a single list be presented, all the candidates included in that list are elected with a simple majority vote 

of the share capital represented at the shareholders’ meeting. 

In the absence of lists, and whenever by means of the voting list mechanism, the number of candidates elected 

is lower than the minimum number envisaged by the by-laws, the Board of Directors is respectively appointed 

or supplemented by the shareholders at their meeting with the legal majority, provided that at least the 

minimum number of directors holding the independence qualification required by the law is guaranteed. 

If during the year, owing to resignation or other reasons, one or more directors cease to serve, the others, 

provided that the majority is still represented by directors appointed by the shareholders at their meeting, shall 

arrange to replace them by means of a resolution approved by the Board of Statutory Auditors. 

Directors are replaced, in compliance with the above requirements of good reputation and independence, with 

the appointment of unelected candidates belonging to the same list as the directors who no longer serve, 

following the original order of presentation. Should this not be possible, the Board of Directors shall act 

pursuant to the law. 

Directors appointed in this manner hold office until the following shareholders’ meeting. 

The shareholders’ meeting resolve upon the replacement of directors, in compliance with the above principles, 

with a simple majority of the share capital represented at the shareholders’ meeting. 

The term of directors appointed by this way ends at the same time as that of the directors serving at the time of 

their appointment. 

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No limits to re-eligibility of directors are envisaged, although directors holding the same position for more than 

nine years in the last twelve years could be considered - on voluntary basis - no longer to meet the 

independence qualification pursuant to the Code of Conduct. 

Pursuant to the current regulations, at least one of the members of the Board of Directors, or two if the Board 

of Directors consists of more than seven members, must be vested with the independence qualification 

established by the law for the members of the Board of Statutory Auditors, while the law requires all directors 

to meet the good reputation requirements established by the Minister of Justice for statutory auditors’ 

regulation. 

The Code, as stated by the Corporate Governance Committee, requires an adequate number of non-executive 

directors to be independent in the sense that they do not have, nor have recently had, directly or indirectly, 

relationships with the company or with parties linked to it, such as to influence their independence of judgment. 

Should an elected director during their term of office no longer satisfy the good reputation requirements 

established by the law or the by-laws, their office shall terminate. 

Should the independence criteria prescribed by the law no longer be met, the director concerned must 

immediately inform the Board of Directors. In the event, the office of the director shall terminate, except in 

cases where such criteria are still held by at least the minimum number of directors envisaged by the current 

regulation. 

No exception to the ban on competition envisaged by art. 2390 of the Italian Civil Code has been authorized by 

the shareholders’ meeting or is envisaged by the Company by-laws. Moreover, no director is a shareholder 

with unlimited responsibility in competitors or runs a competing business on their own or on behalf of third 

parties, or is a director or chief operating officer in competitors. 

Pursuant to the Company by-laws, the Board of Directors is vested with full powers of ordinary and 

extraordinary company management. It may, therefore, perform all acts which it deems necessary to achieve 

the business purpose with the sole exclusion of those expressly reserved by law to the shareholders’ meeting. 

Besides the powers vested with the Board of Directors by law and by the Company by-laws regarding the issue 

of shares and bonds, in compliance with art. 2436 of the Italian Civil Code, resolutions on the matters listed 

below are assigned not only to the extraordinary shareholders’ meeting, but also to the Board of Directors: 

- incorporation of wholly owned or at least ninety percent owned companies; 

- transfer of the registered office, provided that it remains within Italy; 

- establishment or removal of secondary offices, in Italy and abroad; 

- reduction of the share capital in the case of withdrawal by a shareholder; 

- amendment of the company by-laws to comply with legal requirements. 

The Board of Directors, in compliance with the by-laws, meets at least once every quarter. At these meetings, 

the executive directors report to the Board and Board of Statutory Auditors on significant transactions 

undertaken in execution of the powers granted to them. 

The Code underlines the key role played by the Board of Directors and sets out and supplements its specific 

duties which include, among other things: the assignment and termination of delegated powers to senior 

officers; the evaluation and approval of strategic, business and financial plans as well as the assessment of 

business forecasts and the adequacy of the organizational, administrative and general accounting 

arrangements of the company and subsidiaries; the examination and approval of the accounting entries for the 

period; the prior evaluation and approval of strategic transactions; the assessment of the company operational 

structure; the determination of the remuneration of directors vested with special powers and the manager in 

176






charge of preparing the company’s financial reports; reports presented at shareholders’ meetings; the 

examination and approval of the Corporate Governance system. 

In addition, the Board of Directors is required to evaluate and approve in advance: 

- the transactions with related parties undertaken by the company itself and by its subsidiaries when such 

transactions are of strategic or financial importance for Italcementi S.p.A.; 

- other transactions with related parties when expressly required by the specific company procedure and in 

compliance with the methods therein. 

Finally, the Board of Directors must review, at least once a year, the size, composition and functioning of the 

Board itself and of its Committees. 

The Board of Directors mainly consists of non-executive members and among these a sufficient number are 

independent. Should the Chairman of the Board of Directors be the primary officer responsible for company 

management, as also whenever the position of Chairman is held by the person who controls the company, the 

Code envisages that the Board appoints an independent director as the “lead independent director”, to be a 

reference for and to coordinate the requests and contributions of non-executive directors and, in particular, 

independent directors. 

The Chairman coordinates the activities and chairs meetings of the Board of Directors and ensures that its 

members are provided in due time with information on the related important items in order to assure a useful 

attendance, subject to any needs of urgency or confidentiality. To this extent, the supporting documentation on 

the items on the agenda is sent by e-mail to each member of both the Board of Directors and the Board of 

Statutory Auditors some days before each meeting (generally two days before the meeting). Moreover, when 

the supporting documentation is particularly complex and/or heavy, explanatory notes are provided with. 

In addition, the Chairman, through the competent company departments, acts to ensure that the directors take 

part in initiatives aimed at increasing their knowledge of the company and its dynamics and are informed about 

the main amendments to the legislative and regulatory framework concerning the company and its corporate 

bodies. 

Directors act and pass informed resolutions independently, pursuing the primary goal of creating value for 

shareholders. They accept their offices acknowledging that they can devote the due time to diligent 

performance of their duties. Pursuant to the Code, effective performance of the duties of director is deemed to 

be consistent with no more than: 

- 5 offices as executive director, 

- 10 offices as non-executive director or independent director or statutory auditor 

in companies listed also abroad on regulated markets, in financial, banking, insurance or major companies, 

excluding subsidiaries of Italcementi S.p.A., parents and companies subject to joint control. 

A list of the positions as director, statutory auditor, and chief operating officer held by each director in other 

companies listed on regulated markets, in financial, banking, insurance or major companies is set out below: 

Giampiero Pesenti * Italmobiliare S.p.A. - Chairman and Chief Executive Officer 

* Ciments Français S.A. - Director 

(representing Italcementi S.p.A.) 

* Allianz S.p.A. - Director 

* Compagnie Monegasque de Banque - Director 

* Credit Mobilier de Monaco - Director 

* Finter Bank Zürich - Director 

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* Mittel S.p.A. - Director 

Pierfranco Barabani * SACBO S.p.A. - Director 

Carlo Pesenti * Italmobiliare S.p.A. - Director - Chief Operating Officer 

* Ciments Français S.A. - Deputy Chairman 

* Mediobanca S.p.A. - Director 

* RCS MediaGroup S.p.A. - Director 

* Ambienta SGR - Director 

Giulio Antonello * Alerion Clean Power S.p.A. - Chief Executive Officer 

* Industria e Innovazione S.p.A. - Director 

* Reno de Medici S.p.A. - Director 

Alberto Bombassei * Brembo S.p.A. - Chairman – Chief Executive Officer 

* Atlantia S.p.A. - Director 

* Nuovo Trasporto Viaggiatori S.p.A. - Director 

* Pirelli S.p.A. - Director 

* Fiat Industrial S.p.A. - Director 

Giorgio Bonomi * Italmobiliare S.p.A. - Director 

* IGP - Decaux S.p.A. - Director 

Alberto Clô * Atlantia S.p.A. - Director 

* De Longhi S.p.A. - Director 

* Iren S.p.A. - Director 

Federico Falck * Falck S.p.A. - Chairman 

* Falck Renewables S.p.A. - Chairman 

* Banca Popolare di Sondrio S.c.r.l. - Director 

* Avvenire Nuova Editoriale Italiana S.p.A - Director 

* Falk Renewables Wind Ltd. - Director 

Carlo Garavaglia * Beltrame Holding S.p.A. - Chairman 

* Comitalia Compagnia Fiduciaria S.p.A. - Chairman Board of Statutory Auditors 

* Cordfin S.p.A. - Director 

* De Longhi S.p.A. - Director 

* Elba Assicurazioni S.p.A. - Chairman 

* Eunomia S.p.A. - Chairman 

* Habitat S.p.A. - Statutory Auditor 

* Unione di Banche Italiane S.c.p.A. - Supervisory Director 

* Del Clima S.p.A. - Director 

Italo Lucchini * Italmobiliare S.p.A. - Deputy Chairman 

* Unione di Banche Italiane S.c.p.a. - Supervisory Director 


* BMW Italia S.p.A. - Chairman Board of Statutory Auditors 

* BMW Financial Services Italia S.p.A. - Chairman Board of Statutory Auditors 

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* Cartiere Fedrigoni & C. S.p.A. - Chairman Board of Statutory Auditors 

* Fedrigoni S.p.A. - Chairman Board of Statutory Auditors 

Sebastiano Mazzoleni * Italmobiliare S.p.A. - Director 


(representing italcementi Ingegneria S.r.l.) 

Yves René Nanot * Ciments Français S.A. - Chairman 

* Asia Cement Public Co. Ltd - Director 

* Ciments du Maroc - Director 

* Essroc Corporation - Director 

* Suez Cement Company - Director 

* Zuari Cement Ltd - Director 

Marco Piccinini * Ferrari S.p.A. - Director 

* Finter Bank Zürich - Director 

* Montezemolo & Partners S.p.A. - Director 

Attilio Rota * Banca d’Italia – Bergamo branch - Director - Examiner 

Carlo Secchi * Allianz S.p.A. - Director 

* Expo 2015 S.p.A. - Director 

* Mediaset S.p.A. - Director 

* Pirelli & C. S.p.A. - Director 

* A2A S.p.A. - Management Board member 

Elena Zambon * Secofind S.I.M. S.p.A. - Chairman 

* Zambon S.p.A. - Chairman 

* Zambon Company S.p.A. - Director 

* Fondo Strategico Italiano S.p.A. - Director 

Emilio Zanetti * Unione di Banche Italiane S.c.p.a. - Chairman of the Operating Board 

* Banca Popolare di Bergamo S.p.A. - Chairman 

* SACBO S.p.A. - Deputy Chairman 

The report on the financial statements of the Board of Statutory Auditors provides for a list of the positions held 

by each of its members at the date of the report’s publication, in joint stock companies, limited liabilities 

companies and in partnerships. 

Legal representation – Executives 

According to the by-laws, legal representation of the Company vis-à-vis third parties and in lawsuits lies with 

the Chairman and, if appointed, the Deputy Chairman (or Deputy Chairmen) and the Chief Executive Officer 

(or Chief Executive Officers). 

The Board of Directors has granted to an Executive Committee all its powers, except those that the Italian Civil 

Code and the by-laws do not allow to be delegated. 

The resolutions of the Executive Committee are reported to the Board of Directors at the first following meeting. 

The Board of Directors has appointed an Executive Deputy Chairman, a Deputy Chairman, a Chief Executive 

Officer and a Chief Operating Officer. 

179 


The Code provides for the Board of Directors, at its first possible meeting and, in any case, at least on a 

quarterly basis, to be informed on the activities carried out by the Chief Executive Officer and the other 

executive directors, and in particular on the most important transactions with an impact on the financial 

statements undertaken by the company or by the subsidiaries, on the main transactions with related parties 

and those with a potential conflict of interest which have not been submitted to the Board for its prior approval. 

Upon proposal of the Remuneration committee, the Board of Directors, in the absence of those directly 

concerned, establishes the remuneration, grants monetary benefits for directors vested with special powers in 

compliance with the articles of association, based on the opinion of the Board of Statutory Auditors and, when 

required, upon further evaluation of the Committee for Transactions with Related Parties. A significant part of 

the remuneration of the Chairman, Executive Deputy Chairman and Chief Executive Officer is tied to business 

results and to achievement of specific targets. 

A consistent approach and coordination of activities are ensured by the presence of the Chairman, Executive 

Deputy Chairman, Deputy Chairman, Chief Executive Officer and Chief Operating Officer, directors or officers 

of Italcementi S.p.A. on the Boards of Directors of the main subsidiaries. 

Transactions with related parties 

Without prejudice to the provisions of the Procedure for Transactions with Related Parties last approved by the 

Board of Directors in its session of November 2010, transactions with related parties must be carried 

transparently and in compliance with the criteria of formal and substantial accuracy. Therefore, directors who 

have an interest, even if only potential or indirect, in a transaction are required to: 

a) provide timely and exhaustive information to the Board on the existence of the interest and on its 

circumstances; 

b) to leave the Board meeting at the time the resolution is taken. 

In specific circumstances, however, the Board of Directors may allow the participation of the director 

concerned in the discussion and/or the vote. 

Moreover, according to the by-laws and the above mentioned procedure, the Board of Directors may undertake 

significant transactions with related parties notwithstanding a negative opinion of the Committee for 

Transactions with Related Parties, upon authorization of the shareholders’ meeting, provided that, without 

prejudice to the majorities of law, the shareholders who are not related parties present at the meeting 

represent at least 10% of the share capital and those do not vote against the transaction (the so-called 

“whitewash”). 

In cases of urgency, the Board of Directors, or the competent body, may, directly or through subsidiaries, 

execute transactions with related parties, that are not under the prerogatives of the shareholders’ meeting and 

do not require its authorization, by applying the simplified rules envisaged by the Procedure for Transactions 

with related parties adopted by the Company. 

Appointment of committees 

Italcementi S.p.A., in its own Code, provides for the Board of Directors to appoint a Remuneration committee 

and an Internal control committee from among its members. Their resolutions are of advisory or propositional 

role and do not bind the following Board resolutions. 

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The Committees shall be composed of no fewer than three members and, in carrying out their duties, may 

access the supporting corporate information and functions, and also request the assistance of external 

advisors. 

Each Committee elects its own Chairman and a secretary (who is not required to be a member of the 

committee) and meets at request of its Chairman or his/her delegate. The meeting may be called informally 

(including by unwritten means). 

The meetings of each committee are validly convened with the participation of the majority of its members, in 

person or via an audio or video-conference link. Each committee carries resolutions by an absolute majority 

vote of the members participating at the meeting. 

The Remuneration committee, consisting of non-executive directors, the majority of whom are independent, 

has the task of proposing to the Board, in the absence of those directly involved, the remuneration of directors 

vested with special powers, as well as of the Chief Operating Officer and Officers with strategic responsibilities. 

It also enforces their application on the basis of the information supplied by the executive directors. The 

Remuneration committee also performs additional advisory functions on remuneration and related matters 

which the Board of Directors may request from time to time. 

The Internal control committee, consisting of independent directors, has the task, in addition to the above, of 

verifying, together with the manager in charge of preparing the company’s financial reports and the external 

auditors, the correct application of accounting policies and their consistency for the purposes of preparing the 

consolidated financial statements; of expressing, at request of the Chief Executive Officer, opinions on specific 

aspects regarding identification of the main company risks as well as the planning, realization and 

management of the internal control system; of examining the activities’ program and periodic reports prepared 

by the Controller. In addition, the Internal control committee performs further duties assigned by the Board of 

Directors and reports, at least on a half-yearly basis, during approval of the yearly and half-yearly reports, on 

the activities undertaken and on the adequacy of the internal control system. 

The Internal Control committee also supports the Board of Directors with the activities related to the functioning 

of the internal control system. 

The meetings of the committee are attended by the Chairman of the Board of Statutory Auditors or other 

auditor appointed by him/her; the Chairman and the Chief Executive Officer may also take part, as well as, if 

invited, the Chief Operating Officer, the internal control staff and the heads of other company functions. 

Among the committees recommended by the Corporate Governance Committee, the Italcementi S.p.A. Code 

does not provide for a «Nomination committee», given that the shareholding structure of the Company has a 

permanent majority shareholder holding the absolute majority of voting rights. Moreover, the appointment of 

the Board of Directors is now governed by the Company by-laws which envisage, among other things, that 

upon presentation of the list a brief resume is attached for each candidate with their personal and professional 

skills. These resumes, pursuant to the law and the Code, must be duly published on the company website; in 

addition, it is now current practice that during the shareholders’ meeting the Chairman or, at their request, the 

Chief Executive Officer provide data and professional details on candidates and their eligibility as independent 

directors. 

Further, in inviting issuers to evaluate the setting-up of a Nomination committee within the Board of Directors, 

the Corporate Governance Committee stated that “... this solution has its origin in systems with widespread 

shareholdings, to ensure an adequate level of independence of the directors in relation to management ...”. 

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Lastly, the Board of Directors, in compliance with the regulation envisaged for transactions with related parties, 

set up from among its members, during the adoption of the related procedure, a Committee for Transactions 

with Related Parties, which consists of independent directors only and the composition of which coincides with 

that of the Internal control committee. 

The Committee for Transactions with Related Parties has the task of assessing the formal and substantial 

accuracy of the transactions undertaken directly by the Company, or through its subsidiaries, with other related 

parties. 

The members of the Committee were asked to express their approval on the procedure prior to its adoption. 

The committee elects its own Chairman and, at the latter’s request, a secretary who is not necessarily a 

member of the committee and who has the task of preparing the minutes of meetings. The members of the 

committee for Transactions with Related Parties are required to promptly declare the existence of any dealings 

in relation to the specific transaction with related parties, in order to permit application of the equivalent 

controls. In order for the meetings of the committee to be valid, it is necessary for the majority of the serving 

members to be present. The meetings of the committee can also be held using broadcasting technology 

channels. The committee passes resolutions with the majority of those with voting rights. 

Lead independent director 

The Code envisages, in relation to independent directors, that should the Chairman of the Board of Directors 

be the primary officer responsible for company management, and also when the position of Chairman is held 

by the person who controls the company, the Board appoints an independent director as «Lead independent 

director», to provide a reference for and coordinate requests and contributions of non-executive directors and, 

in particular, independent directors. 

At the meeting of April 16, 2010, the Board of Directors appointed Mr. Alberto Clô, an independent director, as 

«Lead independent director». 

Control system 

For this information on the Internal control system, please refer to section «Features of the Risk management and 

internal control system regarding the financial disclosure process». 

Executive director responsible for overseeing the internal control system 

With reference to the control system, during the meeting of April 16, 2010, pursuant to the Code and with the 

assistance of the Internal control committee, the Board of Directors appointed the Chief Executive Officer as 

the executive director responsible for overseeing the internal control system. 


The Consolidated Law on Finance (TUF) provides that, within the corporate organization of companies listed 

on regulated markets which have Italy as their homemember state, should be appointed a manager in charge 

of preparing the company’s financial reports who is assigned with specific responsibilities, in particular for 

corporate disclosure. 

On April 16 th , 2010, the Board of Directors confirmed Carlo Giuseppe Bianchini, the head of Central Group 

Administration & Control, as Manager in charge of preparing the company’s financial reports, pursuant to art. 

154-bis of TUF and art. 30 of the Company by-laws. 

The office of Mr. Bianchini will end with the term of the current Board of Directors, i.e., with the approval of the 

financial statements for 2012. 

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Pursuant to the Company by-laws, the Manager in charge of preparing the company’s financial reports must: 

1) be a manager and meets the good reputation requirements established by law for the members of the 

Board of Directors; 

2) have at least three consecutive years’ experience in the exercise of administrative/accounting and/or 

financial and/or control activities at the company and/or its subsidiaries and/or at other joint stock 

companies. 

At the time of the appointment, the Board of Directors provided the Manager in charge with autonomous 

financial resources to exercise the powers granted to him and with the duty of reporting half-yearly to the Board 

of Directors on the resources utilized. Furthermore, the Board, upon proposal of the Remuneration committee, 

defines, at the time of the appointment and then annually, the remuneration of the Manager in charge. 


The Code takes up and supplements the laws and by-laws with reference to the appointment of the Board of 

Statutory Auditors which shall occur in accordance with a transparent procedure guaranteeing, among other 

things, timely and adequate information on the personal and professional skills of the candidates. 

The Board of Statutory Auditors is appointed on the basis of lists aimed at ensuring for minority shareholders 

the appointment of one acting auditor and one substitute auditor. 

Lists must be filed at the company head offices or by sending notice to the address of certified electronic mail 

indicated in the notice of call, at least 25 days before the date set for the shareholders’ meeting in first or single 

call; this, together with the means and minimum stake required to file the lists, must be mentioned in the notice 

of call. 

Lists may be presented only by shareholders who, alone or together with other shareholders, are able to 

provide evidence that they hold a percentage of the share capital with voting rights no lower than that 

determined by CONSOB pursuant to the regulations in force for the appointment of the Board of Directors. For 

2012, the established threshold is 2% of the ordinary share capital. 

No shareholder may file or participate in the presentation of more than one list, directly or through a third party 

or trust company, or vote for different lists. 

Shareholders belonging to the same group and shareholders who join a shareholders’ agreement on the 

company shares may not file or vote for more than one list, neither through a third party or trust companies. 

Lists filed in violation of these restrictions will not be accepted. 

Each candidate may be filed on one list only under penalty of ineligibility. 

At the time of their filing, lists must include: 

a) statements by which individual candidates: 

* accept their candidature 

* under his/her own responsibility state: 

- entitlement of the professional requirements envisaged by the by-laws, 

- the non-existence of causes for ineligibility or incompatibility, 

- entitlement of the good reputation requirements established by the law, 

- entitlement of the independence criteria required by the law and by the Code of Conduct; 

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) a brief resume on the personal and professional skills of each candidate with an indication of their position 

as director and statutory auditor in other companies; 

c) information on the identity of the shareholders who have presented lists. The certification or statement 

proving ownership of the shareholding prescribed by the law in force when the list is presented may also be 

produced further to the file of the list provided that it reaches the company within the term envisaged by the 

regulation in force for the publication of lists by the company; 

d) a statement by the shareholders who do not hold, even jointly, a controlling or majority stake, bearing 

witness to the absence of any connection, as defined by the law in force. 

A filed list that does not comply with the above provisions will be considered as not presented. 

In the event that, by the deadline of 25 days preceding the date of the shareholders’ meeting, a single list has 

been filed, or only lists presented by shareholders who are connected to each other pursuant to current 

regulations, further lists can be presented until the following third day and the participation threshold indicated 

in the notice of call will be halved. 

At least 21 days before the date envisaged for the shareholders’ meeting which is called to appoint the Board 

of Statutory Auditors, the Company shall make available at the company head offices, at the Italian stock 

exchange and on its website, the lists of candidates which have been submitted by shareholders and the 

belonging documentation. 

In the event of filing of more than one list: 

- the list that obtains the highest number of votes at the shareholders' meeting elects two acting auditors and 

two substitute auditors, in the order in which they are listed in the sections of the list; 

- the minority shareholders’ list that obtains the highest number of votes among the lists presented and voted 

by shareholders who are not connected in any way, directly or indirectly, with the majority shareholders, 

elects the third acting auditor and the third substitute auditor, in the order in which they are listed in the 

sections of the list; 

- should more than one list obtain the same number of votes, a runoff is held on these lists among all the 

shareholders present at the shareholders’ meeting, and the candidates are elected from the list that obtains 

the majority of the share capital represented at the shareholders’ meeting. 

Should a party connected to a majority shareholder vote for a list of the minority shareholders, the connection 

is relevant for the purposes of excluding the minority shareholders’ elected auditor only if this vote was crucial 

for the election of the said auditor. 

Should a single list be presented, all the candidates included in that list are elected with a majority vote of the 

share capital represented at the shareholders’ meeting. 

Should no lists be presented, the shareholders’ meeting appoints the Board of Statutory Auditors with a 

majority vote of the share capital represented at the shareholders’ meeting. 

The chairmanship of the Board of Statutory Auditors lies with the person indicated in first place on the list 

presented and voted by the minority shareholders, or to the first name in the single list presented or to the 

person appointed as such by the shareholders’ meeting should no lists be presented. 

Pursuant to the by-laws of Italcementi S.p.A., those who are in situations of incompatibility as envisaged by 

the law or those who have exceeded the limit of engagements established by the regulation in force, cannot be 

elected as auditors, and if elected cease to serve. 

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Should an elected auditor during his/her term of office no longer satisfy the requirements envisaged by the law 

or the by-laws, his/her office shall terminate. 

When it is necessary to replace an acting auditor, the substitute auditor belonging to the same list as the 

removed auditor takes over. 

In their absence, in accordance with the original order of presentation, the candidate from the same list as the 

ceased auditor takes over, without taking the initial section into account. 

Should the replacement concern the Chairman of the Board of Statutory Auditors, the position will be taken 

over by the auditor of the minority shareholders. 

Auditors appointed in this manner hold office until the following shareholders’ meeting. 

Should it be necessary to supplement the Board of Statutory Auditors: 

- to replace an auditor elected from the majority shareholders list, the appointment takes place with a simple 

majority vote of the share capital represented at the shareholders’ meeting, choosing among the candidates 

indicated in the original majority list; 

- to replace an auditor elected from the minority shareholders list, the appointment takes place with a simple 

majority vote of the share capital represented at the shareholders’ meeting, choosing among the candidates 

indicated in the original minority shareholders’ list; 

- for the simultaneous replacement of auditors elected in the majority and the minority shareholders’ lists, the 

appointment occurs with a simple majority vote of the share capital represented at the shareholders’ 

meeting, choosing among the candidates indicated in the list belonging to which each auditor was part of, 

with a number of auditors equal to the number of ceased auditors belonging to the same list. 

Whenever would not be possible to proceed as above, the shareholders’ meeting called to supplement the 

Board of Statutory Auditors passes a resolution with a simple majority of the share capital represented at the 

shareholders’ meeting, without prejudice to the principle by which one acting auditor and one substitute auditor 

must be appointed by minority shareholders . In any case, the Chairmanship of the Board of Statutory Auditors 

must be assigned to the auditor representing the minority shareholders. 

Auditors shall accept their appointment when they believe they can devote the appropriate time to the diligent 

performance of their duties. 

The Code recommends the statutory auditors to be chosen among those who qualify as independent on the 

basis of the criteria provided for directors and, as mentioned above, upon filing of the list they submit a 

statement to confirm that they meet the independence criteria. The Board of Statutory Auditors shall verify the 

proper application of and compliance with these criteria upon appointment and then annually; the outcome of 

this assessment and of that performed by the Board of Directors to assess the independence criteria of 

directors so defined will be disclosed in the corporate governance report or in the auditors’ report to the 

shareholders’ meeting. 

The Code states that auditors, too, are bound by an obligation of confidentiality and are prohibited by law from 

using, directly or indirectly, confidential information for immediate or future personal or financial gain. 

Besides the duties envisaged by the law and the by-laws, the Code requires the Board of Statutory Auditors to: 

a) oversee the independence of the external auditors by verifying both compliance with relevant laws and the 

nature and extent of services other than account auditing provided to the company and its subsidiaries by 

the external auditors and companies belonging to its group; 

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) evaluate the proposals made by external auditors for their appointment to this position, as well as the audit 

plan and the results set out in their report and any letter of recommendations; 

c) oversee the effectiveness of the audit process. 

Under the Code of Conduct approved by the Corporate Governance Committee, these last two duties could 

have been entrusted to the Internal control committee rather than to the Board of Statutory Auditors. The 

Company believed to be more consistent with the actual functions of the corporate bodies the assignment of 

these duties to the Board of Statutory Auditors, which already reviews the proposals of the external auditors 

and their activity program and, pursuant to the current regulations, proposes the engagement and termination 

of the external auditors at the shareholders' meeting; finally, this interpretation has been confirmed by Leg. 

Dec. 39/2010 by which VIII directive on statutory audits has been acknowledged in Italy. 

The Code provide for the Auditor who has, directly or through third parties, any interest in a specific Company 

transaction, to timely and exhaustively inform the other Auditors and the Chairman of the Board of Directors 

about nature, terms, cause and value of his/her interest. 

Shareholders’ Meetings 

The Code envisages that all the Directors regularly attend shareholders’ meetings and encourage and facilitate 

the broadest possible participation by shareholders smoothing the process of exercising voting rights. 

To this extent, the Board of Directors reports to the shareholders’ meeting on the fulfillment of their duties as 

performed and planned and ensures shareholders to have adequate information in order to them to wellinformed 

resolve upon the matters within their prerogatives. 

Shareholders who hold voting rights as certified by the communication envisaged by law and received by the 

Company no later than the end of the third trading day prior to the date set for the shareholders’ meeting on 

first or single call, are entitled to vote and attend shareholders' meetings. The legitimacy to vote and attend 

shareholders’ meetings is in any case entrusted with when the company has received the communication after 

the terms fixed by current regulations, provided that this is before the beginning of the proceedings for each 

individual meeting. 

For each shareholders’ meeting the Company may appoint, with a specific indication in the notice of call, a 

subject to whom entitled shareholders may confer a proxy, with voting instructions on all or some of the items 

on the agenda, as envisaged by the current regulations. 

No regulations have been envisaged for the proceedings of shareholders’ meeting since the broad powers 

assigned to the Chairman by law and current practices, as well as the by-law (art. 13) that expressly grants to 

the Chairman the power to lead the discussions, keep order and establish the voting method, as long as 

pursuant to disclosed proceeds, are considered adequate tools for the orderly running of shareholders’ 

meetings. 

Relationships with institutional investors and shareholders 

The Company seeks continuous dialogue with shareholders, based on a mutual understanding of their 

respective roles. To this end, the Chairman and the Chief Executive Officer, within their respective corporate 

duties and assignments, provide for the general guidelines to be adopted by company departments in dealings 

with institutional investors and other shareholders. 

To this extent, the Investor relations function, lead by Mr. Giancarlo Berera, has been established within the 

Group Finance department. 

In addition to that and in order to provide timely and easy access to company information and thus allow 

shareholders to exercise their rights well-informed, a specific website section has been created, in which 

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corporate information and documentations are available, in particular the procedures to participate and 

exercise voting rights at shareholders’ meetings, documentation relating to the items on the agenda, including 

Reports on the latter, lists of candidates to director and statutory auditor positions, with their curricula, financial 

reports, press releases issued by the company pursuant to the Consolidated Law on Finance, the corporate 

calendar, etc. 

B) IMPLEMENTATION OF CORPORATE GOVERNANCE RULES 

Board of Directors composition and its meetings 

The shareholders’ meeting of April 16, 2010, appointed the Board of Directors for 2010 - 2012, setting the 

number of members at 19. 

On that occasion, in compliance with the procedure set out in the Company by-laws, two lists of candidates 

were presented, one by the majority shareholder, Italmobiliare S.p.A., the other by the minority shareholder 

First Eagle Investment Management LLC. Therefore, among the elected directors, 18 represented the majority 

shareholder and one the minority. 

The Board of Directors, at its first meeting upon appointment and then annually during examination of the draft 

financial statements for the year, assessed, in compliance with the Code, the good reputation and 

independence qualification of its members taking into account the information supplied by each director. With 

reference to the independence evaluation, the Board agreed upon the declaration provided by Mr. Ettore 

Rossi, Mr. Attilio Rota and Mr. Emilio Zanetti, who considered themselves to be vested with the independence 

qualification despite the fact that they hold the office for more than 9 years out of the last 12 years. 

The outcome of this assessment has been disclosed to the market and is underlined in the Corporate Bodies 

table at the premise of this Report as well as in the table attached to this section. 

The shareholders’ meeting of April 19, 2011 increased the Board of Directors’ members up to 20 directors 

appointing Mr. Renato Guerini, later named Deputy Chairman on September 15. 

Following the early decease of director Mr. Pietro Ferrero, occurred on April 18, 2011, the Board of Directors, 

at its meeting of May 5 , 2011, according to art. 16 of the by-laws, co-opted Mr. Carlo Garavaglia, first and sole 

remaining candidate of the list presented by the majority shareholder at the time of appointing the Board 

members currently in office. 

On April 27, 2011, Mr. Antonio Carosi, sole candidate of the list presented by the minority shareholder First 

Eagle Investment Management LLC, resigned from his office. The Board of Directors, retained the opportunity 

of ensuring, also at this stage, the minority representation at the Board, asked the sole minority shareholder 

who presented the list directly to get proposals on the replacement of the resigning director. During the Board 

meeting of July 29, 2011, Mr. Giulio Antonello was then co-opted. 

As envisaged by the Code, on March 2, 2012, the Board of Directors assessed the size, composition and 

functioning of the Board and its Committees. 

To this extent, the Company circulated among the directors a self-evaluation questionnaire made up of 

statements, for which their level of agreement has been marked. 

The outcome of this assessment and the comments, sometimes expressed, showed a clearly positive 

judgment on the functioning of the Board of Directors and its Committees. 

In particular, note was made of the following: i) the Board of Directors is made up of an adequate numbers of 

non-executive and independent directors so that their judgment has a particular weight on the adoption of the 

resolutions, ii) the Chairman ensures a proper management of the discussions, giving each member the same 

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time to express their point of view, and iii) the information flow among Board of Directors, Statutory Auditors 

and External auditors is positive and fruitful. 

During 2011 the Board of Directors met 6 times in total; 16 directors, of whom 7 independents, attended all the 

meetings, 2 directors, both independent, attended 5 meetings, 1 independent director attended 4 meetings, 1 

director attended 3 meetings. 

The average length of meetings of the Board of Directors held during the year was of approximately 3 hours 

and 20 minutes. 

The entire Board of Statutory Auditors attended 5 of the meetings; two auditors were present at the other 

meeting. 

Upon invitation, the Chief Operating Officer of the Company attended all the meetings of the Board of 

Directors, as did the Manager in charge of preparing the company’s financial reports. Moreover, some officers 

of the Company and of subsidiaries and managers responsible for Company functions, from time to time 

involved, took part at the meetings to refer upon the items on the agenda of their fields. 

The Board, at the time of examining and approving the periodic financial reports, also evaluated the overall 

management’s performance, taking into account information provided by the executives and comparing results 

achieved with ones targeted. 

During 2012 the Board of Directors has so far met twice, the first time to examine revenues for 2011 and the 

outlook for 2012, the second to approve – among other things – the draft financial statements for 2011. During 

the year no fewer than a further three meetings are currently planned to approve the interim accounts. 

During 2011 the Executive committee has so far met twice, once with all its members present and the other 

time with the attendance of 5 members. The average length of meetings of the Executive committee held 

during the year was of approximately 1 hour and 15 minutes. During 2012, Executive committee has not met 

yet. 

During 2011, the «Lead independent director» met once with the other independent directors. 

Assignment of duties and granting of powers 

The Italcementi S.p.A. Board of Directors has 16 non-executive directors out of a total of 20. Among the nonexecutive 

directors, 10 are independent. 

The Chairman, the Executive Deputy Chairman and the Deputy Chairman are deemed as executive directors 

in consideration of the duties and powers granted to them. 

The Chief Executive Officer belongs to the executive directors. The Board of Directors, upon his/her 

appointment, determines duties and powers and sets any quantitative limits on the exercise of such powers. 

The granting of powers (including those of the Chief Operating Officer) is based on the principle of segregation 

of duties. 

The granting of powers, i.e., the assignment of operational powers to one or more directors and/or to the 

Executive Committee does not exclude the prerogative of the Board of Directors, which in any case holds a 

greater power of guidance and control over the general business of the company in its various aspects. 

Three of the 6 members of the Executive Committee, are executive directors; the others, two of whom 

independent, are, in any case, deemed non-executive directors. That because the Company’s Executive 

Committee does not meet on a regular basis and in fact only meets when it is necessary to promptly adopt 

specific resolutions. The Code of Conduct promoted by Borsa Italiana S.p.A., also, agrees with this 

interpretation provided that, as in this case, the director is not granted individual executive powers. 

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Legal representation of the Company is granted by the by-laws, severally, to the Chairman, Deputy Chairman 

(or Deputy Chairmen) and to the Chief Executive Officer (or Chief Executive Officers). 

Within the Board of Directors, the allocation of powers is as follows: 

• to the Executive Committee, consisting of six members, all the powers of the Board of Directors, except for 

those which the Italian Civil Code and the by-laws do not allow to be delegated. As specified at the time of its 

appointment, the resolutions of the Executive Committee must be reported to the next Board of Directors’ 

meeting; 

• to the Chairman, Mr. Giampiero Pesenti, considering his role in the holding company and his consolidated 

experience in the Company scope of activity, among other duties and in addition to the powers envisaged by 

the Company by-laws and by the other Corporate Governance Codes, the duties to oversee application of 

the Corporate Governance principles approved by the Board of Directors and to propose any amendment to 

them; indicate general strategic guidelines for Group business; specify the general policies for annual and 

interim financial statements as well as the general financial policies of the Group; approve the most 

important organizational changes (regarding both Italcementi S.p.A. and the main directly or indirectly 

subsidiaries) upon proposals of the Chief Executive Officer or of the Chief Operating Officer; approve the 

significant changes to the Group’s corporate structure, approve, for further submission to the Board of 

Directors or the Executive Committee, the most important transactions regarding acquisitions, disposals, 

capital expenditure, development in new initiatives and, generally, extraordinary transactions; indicate 

general policies for recruiting, training and managing staff and determine, also upon proposals of the Chief 

Executive Officer, the recruitment, remuneration (after consulting the Remuneration Committee and 

receiving the approval of the Board of Directors where envisaged), promotions, transfers, suspensions, 

termination or contract review for senior managers of the Group in Italy and in the other countries where the 

Group operates; deal with external communication. 

In addition, besides the powers needed to carry out the assigned duties, the Chairman has been granted 

powers to undertake securities and real estate transactions, with a limit of 50 million euro for each individual 

transaction with single signature and 75 million euro with joint signature with the Chief Executive Officer or 

the Chief Operating Officer; 

• to the Executive Deputy Chairman, Mr. Pierfranco Barabani, the powers to undertake property transactions 

up to the limit of 15 million euro for each individual transaction; 

• to the Deputy Chairman, Mr. Lorenzo Renato Guerini, the duty of supporting the international development 

by coordinating the activities within the scope of the Strategic Planning area as well as this of the Research 

center and making proposals on potential partners and institutions which will be able to support on defining 

Group’s international development projects; 

• to the Chief Executive Officer, Mr. Carlo Pesenti, among other duties, the responsibility for supervising 

management policies, business development strategies and coordination of the Company’s and of the main 

direct or indirect subsidiaries’ transactions, issuing the appropriate instructions to the Chief Operating Officer 

and the other corporate bodies; proposing organizational and corporate structure changes; drafting the 

separate and consolidated financial statements, including the half-yearly and quarterly reports as envisaged 

by the law; preparing, with the assistance of the Chief Operating Officer, the annual budgets for Italcementi 

S.p.A. and the Group and long-term strategic plans; overseeing the financial management of the Company 

and the Group; signing technical/administrative contracts with subsidiaries and associates; under the general 

policies indicated by the Chairman, defining policies relating to the choice of senior managers and staff 

management of Italcementi S.p.A. and of the main direct or indirect subsidiaries; recruiting staff at all levels; 

appointing every kind of consultant. 

189 


In addition, the Chief Executive Officer has been granted powers to undertake actions regarding: 

• industrial transactions (technical, manufacturing, commercial, administrative) up to a limit of 50 million euro 

for each individual transaction with single signature and 75 million euro with joint signature with the 

Executive Deputy Chairman or the Chief Operating Officer; 

• securities and real estate transactions up to a limit of 50 million euro for each individual transaction with 

single signature and 75 million euro with joint signature with the Chairman or the Chief Operating Officer; 

• at its meeting on April 16, 2010, the Board of Directors assigned to the Chief Operating Officer, Mr. 

Giovanni Ferrario, among others, the duties of overseeing and directing the technical, manufacturing, and 

commercial activities of Italcementi S.p.A.; directing, coordinating and controlling the activities of the 

industrial subsidiaries; proposing to the Chief Executive Officer the functional arrangements of the corporate 

organization; maximizing the efficiency of the corporate production units of the Italian subsidiaries and their 

compliance with the regulations and laws in force; determining and cooperating with the Chief Executive 

Officer in establishing staff management guidelines. 

In addition, the Chief Operating Officer has been granted powers to undertake industrial transactions 

(technical, manufacturing, commercial, administrative and some financial) up to a limit of 20 million euro for 

each individual transaction and real estate transactions up to a limit of 15 million euro for each individual 

transaction. 

The limits set for the powers granted respectively to the Executive Deputy Chairman and the Chief Operating 

Officer are doubled should their signature be combined with that of the other. In addition, and solely for 

industrial activities, the limits set for the powers granted to the Chief Operating Officer are doubled should their 

signature be combined with that of one of the Deputy Chief Operating Officers, if appointed. 

The Chief Executive Officer and the Chief Operating Officer have assigned specific and more limited powers to 

officers of the Company within their area of activities. 

The Chief Executive Officer and the other executive directors have periodically reported to the Board of 

Directors and the Board of Statutory Auditors, as envisaged by the Code and by the Company by-laws, about 

activities undertaken within their assignments and powers. In addition, the most important transactions with an 

impact on the financial statements undertaken by the Company, the main transactions with related parties as 

well as transactions leading to potential conflicts of interests, have been submitted to the Board of Directors, 

even when within the limits of their powers. 

Group interdepartmental bodies 

To implement the policies of the Board of Directors, a number of bodies not provided for by the by-laws have 

been established with duties of coordination and operational integration which do not, however, modify the 

responsibilities and powers of the functions represented in that bodies. 

In addition, a Committee of Officers operates at Group level, chaired by the Chief Operating Officer of 

Italcementi S.p.A., who also holds the post of Chief Executive Officer of the main subsidiary Ciments Français 

S.A., under the supervision of the Chief Executive Officer of the Company. This Committee is made up of 

officers of some executive departments of both companies. 

The Committee of Officers meets periodically to ensure operational consistency with the strategy and 

objectives set by the Boards of Directors of the various Group companies. 

Finally, the Conference of Officers is organized to raise awareness of strategic and organizational guidelines 

and the main group projects. Besides the members of the Committee of Officers, a small number of other 

senior Group managers take part in the Conference of Officers. 

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Remuneration for Directors, the Chief Operating Officer and Officers with strategic responsibilities 

According to the recommendations of the Code of Conduct promoted by the Italian Stock exchange, as 

updated in March 2010, and in compliance with the Recommendations of the European Committee no. 385 of 

April 30, 2009 and no. 913 of December 14, 2004, the Board of Directors, upon proposal of the Remuneration 

committee, submitted to the consultancy vote of the shareholders’ meeting held on April 19, 2011, the report 

on the Company remuneration policy for executive directors, other directors vested with special powers and 

key management personnel. 

Moreover, at their meeting held on April 19, 2011, the shareholders resolved upon the amendment of art. 32 of 

the by-laws by deleting the provisions of granting 1% of the net profits arising from the annual financial 

statements to the Board of Directors and recognized, till a new resolution, a fixed amount of 45,000 euro to 

each Board member; amount to be doubled for the Bod members who are named to be also part of the 

Executive committee. 

The Board of Directors, upon proposal of the Remuneration Committee and based on a positive opinion of the 

Board of Statutory Auditors, has also established, in the absence of the recipients, the amounts, both fixed and 

variable, to be allocated to the Chairman, Executive Deputy Chairman, Deputy Chairman, Chief Executive 

Officer, Chief Operating Officer and the Manager in charge of preparing the company’s financial reports in 

relation to the targets assigned to each of them and, except for the Executive Deputy Chairman and the 

Deputy Chairman, has approved a Long-term incentive plan which will be awarded upon achievement of the 

targets assigned at the end of the period. 

In addition, at the beginning of his office, to the Chairman was assigned a “Severance pay” which will vest at 

the end of the office. 

About the Remuneration policy, please refer to the Report drafted by the Board of Directors according to art. 

123-ter of TUF and object of a specific item on the shareholders’ meeting agenda. 

Composition and activities of the Committees 

The Remuneration committee is made up of three non-executive members, the majority of whom independent. 

All of them are vested with a specific competence on financial and accounting matters, as envisaged by the 

Code of conduct for at least one member. 

During the fiscal year, it met 5 times; the average length of its meetings was of approximately 1 hour. All the 

members took part in all the meetings, while the entire Board of Statutory Auditors attended 2 of the meetings; 

one auditor at least was present at the other meetings. 

The committee, in the absence of the recipients, examined, and then approved, the Remuneration policy for 

executive directors, other directors vested with special powers and key management personnel and proposed 

the remuneration to be granted to them at the Board of Directors. 

The Chief of Human resources and organizational development department is always invited to participate at 

the meetings. 

During 2012 the Remuneration committee has so far met twice, to resolve upon the proposals to the Board of 

Directors on the remuneration of Directors and Officers as well as on the remuneration for 2012 of the 

Controller, upon proposal of the executive director responsible for overseeing the functioning of the internal 

control system in agreement with the Chairman of the Internal control committee. 

The Internal control committee consists of four members, all non-executive and independent. All of them are 

vested with specific competence in financial and accounting matters, as envisaged by the Code of conduct for 

at least one member. 

191 


During 2011 the Internal control committee met 5 times; the average length of its meetings was of 

approximately 1 hour and 35 minutes. All the members attended 4 meetings and one was held with one 

member absent; the Board of Statutory Auditors attended with two of its members at 4 of the meetings; at the 

other one it was present in its whole. 

The Committee was updated on developments in the legal proceedings concerning the subsidiary Calcestruzzi 

S.p.A. (whose seizure has been revoked following the decision of the court of Caltanissetta on April 20, 2011); 

it examined the reports prepared by the Controller and by the external auditors to verify the adequacy, 

effectiveness and correct functioning of the internal control system, and reported to the Board of Directors 

during approval of the annual report and the half-year financial report, on the activities undertaken and on the 

adequacy of the internal control system. 

Some officers of the Company and of its subsidiaries and managers responsible for Company functions, from 

time to time involved, are invited to attend the meetings to refer upon the items on the agenda of their fields. 

During 2012 the Internal control committee has so far met twice, to examine, among others, the 2011 

impairment test methodology and results, the accounting methods adopted to draft the 2011 consolidated 

financial statements, the final balance of 2011 audit and the three-year audit plan for 2012-2014. 

The Committee for Transactions with Related Parties is made up of four members, all of whom are nonexecutive 

and independent. During 2011 the Committee met 3 times, with all members present. The average 

length of its meetings was of approximately 1 hour and 25 minutes. 

The meetings of the Remuneration committee, the Internal control committee and the committee for 

Transactions with Related Parties were duly minuted. 

Internal control system 

The internal control system is defined as the set of rules, procedures and organizational structures designed to 

ensure, through adequate identification, measurement, management and monitoring of key risks, healthy and 

proper management of the company in line with objectives, thus guaranteeing the safekeeping of the company 

assets, the efficiency and effectiveness of company transactions, the reliability of financial information, and 

compliance with laws and regulations. 

The Board of Directors exercises its functions in relation to the internal control system based on national and 

international reference models and best practice and pays particular attention to the organizational, 

management and control model adopted pursuant to Legislative Decree no. 231 of June 8, 2001. 

The Board of Directors, with the assistance of the Internal control committee, sets the guidelines for the 

internal control system so that the main risks regarding the Company and the subsidiaries are correctly 

identified and adequately measured, managed and monitored. It also sets the criteria to ensure the 

compatibility of these risks with correct and proper management of the Company and assesses, at least on an 

annual basis, the adequacy, effectiveness and functioning of the internal control system with respect to the 

characteristics of the Company. 

As envisaged by the Code, the executive director responsible for overseeing the functioning of the internal 

control system was actively involved, also with reference to the Risk & Compliance project described in the 

section «Risks and uncertainties» of this Report, to identify the main corporate risks and to verify the overall 

adequacy, effectiveness and efficiency of this system, by asking in particular the Controller to undertake 

specific controls of the procedures regarding both Italcementi S.p.A. and its subsidiaries. 

Some time ago, the Company set up an internal audit department. The Board of directors, upon proposal of the 

executive director responsible for overseeing the functioning of the internal control system and based on the 

positive opinion of the Internal control committee, confirmed as Controller, on its meeting of May 6, 2010, the 

192






head of the internal audit department. 

The Controller, performing his duties, got access to all the necessary information to execute them. He reported 

periodically to the Internal control committee, the Board of Statutory Auditors as well as to the executive 

director responsible for overseeing the functioning of the internal control system. 

During 2011 the Controller implemented the audit plan, as presented to the Internal control committee, and 

undertook the appropriate measures within his duties, as assigned from time to time by the Chief Executive 

Officer in his capacity as the executive director responsible for overseeing the internal control system. 

During 2011 the executive director responsible for overseeing the internal control system attended – together 

with the Controller – the meetings of the Internal control committee of the Company. 

The Board of Directors, to which the Internal control committee reports on a half-yearly basis, deems the 

internal control system adequate for the structure and kind of Company and Group business. 


During the renewal of the Board of Statutory Auditors at the shareholders’ meeting of April 17, 2009, the 

majority shareholder presented its own list of candidates. The minority shareholders did not present a list. 

Therefore, none of the auditors currently in office represents the minority shareholders. 

It is to be noted that, although the provisions of art. 148, par. 1-bis of TUF on the Board of Statutory Auditors 

composition are not in force yet, the actual composition of the Board of Statutory Auditors is already in 

compliance with this regulation as it is made up of two female acting auditors and one representing the male 

gender. 

As envisaged by the Code, during 2011, the Board of Statutory Auditors, among other things, oversaw the 

independence of the external auditors, by verifying both compliance with the relevant regulatory provisions and 

the nature and extent of the non-audit services provided to the Company and its subsidiaries by the external 

auditors and bodies belonging to their group. 

During the year, the internal audit manager took part in several meetings of the Board of Statutory Auditors, as 

the Board of Statutory Auditors attended all the meetings of the Internal control committee and of the 

Remuneration committee. This enabled a continuous information flow among the various bodies involved in 

monitoring the whole control system. 

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TABLE 1 

STRUCTURE OF THE BOARD OF DIRECTORS AND COMMITTEES 


Executive 

Committee 

Internal Control 

Committee 

Remuneration 

Committee 

Committee for 

Transactions with 

Related Parties 

Position Member Executives 

Non 

executives 

Indipend. 

Attendance 

No. other 

posts 

Member Attendance Member Attendance Member Attendance Member Attendance 

Chairman Giampiero Pesenti • 6/6 7 • 2/2 

Executive 

Deputy Pierfranco Barabani • 6/6 2 • 2/2 

Chairman 

Deputy 

Chairman 

Lorenzo Renato Guerini • 4/4 - 

Chief Executive 

Officer 

Carlo Pesenti • 6/6 5 • 2/2 

Director Giulio Antonello • 2/2 3 

Director Alberto Bombassei • 4/6 5 • 5/5 

Director Giorgio Bonomi • 6/6 2 

Director Antonio Carosi • 0/2 - 

Director Alberto Clô • 5/6 3 • 4/5 • 3/3 

Director Federico Falck • 6/6 5 • 1/2 • 5/5 • 3/3 

Director Pietro Ferrero • 1/2 - 

Director Danilo Gambirasi • 6/6 - 

Director Carlo Garavaglia • 3/3 9 

Director Italo Lucchini • 6/6 7 • 5/5 

Director Sebastiano Mazzoleni • 6/6 1 

Director Yves René Nanot • 6/6 6 • 2/2 

Director Marco Piccinini • 3/6 3 

Director Ettore Rossi • 6/6 - 

Director Attilio Rota • 6/6 1 • 2/2 • 5/5 • 3/3 

Director Carlo Secchi • 6/6 4 • 5/5 • 3/3 

Director Elena Zambon • 5/6 4 

Director Emilio Zanetti • 6/6 3 • 5/5 

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TABLE 2 

BOARD OF STATUTORY AUDITORS 

Position Member Attendance at meetings 

Chairman Maria Martellini 10/11 

Acting Auditor Mario Comana 9/11 

Acting Auditor Luciana Gattinoni 10/11 

CODE OF ETHICS 

The Code, approved for the first time in 1993 and further modified, envisages that all employees and those 

who deal with the Group or act to achieve its objectives shall base their dealings and conduct on principles of 

honesty, fairness, integrity, transparency, confidentiality and mutual respect. 

To this end, at its meeting of February 2, 2001, the Italcementi Board of Directors approved the current version 

of the Code of Ethics which defines the rules for loyalty and fidelity, impartiality, protection of privacy and 

confidentiality of information, protection of people, the environment and company assets. The Code 

establishes the provisions which are the basis of the control processes and the accounting/operational 

information, and introduces rules to govern dealings with customers, suppliers, public institutions, political 

organizations and unions, and the media. 

CONFIDENTIAL INFORMATION 

In terms of managing confidential information, the Code, after recalling the obligation of confidentiality and the 

prohibition on using such information for personal gain, envisages the adoption of procedures for the 

disclosure of documents and information, with particular reference to price-sensitive information which may be 

disclosed only by people who are generally or specifically authorized to do so. 

At its meeting of February 2, 2001, the Company’s Board of Directors approved a specific procedure requiring 

strict compliance with the disclosure procedures and terms envisaged by the provisions in force, in full 

alignment with the principle of fairness and contextuality. 

Regarding relationships with institutional investors and other shareholders, based, as envisaged by the Code, 

on continuous attention, the organization notices issued by the Chief Executive Officer have established 

general guidelines and identified the Company structures dedicated to this activity. 

INTERNAL DEALING CODE OF CONDUCT 

The Company adopted its own ‘Internal Dealing Code of Conduct’, originally in application of the provisions 

issued by Borsa Italiana S.p.A. and then to take account of the new regulatory provisions adopted by CONSOB 

in execution of the new European regulation (so-called Market abuse) introduced by the Law on Savings of 

2005. The ‘Internal Dealing Code of Conduct’ governs the information to be disclosed to the Company, and by 

the Company to the market, on any transactions involving Italcementi shares and other financial instruments 

connected to them undertaken by ‘Relevant persons’ on their own behalf. 

Pursuant to the ‘Internal Dealing Code of Conduct’, ‘Relevant persons’ are the members of the Board of 

Directors, the Board of Statutory Auditors and the Chief Operating Officer of Italcementi S.p.A. and any subject 

holding an equity investment of at least 10% of the voting share capital of Italcementi S.p.A., as well as any 

other subject who controls Italcementi S.p.A. 

In particular, ‘Relevant persons’ must inform Italcementi S.p.A., which in turn informs the market, about 

completed transactions of an aggregate amount crossing the 5,000 euro threshold by the end of the year. It is 

195 


to be noted that CONSOB, the Italian watchdog, with its resolution no. 18079 of last January 20, introduced an 

exemption to the disclosure of these transactions to the market establishing that only the further transactions 

executed during the year and crossing the previous mentioned threshold (5,000 euro) within the same 

reference period shall be disclosed. 

Given the particular structure of the Group, the ‘Internal Dealing Code of Conduct’ is associated with the Code 

adopted by Italmobiliare S.p.A., in the sense that market disclosures made by Italcementi S.p.A. regarding 

transactions on Italcementi shares by parties who are ‘Relevant persons’ for both companies, are considered 

as made also pursuant to the provisions contained in the Code of Conduct adopted by the parent company 

Italmobiliare S.p.A. 

In addition, the ‘Internal Dealing Code of Conduct’ envisages that ‘Relevant persons’ must abstain from 

transactions that are subject to disclosure to the Company: 

* during the 30 calendar days preceding the meeting of the Board of Directors of Italcementi S.p.A. called to 

approve the full-year and half-year financial statements, including the day on which the meeting is held; 

* during the 15 calendar days preceding the meeting of the Board of Directors of Italcementi S.p.A. called to 

approve the quarterly reports, including the day on which the meeting is held. 

PROCEDURE FOR TRANSACTIONS WITH RELATED PARTIES 

On November 5, 2010, based on the positive opinion of the specifically appointed Committee for Transactions 

with Related Parties, the Company’s Board of Directors adopted the Procedure for Transactions with Related 

Parties envisaged by the CONSOB Regulation of March 12, 2010. 

The Procedure, in compliance also with art. 2391-bis of the Italian Civil Code, sets out the measures adopted 

by the Company to ensure that transactions undertaken with related parties, whether directly or through 

subsidiaries, are carried out transparently and in compliance with the criteria of substantial and procedural 

correctness. 

In particular, with the exception of some situations which are described below, the Procedure provides for the 

authorization process and the disclosure requirements for transactions between i) a party related to 

Italcementi, on the one hand, and ii) Italcementi, on the other, or one of its subsidiaries when, prior to 

completing the transaction, the prior examination or authorization by a corporate body of Italcementi or by an 

officer of Italcementi with relevant delegated powers is requested. The Procedure is also applied to 

transactions undertaken by Italcementi with a subsidiary or associate, as well as among its subsidiaries, when 

the transaction involves significant interests of a related party of Italcementi. 

The Procedure distinguishes «significant» transactions from «minor» transactions on the basis of specific 

quantitative criteria predetermined by CONSOB. This distinction is also relevant for the different kind of rules 

applicable on transparency transactions, which are simplified for minor transactions and more stringent for 

significant transactions, although both envisage prior opinion of the Committee for Transactions with Related 

Parties. 

The Committee has: 

- the duty to give and explain its opinion on both minor (non-binding opinion) and significant (binding opinion) 

transactions; 

- the right, for significant transactions, to take part in the negotiations and in the preliminary investigation stage 

through a complete and prompt information flow , and the right to ask for information and to submit its 

remarks to the delegated bodies and to those in charge of the negotiations or the preliminary investigation; 

196






- the right to seek the assistance, at the Company’s expense, of independent experts of its choosing. 

In the case of minor transactions, the Procedure envisages the right, in any case, to execute the transaction 

even if the Committee for Transactions with Related Parties expresses a negative opinion, provided that this is 

disclosed to the market through a specific document setting out the reasons for this divergence. 

For significant transactions, on the other hand, should the Committee express a negative opinion, the Board of 

Directors may approve the transaction only with the prior authorization of the shareholders’ meeting. 

Finally, in application of the determination powers provided by the CONSOB Regulation, the Company has 

identified the following main exemptions: 

- transactions of a negligible amount (transactions that do not exceed 500,000 euro); 

- ordinary transactions (which fall within the sphere of ordinary business and the related financial transactions 

of the Company and of the Group generally) provided that they are completed on arms-length terms and 

equivalent to market standards; 

- transactions with or between subsidiaries or with associates, unless in the counterpart subsidiaries or 

associates there are significant interests of other related parties of the Company; 

- urgent transactions. 

The Procedure is available on the company website at www.italcementigroup.com. 

At their meeting last year, in accordance with the proposal of the Board of Directors, the shareholders 

integrated the by-laws provisions stating that: 

the significant transactions with related parties can be performed despite the negative opinion of the 

Committee for Transactions with related parties provided that the execution is authorized by the 

shareholders meeting and, without prejudice to the majorities of law, the non-related shareholders present 

at the shareholders’ meeting represent at least 10% of the share capital with voting rights and that a 

contrary vote is not expressed by the majority of the non-related shareholders (so called whitewash); 

the Company may, in cases of urgency, execute transactions with related parties, that are not under the 

prerogatives of the shareholders’ meeting and do not require its authorization, by applying the simplified 

rules envisaged by the Procedure for Transactions with related parties. 

REGULATION OF THE MANAGER IN CHARGE OF PREPARING THE COMPANY’S FINANCIAL 

REPORTS 

As mentioned in another part of the report, the Company, in connection with Law no. 262/05, the so-called 

«Law on Savings», appointed a «Manager in charge of preparing the company’s financial reports» and 

adopted a specific «Regulation» which, in compliance with legal provisions, the by-laws and following current 

best practices, as well as taking into consideration the arrangements for similar activities at the parent 

company Italmobiliare S.p.A., among other things: 

* defines the responsibilities of the «Manager in charge» of Italcementi and specifies his/her related powers; 

* identifies the responsibilities and method for the appointment, removal and termination of office of the 

«Manager in charge», the length of service and the requirements in terms of professional skills and good 

reputation: 

* reports on the principles of conduct which the Company «Manager in charge» must comply with in the event 

of conflicts of interest as well as the confidentiality obligations to be observed in carrying out his/her 

activities; 

197 


* indicates the responsibilities, powers, and resources granted to the «Manager in charge» for the exercise of 

his/her duties, identifying the financial and human resources needed to carry out the mandate; 

* defines dealings with other Company bodies/functions, with the corporate bodies, the internal and external 

control bodies and with subsidiaries, as well as, in compliance with the mutual areas for independent action, 

the procedures for interrelating with the parent company Italmobiliare, regulating information flows; 

* recalls the general principles of the Operational model used by the Italcementi Group, which has been 

established in order to fulfill the regulatory provisions on preparing the financial reports; 

* illustrates the internal and external attestation process in reference to: a) the statements of the «Manager in 

charge» regarding the correspondence of the disclosed acts and communications of the Company to the 

documents and the accounting books and entries; b) the attestations of the «Manager in charge» and of the 

executives, relating to the financial statements, the limited half-year financial statements and the 

consolidated financial statements. 

The «Regulation» has been approved by the Board of Directors and refers to all the entities, functions, 

corporate bodies of Italcementi S.p.A., as well as all the companies that it directly or indirectly controls. The 

Regulation has been circulated to the staff of the Company, the subsidiaries, as well as to all those considered 

affected by its contents. 

ORGANIZATIONAL, MANAGEMENT AND CONTROL MODEL 

In order to make the control system and Corporate Governance more effective, and prevent corporate offenses 

and offenses against the public administration, during 2004, in application of Legislative Decree no. 231/01, the 

Company Board of Directors adopted an «Organizational, management and control model» (the «Model»). 

This was subsequently updated in 2006 in line with the law on market abuse and failure to disclose a conflict of 

interest by directors. 

By adopting the «Model», the Company intends to disseminate and establish a corporate culture based on 

legality, with the express censure of all conduct contrary to the law and the regulations of the «Model». 

In 2008 the «Model» was also extended to crimes connected to violation of the laws on workplace health and 

safety, transnational crimes, conspiracy to handle stolen goods and money-laundering. At its meeting on 

February 3, 2010, the Board of Directors updated the special section of the «Model» on safety. Following the 

introduction of new categories of crimes related to racketeering, industry and commerce, copyrights and 

hacking into the Leg. Decree 231/01, the Board of Directors, in its meeting of February 3, 2012, recently 

updated the «Model» which will be further amended in order to include environmental crimes, recently 

introduced by the lawmaker in Leg. Decree 231/01 as crimes relevant for the purposes of applying the Decree 

itself. To this extent, the Company already appointed a specialized consultancy company to perform a risk 

assessment on the risks connected to these areas. 

The duty of ongoing overseeing the effective functioning and enforcement of the «Model», as well as proposing 

amendments, is entrusted to a Compliance Committee, which operates on an autonomous, professional and 

independent basis. 

In accordance with the provisions of the «Model», the Compliance Committee is currently composed of an 

independent director (subsequently appointed Chairman), an external qualified advisor and the company’s 

Internal Audit manager. 

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CONSOB Regulation on Markets 

The Regulation on Markets, approved by CONSOB with the resolution no. 16191 of October 29, 2007, 

provides for specific conditions to be complied with by the listed companies: 

A) that control companies whose registered office is outside European Union («non-EU») (art. 36) 

B) that are subject to management and coordination activity by another company (art. 37). 

In particular, the companies as set out in letter A) are required to: 

1) disclose the accounts of non-EU subsidiaries drawn up for the purposes of the consolidated financial 

statements, including at least the balance sheet and the income statement; 

2) gather non-EU subsidiaries by-laws, composition and powers of the corporate bodies; 

3) check that the non-EU subsidiaries: 

* provide the parent company external auditor with the information needed to audit the annual and interim 

accounts of the parent company, 

* have an administrative-accounting system consistent to provide the management and external auditor of 

the parent company, on a regular basis, with the business, financial and equity information needed to 

draft the consolidated financial statements. 

The companies set out at letter B), on the other hand, may be admitted for trading on a regulated Italian market 

(or maintain their listing) where they: 

a) have fulfilled the disclosure obligations envisaged by article 2497-bis of the Italian Civil Code; 

b) are free to negotiate in dealings with customers and suppliers; 

c) do not have, with the company that exercises administration and control activity or with any other company 

of the group to which belongs, a centralized treasury management agreement, which is not in their 

corporate interest. The correspondence with the corporate interest is attested by the Board of Directors with 

a detailed declaration verified by the Board of Statutory Auditors; 

d) have a Board of Directors composed mainly of independent directors (pursuant to the Code of Conduct) and 

an Internal Control Committee consisting solely of independent directors. Where appointed, also the other 

committees, as recommended by corporate governance codes promoted by regulated market managers or 

by category associations, shall consist solely of independent directors. 

With reference to the provisions set out at art. 36, at Italcementi S.p.A., the scope of application involves as of 

today 31 subsidiaries, located in 13 countries outside the European Union. 

The information flow between the Company and its subsidiaries is adequate to guarantee: 

* the transmission of the accounts of the subsidiaries drawn up for the purposes of the consolidated financial 

statements, to enable such accounts to be disclosed; 

* the centralized gathering of the by-laws, the composition and powers of the corporate bodies of the 

mentioned subsidiaries and any subsequent amendment. 

Thus, all the by-laws of subsidiaries located in countries that do not belong to the European Union, which are 

relevant for the purposes of the captioned regulation, as well as the composition and powers of the corporate 

bodies have been acquired and are stored in the Company records. 

Furthermore, it has been verified that the subsidiaries based in countries outside European Union, and relevant 

according to the last Audit plan: 

* provide the company’s external auditor with the information needed to verify the annual and interim accounts 

of Italcementi S.p.A., 

* have an administrative-accounting system suitable to provide the management and external auditor of the 

parent company, on a regular basis, with the business, financial and equity information needed to draft the 

199 


consolidated financial statements. 

In addition, pursuant to art. 37 of the Market Regulation, Italcementi S.p.A., a subsidiary subject to 

management and coordination activity by Italmobiliare S.p.A.: 

- has fulfilled the disclosure obligations envisaged by art. 2497-bis of the Italian Civil Code; 

- is free to negotiate in dealings with customers and suppliers; 

- does not have a centralized treasury management agreement with Italmobiliare S.p.A.; 

- has a Board of Directors which consists mainly of independent directors and, with the exception of the 

Remuneration Committee, all the Committees set up among the Board of Directors consist solely of 

independent directors. However, this last provision, introduced with CONSOB resolution no. 17389 of June 

23,2010, provides that companies comply with the new composition conditions within thirty days of the first 

shareholders’ meeting called after October 1, 2010, to renew the Board of Directors. Following the entry into 

force of this resolution, the Italcementi Board of Directors has not yet been renewed. 

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Resolution 

The financial year closed with a profit of 7,001,950.82 euro. 

Taking into consideration that, in accordance with art. 7 -paragraph 5- of the company by-laws, in financial 

years when a dividend of less than 5% of nominal share value is assigned to the savings shares, the difference 

is computed as an increase in the preferred dividend in the two following financial years, the above profit for 

the year enables us to assign to the savings shareholders the entire preferred dividend for financial year 2009 

and part of the preferred dividend for financial year 2010, and thus to propose the distribution of a dividend to 

outstanding savings shares, net of treasury shares held by the company, of 0.066478 euro per share, gross of 

legally required withholdings. 

We also propose the distribution of the entire “Retained earnings” reserve, with the withdrawal from the reserve 

of an overall amount of 3,635,176.77 euro, and of part of the Extraordinary Reserve, with the withdrawal from 

the reserve of an overall amount of 29,802,872.79 euro. Taking into consideration that, in accordance with the 

above-mentioned art. 7 of the company by-laws, in the event of distribution from reserves, savings shares have 

the same rights as other shares, we propose the allocation, for financial year 2011, of 0.12 euro to every 

outstanding ordinary and savings share, net of treasury shares held by the company, gross of legally required 

withholdings. 

* * * 

To the Shareholders, 

if you agree with our proposals, we invite you to carry the following resolution: 

The Italcementi S.p.A. Annual General Meeting of April 18, 2012, 

 

having acknowledged of the directors’ report and the report of the Board of Statutory Auditors after 

examination of the financial statements at December 31, 2011; 

 

to approve: 

- the directors’ report; 

hereby resolves 

- the 2011 separate financial statements, consisting of the statement of financial position, income 

statement, statement of comprehensive income, statement of changes in equity, statement of cash 

flows and notes, which reflect a profit of 7,001,950.82 euro as presented by the Board of Directors in 

its entirety, in the individual postings and with the proposed allocations; 

201 


to apportion the profit for the year as follows: 

Profit for the year 7,001,950,82 

To the legal reserve - 

Residual amount 7,001,950.82 

euro 0.05 per share to each of the 105,325,878 savings shares (1) (financial year 2009) 5,266,293.90 



Total dividend 7,001,853.72 

Residual amount 97.10 

To the 2011 earnings reserve in favor of savings shareholders 97.10 

(1) net of the 105,500 treasury savings shares held at March,2 2012 

 

to withdraw an amount of: 

- 3,635,176.77 euro from Retained earnings, which, as a result, is reduced to zero; 

- 29,802,872.79 euro from the Extraordinary reserve, which, as a result, decreases from 

478,026,655.72 euro to 448,223,782.93 euro, 

by assigning 0.12 euro: 

- to 173,324,535 outstanding ordinary shares, net of the 3,793,029 ordinary treasury shares held at 

March 2, 2012; 

- to the 105,325,878 outstanding savings shares, net of the 105,500 savings treasury shares held at 

March 2, 2012; 

 

to severally authorize the Chairman, the Executive Deputy Chairman, the Deputy Chairman and the 

Chief Executive Officer, should the number of ordinary treasury shares change before the coupon date: 

- to raise the “Extraordinary Reserve” by the amount corresponding to the dividend attributable to any 

purchased ordinary shares, 

- to reduce the “Extraordinary Reserve” by the amount corresponding to the dividend attributable to 

any sold ordinary treasury shares. 

202






Report on Remuneration 

Dear Shareholders, 

This Report on Remuneration, drafted pursuant to Art. 123-ter of February 24, 1998 Legislative Decree No. 58 

(Consolidated Law on Finance - TUF), illustrates the principles adopted by Italcementi S.p.A. with reference to 

the definition of the remuneration of its executive Directors vested with special powers and Officers with 

strategic responsibilities - identified as the Chairman, the Executive Deputy Chairman, the Chief Executive 

Officer, the Deputy Chairmen, the Chief Operating Officer and the Manager in charge of preparing the 

company’s financial reports - as well as of the Controller and of the Officers directly reporting to the Chairman, 

Executive Deputy Chairman, the Chief Executive Officer and Chief Operating Officer, as reported hereunder. 

The Report has been prepared in accordance with the schedule established by CONSOB (Italian stock 

exchange Authority) with resolution No. 18049 of December 23, 2011. 

* * * 

The Remuneration Report presented herewith has been examined and approved by the Remuneration 

Committee and Board of Directors on 2 March 2012. 

SECTION I 

The term Company shall hereinafter mean Italcementi S.p.A., the term Group shall mean Italcementi Group, 

the term Policy shall mean the Remuneration policy for executive Directors, other directors vested with special 

powers, Officers with strategic responsibilities, and Officers directly reporting to the Chairman, the Executive 

Deputy Chairman, the Chief Executive Officer and the Chief Operating Officer. 

a) Bodies or individuals involved in the preparation and approval of the remuneration policy, specifying the 

respective roles, and bodies or individuals responsible for the proper implementation of such policy 

The bodies involved in preparing the remuneration policy are the following: 

Shareholders’ Meeting 

The Company shareholders’ meeting defines the remuneration of Directors not vested with special powers. 

It is also required to express its advisory opinion upon this section of the Report on Remuneration prepared 

by the Board of Directors pursuant to Art. 123-ter of TUF. 

Lastly, the shareholders’ meeting, upon proposal of the Board of Directors, pursuant to Art. 114-bis of TUF, 

resolves upon the approval of any incentive plans based on financial instruments that the Company wishes 

to issue. 


The Board of Directors, upon proposal of the Remuneration Committee and based on the opinion of the 

Board of Statutory Auditors, resolves upon the remuneration to be assigned to the Chairman, Deputy 

Chairmen, Chief Executive Officer, Chief Operating Officer, the Manager in charge of preparing the 

company’s financial reports and the Controller, broken down into a fixed and a variable amount to be 

granted in connection to the achievement of the annual targets assigned to each of them. 

The Board of Directors may also approve a Long-Term Incentive against the achievement of the three-year 

period targets assigned. 

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Department of Human Resources and Organizational Development 

The Group Human Resources and Organizational Development Department supports the Remuneration 

Committee in performing its functions, both in defining and approving proposals concerning the 

remuneration to be submitted to the approval of the Board of Directors, and at the time of monitoring and at 

the time of verifying the full and proper implementation of the same. 

b) Possible participation of a remuneration committee or other responsible committee, describing its 

composition (with the distinction between non-executive and independent directors), competence and 

functioning conditions 

The Remuneration Committee was established within the Board of Directors, it is made up of three nonexecutive 

members, mainly independent, as follows: 

Alberto Bombassei - member - independent 

Italo Lucchini - member 

Emilio Zanetti - Chairman - independent 

The Committee carries out its consultative and advisory functions on matters delegated to it, in particular by 

ensuring the following, in the absence of people directly involved therein: 

- submitting to the Board of Directors proposals for the remuneration of Directors vested with special 

powers and Officers with strategic responsibilities; 

- periodically evaluating the criteria adopted for the remuneration of Officers directly reporting to the 

Chairman, the Executive Deputy Chairman, the Chief Executive Officer, the Officers with strategic 

responsibilities and the Controller, supervising their application on the basis of information provided by the 

Chief Executive Officer and by the corporate functions possibly involved in formulating general 

recommendations on the Board of Directors on this items; 

- monitoring the implementation of the Board of Directors’ decisions, in particular, by verifying the effective 

achievement of performance targets. 

The Remuneration Committee, with the assistance of the Group Human Resources and Organizational 

Development Department, analyzes the composition and disbursement of the remuneration of Directors 

vested with special powers, Officers with strategic responsibilities, the Controller and Officers directly 

reporting to the Chairman, the Executive Deputy Chairman, the Chief Executive Officer and the Chief 

Operating Officer. 

In carrying out its duties, it can also request for the assistance of one or more independent firms specialized 

in the field of executive compensation, and able to make the appropriate comparisons between 

competitiveness and consistency with respect to the reference markets and governance systems required 

by current best practices, having also regard for i) the weight of their offices within the corporate structure, 

ii) the powers granted to them and the related range of discretion; iii) the individual economic impact. 

Afterwards, the Remuneration Committee submits the so-defined Policy to the Board of Directors for the 

formal approval of the same, or, if the current Policy (after its first application) is still considered consistent 

with the Company’s needs, market trends and the regulatory environment, it confirms the latter. 

Once it has examined and approved the Policy, the Board of Directors submits a report thereupon for the 

advisory opinion of the shareholders. 

c) Any independent experts involved in the remuneration policy definition 

Not applicable. 

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It is also pointed out that the sources of information for the analysis of the remuneration competitiveness 

covered by this policy, in particular, were provided by the following companies: Hay Consulting, Mercer 

Consulting and Towers Watson. 

d) The remuneration policy aims, guiding principles and any amendments to the remuneration policy with 

respect to the previous financial year 

The Company believes that the definition and implementation of the Remuneration Policy represents a 

primary tool aimed at: 

- attracting, retaining and motivating highly-qualified management personnel within the Company and, 

more generally, within the Group; 

- aligning the interests of management and shareholders; 

- promoting the creation of shareholder value in the medium-long term, establishing a direct relationship 

between remuneration and performance. 

The Policy is consistent with the principles and related application criteria of the Group’s “Corporate 

Governance Framework”, aimed at encouraging a responsible and sustainable approach to remuneration, 

consistent with the Group values. 

By executing the Policy, the Company pursues: 

- compliance with regulations of both legal and self-regulatory sources, as well as with the regulators’ 

recommendations; 

- governance of the Policy’s definition and implementation process, in line and consistent with current best 

practices; 

- an ongoing dialogue with market practices; 

- a strong link between remuneration and results and sound risk management as a guarantee of its 

sustainability. 

The definition of the Policy is the result of a fully outlined process in which the Company’s Remuneration 

Committee and Board of Directors play a central role. 

The Company’s Remuneration Committee held on February 21, 2011 examined, and on February 24, 2011 

subsequently approved, a Policy consistent with the provisions of the Code of Conduct issued by Borsa 

Italiana (i.e. the Italian stock exchange); an explanatory memorandum of such Policy (the remuneration 

report) was subsequently submitted to the advisory opinion of the shareholders’ meeting called to approve 

the 2010 financial statements held on April 19, 2011. 

Following the new regulations introduced by CONSOB Resolution No. 18049 of December 23, 2011 in 

execution of the powers granted by Legislative Decree No. 259/2010, the Company considered adjusting its 

Remuneration Policy, by confirming the principles and guidelines already expressed in the previous version 

of the same, but expressing them according to the new legal framework. 

e) Description of the policies in terms of fixed and variable components of remuneration, with particular 

reference to the indication of the relative weight within the overall remuneration and distinguishing between 

short and medium-long term variable components. 

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A) VARIABLE COMPONENTS 

Under the Policy, the variable components of remuneration are the following: 

1) Short-Term Variable Component (MBO) 

i) Directors vested with special powers and Officers with strategic responsibilities 

The yearly variable remuneration for Directors vested with special powers and Officers with strategic 

responsibilities is established by the Board of Directors upon proposal of the Remuneration Committee 

and based on the opinion of the Board of Statutory Auditors, in relation to the achievement of the annual 

targets assigned. Such targets are predetermined and measurable, and they are in any case linked to 

value creation for the Company and shareholders in the medium to long term; by way of example, but 

not limited thereto, these targets may be linked to the Company's and/or the Group’s financial position 

and results of operations, the adoption of governance best practices, sustainable development and 

implementation of strategic projects for the Company. 

ii) Officers directly reporting to the Chairman, the Executive Deputy Chairman, the Chief Executive Officer 

and the Chief Operating Officer 

The yearly variable remuneration in favor of Officers directly reporting to the Chairman, the Executive 

Deputy Chairman, the Chief Executive Officer and the Chief Operating Officer is established by the latter 

with the support of the Human Resources and Organizational Development Department, in connection to 

the achievement of annual targets assigned and in compliance with the principles and guidelines of the 

Group’s Remuneration Policy. 

Such targets are predetermined and measurable, and are in any case linked to value creation for the 

Company and the shareholders in the medium to long term; by way of example, but not limited thereto, 

these targets may be linked to the Company's and / or the Group’s financial position and results of 

operations, the adoption of governance best practices, sustainable development and implementation of 

strategic projects for the Company. 

2) Medium-Long Term Variable Component (LTI) 

Two different long-term incentive plans are currently in place: one for Directors vested with special powers 

and Officers with strategic responsibilities and one for the other officers – Officers directly reporting to the 

Chairman, Executive Deputy Chairman, the Chief Executive Officer and the Chief Operating Officer. 

i) Directors vested with special powers and Officers with strategic responsibilities 

Among the Directors vested with special powers, the Chairman and the Chief Executive Officer were the 

recipients of a stock option plan for directors over a three-year period approved by the shareholders' 

meeting of June 20 th , 2007. 

The above plan consisted of three-year cycles, and the first cycle ended in 2009. 

The Officers with strategic responsibilities were the recipients of a stock option plan for top management 

approved by the shareholders’ meeting of April 28, 2008. 

The aforesaid plan consisted of three-year cycles, the first of which was closed in 2010. 

The Company’s Board of Directors deemed it appropriate to replace such incentive systems with a new 

system on a monetary basis (“Long-Term Monetary Incentive Plan for Directors and Officers with 

Strategic Responsibilities of Italcementi S.p.A.”). 

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In making its assessments, the Board of Directors took into account the findings of the analyses carried 

out on behalf of the Company by independent advisors, with extensive experience and international 

standing, on executive compensation. 

The new long-term monetary incentive plan is based on three-year cycles depending on the mediumlong 

term performance of the Company and/or the Group. 

This plan aims at: 

- tying the overall remuneration package of recipients to the Company’s medium-long term 

performance, by rewarding the achievement of strategic targets, and to the corresponding “value 

creation” for shareholders; 

- ensuring maximum transparency and compliance with best governance criteria of the overall 

remuneration package for recipients. 

The corporate body in charge for decisions relating to the plan is the Board of Directors, which adopts 

resolutions upon proposals of the Remuneration Committee with the technical and operational support of 

the Head of Human Resources and Organizational Development Department. 

The plan functioning is aligned, after the necessary adjustments suggested by the Remuneration 

Committee, with the mechanism adopted for the annual incentive plan (points system with minimum 

access threshold, target assigned and maximum target). 

The right to obtain the granting of premium linked to the long-term monetary incentive plan is indeed 

subject to: 

a) the achievement of long-term targets assigned to each recipient by the Board of Directors at the 

beginning of the cycle upon proposal of the Remuneration Committee. Such targets, established 

consistently with the powers granted to each of them, are linked to the Company’s financial position 

and results of operations and other targets specifically assigned such as, for example, targets 

regarding governance, risk management and sustainable development, complementary targets to 

those established in the annual incentive plan. The control over the achievement of such targets is 

made by the Remuneration Committee and, where appropriate, by independent experts; 

b) the expiration of the entire three-year period of each of the plan’s cycles and the uninterrupted holding 

of the office or employment relationship for each individual recipient. Before the expiration of such 

period no right accrues to partial or pro rata disbursements. The allocation of the amount actually 

accrued takes place in April of the year following the end of the three-year reference period. 

ii) Officers directly reporting to the Chairman, the Executive Deputy Chairman, the Chief Executive Officer 

and the Chief Operating Officer 

Officers directly reporting to the Chairman, the Executive Deputy Chairman, the Chief Executive Officer 

and the Chief Operating Officer are the recipient of the long-term monetary incentive plan linked to the 

performance of the security “Italcementi S.p.A. – Ordinary shares” (“Long-Term Monetary Incentive Plan, 

linked to the appreciation of Italcementi shares, for executives”) approved by the shareholders’ Meeting 

of April 28, 2008. 

The latter, on the basis of the above resolution dated April 28, 2008 were initially the recipients of a stock 

option Plan for executives subsequently cancelled, for the not executed portion, by resolution of the 

shareholders’ meeting of April 19, 2011. 

The new long-term monetary incentive plan provides for three-year cycles based on the Company’s 

and/or the Group’s medium-long term performance and the allocation to the beneficiaries of a certain 

number of phantom stock in proportion to the results achieved. 

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This plan aims at: 

- tying the overall treatment of executives to the Company’s medium-long term performance, by 

rewarding the achievement of certain strategic targets, and to the corresponding “value creation” for 

shareholders; 

- ensuring maximum transparency and compliance with best governance criteria of the overall 

remuneration package of recipients. 

The corporate body responsible for decisions relating to the plan is the Board of Directors, which passes 

resolutions upon proposals of the Remuneration Committee with the technical and operational support of 


The Board of Directors delegates the operational management of the plan to the Chief Executive Officer. 

The functioning of the plan provides for the allocation to each beneficiary of a minimum-maximum range 

of phantom stock whose underlying are Italcementi shares. 

The right to obtain the granting of the premium linked to the long-term monetary incentive plan is subject 

to: 

a) the achievement of long-term targets assigned to each recipient by the Chairman, the Executive 

Deputy Chairman, the Chief Executive Officer and Chief Operating Officer at the beginning of the 

cycle, proposed with the support of the Department of Human Resources and Organizational 

Development. Such targets, defined consistently with the powers granted to each of them, are linked 

to the Company’s financial position and results of operations and other targets specifically attributed 

such as, for example, targets regarding governance, risk management and sustainable development, 

targets additional to those established in the annual incentive plan. Control over the achievement of 

these targets will be made by the Department of Human Resources and Organizational Development; 

b) the expiration of the full three-year period of each of the plan’s cycles and the uninterrupted holding of 

office or employment relationship for each individual recipient. Before the expiration of such period no 

right accrues to partial or pro rata granting of phantom stock. 

The amount of the incentive is then calculated by multiplying the number of phantom stock actually 

accrued by the current value of Italcementi stock in December 2013 (last month of the 2 nd cycle of the 

plan). Allocation of the amount awarded normally takes place within the month of April of the year 

following the end of the three-year reference period. 

B) FIXED COMPONENTS AND OVERALL REMUNERATION 

As a result of the foregoing, the overall treatment approved according to the Policy, inclusive of the fixed 

component of remuneration, may be represented as follows for the different beneficiaries: 

a) Remuneration of Officers with Strategic Responsibilities 

The Company’s Board of Directors identified the Chief Operating Officer and the Manager in charge of 

preparing the company’s financial reports as Officers with strategic responsibilities. 

The remuneration of Officers with strategic responsibilities is established by the Board of Directors upon 

proposal of the Remuneration Committee and based on the opinion of the Board of Statutory Auditors. 

The Officers with strategic responsibilities’ remuneration components are as follows: 

a) an annual fixed component; 

b) an annual variable component linked to the achievement of specific business targets (Management By 

Targets); 

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c) an exclusively monetary medium-long term variable component (Long Term Incentive), linked to the 

achievement of specific targets, as the previous one. 

Having defined the overall remuneration package as the sum of the three components recalled above, in 

the event targets related to the components b) and c) are achieved, it is pointed out that such targets and 

the related remuneration are referred to the position of Officers with strategic responsibilities within the 

Group (therefore including targets and remuneration received due to other positions in other Group 

companies), and the relative weight of the same can be approximately represented as follows: 

a) the weight of the yearly fixed component is approximately equal to 35% of the Chief Operating Officer’s 

and 50% of the Manager in charge of preparing the company’s financial reports’ overall remuneration; 

b) the weight of the annual variable component (MBO) is approximately equal to 35% of the Chief Operating 

Officer’s and 30% of the Manager in charge of preparing the company’s financial reports’ overall 

remuneration. 

Such variable component cannot in any case exceed 100% of the fixed component as per letter a) 

above; 

c) the medium-long term variable component (LTI), currently based on three-year cycles, in its annual 

amount , represents about 30% of the Chief Operating Officer’s and 20% of the Manager in charge of 

preparing the company’s financial reports’ overall remuneration. 

Such variable component cannot in any case, during the entire three-year period of each plan, exceed 

100% of the fixed component referred to under a) above, as granted throughout the plan’s execution 

periods. 

With reference to the variable components of remuneration for Officers with strategic responsibilities 

referred to under letters b) and c) above, the Remuneration Committee: 

- defines, annually, proposals for the assignment of MBO targets to be submitted to the Board of Directors’ 

approval; 

- monitors, in the following year, the degree of achievement of MBO targets and verifies the performance 

carried out; 

- verifies, at the end of each three-year reference period, the level of achievement of LTI targets. 

The Company does not have currently in place long-term incentive plans based on financial instruments for 

Officers with strategic responsibilities. 

The Board of Directors may also exceptionally establish special bonuses, upon occurrence of relevant, 

specific and unforeseen circumstances, in order to remunerate Officers with strategic responsibilities i) if the 

total amount of the other elements of remuneration is considered to be objectively inadequate with respect 

to the performance carried out, always within the overall upper limits set out in this Policy, or ii) in relation to 

specific activities and/or extraordinary transactions in terms of strategic relevance and impact on the 

Company’s and/or the Group’s results of operations. 

b) Remuneration of the Controller 

The remuneration of the Controller is established by the Board of Directors upon proposal of the 

Remuneration Committee based on the opinion of the Executive Director in charge of overseeing the 

functioning of the Internal Control system. 

Such remuneration is made up of an annual fixed component, an annual variable component and a longterm 

variable component (over three years). 

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The variable components are aligned to the Group’s MBO and Long-Term Incentive systems and do not 

provide for any target related to the Company's results of operations, but only targets linked to the 

improvement of the Internal Control system’s effectiveness and functionality . 

The weight of the annual fixed, variable (MBO) and medium / long term (LTI) components of the Controller 

is respectively 45%, 15% and 40% of his/her overall remuneration. 

c) Remuneration of Officers Directly Reporting to the Chairman, the Executive Deputy Chairman, 

the Chief Executive Officer and the Chief Operating Officer 

The remuneration of Officers directly reporting to the Chairman, the Executive Deputy Chairman, the Chief 

Executive Officer and the Chief Operating Officer is established by the latter with the support of the Head of 

Human Resources and Organizational Development Department according to the principles and guidelines 

of the Group’s “Remuneration Policy”. 

The components of the remuneration of Officers directly reporting to the Chairman, the Executive Deputy 

Chairman, the Chief Executive Officer and the Chief Operating Officer are the following: 



Targets); 

c) a variable medium-long term component (Long Term Incentive), monetary-based and linked to the 

performance of “Italcementi S.p.A. - Ordinary” shares, also subject to the achievement of specific targets 

as the previous one. 

Having defined the overall remuneration package as the sum of the three components recalled above in the 

event of targets related to components b) and c) are achieved, it is pointed out that such targets and the 

related remuneration are referred to the position of Officers directly reporting to the Chairman, the Executive 

Deputy Chairman, the Chief Executive Officer and the Chief Operating Officer within the Group (therefore 

including targets and remuneration received due to other positions in other Group companies), and the 

relative weight of the same can be approximately represented as follows: 

a) the weight of the yearly fixed component is approximately equal to 50% of the overall remuneration; 

b) the weight of the annual variable component (MBO) is approximately equal to 30% of the overall 

remuneration. 

Such variable component cannot in any case exceed 70% of the fixed component as per letter a) above; 

c) the medium-long term variable component (LTI), currently based on three-year cycles, as the annual 

amount thereof, has a weight equal to about 20% of the overall remuneration. 

With reference to the variable components of remuneration of Officers directly reporting to the Chairman, 

the Executive Deputy Chairman, the Chief Executive Officer and the Chief Operating Officer referred to in 

letters b) and c) above, the Human Resources and Organizational Development Department: 

- defines, annually, proposals for the assignment of MBO targets to be submitted to the Chairman, the 

Executive Deputy Chairman, the Chief Executive Officer and the Chief Operating Officer for approval, 

depending on the officer’s position within the organizational structure; 

- in the following financial year, monitors and submits to the Chairman, the Executive Deputy Chairman, the 

Chief Executive Officer and the Chief Operating Officer the degree of achievement of MBO targets and 

verifies the performance carried out; 

- at the end of each three-year reference period, verifies the level of achievement of LTI targets, submitting 

the results to the approval of the Chairman, the Executive Deputy Chairman, the Chief Executive Officer 

and the Chief Operating Officer. 

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f) Policy followed with regard to non-monetary benefits 

Please refer to the description under points e) and n) for non-monetary benefits respectively granted to i) 

Officers with strategic responsibilities and Officers directly reporting to the Chairman, the Executive Deputy 

Chairman, the Chief Executive Officer and the Chief Operating Officer, and ii ) Directors vested with special 

powers and other Directors. 

g) With reference to variable components, a description of performance targets based on which they are 

assigned, distinguishing between short and medium-long term variable components, and information on the 

link between variation of results and variation of remuneration 

Reference is made to that represented under points e) A) 1) i), e) A) 1) ii), e) A) 2) i) and e) A) 2) ii). 

h) Criteria applied for the evaluation of performance targets forming the basis for the allocation of shares, 

options, other financial instruments or other variable components of the remuneration 

Consistently with the information provided under points e) B) a) and e) B) b), the definition and verification 

of the correct implementation of the criteria used for the performance targets’ evaluation are on each 

occasion carried out by of the Remuneration Committee and the Human Resources and Organizational 

Development Department. 

i) Information aimed at highlighting the consistency of the remuneration policy with the company’s long-term 

objectives’ pursue and its risk management policy, where formalized 

By applying the Policy, the Company pursues a strong link between remuneration and results of operations 

and a sound risk management as guarantee of its sustainability. 

According to the above, the Remuneration Committee periodically evaluates, among other things, the 

criteria adopted for the remuneration of Directors and Officers with strategic responsibilities, supervising 

their implementation based on information provided by the Chief Executive Officer and any corporate 

functions involved and formulating general recommendations to the Board of Directors on the subject. 

j) Vesting period, any deferred payment system, with the indication of periods of deferment and of the criteria 

used for the establishing such periods and, if applicable, ex-post correction mechanism 


See also Section I - letter e) A) 2) for detailed information on LTI functioning. 

k) Information about the possibility of introducing provisions for maintaining financial instruments in the 

portfolio after acquisition thereof, indicating the periods of maintenance and the criteria used for establishing 

such periods 


l) Policy on treatment provided for termination of office or termination of employment agreement events, 

specifying the circumstances which determine the onset of the right thereto and the possible link between 

such treatment and the company’s performance; 

The Company has not entered into specific agreements, except in the case described below, with the 

Directors vested with special powers and Officers with strategic responsibilities aimed at regulating, at the 

outset, the financial consequences resulting from a possible early termination of employment relationship 

caused by the Company or the individual employee. 

With regard to the single position of the Chief Operating Officer, a total settlement of any amounts due, 

equal to two annual salaries, has been agreed in the event of termination of the employment agreement for 

reasons other than just cause. 

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With reference to the other offices, in the event of termination of the employment agreement with the 

Company for reasons other than just cause, it is considered appropriate to pursue out-of-court settlements 

on an equitable basis, to the extent allowed by the law, as well as the benchmarks and existing good 

practice for similar positions, except as may be required by rules and agreements in force, and in particular 

by the collective bargaining agreement for Executives of companies producing goods or providing services. 

There is no provision for the granting of extraordinary remuneration to Directors not vested with special 

powers due to termination of the office. 

The Company does not, in general, enter into specific non-competition agreements with its Officers with 

strategic responsibilities, designed to pay out financial consideration, during the employment relationship or 

subsequently to termination thereof, related to the respective fixed remuneration in relation to the term and 

geographical, business scope and product sector of the constraints arising from same. 

m) Information on the presence of any insurance, or pension or retirement, coverage other than the mandatory 

one 

Specific health and safety insurance policies consistent with what represented under letter n) below are 

provided for the Chairman and Chief Executive Officer. 

n) Remuneration policy possibly followed in regard of: (i) independent directors, (ii) participation in committees 

and (iii) performance of particular tasks (Chairman, Deputy Chairman, etc.). 

The Company’s Board of Directors consists of two categories of directors: 

a) Directors vested with special powers; 

b) Directors not vested with special powers. 

As of January 31, 2012, the members of the Company’s Board of Directors were divided in the two 

categories as shown below: 

a) Giampiero Pesenti, Chairman • Pierfranco Barabani, Executive Deputy Chairman • Carlo Pesenti, Chief 

Executive Officer • Lorenzo Renato Guerini, Deputy Chairman; 

b) Giulio Antonello • Alberto Bombassei • Giorgio Bonomi • Alberto Clô • Federico Falck • Danilo Gambirasi 

• Carlo Garavaglia • Italo Lucchini • Sebastiano Mazzoleni • Yves René Nanot • Marco Piccinini • Ettore 

Rossi • Attilio Rota • Carlo Secchi • Elena Zambon • Emilio Zanetti. 

The shareholders’ meeting held on April 19, 2011 granted to the Board of Directors’ members an annual 

remuneration of € 45,000, increased to € 90,000 for those being also members of the Executive Committee. 

Such amount is increased for Directors who are members of Board’s Committees, and for Chairmen of the 

latter. 

In compliance with best practices in place for Directors not vested with special powers, no variable 

component of remuneration is provided for, while they are reimbursed expenses incurred in performing their 

office. 

Finally, an insurance policy, in line with existing practices, has been taken out for civil liability to third parties 

of Directors for events related to the exercise of their functions, in compliance with the provisions set forth 

with regard to corporate offices, except in cases of willful misconduct and gross negligence. 

The remuneration of Directors vested with special powers, is directly established at the time of appointment, 

or at a subsequent useful meeting, by the Board of Directors acting upon proposal of the Remuneration 

Committee and based on the opinion of the Board of Statutory Auditors. 

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The components of the remuneration of Directors vested with special powers are as follows: 

A) Chairman and Chief Executive Officer: 



Targets); 

c) a monetary medium-long term variable component (Long Term Incentive), also linked to the achievement 

of specific targets as the previous one. 

Having defined the overall remuneration package as sum of the three components listed above in the event 

of targets related to components b) and c) are achieved, it is pointed out that such targets and the related 

remuneration are referred to the position of Director vested with special powers within the Company 

(therefore not comprising targets and remuneration received due to other positions in other Group 

companies, including the parent company), and the relative weight of the same can be approximately 

represented as follows: 

a) the weight of the yearly fixed component is approximately equal to 35% of total remuneration; 

b) the weight of the annual variable component (MBO) is approximately equal to 25% of total remuneration. 

Such variable component cannot in any case exceed 100% of the fixed component as per letter a) 

above; 

c) the medium-long term variable component (LTI), currently based on three-year cycles as to the annual 

amount thereof, has a weight equal to about 40% of total remuneration. 

Such variable component cannot in any case, over the entire three-year period of duration of each plan, 

exceed 120% of the fixed component referred to under letter a) above, as granted throughout the plan 

execution periods. 

With reference to the variable components of remuneration of Directors vested with special powers referred 

to under letters b) and c) above, the Remuneration Committee: 

- annually, makes proposals for the assignment of MBO targets to be submitted to the Board of Directors 

for approval; 

- in the following financial year, monitors the degree of achievement of MBO targets and verifies the 

performance achieved; 

- at the end of each three-year reference period, verifies the level of achievement of LTI targets. 

The Company does not have currently in place long-term incentive plans based on financial instruments for 

Directors vested with special powers. 

The Chairman is entitled to a “Severance pay”, which will accrue at the end of each term of office. 

The allowance has been calculated so as to not exceed 3 years of remuneration and it will not be granted if 

termination of office is due to the attainment of objectively inadequate results. 

In addition to benefits usually provided for similar positions, the Chairman is also entitled to an illness and 

injury policy, and reimbursement of expenses incurred to attend meetings and conferences, etc.. 

The allowances granted to the Chief Executive Officer are discharged in full to the holding company, where 

he acts as Executive and Chief Operating Officer; the holding charges the Company for the total cost, 

including social security contributions payable by the Company and post-employment benefits. 

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The Board of Directors may also grant special awards, exceptionally, upon occurrence of significant, 

specific and unforeseen, circumstances in order to remunerate Directors vested with special powers, i) if the 

overall remuneration components are considered to be objectively inappropriate to the performance 

achieved, within the limits of the upper limits set in this Policy, or ii) in relation to specific activities and / or 

extraordinary transactions in terms of strategic relevance and impact on the Company’s and/or the Group’s 

results of operations. 

B) Deputy Chairmen: 

The remuneration of Deputy Chairmen consists of a fixed component and a possible annual variable 

component, not exceeding 100% of fixed remuneration, defined in accordance with the provisions of the 

MBO system mentioned above. 

o) Whether the remuneration policy was defined using the remuneration policies of other companies as a 

reference and, if so, the criteria used for the selection of such companies 


SECTION II 

I.1 – PART ONE 

1.1. Full representation of the remuneration components, including the treatment provided for termination of 

office or termination of the employment agreement, and their consistency with the reference Policy has 

already been given in Section I of this report; 

With respect to incentive plans based on financial instruments, please find below information concerning 

the plans in place. 

Incentive plans for Directors and Officers 

A stock option Plan for directors -2001, a stock option Plan for executives -2000, a stock option plan for 

top management - 2008, a long-term monetary incentive Plan for directors and Officers with strategic 

responsibilities and a long-term monetary incentive Plan linked to the appreciation of Italcementi shares 

for executives, are currently in place at Italcementi S.p.A.. 

During 2011, none of the Company Directors and Officers beneficiary of stock option plans exercised the 

respective rights already accrued. 

Stock Option Plan for Directors 2001 

In execution of the shareholders’ resolution of April 24, 2001, the Company’s Board of Directors meeting 

of May 9, 2001, approved the stock option plan for directors who are vested with special powers in 

accordance with the articles of association, or those who perform specific operating duties. By resolution 

of the shareholders meeting of June 20, 2007, the Plan discussed herein was replaced, with respect to the 

not executed part, by the “Stock Option Plan for Directors 2007”. 

During the year no options were exercised. 

Overall, in execution of the stock option Plan for directors, 1,339,825 options equal to 0.47% of share 

capital were granted; the options granted as of December 31, 2008 and not yet exercised amounted to a 

total amount of 960,900. 

214






Stock Option Plan for Directors 2007 

The shareholders' meeting held on June 20, 2007 approved a second stock option plan for directors 

vested with special powers in accordance with the articles of association, or those who perform specific 

operating duties, which, for the not executed part, replaces the Stock Option Plan for directors described 

above. 

With reference to such stock option Plan, in 2007, the Company’s Board of Directors assigned the 

Chairman and the Chief Executive Officer targets based on which, once their achievement has been 

verified, a number of options from a minimum of 555,000 up to a maximum of 1,050,000 could have been 

exercised upon expiry of the three-year period. If the minimum targets set by the Board of Directors were 

not met, the beneficiary would have lost the right to exercise all the options granted. 

Having assessed the degree of achievement of performance targets that were originally assigned, the 

Board of Directors, in its meeting held on March 5, 2010, upon proposal of the Remuneration Committee, 

granted: 

* 401,250 options to the Chairman; 

* 300,000 options to the Chief Executive Officer. 

Both the Chairman and the Chief Executive Officer waived the granting of stock options in their favor. No 

new option grant has been approved by the Board of Directors. Following the resolution of the Board of 

Directors and the subsequent waiver of the award by the Chairman and the Chief Executive Officer, no 

further options on the "Stock Option Plan for Directors - 2007" are outstanding. 

The shareholders' meeting held on April 19, 2011 approved the cancellation of the Plan, for the not 

executed part. 

Long-term monetary incentive Plan for directors and managers with strategic responsibilities of 


By resolution of February 3, 2011, the Board of Directors, upon proposal of the Remuneration Committee 

and based on the favorable opinion of the Committee for Transactions with Related Parties, adopted a 

“long-term monetary incentive Plan for directors and Officers with strategic responsibilities of Italcementi 

S.p.A.” whose main features are listed below. 

At the same meeting of February 3, 2011, the Board of Directors, in execution of said Plan, assigned the 

Chairman and the Chief Executive Officer the targets for their term of office. Moreover, at the meeting held 

on March 4, 2011, the Chief Operating Officer and the Manager in charge of preparing the company’s 

financial reports were assigned targets for the 2011-2013 period. 

In any case, no award will be granted in the absence of the achievement of acceptable results, likewise, in 

case results are significantly better than forecast, a total bonus higher than the one established at the 

assignment of targets will be granted. 

The main features of the Plan are the following. 

a) Reasons for the adoption of the plan 

They can be summarized as follows: 

• to tie the overall treatment of participants to the Company’s performance in the medium-long term by 

rewarding the achievement of certain strategic targets, and the consequent “value creation” for 

shareholders; 

• to ensure maximum transparency and compliance with best governance criteria of the overall salary 

package of participants. 

215 


) Plan Management 

The corporate body responsible for decisions relating to the Plan is the Board, acting upon proposal of 

the Remuneration Committee (hereinafter referred to as the Committee) with the technical and 

operational support of the Head of Human Resources and Organizational Development Department, 

and, when applicable, having heard the opinion of the Committee for Transactions with Related Parties. 

The Plan’s working mechanism will be aligned, after the necessary adjustments suggested by the 

Committee, with the mechanism adopted for the annual incentive plan (points system, with minimum 

access threshold, target assigned and maximum target). 

More specifically, the Board will be responsible for: 

i) identifying the individual participants for each cycle; 

ii) establishing the long-term monetary incentive bonus for each of them; 

iii) approving for each participant individual targets for each cycle; failure to achieve them constitutes a 

an express termination condition for the bonus grant; 

iv) assessing the degree of achievement of the targets by each participant; 

v) approving proposed amendments, where necessary, to the functioning mechanisms of the plan. 

The assessment as to whether to revise the plan is left to the discretion of the Board. 

c) Beneficiaries of the Plan 

Beneficiaries of the plan are certain Directors and Officers with strategic responsibilities of Italcementi 

S.p.A. 

The plan is offered to participants considering the relevance of the functions attributed to them for the 

achievement of the Company’s strategic targets. 

Being a member of the Company’s Board of Directors or having an office within the Company as 

Officer with strategic responsibilities are eligibility requirements to be admitted to the monetary 

incentive plan. 

d) Term and Constraints of the Plan 

The plan term is 3 (three) three-year cycles from 2010 to 2019. The term of the first cycle will be: i) for 

the Directors, the period 2010-2012, ii) for Officers with strategic responsibilities identified by the 

Company’s Board of Directors (hereinafter, the Board), the period 2011-2013. 

For each participant, the Board will, upon the Committee's proposal and, when applicable, having 

heard the opinion of the Committee for Transactions with Related Parties, establish the amounts of 

monetary bonuses related to the achievement of the assigned targets. These amounts will have to be 

established consistently with, among other criteria, the following: 

i) market-based remuneration practices for senior Management positions of comparable corporations; 

ii) consistency with the principles of the Company’s “Remuneration Policy”, in force from time to time; 

iii) certainty of maximum possible cost for the Company, corresponding to a submultiple significantly 

lower than the value generated for the Company by achieving the targets related to disbursement of 

the bonus. 

The right to obtain a pay-out of the bonus in connection with the long-term monetary incentive plan is 

subject to the achievement of the targets, linked to the Company’s financial position and results of 

216






operations and to the other targets specifically assigned to the participant, as approved by the Board at 

the beginning of the cycle. 

The Board, based on the opinion of the Committee, the Head Director of Human Resources and 

Organizational Development Department and, when applicable, the Committee for Transactions with 

Related Parties, will assess and evaluate the degree of achievement of targets - which will be in no way 

linked to the performance / price of the Italcementi shares on the stock market - achieved during the 

three-year term of each cycle, thus calculating the bonus actually accrued in favor of each participant. 

e) Plan Implementation Procedures and Terms 

The plan provides for the assignment of a monetary premium to participants at the end of each threeyear 

cycle, once the conditions for the expected performance as established at the beginning of the 

cycle have been met. The amount of the bonus will be directly linked to the degree of achievement of 

the targets assigned. 

Without limitation to the right of the Board to decide otherwise, participation in the long-term monetary 

incentive plan, under this regulation, is inherently and functionally related to, and conditioned by, the 

permanence of each participant in the position held at the time of assignment for the entire duration of 

the cycle. 

Subject to any exceptions for specific cases established by the Board having heard the Committee and, 

when applicable, the opinion of the Committee for Transactions with Related Parties, the following 

provisions will be applied to the cases mentioned below: 

a) in case of revocation of, or change in, position during the cycle, the Board may, at its discretion, 

based on the Committee’s opinion, and in consideration of the reasons motivating the revocation or 

change, evaluate the possibility of paying out a compensatory lump sum bonus, commensurate with 

the portion of period and the transitional partial degree of achievement of targets assigned; 

b) in case of death of the participant during the cycle, the above will apply; if death occurs after the 

assigned targets have been achieved, the participant’s heirs will be acknowledged the right to obtain 

payment of any bonus accrued. 

f) Other Responsibilities of the Board of Directors 

The Board, having heard the Committee’s opinion, may temporarily suspend the long-term monetary 

incentive plan in case of specific and particular circumstances. 

The suspension of the effects coming from the right to bonus grant accrual under the long-term 

monetary incentive plan will occur in any case in which such circumstances may affect the conditions 

governing the execution of the plan, possibly altering the economic and financial preconditions and 

jeopardizing its aims as defined in letter a) above. 

The Board may, in all cases mentioned above and having heard the Committee’s opinion, amend or 

integrate the plan, the cycle and this Regulation, or order the lapse of the same plan if it is no longer 

consistent with the Company’s situation, subject to any rights acquired in the meantime as a result of 

the three-year period of reference having elapsed and the other requirements and conditions of this 

Regulation being met. 

217 


g) Any Support for the Plan by the Special Fund for the Encouragement of Employee Participation 

in Enterprises, pursuant to Art. 4, paragraph 112 of Law No. 350 dated December 24, 2003 

Not applicable 

Stock Option Plan for Officers 2000 

By resolution of the Board of Directors held on March 20, 2000, the Company approved a stock option 

plan for officers, which, by resolution of the shareholders’ meeting held on April 28, 2008 was replaced, 

only for the not executed part, by the "stock option Plan for top management” and by the “long-term 

monetary incentive Plan linked to the appreciation of the Italcementi shares for officers”, whose main 

elements will be reported hereunder. 

Overall, in execution of such Plan, 3,483,223 options were granted to the Group’s management. 

The figures mentioned above do not take into account the options granted to the former Chief Operating 

Officer and to the Chief Executive Officer when he was an employee of the Company. Including also such 

offices, the total options granted amount to 4,196,823, i.e. 1.496% of share capital. 

No options were exercised during the year. 

The options granted in execution of the Plan and not yet exercised amount to a total of 2,269,316. 

Stock Option Plan for the Top Management 2008 

The shareholders' meeting held on April 28, 2008 approved a second stock option plan for officers, which, 

for the not executed part, replaces the Stock Option Plan for officers described above. 

With reference to this stock option Plan, the Company’s Board of Directors, at its meeting held on June 4, 

2008 regarding the three-year period 2008-2010, granted the Chief Operating Officer and 10 officers a 

total number of options ranging from a minimum of 1,180,000 to a maximum of 2,000,000. If the recipient 

does not reach the minimum targets assigned to him/her, he/she loses the right to exercise all of the 

options granted. 

The Board of Directors, at its meeting held on March 4, 2011, upon proposal of the Remuneration 

Committee, assessed the degree of achievement of performance targets originally assigned to the Chief 

Operating Officer, granted 375,000 options to the Chief Operating Officer and 80,000 options to the 

Manager in charge of preparing the Company’s financial reports. 

The shareholders' meeting held on April 19, 2011 approved the cancellation of the Plan, for the not 

executed part. 

Long-Term Monetary Incentive Plan linked to the Appreciation of the Italcementi Shares for 

Officers 

This Plan was approved by the shareholders’ meeting on April 28, 2008. 

The Board of Directors, at its meeting held on June 4, 2008, granted 20 officers, with respect to the threeyear 

period 2008-2010, from a minimum of 180,000 up to a maximum of 300,000 overall rights. If the 

beneficiary fails to achieve the minimum targets assigned, he/she loses the right to obtain payment of the 

entire cash bonus. 

Having assessed the degree of achievement of assigned targets, the Chief Executive Officer granted 17 

recipients (in the meantime, the remaining 3 had left the Company) a total number of 221,000 rights, of a 

value of € 6.272 per unit, equal to a total of € 1,386,134. 

218






Moreover, the Chief Executive Officer, executing the powers provided by the Plan, identified, for the 2nd 

cycle of validity of the same - 2011/2013 - 28 officers of Italcementi S.p.A., to whom a minimum of 

1,000,000 rights would be granted. 

The main features of the Plan are the following. 

a) Reasons for the Adoption of the Plan 

These may be summarized as follows: 

• to tie the overall treatment of beneficiaries to the Company’s medium-long term performance and to 

"value creation" for shareholders; 

• to reward the achievement of targets of each beneficiary, ensuring the highest involvement of the 

Company’s entire top management on its performance and increasing the sense of belonging of 

beneficiaries, encouraging them to remain at the Company. 

b) Plan Management 

The corporate body responsible for decisions relating to the Plan is the Board of directors which 

delegates the Chief Executive Officer to manage the Plan, including through the technical support of 


More specifically, the Chief Executive Officer will be responsible for: 

i) establishing the maximum number of Rights to participate in the long-term monetary incentive plan 

linked to the appreciation of Shares, altogether attributable as part of the Cycle; 

ii) identifying the individual Beneficiaries for each Cycle as well as to decide the number of Rights to 

participate in the long-term monetary incentive plan linked to the appreciation of Shares, granted to 

each Beneficiary; 

iii) approving for each Beneficiary the individual Targets for each Cycle, whose failure to achieve will be 

an express termination condition of the Rights granted to participate in the long-term monetary 

incentive plan linked to the appreciation of Shares made in favor of the same Beneficiary within the 

Cycle, with the consequent forfeiture of the right to obtain the cash bonus linked to the same rights; 

iv) assessing the degree of achievement of the Targets by each Beneficiary; 

v) deciding the date of commencement of the Availability Period. 

The management of the Plan is carried out by the Company’s Human Resources and Organizational 

Development Department in accordance with the provisions of the Regulations. 

c) Beneficiaries of the Plan 

Beneficiaries of the plan are the Company’s employees identified by the Chief Executive Officer, to 

whom Rights are granted to participate in the long-term monetary incentive plan linked to the 

appreciation of Shares. 

d) Term and Availability Restrictions on the Shares and on the Granted Option Rights 

The term of the Plan is of three three-year Cycles from 2008 to 2016. 

The end of the Plan is set for late 2017 (the first year following the end of the last three-year Cycle). 

The Chief Executive Officer, under the Plan, decides the number of rights to participate in the Plan to 

be granted to each of the beneficiaries on the basis of an overall evaluation, which, taking into account 

the Company’s general performance as an essential prerequisite, and the strategic and organizational 

219 


position of the role of each beneficiary in order to pursue the Company’s strategic targets, will regard: 

i) the Company’s performance achieved in the period, 

ii) the Beneficiary’s organizational level in the Company’s structure, 

iii) consistency with the principles of overall remuneration underlining the Company’s remuneration 

policy. 

The accrual of the rights granted to each beneficiary is subject to the achievement of the targets linked 

to the financial position and results of operations and other individual targets specifically assigned. 

The Chief Executive Officer, with the support of the Human Resources and Organizational 

Development Department, is in charge of the verification and evaluation, during each cycle, of the 

degree of achievement of the targets, accordingly defining the amount of rights to participate in the plan 

previously granted to each beneficiary. 

e) Procedures for the Value of Rights determination and Clauses for the Plan Implementation 

The Plan provides for the offer, free-of-charge and reserved to the beneficiaries, of rights to participate 

in the Plan which, once they reach maturity in accordance with the requirements and conditions laid 

down by the Regulations, will enable the beneficiaries to obtain payment of a cash bonus equal to the 

value of the shares as resulting from the arithmetic average of official prices of the same on the stock 

exchange market managed by Borsa Italiana (i.e. the Italian stock exchange market) within the thirty 

calendar days preceding the date of payment. 

The rights to participate in the Plan are nominative and non-transferable. 

In case of 

a) termination of the employment relationship due to dismissal or resignation occurring after the 

Performance Monitoring Period has elapsed but before the beginning of Availability Period, the 

general principle will apply and therefore the Beneficiary will automatically and permanently lose the 

right to receive the cash bonus linked to the Rights to participate in the long-term monetary incentive 

plan linked to the appreciation of Shares, granted but not yet accrued; 

b) termination of the employment relationship by mutual consent or resignation for retirement or further 

to invalidity, howsoever occurred after the end of the Performance Monitoring Period, or if the 

Beneficiary has achieved the assigned Targets, the same Beneficiary will maintain the right to obtain 

the cash bonus linked to the Rights to participate in the long-term monetary incentive plan tied to the 

appreciation of Shares, granted but not yet accrued, if, after the date of termination of the 

employment, the accrual of the same actually takes place; 

c) death of the Beneficiary after the end of the Performance Monitoring Period, or upon attainment of 

the Targets assigned, the Rights to participate in the long-term monetary incentive plan linked to the 

appreciation of Shares granted to the same under this Plan which may have been accrued will be 

awarded to the same Beneficiary’s heirs upon submission by the latter of the necessary 

documentation proving such qualification. 

If, during the course of the assignment cycle, the transfer of the Beneficiary’s employment relationship 

occurs between the Company and its Italian and foreign subsidiaries or its parent company or between 

the latter, regardless of the manner by which such transfer occurred, or the Beneficiary’s organizational 

position is changed with a consequent change in the latter’s responsibilities, the Targets will also be 

updated in line with the new position. 

220






In any case, the Chief Executive Officer may define an equitable amount payable to the Beneficiary in 

relation to the activities carried out till then. 

For each three-year cycle a maximum of 223,000 Rights to participate in the Plan may be granted. 

f) Other Powers Assigned to the Board of Directors 

The Chief executive Officer may temporarily suspend the effects deriving from the accrual of Rights to 

participate in the plan in case of specific and particular needs such as, by way of example but not 

limited to, changes in legal and regulatory provisions, excluding tax provisions, applicable to the legal 

relationships arising from the Plan. 

The suspension of the effects deriving from the accrual of Rights to participate in the plan will also take 

place in any case in which such circumstances may occur as, by way of example but not limited to, 

corporate transactions, mergers and demergers having an effect on the Company's share capital, 

increase and reduction of the Company's share capital, changes to the Bylaws relating to the Shares 

such as to affect the conditions governing the implementation of the Plan, possibly altering the 

economic and financial conditions and jeopardizing its aims as previously defined. 

In any case, the suspension will be promptly communicated to the Beneficiaries. 

g) Any support for the plan by the special Fund for the encouragement of employee participation 

in enterprises, pursuant to Art. 4, paragraph 112, of Law No. 350 dated December 24, 2003 


1.2. Full representation in Section I of this Report was given of the agreements that provide for indemnity for 

early termination of contracts; the following information are also provided: 

• the possible existence of such agreements, providing negative information if they are not present; 

See Section I - letter. l); 

• the criteria for calculating the indemnity payable to each person. If the indemnity is expressed in 

connection with the annual salary, indicate the components of such annual salary in detail; 

See Section I - letter I; in the case mentioned above, the annual salary is the sum of the fixed 

component and the variable component effectively disbursed in the reference year; 

• the possible presence of performance criteria which the granting of remuneration is linked to; 

Not applicable; 

• the possible effects of the employment contract termination on rights granted under incentive plans 

based on financial instruments or to be disbursed on a cash basis; 

See section Il l.1 - PART ONE - 1.1; with respect to the long-term monetary incentive Plan for directors 

and key management personnel - letter e); with respect to the long-term monetary incentives Plan linked 

to the appreciation of Italcementi shares for officers - letter e). 

Furthermore: 

1) With respect to the stock option plan for directors - 2001: the exercise of stock option rights was 

subject to the condition that the director beneficiary of the Plan had regularly concluded his/her office 

during the term of which the options had been granted without early resignation being given and 

without a revocation measure being decided by the shareholders’ meeting; 

221 


2) With respect to the stock option plan for top management - 2008: In the event of: 

a) termination of the employment relationship due to dismissal or resignation after the Accrual Period 

expired but before the exercise of Options, the general principle will apply and therefore the 

beneficiary will automatically and permanently lose the right to subscribe or purchase the Shares 

underlying such Options; 

b) termination of the employment relationship by mutual consent, resignation due to retirement, or 

further to invalidity during the course of the Accrual Period but before the exercise of Options, or 

regarding a beneficiary who has achieved the assigned targets in the period, the same beneficiary 

will retain the right to exercise the Options not yet exercised in compliance with the terms and 

conditions laid down in the Regulations; 

c) the beneficiary's death occurring after the expiry of the Accrual Period but before the exercise of 

Options, or regarding a beneficiary who has achieved the assigned targets in the period, the 

Options may be exercised by the beneficiary’s heirs upon submission by the latter of the 

necessary documentation proving that qualification; 

3) With respect to the stock option plan for officers - 2000: as a general rule, stock option rights not yet 

exercised will not be recognized - except in case of retirement - in the event of interruption of the 

employment relationship within the Group. 

In case of death of the holder of options, these may be exercised by successors within six months of his 

death provided that such term falls within the period of exercisability of the options. 

• cases in which the right to indemnity accrues; 

See section I - letter l); 

• possible existence of agreements that provide for granting or maintaining non-monetary benefits in favor 

of persons who have ceased their assignment or entering into consulting contracts for a period following 

termination of employment; 


• possible existence of agreements that provide for remuneration due to non-competition commitments; 

The Company, in general, does not conclude specific non-competition agreements with its Officers with 

strategic responsibilities, designed to pay consideration in cash, during the employment or after the 

termination thereof, related to their respective fixed remuneration in relation to the geographical extent, 

term and kind of business of the constraints arising from the same agreement; 

• with reference to the directors who have terminated their office during the financial year, any deviations 

in defining their indemnity with respect to the provisions of the reference agreement; 


• Where specific agreements are not provided, explain the criteria by which accrued indemnity was 

defined; 


222






I.2 – PART TWO 

Remuneration Paid to Members of the Governing and Supervising Bodies, Chief Operating Officer and 

other officers with Strategic Responsibilities 

Name, surname 


Position 

Chairman 

Executive Committee 

Period during 

which the office 

was held 

End of office 

term 

1.1 – 31.12 2012 

Fixed 

remuneration 

Remuneration 

for taking 

part in 

committees 

Variable non-equity 

remuneration 

Bonuses 

and other 

incentives 

Profit 

sharing 

Non- Other 

monetary remuneration 

benefits 

(I) Remuneration in the company preparing the financial statements 1,040,000 690,000 256,983 1,986,983 

(II) Remuneration from subsidiaries and affiliated companies 35,500 35,500 

Total 1,075,500 690,000 256,983 2,022,483 

Pierfranco Barabani Executive Deputy 1.1 – 31.12 2012 

Chairman 


(I) Compensi nella società che redige il bilancio 215,000 100,000 2,385 317,385 

(II) Compensi da controllate e collegate 47,000 47,000 

Totale 262,000 100,000 2,385 364,385 

Lorenzo Renato Deputy Chairman 19.4 – 31.12 2012 

Guerini 

15.9 – 31.12 

(I) Remuneration in the company preparing the financial statements 68,262 68,262 

(II) Remuneration from subsidiaries and affiliated companies 

Total 68,262 68,262 

Carlo Pesenti 

Chief Executive Officer 1.1 – 31.12 2012 


(I) Remuneration in the company preparing the financial statements 1,335,000 875,000 2,210,000 


Total 1,335,000 875,000 2,210,000 

Giulio Antonello Director 29.7 – 31.12 2012 

Total Fair value 

dei compensi 

equity 

End-ofservice 

bonus 

and 

severance 

indemnity 

di l 



Total 18,853 18,853 

Alberto Bombassei Director 

1.1 – 31.12 2012 

Remuneration 

Committee 

(I) Remuneration in the company preparing the financial statements 45,000 15,000 60,000 


Total 45,000 15,000 60,000 

Giorgio Bonomi Director 1.1 – 31-12 2012 



Total 45,000 45,000 

Antonio Carosi Director 1.1 – 27.4 2012 



Total 15,000 15,000 

Alberto Clô 

1.1 – 31-12 2012 

Director 

Internal Control Committee 

Committee for Transactions 

with Related Parties 



Total 45,413 70,000 115,413 


1.1 – 31.12 2012 

Director 







Total 90,310 70,000 160,310 

Pietro Ferrero Director 1.1 – 18.4 2012 



Total 13,177 13,177 

223 


Name, surname 

Position 

Period during 


was held 

End of office 

term 

Danilo Gambirasi Director 1.1 – 31.12 2012 

Fixed 

remuneration 

Remuneration 

for taking 

part in 

committees 


remuneration 

Bonuses 

and other 

incentives 

Profit 

sharing 

Non- Other 


benefits 


dei compensi 

equity 

End-ofservice 

bonus 

and 

severance 

indemnity 

di l 


(II) Remuneration from subsidiaries and affiliated companies 100,000 1,308 101,308 

Total 145,000 146,308 

Carlo Garavaglia Director 5.5 – 31.12 2012 




Director 

Remuneration 

Committee 

Total 30,155 30,155 

1.1 – 31.12 2012 



Total 80,200 15,000 95,200 

Sebastiano Mazzoleni Director 1.1 – 31-12 2012 



Total 74,000 74,000 

Yves René Nanot Director 

1.1 – 31-12 2012 




Total 330,443 3,798 334,241 

Marco Piccinini Director 1.1 – 31.12 2012 



Total 45,052 45,052 

Ettore Rossi 

Director 

Supervising Body 

1.1 - 31-12 2012 



Total 49,300 40,000 89,300 

Attilio Rota 

1.1 – 31.12 2012 

Director 







Total 90,310 70,000 160,310 

Carlo Secchi 

1.1 – 31.12 2012 

Director 






Total 45,362 70,000 115,362 

Elena Zambon Director 1.1 – 31.12 2012 

(I) Compensi nella società che redige il bilancio 45,258 45,258 


Total 45,258 45,258 

Emilio Zanetti 

Director 

1.1 – 31.12 2012 

Remuneration 

Committee 



Total 45,000 15,000 60,000 

Maria Martellini Chairman of the Board 1.1 – 31.12 2011 

of Statutory Auditors 



Total 71,068 71,068 

224






Name, surname 

Position 

Period during 


was held 

End of office 

term 

Mario Comana Regular Auditor 1.1 – 31.12 2011 

Fixed 

remuneration 

Remuneration 

for taking 

part in 

committees 


remuneration 

Bonuses 

and other 

incentives 

Profit 

sharing 

Non- Other 


benefits 


dei compensi 

equity 

End-ofservice 

bonus 

and 

severance 

indemnity 

di l 



Total 47,207 47,207 

Luciana Gattinoni Regular Auditor 1.1 – 31.12 2011 



Giovanni Battista 

Ferrario 

Total 47,362 47,362 

General Manager 1.1 – 31.12 - 

(I) Remuneration in the company preparing the financial statements 350,000 512,500 23,430 1,920 887,850 

(II) Remuneration from subsidiaries and affiliated companies 750,000 552,000 1,302,000 

Total 1,100,000 1,064,500 23,430 1,920 2,189,850 

Carlo Bianchini Responsible Manager 1.1 – 31.12 2012 

(I) Remuneration in the company preparing the financial statements 294,565 366,000 5,199 30,320 696,084 2,922 


Total 352,357 375,000 5,199 30,320 762,876 

Remuneration for each office when the amount reported in the above table are in aggregate form 

Fixed remuneration 


Pierfranco Barabani 

Lorenzo Renato Guerini 

Carlo Pesenti 

Giulio Antonello 

Alberto Clô 


Pietro Ferrero 

Carlo Garavaglia 


Remuneration as Director 

Remuneration as Executive committee member 


Italcementi S.p.A.: 




Subsidiaries and affiliated companies: 

Ciments Français S.A.: 


Ing. Sala S.p.A.: 

Remuneration as Chairman 







Expenses allowance 













Azienda Agricola Lodoletta S.p.A.: 


45,000 

45,000 

950,000 

45,000 

45,000 

125,000 

29,000 

18,000 

31,875 

36,387 

45,000 

45,000 

1,245,000 

18,750 

103 

45,000 

413 

45,000 

45,000 

310 

13,125 

52 

30,000 

155 

29,000 

6,200 

225 


Yves René Nanot 


Attilio Rota 

Carlo Secchi 

Elena Zambon 






Remuneration as Chairman 

Subsidiaries of Ciments Français S.A.: 











45,000 

45,000 

119,880 

120,563 

45,000 

52 

45,000 

45,000 

310 

45,000 

362 

45,000 

258 

Remuneration for the Board committees’ members 

Alberto Clô 


Committee for Transactions with related parties 




Attilio Rota 



Carlo Secchi 



35,000 

35,000 

35,000 

35,000 

35,000 

35,000 

35,000 

35,000 

Stock-options Granted to Members of the Governing and Supervising Bodies, Chief Operating 

Officer and other Officers with Strategic Responsibilities 

Name, 

last name 

A B (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) 

Position Plan Number of 

options 

Options held at the 

beginning of the financial 

year 

Exercise 

price 

Period of 

possible 

exercise 

(from-to) 

Number of 

options 

Exercise 

price 

Options granted during 

the financial year 

Period of 

possible 

exercise 

(from-to) 

Fair value Grant date 

as of the 

grant date 

Market 

price of 

shares 

underlying 

the 

granting of 

options 

Options exercised 

during the financial 

year 

Number of 

options 

Exercise 

price 

Options 

expired 

during the 

financial 

year 

Opzioni 

detenute 

alla fine 

dell' 

esercizio 

(15)= 

(2)+(5) 

-11-14 

Options 

held at 

the end of 

the 

financial 

year 

(16) 

Market Number of Number of Fair value 

price of 

underlying 

shares as 

of the date 

of exercise 

options options 

Giampiero 

Pesenti 

Chairman 

(I) Remuneration in the company 

preparing the financial statements 

Stock option plan 

for directors 

(BoD resolution 

9/5/2001) 

150,000 13.3871 

150,000 16.89 

150,000 23.049 

17.03.2008 

16.03.2015 

07.03.2009 

06.03.2016 

07.03.2010 

06.03.2017 

- - - - - - - - - - 150,000 - 

- - - - - - - - - - 150,000 - 

- - - - - - - - - - 150,000 - 

(II) Remuneration from subsidiaries and 

affiliated companies 

- - - 

Total 450,000 450,000 - 

Carlo 

Pesenti 


Officer 




for directors 


9/5/2001) 

135,000 13.3871 

85,000 16.89 

200,000 23.049 

17.03.2008 

16.03.2015 

07.03.2009 

06.03.2016 

07.03.2010 

06.03.2017 

- - - - - - - - - - 135,000 - 

- - - - - - - - - - 85,000 - 

- - - - - - - - - - 200,000 - 



- - - 

Total 420,000 420,000 - 

226






Name, 

last name 

A B (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) 

Position Plan Number of 

options 

Options held at the 

beginning of the financial 

year 

Exercise 

price 

Period of 

possible 

exercise 

(from-to) 

Number of 

options 

Exercise 

price 

Options granted during 

the financial year 

Period of 

possible 

exercise 

(from-to) 

Fair value Grant date 

as of the 

grant date 

Market 

price of 

shares 

underlying 

the 

granting of 

options 

Options exercised 

during the financial 

year 

Number of 

options 

Exercise 

price 

Options 

expired 

during the 

financial 

year 

Opzioni 

detenute 

alla fine 

dell' 

esercizio 

(15)= 

(2)+(5) 

-11-14 

Options 

held at 

the end of 

the 

financial 

(16) 

Market Number of Number of Fair value 

price of 

underlying 

shares as 

of the date 

of exercise 

options options 

Yves René 

Nanot 

Director 



Plan A (date of 

relevant resolution) 

- - - 

Plan A (BoD 

resolution 1/3/2005) 

40,000 70.88 

14.04.2008 

13.04.2015 

- - - - - - - - - - 40,000 - 

(II) Compensi da controllate e collegate 

Plan B (BoD 


Plan C (BoD 


45,000 117.29 

45,000 140.28 

23.03.2009 

22.03.2016 

23.03.2010 

22.03.2017 

- - - - - - - - - - 45,000 - 

- - - - - - - - - - 45,000 - 

Plan D (BoD 


45,000 108.55 


13.04.2018 

Total 175,000 175,000 

45,000 - 


Ferrario 

General Manager 




for directors 

( Shareholders’ 

resolution 

26/4/2008) 

375,000 13.355 


03.06.2018 - - - - - - - - - - 375,000 - 



- - - 

Total 375,000 375,000 - 

Carlo 

Bianchini 

Manager in charge 

10,750 13.3871 

17.03.2008 

16.03.2015 - - - - - - - - - - 10,750 - 




for directors 


20/3/2000) 

10,000 16.89 

13,300 23.049 

14,440 12.804 

07.03.2009 

06.03.2016 

07.03.2010 

06.03.2017 


25.03.2018 

- - - - - - - - - - 10,000 - 

- - - - - - - - - - 13,300 - 

- - - - - - - - - - 14,440 2,922 


for directors 

(Shareholders’ 

resolution 

26/4/2008) 

80,000 13.355 


03.06.2018 

- - - - - - - - - - 80,000 - 



- - - 

Total 128,490 128,490 2,922 

227 


Monetary Incentive Plans in Favor of Members of the Governing and Supervising Bodies, Chief 

Operating Officer and other Officers with Strategic Responsibilities 

Last name, name Position Plan 

Bonus for the year 

Payable/disbursed Deferred Deferment 

period 

Not payable 

any more 

Bonus for previous years 

Payable/disbursed 

Still deferred 

Other bonus 

Giampiero 

Pesenti 

Chairman 

(I) Remuneration in the 

company preparing the 

financial statements 

March 4, 2011 Annual MBO 690,000 

February 3, 2011 Three-year LTI Max 1,092,500* Max 1,092,500** 

(II) Compensi da 

controllate e collegate 

- - 

Total 690,000 Max 1,092,500* Max 1,092,500** 

Pierfranco 

Barabani 




(II) Remuneration from 

subsidiaries and affiliated 

companies 

Executive Deputy 

Chairman 


- - 

Total 100,000 

Carlo 

Pesenti 





Officer 


February 3, 2011 Three-year LTI Max 1,437,500* Max 1,437,500** 


subsidiaries and affiliated - - 

companies 

Total 875,000 Max 1,437,500* Max 1,437,500** 


Ferrario 

General Manager 





March 5, 2010 

Annual MBO 

March 4, 2011 Three-year LTI Max 1,000,000*** 

September 15, 


MBO 200,000 


subsidiaries and affiliated March 2, 2011 Annual MBO CF 552,000 

companies 

Total 864,500 Max 1,000,000*** 200,000 

* Theoretical portion of the 2010-2012 LTI plan accrued in financial year 2011 

** Theoretical portion of the 2010-2012 LTI plan accrued in financial year 2010 

*** Theoretical portion of the 2011-2013 LTI plan accrued in financial year 2011 

228






Last name, name Position Plan 

Carlo 

Bianchini 

Manager in charge 

Bonus for the year 

Payable/disbursed Deferred Deferment 

period 

Not payable 

any more 

Bonus for previous years 

Payable/disbursed 

Still deferred 

Other bonus 



company preparing the March 4, 2011 Three-year LTI Max 133,000*** 


September 15, 


MBO 200,000 


subsidiaries and affiliated - - 9,000 

companies 

Total 166,000 Max 133,000*** 209,000 

* Theoretical portion of the 2010-2012 LTI plan accrued in financial year 2011 

** Theoretical portion of the 2010-2012 LTI plan accrued in financial year 2010 

*** Theoretical portion of the 2011-2013 LTI plan accrued in financial year 2011 

229 


Participation of Governing and Supervising Bodies, Chief Operating Officer and Manager in 

charge of Preparing the Company’s Financial Reports 

Name, last position Position Company held 

Number of shares held 

at the end of the previous financial 

year 

Giampiero Pesenti Chairman Italcementi ordinary shares: 

savings shares: 

10,972 

1 

ordinary shares: 

22,698 2 savings shares: 

- 

- 



- 

- 



10,972 

1 

22,698 2 

Pierfranco Barabani Executive Deputy Italcementi ordinary shares: 78,780 2 

ordinary shares: - ordinary shares: - ordinary shares: 78,780 

2 

Chairman 

savings shares: 884 savings shares: 

- savings shares: 

- savings shares: 884 

Lorenzo Renato Guerini Deputy Chairman Italcementi ordinary shares: 60,000 1 ordinary shares: - ordinary shares: - ordinary shares: 60,000 1 

Carlo Pesenti 


Officier 

Italcementi ordinary shares: 


1,500 

1 


3,000 1 savings shares: 

- 

- 



- 

- 



1,500 

1 

3,000 1 

Ciments Français ordinary shares: 50 ordinary shares: - ordinary shares: - ordinary shares: 50 

Giorgio Bonomi Director Italcementi ordinary shares: 2,500 ordinary shares: - ordinary shares: - ordinary shares: 2,500 

Federico Falck Director Italcementi ordinary shares: 


41,600 

6,760 



- 

- 



- 

- 



Danilo Gambirasi Director Italcementi ordinary shares: 1,248 ordinary shares: - ordinary shares: - ordinary shares: 1,248 

Italo Lucchini Director Ciments Français ordinary shares: 50 ordinary shares: - ordinary shares: - ordinary shares: 50 

Sebastiano Mazzoleni Director Italcementi ordinary shares: 


7,352 

7,040 



- 

- 



- 

- 



Yves René Nanot Director Ciments Français ordinary shares: 89,550 ordinary shares: - ordinary shares: - ordinary shares: 89,550 

Attilio Rota Director Italcementi ordinary shares: 108,186 3 ordinary shares: - ordinary shares: - ordinary shares: 108,186 3 

Emilio Zanetti Director Italcementi ordinary shares: 30,602 4 ordinary shares: - ordinary shares: 26,442 ordinary shares: 4,160 

Mario Comana Regular Auditor Italcementi ordinary shares: 



Responsible 

Manager 

2,500 

2,000 

Number of shares 

purchased 



- 

- 

Number of shares sold 



- 

- 

Number of shares held 

at the end of the current financial 

year 



Italcementi ordinary shares: 4,500 ordinary shares: - ordinary shares: - ordinary shares: 4,500 

41,600 

6,760 

7,352 

7,040 

2,500 

2,000 

1 Shares held by spouse 

2 Shares in part held directly and in part by spouse 

3 Shares in part held directly (in part with beneficial ownership and voting rights only) and in part by spouse 

4 26,442 of which ordinary shares with beneficial ownership and voting rights only, sold during the year 

* * * 


We invite you to adopt the following resolution: 

“The Shareholders’ Meeting of Italcementi S.p.A. held on April 18 , 2012, 

- having acknowledged the report prepared by the Directors, 


In favor of / against 

the first section of the Report on Remuneration illustrated above. 

230






Authorization to purchase and dispose of treasury shares 


The ordinary shareholders' meeting of April 19, 2011, renewed the authorization for the Company to acquire 

and dispose of treasury shares for a period of 18 months as of the resolution date. 

In connection with the aforementioned shareholders’ resolution, the Company has not purchased any ordinary 

and savings shares nor has it sold those held in portfolio to stock option beneficiaries during the fiscal year, 

since no options were exercised. 

As a consequence, as at March 2, 2012, the Company holds 3,793,029 ordinary treasury shares and 105,500 

savings treasury shares. The carrying amount of treasury shares in portfolio at date thereof is equal to a total 

amount of Euro 58,689,585.56, as reflected in the accounts in accordance with the applicable laws. 

Since the authorization expires on October 18, 2012, in order to enable the Company to maintain its right to 

acquire and dispose of treasury shares, we invite you to resolve upon the renewal of such authorization for the 

next 18 months. 

This proposal does not contain any differences in respect to the proposal approved by the shareholders' 

meeting of last year. 

1) Reasons underlying the proposed authorization to acquire and dispose of treasury shares. 

The authorization is requested in order to: 

• dispose of treasury shares 

* to be granted to employees and/or directors in connection with stock option plans reserved to them; 

* for medium/long-term investment purposes; 

• operate, in compliance with current regulations, directly or through intermediaries, in order to limit anomalous 

trends in share prices and to regularize stock exchange prices caused by temporary distortions linked to 

excessive volatility or low trading liquidity; 

• create a treasury stock portfolio to serve extraordinary financial transactions or for other purposes deemed to 

be in the financial, business and /or strategic interest of the Company; 

• offer an additional tool to monetize their investments to the shareholders. 

2) Maximum number, category and nominal value of the shares which the authorization refers to; 

compliance with paragraph 3, art. 2357 of the Italian Civil Code 

Purchases refer to ordinary and/or savings shares of the Company whose maximum number, including 

treasury shares already held as at the date hereof by the Company and by the subsidiaries (which will receive 

specific instructions for timely disclosure of the shares they hold), shall not exceed an overall nominal value of 

one tenth of the entire share capital. 

In any case, purchases shall be made, in accordance with article 2357 of the Italian Civil Code, within the limits 

of the distributable earnings and available reserves reflected in the latest approved financial statements of the 

Company. 

The consideration paid or received with respect to treasury shares purchase or sale shall be directly reflected 

in equity in compliance with IAS 32 and it shall in any case be accounted for in the manner established by the 

laws in force from time to time. 

231 


3) Term of the authorization. 

The authorization to purchase treasury shares is requested for a period of 18 months as of the date on which 

the shareholders adopts the resolution, while the authorization for their disposal is requested without time 

limits. 

4) Minimum and maximum consideration and market values on which such considerations have been 

determined. 

The purchase price of each share shall not be lower nor exceed 15%, as peak, than the average reference 

share price occurred on the same regulated market in the last three sessions preceding each transaction. 

The overall consideration to be paid by the Company for the purchase shall in no case exceed the amount of 

Euro 100 million. 

The shares may be sold, whether or not purchases have been completed, and on one or more occasions (also 

through public offers or offers to the shareholders or through placement of warrants and depositary receipts 

representing shares and/or similar securities), at a price no lower than the lowest purchase price. 

This price limit shall not apply in the event of sale of shares offered to the employees of Italcementi S.p.A. and 

its subsidiaries, parent companies and the other companies controlled by the latter or to members of the Board 

of Directors of Italcementi S.p.A. and its subsidiaries who are vested with special offices in compliance with the 

Articles of Association or who perform specific operating duties, in connection with stock option plans for 

employees and for directors. 

5) Terms and Conditions according to which purchases shall be made. 

Purchases of treasury shares shall be normally made, unless otherwise indicated below, so that equal 

treatment of shareholders is ensured and offers to purchase, directly matched with pre-determined offers to 

sell, are not allowed. 

Moreover, in consideration of the various purposes illustrated in this proposal, the Board of Directors proposes 

to be authorized to purchase in accordance with any other manner allowed under current laws and regulations 

governing the stock market on which the transaction is performed and, therefore, as at the present time: 

• through public tender or exchange offers; 

• through the purchase and sale of derivatives traded on regulated markets which provide for physical delivery 

of the underlying shares; 

• through the proportional allocation to shareholders of put options to be exercised within the term of the 

authorization as per paragraph 3 above. 

With regard to sale transactions, the Board of Directors proposes that the authorization shall allow the adoption 

of any procedure deemed appropriate to achieve the intended objectives to be executed either directly or 

through intermediaries, in compliance with national and European laws and regulations. 

The treasury shares acquisitions and sales which the authorization is requested for will be executed in 

compliance with applicable laws, especially, in compliance with national and European laws and regulations 

including those on market abuse. 

Appropriate disclosure of treasury shares acquisitions and sales will be provided in compliance with the 

applicable disclosure requirements. 

232






6) Acquisition in order to reduce share capital. 

In light of these forecasts, this hypothesis does not apply. 

* * * 


If you agree with our proposal, we invite you to resolve upon the following resolution: 

“Italcementi S.p.A. shareholders' meeting held on April 18, 2012, 

- having acknowledged the Directors’ proposal, 

- taking into account articles 2357 and 2357-ter of the Italian Civil Code 


1) to revoke the resolution authorizing the acquisition and disposal of treasury shares adopted by the ordinary 

shareholders' meeting of April 19, 2011; 

2) to authorize, pursuant to art. 2357 of the Italian Civil Code, the purchase of ordinary and/or savings treasury 

shares, for the amounts, at the price, according to the terms and conditions indicated herein below: 

- the purchases shall be made once or in more times, within 18 months of the resolution date; 

- the purchase price of each share shall not be more than 15% above or below the average reference price 

as recorded on the same regulated market in the three sessions preceding each transaction; 

- the overall amount paid shall in no case exceed Euro 100 million; 

- the maximum number of ordinary and/or savings shares acquired shall not have an overall nominal value, 

including treasury shares already held as of the date hereof by the Company and by the subsidiaries, in 

excess of one tenth of the share capital; 

3) to authorize, pursuant to art. 2357-ter, paragraph 1 of the Italian Civil Code, the Chairman, Executive 

Deputy Chairman, the Deputy Chairman and the Chief Executive Officer in office from time to time to 

severally dispose of the purchased treasury shares, even if the purchase has not been completed yet, in 

compliance with current laws and without time limits. 

The sale price shall not be lower than the lowest purchase price. 

This price limit shall not apply, however, in the event of a sale of shares to the employees of Italcementi 

S.p.A. and its subsidiaries, parent companies and the other companies controlled by the latter or to 

members of the Board of Directors of Italcementi S.p.A. and its subsidiaries who are vested with special 

offices in compliance with the Articles of Association or who perform specific operating duties, in connection 

with stock option plans for employees and for directors. 

4) to establish that: 

• the purchases shall be normally conducted so that equal treatment of shareholders is ensured and offers 

to purchase directly matched with pre-determined offers to sell are not allowed, or, taking into account the 

various possible purposes, in any other manner allowed under current laws and regulations governing the 

stock market on which the transactions are performed; 

• the shares shall be disposed of in any manner deemed appropriate to achieve the objectives pursued, 

directly or through intermediaries, in compliance with current applicable national and European laws and 

regulations; 

• treasury shares purchases and sales shall be executed in compliance with applicable laws and, 

233 


specifically, with laws and regulations governing the stock market on which the transactions are 

performed; 

5) to establish that the consideration paid or received with respect to treasury shares purchases or sales 

transactions shall be reflected directly in equity in compliance with IAS 32 and shall in any case be 

accounted for in the manner established by the laws in force from time to time; 

6) to severally grant to the Chairman, Executive Deputy Chairman, Deputy Chairman and Chief Executive 

Officer in office from time to time any power to proceed with the purchases and sales and in any case to 

execute the above resolutions, also through attorneys-in-fact, complying with any requirements provided for 

by the competent authorities”. 

Supplement to the Board of Directors 


Last year’s shareholders meeting of April 19 resolved, inter alia, to increase the number of Board members to 

20 by appointing Mr. Lorenzo Renato Guerini as Director for the remaining part of the Board’s mandate. 

However, the day before Mr. Pietro Ferrero prematurely deceased. At their meeting of May 5, 2011, the Board 

of Directors co-opted Mr. Carlo Garavaglia to replace him, according to law and the Bylaws, as being the first 

and sole unelected candidate on the list presented by the majority shareholder at the time of the election of the 

Board members currently in office. 

Moreover, on April 27, 2011, Mr. Antonio Carosi, sole candidate of the list presented by the minority 

shareholder First Eagle Investment Management LLC, resigned from his office of Director. The Board of 

Directors deemed it appropriate to ensure, even at this stage, a representation on the Board of Directors to 

minority shareholders, it asked the sole minority shareholder who presented the list directly to get proposals on 

the replacement of the resigning director. During the Board meeting of July 29, 2011, Mr. Giulio Antonello, 

therefore, was co-opted as Director. 

Mr. Garavaglia and Mr. Antonello, in accordance with law and the Bylaws, will remain in office until the next 

shareholders’ meeting. 

For the purposes of supplementing the Board of Directors, two articles of the Bylaws are relevant: the principle 

invoked by Art. 15 of the Bylaws, which aims at ensuring a minimum number of Directors to be appointed by 

minority shareholders as required by law, and the provision of Art. 16 of the same Bylaws, under which the 

shareholders shall act by a majority of the share capital represented therein. The voting list mechanism does 

not apply to the Board of Directors’ supplements. 

Regarding the replacement of the Director elected from the majority list, the shareholder Italmobiliare informed 

the Company of its intention to confirm Mr. Carlo Garavaglia as Director. With reference, however, to the 

replacement of the minority Director, whose principle of representativeness is expressly provided for in the 

Bylaws, limits on participation and time set for the presentation of candidates do not apply. 

In order to facilitate the appropriate development of the shareholders’ meeting, however, we call upon the 

minority shareholders holding a stake in the share capital with voting rights no lower than 2% of the ordinary 

share capital, to submit their own candidates at the registered office (via G. Camozzi 124, 24121 Bergamo, 

Corporate Affairs) or to file them by means of the certified email address 

affarisocietari@italcementi.legalmail.it, at least five days before the shareholders’ meeting on first call (i.e. by 

April 13, 2012 ), along with the following documentation: 

234






a) statements by which individual candidates accept their candidature and, under his/her own responsibility, 

state the non-existence of causes for ineligibility and the entitlement of the good reputation requirements 

established by the law; 



c) statements by which individual candidates declare entitlement of the independence qualification required by 

the law and by the Code of Conduct; 

d) information on the identity of shareholders who have presented candidates; 

e) a statement of the shareholders who do not hold, even jointly, a controlling or majority stake, bearing 

witness to the absence of any connection with the majority shareholder, as defined by the law in force. 

The intermediary certification proving ownership of the shareholding prescribed at the date on which 

candidates are presented may also be produced after the filing provided that it reaches the company at least 5 

days before the shareholders’ meeting date on first call (i.e. by April 13, 2012). 

In any case, shareholders can present candidates directly at the venue of the Meeting. 

During the Meeting, the Chairman will summarize the candidates of the minority shareholders and will submit 

them to poll, according to the order in which they have been received by the Company. 

To this end, Italmobiliare communicated its intent to abstain from any vote on candidates submitted by 

shareholders holding at least 2% of the ordinary share capital. 

In the event that no candidates are submitted nor any other candidates by holders of shares under 2% of the 

ordinary share capital are filed, the shareholders’ meeting will act under the usual majorities without prejudice 

to the possibility of reducing by one unit the number of members of the Board of Directors. 

Appointment of Statutory Auditors, the Chairman of the Board of Statutory Auditors and 

determining their remuneration 


Upon approval of the financial statements as at December, 31 st 2011, the office of the entire Board of Statutory 

Auditors will expire. 

We invite you to appoint, for the 2012-2014 three-year period, three acting Auditors and three substitute 

Auditors, and the Chairman of the Board, after determining their respective annual remuneration. 

According to the Bylaws, the Board of Statutory Auditors is appointed on the basis of lists aimed at assuring 

the appointment of one acting Auditor and one substitute Auditor by the minority shareholders. 

Only shareholders who, alone or together with other shareholders, provide documented evidence that they 

own, as at the date on which lists are filed with the Company, a percentage of the share capital with voting 

rights not lower than 2%, are entitled to file the lists. 

Each shareholder cannot file or concur in the filing of more than one list, directly or through third parties or trust 

company, or vote for different lists. 

Shareholders belonging to the same group and shareholders who are party to a shareholders’ agreement 

concerning the company shares may not file or vote for more than one list, neither through third party or trust 

companies. 

Lists presented in violation of these restrictions will not be accepted. 

Each list consists of two sections: one for candidates as acting Auditors, and the other for candidates as 

substitute Auditors. 

235 


Each section shall list in progressive order the names of no more than three candidates as acting Auditors and 

no more than three candidates as substitute Auditors. 

Each candidate may be presented on one list only under penalty of ineligibility. 

Lists must be filed with the registered office or sent by means of certified electronic mail to: 

affarisocietari@italcementi.legalmail.it, by the twenty-fifth day prior to the date of the shareholders’ meeting 

convened in first call along with the following documentation: 

a) statements by which each candidate accepts his/her candidature and, under his/her own responsibility, 

states the non-existence of causes for ineligibility or incompatibility as well as the entitlement of further 

requirements established by the law, Company bylaws and Code of Conduct; 



c) information on the identity of shareholders who have filed lists. The intermediary certification proving 

ownership of the share capital percentage required under the rules and regulations in force at the time the 

list is filed can be produced also after the filing thereof, provided that this is delivered to the Company within 

the terms provided for by the rules and also regulatory provisions in force for publication of lists by the 

Company; 

d) a statement of the shareholders who do not hold, even jointly, a controlling or majority stake, bearing 

witness to the absence of any connection with the majority shareholder, as defined by the applicable law. 

A list presented not in compliance with the above provisions will be considered as not presented. 

In the event, on expiry of the 25 day term prior to that fixed for the Meeting in first call, a sole list has been filed, 

or only lists filed by shareholders who are connected to each other under current regulations, additional lists 

can be filed until following third day, and the threshold of 2% above mentioned will be halved. 

Proposal to increase the total amount of rights to be allocated to the “Long-term monetary 

incentive Plan for Officers, linked to the appreciation of Italcementi shares” 


The shareholders' meeting held on April 28, 2008 had approved the adoption of a “Stock option Plan for Top 

Management", later revoked by the shareholders’ meeting on April 19 last year for the unexecuted part, and of 

a "Long-term monetary incentive Plan for Officers linked to the appreciation of Italcementi shares” (the “Plan”). 

The Plan currently contemplates an overall maximum allocation, for each three-year cycle, of 223,000 rights, 

equal to a grand total of 669,000 attributable rights. 

In 2011, having made an assessment as to the degree of achievement of targets assigned in 2008, the Chief 

Executive Officer granted a total of 221,000 rights to 17 recipients to be claimed for the first cycle (2008-2010) 

of the “Plan”. 

With reference to the second cycle (2011-2013), however, last September the Chief Executive Officer informed 

the Board of Directors he had granted 1,000,000 rights to 28 officers to participate in the “Plan”. Among these 

are included 6 officers originally beneficiaries of the stock option Plan which was canceled last year. 

The recognition of these rights was subject to an authorization by the shareholders’ meeting to increase the 

number of overall rights to be subjected to the aforesaid Plan both for this cycle of allocations and for the next 

one (2014-2016). 

236






Thus, when the period of validity of the Plan (financial year 2016) expires, taking into account 221,000 rights 

granted at the end of 1st cycle, a maximum number of 2,221,000 rights will be allocated overall in proportion to 

the achievement of the targets assigned to each recipient. 

* * * 


If you agree with our proposal, we invite you to adopt the following resolution: 

“The Shareholders’ General Meeting of Italcementi S.p.A. held on April 18, 2012, 

- having acknowledged the proposal of the Directors, 


to increase the total amount of rights to participate in the “Long-term monetary incentive Plan for Officers, 

linked to the appreciation of Italcementi shares” from the current 669,000 to 2,221,000. 


On behalf of the Board of Directors 

The Chairman 


237 


238

Separate financial statements 

239 


Financial statements 


(euro) Notes 12.31.2011 12.31.2010 Change 


Property, plant and equipment 2 582,027,296 595,500,863 (13,473,567) 

Investment property 2 12,875,572 13,679,317 (803,745) 

Intangible assets 3 28,592,972 19,948,359 8,644,613 

Investments in subsidiaries and associates 4 1,721,666,830 1,740,651,185 (18,984,355) 

Other equity investments 4 5,731,012 5,802,455 (71,443) 

Deferred tax assets 18 26,533,915 12,079,357 14,454,558 

Other non-current assets 5 200,708,026 172,661,978 28,046,048 

Total non-current assets 2,578,135,623 2,560,323,514 17,812,109 


Inventories 6 108,592,701 109,876,613 (1,283,912) 

Trade receivables 7 276,998,802 220,693,223 56,305,579 

Other current assets including derivatives 8 74,570,047 20,291,942 54,278,105 

Tax assets 9 4,795,813 18,196,761 (13,400,948) 

Equity investments, bonds and financial assets 10 375,757,775 419,738,235 (43,980,460) 

Cash and cash equivalents 11 478,967 946,229 (467,262) 

Total current assets 841,194,105 789,743,003 51,451,102 

Total assets 3,419,329,728 3,350,066,517 69,263,211 

Equity 

Share capital 12 282,548,942 282,548,942 - 

Share premium 13 344,103,798 344,103,798 - 

Reserves 13 17,998,546 21,230,658 (3,232,112) 

Treasury shares 14 (58,689,585) (58,689,585) - 

Retained earnings 15 1,198,686,097 1,225,122,196 (26,436,099) 

Total equity 1,784,647,798 1,814,316,009 (29,668,211) 

Non-current liabilities 

Financial liabilities 19 832,068,566 1,076,223,836 (244,155,270) 

Employee benefits 16 41,392,717 39,622,175 1,770,542 

Provisions 17 27,311,521 30,620,306 (3,308,785) 

Other non-current liabilities 19 27,144,996 11,370,466 15,774,530 

Total non-current liabilities 927,917,800 1,157,836,783 (229,918,983) 

Current liabilities 

Loans and borrowings 19 146,416,308 135,545,990 10,870,318 

Financial liabilities 19 338,554,990 54,028,086 284,526,904 

Trade payables 20 142,637,020 132,472,181 10,164,839 

Other current liabilities 21 79,155,812 55,867,468 23,288,344 

Total current liabilities 706,764,130 377,913,725 328,850,405 

Total liabilities 1,634,681,930 1,535,750,508 98,931,422 

Total equity and liabilities 3,419,329,728 3,350,066,517 69,263,211 

240







(euro) Notes 2011 % 2010 % Change % 

Revenue 23 613,792,598 100.0 614,085,918 100.0 (293,320) 0.0 

Other revenue 24 32,254,562 27,459,272 

Change in inventories 2,143,169 (1,539,539) 

Internal work capitalized 1,281,289 1,230,582 

Goods and utilities expense 25 (341,433,092) (355,509,943) 

Services expense 26 (176,109,581) (176,492,334) 

Employee expense 27 (176,411,711) (176,611,584) 

Other operating income (expense) 28 43,940,516 12,915,032 

Recurring EBITDA (542,250) -0.1 (54,462,596) -8.9 53,920,346 n.s. 

Net capital gains on sale of fixed assets 29 16,336,531 8,888,035 

Other non-recurring income (expense) 29 (8,097,887) (5,786,903) 

EBITDA 7,696,394 1.3 (51,361,464) -8.4 59,057,858 n.s. 

Amortization and depreciation 2-3 (81,610,136) (80,679,610) 

Impairment (693,212) 1,746,395 

EBIT (74,606,954) -12.2 (130,294,679) -21.2 55,687,725 n.s. 

Finance income 30 202,488,114 135,166,546 

Finance costs 30 (91,592,169) (57,111,510) 

Net exchange-rate differences and derivatives 30 (1,076,983) 725,377 

Impairment on financial assets 4 (52,284,040) (38,225,234) 

Profit before tax (17,072,032) -2.8 (89,739,500) -14.6 72,667,468 n.s. 

Income tax (expense) 31 24,073,983 55,378,980 

Profit (loss) for the period 7,001,951 1.1 (34,360,520) -5.6 41,362,471 n.s. 


241 


Statement of comprehensive income 

(euro) Notes 2011 % 2010 % Change % 

Profit (loss) for the period 7,001,951 1.1 (34,360,520) -5.6 41,362,471 n.s. 


Available-for-sale financial assets (7,524,000) (25,580,600) 18,056,600 

Derivatives 2,897,048 2,962,356 (65,308) 

Tax on other comprehensive income 1,900,257 455,188 1,445,069 

Other comprehensive income 13 (2,726,695) (22,163,056) 19,436,361 

Total comprehensive income 4,275,256 0.7 (56,523,576) -9.2 60,798,832 n.s. 


242






Statement of changes in equity 

Reserves 

Share Share Fair value Hedging Other Treasury Retained Total 

(euro) capital premium reserve reserve reserves shares earnings equity 

Balances at December 31, 2009 282,548,942 344,103,798 32,649,412 (12,769,430) 22,800,394 (58,689,585) 1,292,920,765 1,903,564,296 

Profit (losses) for the period (34,360,520) (34,360,520) 

Total other comprehensive income (25,125,412) 2,962,356 (22,163,056) 

Stock options 713,338 713,338 

Distribution of profits: 

Dividends (33,438,050) (33,438,050) 

Balances at December 31, 2010 282,548,942 344,103,798 7,524,000 (9,807,074) 23,513,732 (58,689,585) 1,225,122,195 1,814,316,008 

Profit (losses) for the period 7,001,951 7,001,951 

Total other comprehensive income (7,524,000) 4,797,305 (2,726,695) 

Stock options (505,417) (505,417) 

Distribution of profits: 

Dividends (33,438,049) (33,438,049) 

Balances at December 31, 2011 282,548,942 344,103,798 - (5,009,769) 23,008,315 (58,689,585) 1,198,686,097 1,784,647,798 

243 


Statement of cash flows 

(euro) 

Notes 2011 2010 

A) Cash flow from operating activities: 

Profit before tax (17,072,032) (89,739,500) 

Amortization, depreciation and impairment 83,351,248 79,112,627 

Impairment on financial assets 52,284,040 38,225,234 

Capital (gains)/losses on sale of fixed assets (18,829,797) (24,368,172) 

Change in employee benefits and other provisions 655,386 1,829,060 

Stock options (505,419) 713,338 

Reversal of net finance costs (income) (106,663,719) (62,827,191) 

Cash flow from operating activities befre tax, 

finance income/costs and change in working capital: (6,780,293) (57,054,604) 

Working capital (49,349,275) 64,330,884 

Other assets/liabilities (28,534,268) (7,899,009) 

Total change in working capital (77,883,543) 56,431,875 

Net finance costs paid (40,030,986) (41,521,046) 

Dividends received 148,664,704 104,327,894 

Taxes (paid) or surpluses recovered 12,094,457 (7,421,641) 

Total A) 36,064,339 54,762,478 

B) Cash flow from investing activities: 


Intangible assets (18,922,498) (15,027,602) 

Property, plant and equipment and investment property (61,867,481) (83,695,715) 

Financial assets (equity investments) 4 (50,824,381) (43,677,307) 

Other assets - (39,386) 

Total capital expenditure (131,614,360) (142,440,010) 

Proceeds from the sale of fixed assets 41,516,964 123,786,260 

Total sales 41,516,964 123,786,260 

Change in other long-term financial assets and liabilities 7,819 - 

Total B) (90,089,577) (18,653,750) 

C) Cash flow from financing activities: 

Increase in non-current financial liabilities 80,856,859 209,482,286 

Repayment of non-current financial liabilities (193,341) (15,215,916) 

Change in current financial liabilities (29,531,575) (75,763,516) 

Change in other financial assets 40,866,822 (121,943,624) 

Payment replenishment losses in equity investments 4 (5,000,000) - 

Dividends paid 15 (33,440,789) (33,432,387) 

Total C) 53,557,976 (36,873,157) 

D) Cash flows for the period (A+B+C) (467,262) (764,429) 

E) Cash and cash equivalents at beginning of period 11 946,229 1,710,658 

Cash and cash equivalents at end of period (D+E) 11 478,967 946,229 

244






Contents 

Notes 




4. Investments in subsidiaries, associates and Other equity investments 





9. Tax assets and liabilities 

10. Equity investments, bonds and financial assets 

11. Cash and cash equivalents 

12. Share capital 

13. Reserves 


15. Analysis of equity captions 



18. Deferred tax assets and deferred tax liabilities 

19. Net debt 

20. Trade payables 



23. Revenue 

24. Other revenue 


26. Services 




30. Finance income (costs), exchange rate differences and derivatives 






245 


Notes 

The Italcementi S.p.A. financial statements as at and for the year to December 31, 2011, were approved by the 

Board of Directors on March 2, 2012. At the meeting, the Board authorized publication of a press release 

dated March 2, 2012 containing key information from the financial statements. 

Italcementi S.p.A. is a legal entity established in accordance with the laws of the Republic of Italy. It has been 

listed on the Milan Stock Exchange since 1925, belongs to the S&P/Mib index of leading Italian companies and 

is subject to management and coordination by Italmobiliare S.p.A., whose key data from the most recently 

approved financial statements are provided in an annex to the separate financial statements. 

Italcementi S.p.A. and its subsidiaries form the “Italcementi Group”, an international player whose main lines of 

business are hydraulic binders, ready mixed concrete and aggregates. The Group is also active in other areas, 

some of which are instrumental to its core businesses: materials for the construction industry, additives, 

transport, energy, engineering and e-business. 

The Italian laws that implement EEC Directive IV are also applied, where compatible, to the companies that 

draw up financial statements in accordance with the IFRS. Consequently the financial statements are 

compliant with the articles of the Italian Civil Code and the corresponding indications of the Consolidated 

Finance Act (TUF, testo unico della finanza) for listed companies with regard to the Directors’ Report (art. 2428 

Italian Civil Code), Audit (art. 2409-bis Italian Civil Code) and Publication of the Financial Statements (art. 2435 

Italian Civil Code). 

The separate financial statements and related notes also set out the details and additional disclosures required 

under art. 2424, 2425 and 2427 of the Italian Civil Code and art. 27, paragraph 5 of Legislative Decree 

127/1991, since such requirements are not in conflict with the IFRS. 

The financial statements have been drawn up on a going-concern basis. Despite the difficult economic and 

financial situation, by virtue of the measures already in place to respond to the changes in demand, and its 

business and financial flexibility the company has no material uncertainties about its ability to continue as a 

going concern. 


1.1. Statement of compliance with the IFRS 

These financial statements have been drawn up in compliance with the International Accounting and Financial 

Reporting Standards (IAS/IFRS) applicable at December 31, 2011, endorsed by the EC Commission. 

In compliance with European Regulation no. 1606 of July 19, 2002, the principles adopted do not include the 

standards and interpretations published by the IASB and the IFRIC through December 31, 2011, that had not 

been endorsed by the European Union at that date. 

Since December 31, 2010, the following standards, amendments and interpretations endorsed by the 

European Union have come into force and have been applied in the 2011 financial statements: 

 

 

 

IAS 24 revised ““Related party disclosures” which simplifies disclosure requirements relating to related 

parties in which public entities are present and provides a new definition of related parties that also 

comprises the subsidiaries of associates and joint ventures. 

Amendment to IAS 32 “Financial instruments presentation” regarding classification of rights issues. The 

changes permit classification of rights issues (e.g., options and warrants) as equity instruments 

independently of the currency in which exercise price is denominated. 

Amendment to IFRS 1 “First-time adoption of IFRS” and the related amendment to IFRS 7 “Financial 

instruments: disclosures” relating to the exemption from comparative disclosure allowed by IFRS 7 on 

246






 

 

 

first-time adoption. The amendment exempts the reporting entity, on first-time adoption of IFRS, from 

providing the comparative data required by IFRS 7 for fair value measurement and liquidity risk. 

Amendments to a number of IAS/IFRS/IFRIC as part of the improvement of the same: IFRS 1 “Firsttime 

adoption of IFRS”, IFRS 3 “Business combinations”, IFRS 7 “Financial instruments: disclosures”, 

IAS 1 “Presentation of financial statements”, IAS 27 “Consolidated and separate financial statements”, 

IAS 34 “Interim financial reporting”, IFRIC 13 “Customer loyalty programs”. The above changes had no 

material effects for the company. 

Amendment to IFRIC 14 “Prepayments of a minimum funding requirement” governing cases where an 

entity subject to a minimum funding requirement on defined benefit plans, makes prepayments to 

guarantee the limits in question. The benefits arising from the prepayments may be recognized as 

assets. This case does not apply to the company. 

IFRIC 19 “Extinguishing financial liabilities with equity instruments” which provides guidelines for 

accounting treatment of extinction of a financial liabilities through issue of own equity instruments. The 

difference between the carrying amount of the financial liability to be extinguished and the initial 

measurement of the equity instruments to be issued must be reflected in the income statement. 

The application of the new standards, amendments and interpretations has not had a material impact on the 

company’s annual accounts. 

At December 31, 2011, the European Union had approved an amendment to IFRS 7 “Financial instruments: 

disclosures” concerning disclosures to be made on the transfer of financial assets. This amendment is not yet 

in effect and the Group has not elected early application. 

Standards, amendments and interpretations published by the IASB but not yet endorsed by the European 

Union are: 

 

 

 

 

 

 

 

 

 

 

Amendment to IAS 1 “Presentation of financial statements” relating to the presentation of other 

components recognized under equity. 

Amendment to IAS 12 “Income taxes” with reference to deferred tax: recovery of underlying assets. 

Amendments to IAS 19 “Employee benefits”. The main change is the elimination of the “corridor” for 

defined benefit plans with the requirement for immediate and full recognition of actuarial gains and 

losses in the statement of comprehensive income. 

Review of IAS 27 “Consolidated and separate financial statements” and IAS 28 “Investments in 

associates”. 

Amendments to IFRS 1 “First-time adoption of IFRS” for situations subsequent to hyperinflationary 

periods and suppression of fixed dates on first-time adoption. 

IFRS 10 “Consolidated financial statements”. This new standard replaces IAS 27 “Consolidated and 

separate financial statements” with regard to consolidated financial statements. IAS 27 has been 

renamed “Separate financial statements” and deals exclusively with preparation of separate financial 

statements. 

IFRS 11 “Joint arrangements”. The new standard replaces IAS 31 “Interests in joint ventures”, and 

identifies two categories of arrangement, with separate accounting treatments. 

IFRS 12 “Disclosure of interests in other entities” which re-organizes and supplements disclosures on 

subsidiaries, associates, joint ventures and other equity investments. 

IFRS 13 “Fair value measurement”. This new standard provides guidelines for measurement and 

disclosure of fair value. 

IFRIC 20 “Stripping costs in the production phase of a surface mine”. 

247 


1.2. Accounting policies and basis of presentation 

The accounts adopt the cost principle, with the exception of derivatives and financial assets held for trading or 

for sale, which are stated at fair value. The carrying amounts of hedged assets and liabilities are adjusted to 

reflect changes in fair value on the basis of the hedged risks. The financial statements are presented in euro. 

All amounts in the accounting schedules and in the notes are rounded to thousands of euro, unless otherwise 

specified. 

The basis of presentation of the financial statements is as follows: 

current and non-current assets and current and non-current liabilities are presented as separate 

classifications on the face of the statement of financial position. Current assets, which include cash and 

cash equivalents, are assets that the company intends to realize, sell or consume during its normal 

business cycle; current liabilities are liabilities that the company expects to settle during the normal 

business cycle or in the twelve months after the end of the reporting period; 

on the income statement, costs are analyzed by the nature of the expense; 

on the statement of cash flows, the indirect method is used. 

Since the Italcementi Group applies IAS 34 “Interim Financial Reporting” to its half-year reports, with the 

consequent identification of a six-month interim period, any reductions in value are recorded at closure of the 

half year. 

1.3. Use of estimates 

The preparation of the separate financial statements and the notes in conformity with the international financial 

reporting standards requires management to make estimates that affect the carrying amounts of assets, 

liabilities, income and expense, such as amortization, depreciation and provisions, and the disclosures on 

contingent assets and liabilities in the notes. Since these estimates are determined on a going-concern basis, 

using the information available at the time, they could diverge from the actual future results. This is particularly 

evident in the present financial and economic crisis, which could generate situations diverging from those 

estimated today and require currently unforeseeable adjustments, including adjustments of a material nature, 

to the carrying amounts of the items in question. Assumptions and estimates are particularly sensitive with 

regard to measurement of non-current assets, which depend on forecasts of future results and cash flows, 

provisions for disputes and restructurings and commitments in respect of pension plans and other long-term 

benefits. Management conducts regular reviews of assumptions and estimates, and immediately recognizes 

any adjustments in the financial statements. 

1.4. General policies 

Subsidiaries and associates 

Subsidiaries are companies in which the company has the power to determine, directly or indirectly, 

administrative and management decisions and to obtain the benefits thereof. Generally speaking, control is 

assumed to exist when the company holds, directly or indirectly, more than one half of voting rights, including 

potential voting rights deriving from convertible securities. Associates are companies in which the company 

has significant influence over administrative and management decisions even though it does not hold control. 

Generally speaking, significant influence is assumed to exist when the company holds, directly or indirectly, at 

least 20% of voting rights or, even if it holds a lower percentage of voting rights, when it is entitled to take part 

in financial and management policy decisions by virtue of a specific juridical status including, but not limited to, 

participation in voting trusts or other forms of material exercise of rights of governance. 

Investments in subsidiaries and associates are measured using the cost method, whereby they are recognized 

initially at cost, and subsequently adjusted to reflect changes in amount whenever, following impairment 

testing, conditions are found such as to make it necessary to adjust the carrying amount to the effective value 

248






of the equity investment. The original cost is restored in subsequent periods if the grounds for the adjustments 

no longer exist. Adjustments and any restatements of value are charged to the income statement. 

Joint ventures 

Joint ventures are companies whose business operations are controlled by the company jointly with one or 

more other parties, under contractual arrangements. Joint control presupposes that strategic, financial and 

management decisions are taken with the unanimous consent of the parties that control the venture. 

Interests in joint ventures are measured on a cost basis and, as with investments in subsidiaries and 

associates, this amount is subjected to periodic impairment testing. 

They are included in investments in subsidiaries or associates as from the date on which joint control is 

assumed and until such control is relinquished. 

1.5. Business combinations 

On first-time adoption of the IFRS, as allowed by IFRS 1, the company elected not to apply IFRS 3 

retrospectively to business combinations that took place before January 1, 2004. 

Until December 31, 2009, business combinations were accounted for with the purchase method in IFRS 3. 

Since January 1, 2010, business combinations have been accounted for with the acquisition method in IFRS3 

revised. 

Cost of business combinations 

Under IFRS 3 revised, acquisition cost is the sum of the acquisition-date fair value of the contingent 

consideration and the amount of any non-controlling interests in the acquired entity. For each business 

combination, any non-controlling interests in the acquired entity must be measured at fair value or in proportion 

to their interest in the identifiable net assets of the acquired entity. 

IFRS 3 revised provides that costs relating to the acquisition be expensed in the periods in which they are 

incurred and the services are received. Any costs incurred in 2009 relating to business combinations in 2010 

were expensed in 2009. 

Allocation of the cost of business combinations 

Goodwill is measured as the positive difference between: 

- the aggregate of the consideration transferred, the amount of any non-controlling interests in the acquired 

entity, the acquisition-date fair value of the acquirer’s previously held equity interest in the acquired entity, 

with respect to 

- the net amount at the acquisition date of identifiable assets acquired and liabilities assumed. 

If the difference is negative, it is recognized in the income statement. 

If on initial recognition the acquisition cost of a business combination can only be determined provisionally, the 

allocated amounts are adjusted within twelve months of the acquisition date (measurement period). 

1.6. Translation of foreign currency items 

Foreign currency transactions 

Foreign currency transactions are initially translated to the functional currency using the exchange rate at the 

transaction date. At the reporting date, foreign currency monetary assets and liabilities are translated to the 

functional currency at the closing rate. Exchange rate gains and losses are taken to the income statement. 

Non-monetary foreign currency assets and liabilities measured at cost are translated at the exchange rate 

ruling at the transaction date; those measured at fair value are translated with the exchange rate at the date 

fair value was determined. 

249 


1.7. Property, plant and equipment 

Measurement 

Property, plant and equipment are recognized at cost, less accumulated depreciation and impairment losses. 

Cost includes the purchase or production cost and the directly attributable costs of bringing the asset to the 

location and the conditions required for its operation. Production cost includes the cost of materials and direct 

labor costs. Finance costs relating to the purchase, construction and production of qualifying assets are 

capitalized. The carrying amount of some assets existing at the IFRS first-time adoption date of January 1, 

2004, reflects revaluations applied in prior periods in connection with specific local laws, based on the real 

economic value of the assets in question. Assets acquired through business combinations are stated at fair 

value, determined on a provisional basis at the purchase date and subsequently adjusted within the following 

twelve months. 

Subsequent to initial recognition, property, plant and equipment are carried at cost and depreciated over the 

asset’s useful life, less any impairment losses. 

Assets under construction are recognized at cost; depreciation begins when the assets enter useful life. 

When an asset consists of components with a significant cost and different useful lives, initial recognition and 

subsequent measurement are carried out separately for each component. 

Subsequent expense 

Repair and maintenance expense is normally recognized as incurred. Component replacement costs are 

capitalized and the carrying amount of the replaced component is expensed. 

Depreciation 

Depreciation is generally calculated on a straight-line basis over the estimated useful life of each component of 

an asset. Land is not depreciated, with the exception of land used for quarrying operations. 

Asset useful life determines the depreciation rate until a subsequent review of residual useful life. The useful 

life range adopted for the various categories of assets is disclosed in the notes. 

Quarries 

Costs for the preparation and excavation of land to be quarried are amortized as the economic benefits of such 

costs are obtained. 

Quarry land is depreciated at rates reflecting the quantities extracted in the period in relation to the estimated 

total to be extracted over the period in which the quarry is to be worked. 

The company makes specific provision for quarry environmental restoration obligations. Since the financial 

resources required to settle such obligations are directly related to the degree of use, the charge cannot be 

defined at inception with a balancing entry to the asset cost, but is provided to reflect the degree of use of the 

quarry. 

1.8. Leases 

Finance leases, which substantially transfer to the company all risks and rewards incidental to ownership of the 

leased asset, are recognized from the lease inception date at the lower of the leased asset fair value or the 

present value of the lease payments. Lease payments are apportioned between finance costs and reductions 

against the residual liability so as to obtain a constant rate of interest on the outstanding liability. 

The policies used for depreciation and subsequent measurement of leased assets are consistent with those 

used for the company’s own property, plant and equipment. 

Leases where all risks and rewards incidental to ownership are retained by the lessor are classified as 

operating leases. 

Operating lease payments are recognized as expense on a straight-line basis over the lease term. 

250






1.9. Investment property 

Investment property is land and/or buildings held to earn rental income and/or for capital appreciation, rather 

than for use in the production or supply of goods and services. Investment property is initially recognized at 

purchase cost, including costs directly attributable to the purchase. Subsequent to initial recognition, 

investment property is measured at amortized cost. 

1.10. Intangible assets 

Intangible assets purchased separately are capitalized at cost, while those acquired through business 

combinations are recognized at provisionally estimated fair value at the acquisition date and adjusted where 

necessary within the following twelve months. 

Subsequent to initial recognition, intangible assets are carried at cost amortized over the asset’s useful life. 

The company has not identified intangible assets with an indefinite useful life. 

1.11. Impairment 

Property, plant and equipment and investment property, and amortizable intangible assets, are tested for 

impairment if indications of impairment emerge. 

Assets represented by equity investments in companies recorded at cost are tested for impairment if 

indications of impairment emerge. 

Impairment is the difference between the asset carrying amount and its recoverable amount. Recoverable 

amount is the greater of fair value, less costs to sell, of an asset or cash-generating unit, and its value in use, 

determined as the present value of future cash flows. 

Fair value less costs to sell is determined through application of relevant valuation models adopting 

appropriate income multipliers, quoted share prices on an active market for similar enterprises or other 

available fair value indicators applicable to the assets being measured. 

In determining value in use, assets are measured at the level of cash-generating units on a continuing 

operations basis. Estimated future cash flows are discounted at a rate determined for each cash-generating 

unit using the weighted average cost of capital method (WACC). 

If an impairment loss on an asset other than goodwill subsequently reverses in full or in part, the asset carrying 

amount is increased to reflect the new estimated recoverable amount, which may not exceed the amount that 

would have been reflected in the absence of the impairment loss. Impairment losses and reversals of 

impairment losses are taken to the income statement. 

1.12. Financial assets 

All financial assets are recognized initially at cost at the purchase date. Cost corresponds to fair value plus 

additional costs attributable to the purchase. 

Subsequent to initial recognition, assets held for trading are classified as current financial assets and carried at 

fair value; any gains or losses are taken to the income statement. 

Held-to-maturity investments are classified as current financial assets, if they mature within one year; 

otherwise they are classified as non-current assets and subsequently carried at amortized cost. Amortized cost 

is determined using the effective interest rate method, taking account of any acquisition discounts or 

premiums, which are apportioned over the entire period until maturity, less any impairment losses. 

Other financial assets are classified as available for sale and measured at fair value. Any gains or losses are 

shown in a separate equity caption until the assets are sold, recovered or discontinued, or until they are found 

to be impaired, in which case the cumulative gains or losses in equity are taken to the income statement. 

Equity instruments that are not listed on an active market and whose fair value cannot be measured reliably 

are carried at cost. 

251 


1.13. Inventories 

Inventories are measured at the lower of purchase/production cost (using the weighted average cost method) 

and net realizable value. 

Purchase cost includes costs incurred to bring assets to their present location, less allowances for obsolete 

and slow-moving items. 

Production cost of finished goods and semi-finished goods includes the cost of raw materials, direct labor and 

a portion of general production costs, determined on the basis of normal plant operations. Financial costs are 

not included. 

The net realizable value of raw materials, consumables and supplies is their replacement cost. 

The net realizable value of finished goods and semi-finished goods is the estimated selling price in the ordinary 

course of business, less estimated cost of completion and estimated costs to sell. 

1.14. Trade receivables and other receivables 

Trade receivables and other receivables are stated at their nominal amount, less allowances for uncollectible 

amounts, which are provided as doubtful debts are identified. 

1.15. Cash and cash equivalents 

Cash and cash equivalents consists of cash on hand, bank demand deposits and other treasury investments 

with original maturity of not more than three months. 

Current account overdrafts are treated as financing and not as a component of cash and cash equivalents. 

The definition of cash and cash equivalents in the statement of cash flows is identical to that in the statement 

of financial position. 

1.16. Income taxes 

Current income taxes are provided in accordance with local tax laws in the countries where the Group 

operates. Deferred tax is recognized using the liability criterion, based on temporary differences between the 

tax base of assets and liabilities and their carrying amount in the statement of financial position. 

Deferred tax liabilities are recognized on all taxable temporary differences. Deferred tax assets are recognized 

for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is 

probable that future taxable income will be available against which such differences, losses or credits may be 

reversed. 

Taxable or deductible temporary differences do not generate recognition of deferred tax liabilities or assets 

only in the following cases: 

taxable temporary differences arising from the initial recognition of goodwill, unless goodwill is taxdeductible; 

taxable or deductible temporary differences arising from initial recognition of an asset or a liability in 

transactions that are not business combinations and affect neither accounting profit nor taxable profit at the 

transaction date; 

equity investments in subsidiaries, associates and joint ventures when: 

a) the Group is able to control the timing of the reversal of the taxable temporary differences and it is 

probable that such differences will not reverse in the foreseeable future; 

b) it is not probable that the deductible temporary differences will reverse in the foreseeable future and that 

taxable income will be available against which the temporary difference can be used; 

deferred tax assets are reviewed at the end of every reporting period and reduced to the extent that 

sufficient taxable income is no longer likely to be available in the future against which the assets can be 

used in full or in part. 

252






Deferred tax assets and liabilities are determined at tax rates expected to apply when the deferred tax asset 

(liability) is realized (settled), based on rates that have been enacted or substantially enacted at the reporting 

date. 

Taxes relating to items recognized directly in equity are recognized in equity, not in the income statement. 

1.17. Employee benefits 

The company operates pension plans, post-employment medical benefit plans and post-employment benefits. 

It also has other commitments, in the form of bonuses payable to employees on the basis of length of service 

in the company (“Other long-term benefits”). 


Defined contribution plans are structured post-employment benefit programs where the company pays fixed 

contributions to an insurance company or pension fund and will have no legal or constructive obligation to pay 

further contributions if the fund does not dispose of sufficient assets to pay all the employee benefits accruing 

in respect of services rendered during the current year and in previous years. 

These contributions are paid in exchange for the services rendered by employees and recognized as expense 

as incurred. 


Defined benefit plans are structured post-employment benefit programs that constitute a future obligation for 

the company. In substance, the company assumes the actuarial and investment risks of the plan. In 

accordance with IAS 19, the company uses the unit credit projection method to determine the present value of 

obligations and the related current service cost. These actuarial calculations require use of consistent and 

objective actuarial assumptions about demographic variables (mortality rate, personnel turnover rate) and 

financial variables (discount rate, future increases in salaries and medical benefits). 

The post-employment benefits in Italy (TFR, trattamento di fine rapporto) are treated in the same way as 

benefit obligations arising from defined benefit plans. 

Termination benefits 

Termination benefits include provisions for restructuring costs recognized when the company has approved a 

detailed formal plan that has already been implemented or notified to the third parties concerned. 

Actuarial gains and losses 

Actuarial gains and losses on post-employment defined benefit plans may arise as a result of changes in the 

actuarial assumptions used in two consecutive periods or as a result of changes in the obligation value or in 

the fair value of any plan asset in respect of the actuarial assumptions used at the beginning of the period. 

The company uses the corridor method whereby actuarial gains and losses are recognized as income or 

expense when their unrecognized cumulative net value, for each plan, at the end of the previous period 

exceeds 10% of the larger of present value of the defined benefit obligation or the fair value of plan assets at 

that date. These gains or losses are taken to profit or loss over the estimated average residual working life of 

the employees participating in the plans. 

Actuarial gains and losses relating to “Other long-term benefits” (service medals, length of service benefits) 

and to early retirement benefits are recognized as income or expense immediately. 

253 


Past service cost 

Changes in liabilities resulting from a change to an existing defined benefit plan are recognized as expense on 

a straight-line basis over an average period until the benefits have vested. Costs for benefits that vest 

immediately upon changes to a plan are recognized as expense as incurred. 

Curtailment and settlement 

Gains or losses on the curtailment or settlement of a defined benefit plan are recognized as income or expense 

when the curtailment or settlement occurs. The gain or loss includes changes in the present value of the 

obligation, changes in the fair value of plan assets, actuarial gains or losses and past service costs not 

previously accounted for. 

At the curtailment or settlement date, the obligation and the fair value of the plan assets are re-measured using 

current actuarial assumptions. 

1.18. Share-based payments 

The company has applied IFRS 2 as from January 1, 2004. 

Options for the subscription and purchase of shares granted by the company to employees and directors give 

rise to recognition of a cost classified under employee expenses, with a corresponding increase in equity. 

In accordance with IFRS 2, only options granted after November 7, 2002, whose rights had not vested at 

December 31, 2003, have been measured and recognized at the transition date. Options for the subscription 

and purchase of shares are measured at fair value at the grant date and amortized over the vesting period. 

Fair value is determined using the binomial method, and taking account of dividends. Future volatility is 

determined on the basis of historic market prices, after adjustment for extraordinary events or factors. 

The cost of granted options is reviewed on the basis of the actual number of options that have vested at the 

beginning of the exercise period. 

1.19. Provisions for risks and charges 

The company recognizes provisions for risks and charges when a present legal or constructive obligation 

arises as a result of a past event, the amount of which can be reliably estimated, and use of resources is 

probable to settle the obligation. Provisions reflect the best estimate of the amount required to settle the 

obligation or transfer it to third parties at the reporting date. If the present value of the financial resources that 

will be used is material, provisions are determined by discounting expected future cash flows at a rate that 

reflects the current market assessment of the time value of money and, where appropriate, the risks specific to 

the liability. When discounting is performed, movements in provisions due to the effect of time or changes in 

interest rates are recognized in financial items. 

Changes in estimates are recognized in the income statement for the period. 

The company recognizes a separate provision for environmental restoration obligations on land used for quarry 

work, determined in relation to the use of the quarry in question. 

Pending publication of a standard/interpretation on accounting treatment of greenhouse gas emission 

allowances, after the withdrawal of IFRIC 3 by the International Accounting Standards Board, the company 

recognizes a separate provision when emissions are greater than the allowance. 

1.20. Loans and borrowings 

Loans and borrowings are initially recognized at the fair value of the consideration provided/received less 

charges directly attributable to the financial asset/liability. 

After initial recognition, loans and borrowings are measured at amortized cost using the effective interest rate 

method. 

254






1.21. Trade payables and other payables 

Trade payables and other payables are stated at the fair value of the original consideration received. 

1.22. Derivatives 

The company uses derivatives such as foreign currency forward contracts and interest-rate swaps and options 

to hedge currency and interest-rate risks. Derivatives are measured and recognized at fair value. 

The fair value of foreign currency forward contracts is determined on the basis of the current forward exchange 

rates for contracts with similar maturity profiles. 

The fair value of interest-rate contracts is determined on the basis of discounted flows using the zero coupon 

curve. 

Hedging transactions 

Derivatives are designated as hedging instruments or as non-hedging instruments. Transactions that qualify for 

application of hedge accounting are classified as hedging transactions; other transactions are designated as 

trading transactions, even if they are performed for the purposes of risk management. 

For accounting purposes, hedging transactions are classified as “fair value hedges” if they cover the risk of 

changes in the fair value of the underlying asset or liability; or as "cash flow hedges” if they hedge cash flows 

arising from an existing asset or liability or from a future transaction, which are exposed to variability. 

With regard to fair value hedges, fair value gains and losses on the derivatives are taken to the income 

statement immediately. Similarly, the underlying assets or liabilities are measured at fair value and any gain or 

loss attributable to the hedged risk is recognized as an income or expense balancing entry. 

If the movement refers to an interest-bearing financial instrument, it is amortized in the income statement until 

maturity. 

With regard to cash flow hedges (foreign currency forward contracts, fixed-rate interest swaps), movements in 

inherent value are reflected in a separate equity caption, while time-based changes and the non-effective 

hedge component are recognized in the income statement. The effective component and non-effective 

component are calculated using the methods indicated in IAS 39. 

Gains or losses arising from changes in the fair value of derivatives designated for trading are recorded as 

income or expense. 

When the financial instrument matures, is sold, settled, exercised or no longer qualifies for hedge accounting, 

the derivative is no longer treated as a hedging contract. In this case, gains or losses on the derivative are 

retained in equity until the hedged transaction takes place. If the company no longer expects the hedged 

transaction to take place, the net gain or loss in equity is taken to the income statement. 

1.23. Revenue, other revenue, interest income and dividends 

Sale of goods and services 

Revenue is recognized to the extent that it is probable that the economic benefits associated with the sale of 

goods or rendering of services are collected by the company and the amount in question can be reliably 

determined. 

Revenue is recognized at the fair value of the consideration received or due, taking account of any trade 

discounts given and volume discounts. 

Revenue from the sale of goods is recognized when the company transfers the material risks and rewards 

incidental to ownership of the goods to the purchaser. 

Rental income 

Rental income is recognized as other revenue, as received. 

255 


Interest income 

Interest income is classified as finance income on an accrual basis using the effective interest method. 

Dividends 

Dividends are recognized as finance income as shareholders’ right to receive payment arises. 

1.24. Government grants 

Government grants are recognized when there is a reasonable certainty that they will be received and all the 

requirements on which receipt depends have been fulfilled. 

Grants related to the purchase or production of non-current assets (grants related to assets) are recognized as 

deferred income and taken to the income statement over the useful life of the underlying assets. 

256






Assets 


2. Property, plant and equipment 


Land and 

buildings 

Quarries 

Technical plant 

materials and 

equipment 

Other property, 

plant and 

equipment 

Carrying amount at Dec. 31, 2010 120,450 29,737 339,205 106,109 595,501 

Gross amount 494,888 58,135 1,981,211 159,220 2,693,454 

Accumulated depreciation ( 374,438) ( 28,398) ( 1,642,006) ( 53,111) ( 2,097,953) 

Carrying amount at Dec. 31, 2010 120,450 29,737 339,205 106,109 595,501 

Additions 7,447 845 40,277 17,641 66,210 

Disposals ( 290) ( 9) ( 1,104) ( 339) ( 1,742) 

Depreciation ( 8,126) ( 708) ( 65,519) ( 2,896) ( 77,249) 

Impairment losses - - ( 693) - ( 693) 

Reversal of impairment losses and 

- - ( 113) 113 - 

reclassifications 

Carrying amount at Dec. 31, 2011 119,481 29,865 312,053 120,628 582,027 

Gross amount 501,732 58,823 2,012,661 175,602 2,748,818 

Accumulated depreciation ( 382,251) ( 28,958) ( 1,700,608) ( 54,974) ( 2,166,791) 

Carrying amount at Dec. 31, 2011 119,481 29,865 312,053 120,628 582,027 

Total 

“Other property, plant and equipment” includes construction in progress and payments on account. 

The year’s additions related to the completion of the Matera cement plant revamp, the continuation of 

construction of the new research and innovation centre at the Kilometro Rosso science park, the start of work 

to revamp the Rezzato cement plant, and the normal renovation of industrial plant. 

The carrying amount of the assets arising from finance leases or rental contacts, which come under the 

definition of leases provided by IFRS, totaled 14,372 thousand euro (17,230 thousand euro at December 31, 

2010) and concerned buildings (704 thousand euro), plant and machinery (13,622 thousand euro) and 

vehicles (46 thousand euro). 

The useful life adopted by the company for the main asset categories is as follows: 

Civil and industrial buildings 

Plant and machinery 

Other property, plant and equipment 

10 – 33 years 

5 – 30 years 

3 – 10 years 

257 



Investment property of 12,875 thousand euro (13,679 thousand euro at December 31, 2010) is carried at 

amortized cost. 


Investment property 

Carrying amount at Dec. 31, 2010 13,679 


Accumulated depreciation ( 23,874) 

Carrying amount at Dec. 31, 2010 13,679 

Additions 150 

Disposals ( 487) 

Depreciation ( 467) 

Carrying amount at Dec. 31, 2011 12,875 


Accumulated depreciation ( 21,905) 

Carrying amount at Dec. 31, 2011 12,875 

Depreciation exclusively concerned civil and industrial buildings and is calculated on the basis of the 

respective useful lives adopted by the company: civil buildings 33 years, industrial buildings 18 years. 

The fair value of these investments at December 31, 2011, was 103.4 million euro. 


Concessions 

Patents, 

Software 

Total 

brands, 

licenses and 

development 

expenses 


other rights 

Carrying amount at Dec. 31, 2010 1,033 4,686 14,229 19,948 

Gross amount 1,461 7,718 17,473 26,652 

Accumulated amortization ( 428) ( 3,032) ( 3,244) ( 6,704) 

Carrying amount at Dec. 31, 2010 1,033 4,686 14,229 19,948 

Additions 27 6,722 12,174 18,923 

Disposals - ( 5,386) - ( 5,386) 

Amortization ( 95) ( 1,052) ( 2,748) ( 3,895) 

Impairment losses - ( 1,048) - ( 1,048) 

Reclassifications ( 23) 63 11 51 

Carrying amount at Dec. 31, 2011 942 3,985 23,666 28,593 

Gross amount 1,459 8,385 28,922 38,766 

Accumulated amortization ( 517) ( 4,400) ( 5,256) ( 10,173) 

Carrying amount at Dec. 31, 2011 942 3,985 23,666 28,593 

The year’s additions mainly concerned the development of projects to standardize processes within the Group. 

The amortization period for “Concessions” is based on the length of the agreements signed. 

Software licenses of indeterminate life and the related development costs are amortized over a five-year 

period. 

Impairment losses refer to CO 2 emission rights held at year-end for 864 thousand euro and were applied on 

the basis of market price. 

258






4. Investments in subsidiaries and associates 

The changes compared to December 31, 2010, were as follows: 


At December 31, 2010 1,740,651 

Acquisitions 55,825 

Repayments ( 450) 

Sales ( 14,551) 

Impairment losses on financial assets ( 52,284) 

Impairment losses on financial assets withdrawn from reserves ( 7,524) 

At December 31, 2011 1,721,667 

During the year the subsidiary Sicilfin S.r.l. incorporated the companies Silicalcite S.r.l., Italcementi Ingegneria 

S.r.l., Intertrading S.r.l., Immobiliare Salesiane S.r.l. and Imes S.r.l. and changed its business name to 

Italcementi Ingegneria S.r.l.; the values of these equity investments were, therefore, combined. 

Acquisitions refer mainly to the payment to replenish losses at Nuova Sacelit S.p.A. and to the increase in the 

share capital of Calcestruzzi S.p.A., for, respectively, 5,000 thousand euro and 50,787 thousand euro. 

Repayments refer to the partial return of the share capital by Sirio S.p.A.. 

Sales include the sale of the equity investment in Axim Italia S.p.A. at a sale price of 15,203 thousand euro, for 

which a net gain of 1,633 thousand euro was posted under finance income. 

Investments in subsidiaries and associates are tested for impairment if evidence of impairment emerges, by 

comparing carrying amount with recoverable amount. The methods used to determine recoverable amount are 

described in the accounting policies in the section “Impairment losses on assets”. 

The value configuration used to determine the recoverable amount of equity investments is value in use, that 

is, fair value less costs to sell, with reference to comparable transactions. 

The value in use of each equity investment is determined on the basis of 2012 budget data and on the 

discounted projection of expected future cash flows, taking account of changes in operating assets, net of the 

effects of investments for additions or restructuring. The observation period varies between five to nine years 

according to the characteristics of the markets on which the Group companies operate. The terminal value is 

calculated on the basis of the discounted cash flows for the last year. The growth rate is based on the forecast 

long-term growth of the relevant industrial sector of the country and on the estimated long-term inflation rate. 

The estimate assumes a growth rate, for operations in Italy, equivalent to the long-term inflation rate (2%). The 

pre-tax discount factor used to calculate the present value of expected cash flows for operations in Italy is 

8.9%. 

The aforementioned discount and growth rates are supported by previous experience and are in line with 

those in use in the sector. 

Impairment testing highlighted the need to impair the investments in Calcementi Jonici S.p.A. for 1,767 

thousand euro, Nuova Sacelit S.p.A. for 10,021 thousand euro, International City for Ready Mix for 1,843 

thousand euro, Azienda Agricola Lodoletta S.r.l. for 285 thousand euro, on the basis of estimated value in use, 

and to apply an adjustment to the carrying amount of Calcestruzzi S.p.A. for 45,892 thousand euro, of which 

38,368 thousand euro was expensed and 7,524 thousand euro taken from the reserve, on the basis of fair 

value inferred from market transactions, determined with the assistance of a fair value opinion issued by an 

independent professional. 

259 


The list of investments in subsidiaries and associates at December 31, 2011, is as follows: 

(in thousands of euro) Location Share/quota capital % held Carrying amount 

at 12.31.2011 

Aliserio S.r.l. Bergamo € 2,270,000 90.00 1,938 

Azienda Agricola Lodoletta S.r.l. Bergamo € 10,400 75.00 2,877 

BravoSolution S.p.A. Bergamo € 29,302,379 83.02 43,590 

CTG S.p.A. Bergamo € 500,000 50.00 250 

Calcementi Jonici S.r.l. Siderno (RC) € 3,513,741 99.90 7,591 

Calcestruzzi S.p.A. Bergamo € 110,000,000 99.90 64,635 

Cementificio di Montalto S.p.A. Bergamo € 10,000,000 100.00 38,826 

Ciments Français S.A. Puteaux € 143,114,304 83.20 1,467,397 

Gruppo Italsfusi S.r.l. Savignano sul Panaro (MO) € 156,000 99.50 277 

Italcementi Finance S.A. (formerly Holfipar) Puteaux € 20,000,000 100.00 20,005 

Italcementi Ingegneria S.r.l. Bergamo € 650,000 100.00 9,459 

Italgen S.p.A. Bergamo € 20,000,000 99.90 20,111 

Nuova Sacelit S.r.l. Bergamo € 7,500,000 100.00 4,344 

SAMA S.r.l. Bergamo € 1,000,000 99.00 1,867 

Sociètè Internationale Italcementi (Luxembourg) S.A. Luxembourg € 1,771,500 99.87 13,897 

Shqiperia Cement Company Tirana ALL 74,250,000 100.00 602 

Silos Granari della Sicilia S.r.l. Bergamo € 7,980,000 99.90 10,383 

Star.Co. S.r.l. Bergamo € 118,000 100.00 2,751 

International City for Ready Mix Arabia SAR 100,000,000 50.00 1,792 

Cementi della Lucania S.p.A. Potenza € 619,746 30.00 4,149 

Consorzio Medeuropa Milan - 20.00 3 

Les Ciments de Zouarine S.A. Tunis TND 80,000 49.93 23 

Sirio S.p.A. - Associazione in Partecipazione Milan - - 4,900 

Total 1,721,667 

The following additional information is provided for the investment in the associate Cementi della Lucania 

S.p.A.: 

Total 

Total Revenue Loss for the period 


assets liabilities 

Cementi della Lucania S.p.A. (1) 11,872 4,942 8,552 ( 3,497) 

(1) data taken from financial statements at December 31, 2010 

260






4.1 Other equity investments 

This non-current asset caption reflects equity investments in the “available-for-sale” category as required by 

IAS 39. 

(migliaia di euro) 

Al 31 dicembre 2010 5.802 

Vendite ( 71) 

Al 31 dicembre 2011 5.731 

“Sales” refer to the sale of Mediobanca S.p.A. warrants, which led to recognition of a loss of 69 thousand euro 

under finance costs. 

The breakdown of equity investments at December 31, 2011, was as follows: 

(migliaia di euro) 

Partecipazioni in società non quotate: 

Istituto Europeo di Oncologia S.p.A. 3.685 

S.A.C.B.O. S.p.A. 2.029 

Altre partecipazioni 17 

Totale 5.731 

Totale partecipazioni 5.731 


(in thousands of euro) 12.31.2011 12.31.2010 Change 

Guarantee deposits 569 577 ( 8) 

Receivables for expropriations 3,390 3,390 - 

"Bravosolution 2007-2012" convertible bonds - 3,934 ( 3,934) 

Italcementi Finance S.A. bonds 8,551 - 8,551 

Derivatives - 82 ( 82) 

Commodity derivatives 15,404 3,315 12,089 

Financial receivables due from Group companies 100,000 100,000 - 

Receivables due from parent in connection with tax consolidation 72,794 61,364 11,430 

Total 200,708 172,662 28,046 

The “Bravosolution 2007-2012” convertible bonds were reclassified under current assets. 

In December Italcementi Finance S.A. bonds were bought on the open market for a par value of 11 million 

euro; the carrying amount of 8,551 thousand euro was determined in accordance with the amortized cost 

criterion. 

The financial receivable of 100,000 thousand euro refers to an interest-bearing loan granted to the subsidiary 

Ciments Français S.A. 

The receivable due from the parent Italmobiliare S.p.A. in connection with the tax consolidation is the sum of 

the receivable for current income tax (IRES) of 12,462 thousand euro and the receivable relating to tax losses, 

payments on account and withholdings of 60,332 thousand euro and was reclassified from current assets in 

consideration of the expected recovery time. 

261 





Raw materials, consumables and supplies 69,713 73,140 ( 3,427) 

Work in progress and semi-finished goods 22,626 20,625 2,001 

Finished goods 16,254 16,112 142 

Total 108,593 109,877 ( 1,284) 

Inventories of raw materials, consumables and supplies are shown net of the allowance of 9,086 thousand 

euro (8,748 thousand euro at December 31, 2010) provided against the risk of slow-moving supplies and 

consumables; they include spare parts of 24,751 thousand euro at December 31, 2011 (26,863 thousand euro 

at December 31, 2010). 



From customers 207,163 186,031 21,132 

From Group companies 82,894 45,319 37,575 

Allowance for impairment ( 13,058) ( 10,657) ( 2,401) 

Net amount 276,999 220,693 56,306 

The increase in receivables due from customers reflected the lengthening of payment collection times. 

For an analysis of the “Receivables due from Group companies”, reference should be made to the section on 

transactions with related parties. 

The net change in the allowance for impairment was the result of the difference between the year’s allowance 

of 7,718 thousand euro and applications of 5,317 thousand euro. 


(migliaia di euro) 31.12.2011 31.12.2010 Variazione 

Crediti verso enti previdenziali 1.253 868 385 

Crediti verso Erario per IVA 866 2.429 ( 1.563) 

Crediti per contributi in c/capitale 116 408 ( 292) 

Crediti per espropri 586 586 - 

Altri crediti 32.814 5.627 27.187 

Strumenti derivati 1.537 678 859 

Strumenti derivati su commodity 31.412 1.782 29.630 

Ratei e risconti attivi 5.986 7.914 ( 1.928) 

Totale 74.570 20.292 54.278 

Other receivables include the amounts relating to the allocation of white certificates (7,948 thousand euro) and 

the current amount of the receivable accrued at December 31, 2011, for “new entry” CO 2 quotas recognized 

for 2008-2012 (19,845 thousand euro). 

Prepayments and accrued income include an amount of 4,618 thousand euro (6,122 thousand euro at 

December 31, 2010) relating to fees paid for the opening of lines of credit, recognized in the income statement 

under finance costs in relation to the duration of the lines of credit granted. 

262






9. Tax assets and liabilities 

Tax assets were as follows: 


Tax receivable for prior-year taxes 431 329 102 

Tax credit for "dividend imputation" 583 12,357 ( 11,774) 

Tax receivables for IRAP payments on account and surpluses to be recovered 5,511 5,511 - 

Payable for IRAP on income in the year ( 1,729) - ( 1,729) 

Total 4,796 18,197 ( 13,401) 

The principal of the tax credit for “dividend imputation” was collected in full, while a receivable for the interest 

component was still outstanding. 

10. Equity investments, bonds and financial assets 


Equity investments in other companies 288 289 ( 1) 

Financial receivables due from Group companies 371,671 419,449 ( 47,778) 

"Bravosolution 2007-2012" convertible bonds 3,799 - 3,799 

Total 375,758 419,738 ( 43,980) 

Financial receivables due from Group companies consist of current accounts, regulated at normal market 

rates, which represent the financial support provided in relation to operating requirements. 

The conversion of the 3,664,895 “Bravosolution 2007-2012” convertible bonds may take place over the lifetime 

of the loan at a rate of 1 Bravosolution ordinary share for each bond with a par value of 1 euro. 

The carrying amount of 3,799 thousand euro, determined in accordance with the amortized cost criterion, 

reflects the value of the bonds, taking account of the value of the option to convert them into shares. 

11. Cash and cash equivalents 

(migliaia di euro) 31.12.2011 31.12.2010 Variazione 

Depositi bancari e postali 166 135 31 

Assegni 174 669 ( 495) 

Denaro e valori in cassa 139 142 ( 3) 

Totale 479 946 ( 467) 

263 


Equity 

12. Share capital 

At December 31, 2011, the fully paid-in share capital totaled 282,548,942 euro, divided into 282,548,942 

shares with a par value of 1 euro each, as follows: 

Number of shares 12.31.2011 12.31.2010 Change 

Ordinary shares 177,117,564 177,117,564 - 

Savings shares 105,431,378 105,431,378 - 

Total 282,548,942 282,548,942 - 

13. Reserves 

Reserves reflect movements in the share premium, the fair value adjustment of available-for-sale financial 

assets and interest-rate and currency hedges, and the valuation of stock options. 

The stock option reserve reflects the total amount at December 31, 2011, of the options granted and 

amortized over the vesting period of the stock option plans. 

The movements in reserves were as follows: 

Reserves 

Share premium Fair value reserve Hedging reserve Stock option reserve Total 


reserves 

At December 31, 2010 344,104 7,524 ( 9,807) 23,514 21,231 

Gains (losses) taken directly to reserve - ( 7,524) ( 6,961) ( 505) ( 14,990) 

Tax taken directly to reserve - - 1,900 - 1,900 

(Gains) losses taken to income statement - - 9,858 - 9,858 

At December 31, 2011 344,104 - ( 5,010) 23,009 17,999 


At December 31, 2011, the carrying amount of purchased treasury shares totaled 58,690 thousand euro and 

was charged to the reserve for treasury shares as shown below: 

Total carrying 

No. ordinary shares 

amount 

par value € 1 (in thousands of euro) 

No. savings shares 

par value € 1 


amount 



amount 


December 31, 2010 3,793,029 58,342 105,500 348 58,690 

December 31, 2011 3,793,029 58,342 105,500 348 58,690 

Ordinary treasury shares in portfolio at December 31, 2011, were held to service stock option plans for 

directors and managers. 

264






15. Analysis of equity captions 

The table below sets out an analysis of equity captions in relation to their origin, possibility of use and possible 

distribution: 


Amount 

Possibility 

of use 

Available amount 

Nature / description 

Share capital 282,549 

Share premium 344,104 A, B, C 344,104 

Reserves: 

Stock option reserve 23,009 - - 

Hedging reserve ( 5,010) - - 

Total reserves 17,999 

Treasury shares ( 58,690) 

Retained earnings: 

Revaluation reserves 256,992 A, B, C 256,992 

Legal reserve 56,510 B 

Extraordinary reserve 478,026 A, B, C 478,026 

Provision art. 18 Law 675/77 1,224 A, B, C 1,224 

Provision for grants related to assets 71,480 A, B, C 71,480 

Provision under Law 169/83 65,280 A, B, C 65,280 

Negative goodwill 151,169 A, B, C 151,169 

Provision under Law 904/77 38,163 A, B, C 38,163 

Provision under Law 488/92 28,700 - - 

Summary of uses made in last three 

years 

Coverage of 

losses 

( 1) 

For other 

reasons 

33,438 

Reserve under art. 7 Leg. Decree 38/2005 40,505 - - 

Retained earnings 3,635 A, B, C 3,635 16,265 

Profit for the period 7,002 A, B, C 7,002 

Total retained earnings 1,198,686 

Distributable total 1,417,075 

Key: 

A: for share capital increase 

B: to cover losses 

C: for distribution to shareholders 

(1) distribution of dividends 

( 1) 

132,723 

The reserves, which form part of the company’s taxable income when distributed, totaled 380,566 thousand 

euro in addition to 93,852 thousand euro included in share capital following the increases made in previous 

periods. 

Reserves not subject to taxation are recorded gross of the tax impact, in the absence of resolutions that 

envisage their distribution. 

265 


Dividends paid 

Dividends approved in 2010 and 2009 were as follows: 



2010 



(000 euro) 


(000 euro) 

Ordinary shares 0.12 0.12 20,799 20,799 

Savings shares 0.12 0.12 12,639 12,639 

Total dividends 33,438 33,438 

Dividends paid in 2011 totaled 33,441 thousand euro (33,432 thousand euro in 2010) 


This caption includes the post-employment benefits in accordance with IAS 19 and liabilities relating to future 

commitments, in the form of bonuses, to be paid to employees on the basis of their length of service at the 

company; these liabilities arise from actuarial valuations at December 31, 2011. 

In addition, provision was made for costs envisaged for recourse to state-subsidized lay-off schemes and 

redundancy programs under the on-going re-organization of head-office operations and the manufacturing and 

sales networks. 

Post-employment 

benefits 

Provision for 

seniority increases 

and social security 

abroad 

Other employee 

benefits 

Provisions for 

termination of 

employment 

Total 


At December 31, 2010 25,557 68 3,106 10,891 39,622 

Amounts accrued 1,629 9 223 - 1,861 

Indemnities paid ( 3,475) - - - ( 3,475) 

Staff transfers ( 23) - - - ( 23) 

Provision - - - 9,544 9,544 

Use - - - ( 6,136) ( 6,136) 

At December 31, 2011 23,688 77 3,329 14,299 41,393 

Use of provisions for termination of employment includes the release to the income statement of surpluses of 

1,525 thousand euro. 

The assumptions used to determine liabilities arising from long-term benefits are set out below: 

Post-employment 

benefits 

Other employee 

benefits 

Discount rate 4.60% 4.60% 

Future salary rises - 3.06% 

Inflation 2.00% 2.00% 

266







(in thousands of euro) 12.31.2010 Additions Decreases Reclassifications 12.31.2011 

Tax 3,891 - ( 1,430) - 2,461 

Restoration of quarries 14,969 1,209 ( 583) - 15,595 

Restoration of industrial areas 4,000 - ( 216) - 3,784 

Other risks 7,760 - ( 1,525) ( 764) 5,471 

Total other provisions 30,620 1,209 ( 3,754) ( 764) 27,311 

As regards tax assessments relating to Italcementi S.p.A., the tax assessments relating to the Italcementi 

S.p.A. tax returns for 1987, 2003, 2004, 2005, and 2006 are still being disputed; the adjustments requested by 

the authorities appear to be largely unfounded, also in the view of independent consultants. 

On July 27, 2011, a long-standing dispute relating to the years from 1996 to 1999 ended when the Court of 

Cassation rejected the appeals filed by the State and confirmed in full the rulings of the Milan Regional Tax 

Commission. 

The proceeding was concluded with an additional tax charge of 0.8 million euro, compared with the amount of 

68 million euro initially claimed by the tax authorities. 

In addition, on December 13, 2010, the Supreme Court of Cassation discussed the appeal relating to 1987; on 

March 2, 2011, it deposited its ruling upholding the two cross appeals presented by the company and 

overturned, for approximately 4 million euro of taxable income, the sentence of the Regional Tax Commission 

in our favor, since the grounds of the judge’s ruling were per relationem. 

The case was reopened on January 13, 2012, by the Regional Tax Commission. 

On February 1, 2011, the Regional Tax Commission decided in favor of the company, by confirming the 

sentence of first instance, which annulled a notice of assessment relating to 2003, and also declaring that the 

notice was without merit, since no intent of evasion was perceived in the company’s conduct. 

In August 2009, the Regional Tax Office for Major Contributors served a notice of assessment relating to 

2004, against which the company appealed in November 2009. A hearing was held and on October 12, 2011, 

the Tax Commission annulled the notice and upheld the company’s arguments in full. 

The Regional Office of Lombardy served notices of assessment relating to 2005 and 2006 regarding the same 

matter as the notices for 2003 and 2004, the judicial outcome of which was in the company’s favor. 

The company has appealed to the Milan Tax Commission for both years. 

Of the decrease in the provision for tax, 630 thousand euro referred to the payment of tax demands and 800 

thousand euro to the use of a surplus provision following a sentence issued by the Supreme Court of 

Cassation. 

The increase in the provision for the restoration of quarries includes a cash adjustment of 231 thousand euro, 

charged to the income statement under “Finance costs”. 

The decreases in the provision for restoration of industrial areas refer entirely to use of the provision for 

expenses incurred for the dismantling of plant and the remediation of some sites. 

The decreases in the provision for other risks relate to the settlement of an outstanding dispute and to the first 

payment made in favor of the Azzanelli foundation for construction of a new geriatric facility. 

267 


18. Deferred tax assets and deferred tax liabilities 

12.31.2010 Adjustments to prior 

year taxes 

Increases 

Decreases Changes in deferred 

taxes taken to 

reserve 



Deferred tax liabilities 25,919 ( 7) 1,235 ( 2,467) 1,073 25,753 

Deferred tax assets ( 37,998) 55 ( 15,095) 3,725 ( 2,973) ( 52,286) 

Total ( 12,079) 48 ( 13,860) 1,258 ( 1,900) ( 26,533) 

268






The table below details the temporary differences that generated deferred tax assets and liabilities: 

Tax rate Temporary 

differences at 


Balance at Adjust-ment 

12.31.2010 prior-year 

taxes 

Tax 

provision 

Applications 

Change in 

deferred tax 

liabilities 

taken to 

reserve 

Balance at 



Deferred tax liabilities on: 

Gains in instalments from the sale of 

operating assets 27.50% 9,840 4,886 (2,180) 2,706 

Gains in instalments from the sale of nonoperating 

assets 3.90% - 68 (68) - 

Depreciation of property, plant, and 

equipment 3.90% 775 70 (8) (32) 30 

Revaluation of inventories 27.50% 57,069 14,706 988 15,694 

Revaluation of inventories 3.90% 57,069 2,085 140 2,225 

Fair value of derivatives 27.50% 3,901 1,073 1,073 

Other items 27.50% 795 219 219 

Other items 27.50% 12,681 3,532 107 (151) 3,488 

Other items 27.50% 904 281 1 (33) 249 

Other items 3.90% 1,759 72 (3) 69 

Total deferred tax liabilities 25,919 (7) 1,235 (2,467) 1,073 25,753 

Deferred tax assets on: 

Provision for restoration of quarries and 

industrial areas 27.50% 20,654 5,631 269 (220) 5,680 

Provision for restoration of quarries and 

industrial areas 3.90% 11,710 488 (31) 457 

Provision for other risks 27.50% 15,318 3,496 2,624 (1,908) 4,212 

Depreciation of civil buildings 27.50% 17,083 4,698 4,698 

Employee benefits and directors' 

remuneration 27.50% 12,304 2,102 201 1,747 (666) 3,384 

Write-down materials inventories 27.50% 6,916 1,809 524 (431) 1,902 

Write-down materials inventories 3.90% 92 (92) - 

Non-deductible interest expense 27.50% 61,147 10,727 (190) 6,278 16,815 

Emissions of CO 2 27.50% 1,353 208 164 372 

Emissions of CO 2 3.90% 4 (4) - 

Fair value of derivatives 27.50% 10,811 2,973 2,973 

Other items 27.50% 31,319 5,562 (5) 3,299 (243) 8,613 

Other items 27.50% 11,538 3,174 (69) 190 (122) 3,173 

Other items 3.90% 178 7 8 (8) 7 

Total deferred tax assets 37,998 (55) 15,095 (3,725) 2,973 52,286 

Total (12,079) 48 (13,860) 1,258 (1,900) (26,533) 

269 


19. Net debt 

An itemized correlation of net debt with the statement of financial position is set out below: 


Financial asset and liability Statement of financial position caption December 31, 2011 December 31, 2010 

category 

Current financial assets ( 382,104) ( 427,196) 

Cash and cash equivalents Cash and cash equivalents ( 479) ( 946) 

Current loan assets 

Equity investments, bonds and financial 

assets ( 375,470) ( 419,449) 

Other current financial assets Other current assets ( 4,618) ( 6,123) 

Derivatives Other current assets ( 1,537) ( 678) 


Bank overdrafts and short-term 

borrowings Loans and borrowings 146,416 135,546 

Loans and short-term borrowings Financial liabilities 338,555 54,028 

Derivatives Other current liabilities 1,989 3,339 

Non-current financial assets ( 108,551) ( 104,016) 

Securities and bonds Other non-current assets ( 8,551) ( 3,934) 

Non-current financial assets Other non-current assets ( 100,000) ( 100,000) 

Derivatives Other non-current assets - ( 82) 

Non-current financial liabilities 842,672 1,084,061 

Loans and long-term borrowings Financial liabilities 832,068 1,076,224 

Derivatives Other non-current liabilities 10,604 7,837 

Net debt 838,977 745,762 

19.1 Financial liabilities 

Financial liabilities are shown below by category, subdivided by non-current and current liabilities: 

(in thousands of euro) December 31, 2011 December 31, 2010 


Non-current portion of loans and borrowings 9,276 9,258 

Financial liabilities vs Group companies 208,882 208,746 



Total non-current financial liabilities 842,672 1,084,061 

Bank overdrafts and short-term borrowings 146,416 135,546 

Current portion of loans and borrowings 262,647 12,662 


Amounts due to banks and current financial liabilities 484,971 189,574 


Total current financial liabilities 486,960 192,913 


Current financial liabilities with respect to Group companies refer essentially to current accounts and a loan 

granted by Italcementi Finance S.A.. 

270







Effective Maturity 12.31.2011 12.31.2010 


interest rate 

Amounts due to banks 832,068 1,076,224 

Ordinary borrowing 249,550 

Ordinary borrowing 4.48% 2014 49,600 49,450 

Ordinary borrowing 5.08% 2019 59,310 59,220 

Intercompany ordinary borrowings 5.61% 2020 208,882 208,746 

Confirmed line of credit 75,000 

Confirmed lines of credit 

1.64% 2013 325,000 325,000 

Confirmed line of credit 1.65% 2014 180,000 100,000 





Current liabilities 71,416 145,546 

Current portion confirmed line of credit 2011 75,000 - 

Current portion of loans and borrowings 2011 262,647 2,662 






(migliaia di euro) 31 dicembre 2011 31 dicembre 2010 

2012 - 333,030 

2013 333,698 325,199 

2014 229,800 149,650 

2015 189 189 

2016 190 - 

Oltre 268,191 268,156 

Strumenti derivati di copertura 10,604 7,837 

Totale debiti finanziari 842,672 1,084,061 

271 


Main bank loans and drawn and available lines of credit 

The main changes in Italcementi S.p.A. medium/long-term loans and borrowings in 2011 and 2010 are 

described below: 

Bank loans and drawings on lines of credit: 

a) In 2010, Italcementi S.p.A. arranged a three-year line of credit for an original amount of 100 million euro, 

subsequently reduced to 25 million euro after the counterparty joined the syndicated line of credit headed by 

Italcementi Finance S.A. No drawings had been made on the facility at December 31, 2011; 

Main intercompany borrowings and lines of credit at Italcementi S.p.A. 

b) In 2011, after finalization of a bilateral bank line of credit arranged by Italcementi Finance S.A., Italcementi 

S.p.A. obtained from Italcementi Finance S.A. a 50 million euro five-year renewable line of credit. No drawings 


c) In 2010, concomitantly with the Italcementi Finance S.A. bond issue, Italcementi S.p.A. obtained two tenyear 

intercompany loans from Italcementi Finance S.A., one at a fixed rate and one at a floating rate, for a 

total amount of 210 million euro; 

d) In 2010, Italcementi S.p.A. took part in financing the repurchase offer on the Ciments Français S.A. US 

Private Placements, granting Ciments Français S.A. a long-term 5-year floating-rate intercompany loan for 100 

million euro; 

e) In 2010, concomitantly with the finalization of the Italcementi Finance S.A. syndicated line of credit, 

Italcementi S.p.A. obtained from Italcementi Finance S.A. a five-year 220 million euro renewable line of credit. 

No drawings had been made on the line at December 31, 2011; 

f) As a result of the Moody’s rating downgrade on December 15, 2011, the intercompany loans granted by 

Italcementi Finance S.A. to Italcementi S.p.A. for a total amount of 210 million euro will be subject to the 

applicable interest-rate increase of 125 basis points, in compliance with the step-up clause of the 750 million 

euro bond issued by Italcementi Finance S.A.. 

272






19.2 Management of liquidity, credit and counterparty risks 

19.2.1 Liquidity risk 

Italcementi S.p.A. cash and cash equivalents at December 31, 2011 were immaterial. 

The company’s objective is to maintain a debt level able to ensure a balance between average debt maturity, 

flexibility and diversification of sources. Consequently, it arranges confirmed lines of credit and diversified 

sources of finance. Distribution of loan maturities is balanced, and will enable the company to refinance its 

borrowings as they fall due in a satisfactory manner, despite the difficult economic scenario. 

The company’s policy is designed to ensure that at any time debt maturing in under two years is less than or 

equal to undrawn confirmed lines of credit. 

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 intercompany loans, arranged at arm’s 

length conditions. 

The tables below compare net debt (excluding the fair value of derivatives and financial assets) by maturity 

with available lines of credit at the end of each period: 

At December 31, 2011 (*) : 

Maturity 

less than 

1 year 

Maturity 

1 to 2 

years 


Non-current financial liabilities 333,698 229,800 189 190 268,191 832,068 

Other current financial liabilities 413,555 413,555 


Cash and cash equivalents (479) (479) 

Total 484,492 333,698 229,800 189 190 268,191 1,316,560 

end 2012 end 2013 end 2014 end 2015 end 2016 

Confirmed available lines of credit 765,000 740,000 420,000 50,000 


Maturity 

2 to 3 

years 

Maturity 

3 to 4 

years 

Maturity 

4 to 5 

years 

Maturity 

more than 

5 years 

Total 

At December 31, 2010 (*) : 


Maturity 

less than 

1 year 

Maturity 

1 to 2 

years 

Maturity 

2 to 3 

years 

Maturity 

3 to 4 

years 

Maturity 

4 to 5 

years 

Maturity 

more than 

5 years 

Non-current financial liabilities 333,030 325,199 149,650 189 268,156 1,076,224 

Other current financial liabilities 119,028 119,028 


Cash and cash equivalents (946) (946) 

Total 188,628 333,030 325,199 149,650 189 268,156 1,264,852 

end 2011 end 2012 end 2013 end 2014 end 2015 

Confirmed available lines of credit 795,000 795,000 770,000 370,000 


Total 

273 


At December 31, 2011, the average maturity of Italcementi S.p.A. gross debt was 3 years. 

At December 31, 2011, Italcementi S.p.A. had 1,345 million euro of confirmed lines of credit, of which 765 

million euro undrawn and immediately available (1,295 and 795 million euro respectively at December 31, 

2010). 

19.2.2 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 at the year end. 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, 2011, lines of credit and loans subject to covenants accounted for 12% of total drawings 

represented by gross debt (1,317 million euro at December 31, 2011, excluding the fair value effects of 

derivatives). 

At December 31, 2011, the company complied with all contractual commitments; covenant-related financial 

ratios were well within the contractual limits agreed by 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. 

19.2.3 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 customerbalance 

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 amounts normally provided for uncollectible and doubtful receivables. 

19.2.4 Counterparty risk 

Currency 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 counterparts are in Western Europe or in the USA. 

At December 31, 2011, Italcementi S.p.A.’s credit exposure (intragroup current accounts) to the Calcestruzzi 

group, standing at 212.5 million euro, did not present risk in excess of that already contemplated in testing 

Italcementi’s interest in the Calcestruzzi group for impairment. 

274






19.3 Financial assets and liabilities 

The table below sets out the carrying amount and fair value of financial assets and liabilities at December 31, 

2011: 




Fair value Carrying 

amount 

Fair value Carrying 

amount 

Financial assets 

Cash and cash equivalents 479 479 946 946 

Derivatives 1,537 1,538 761 761 

Trade receivables 276,999 276,999 220,693 220,693 

Other equity investments 5,731 5,731 5,802 5,802 

Other financial assets 490,297 489,496 530,372 530,372 

To tal 775,043 774,243 758,574 758,574 

Trade payables 142,637 142,637 132,472 132,472 

Derivatives 12,592 12,592 11,176 11,176 

Finance lease payables 8,518 8,518 8,284 8,284 

Floating-rate financial liabilities 985,755 985,755 967,367 967,367 

Fixed-rate financial liabilities 107,936 100,443 100,257 100,574 

Amounts due to banks 146,416 146,416 135,546 135,546 

Other short-term financing 75,908 75,908 54,028 54,028 

To tal 1,479,762 1,472,269 1,409,130 1,409,447 

Trade receivables and payables are current assets and liabilities and are carried at amounts that are 

reasonable approximations of their fair value. 

Derivatives are measured and recognized at fair value. The fair value of interest-rate contracts is determined 

on the present value of cash flows using the zero coupon curve. 

The fair value of forward currency purchase contracts is based on the current exchange rates of contracts with 

similar maturity profiles. 

The fair value of foreign currency payables and receivables is determined using closing rates. The fair value of 

fixed-rate payables and receivables is based on a fixed rate with no credit margin, net of transaction costs 

directly related to the financial asset or liability. Other short-term financing includes financial liabilities and 

current account amounts due to Group companies for 75,908 thousand euro. 

275 


19.3.1 Fair value of derivatives 

The table shows the fair value of financial instruments reflected in the statement of financial position, 

subdivided by type of hedge: 


(in thousands of euro) Assets Liabilities Assets Liabilities 

Interest-rate derivatives hedging cash flows - 1,989 - 2,596 

Trading interest-rate derivatives - - - - 

Exchange-rate derivatives hedging cash flows 1,520 - 678 571 

Exchange-rate derivatives hedging fair value 17 - - - 

Trading exchange-rate derivatives - - - 172 

Total short-term 1,537 1,989 678 3,339 

Interest-rate derivatives hedging cash flows 10,604 83 7,837 

Total medium/long-term - 10,604 83 7,837 

Italcementi S.p.A. does not set up hedges on sales and purchases of shares. 

Derivatives on trading exchange rates and interest rates refer to assets that do not qualify for recognition with 

hedge accounting criteria. 

The fair value of derivatives relating to EUA and CER transactions was 1,910 thousand euro at December 31, 

2011, of which -28,364 thousand euro reflected under “Other current liabilities”, 31,412 thousand euro under 

“Other current assets”, -16,541 thousand euro under “Other non-current liabilities” and 15,403 thousand euro 

under “Other non-current assets”. 

2011 derivative transactions on emission rights had an impact of –2,095 thousand euro on the income 

statement and 4,251 thousand euro on equity (OCI reserve). 

The fair value of derivatives relating to transactions on electricity at December 31, 2011, was -509 thousand 

euro, reflected under “Other current liabilities” for -814 thousand euro and “Other current assets” for 305 

thousand euro. 

2011 derivative transactions on electricity had an impact of–46 thousand euro on the income statement and - 

463 thousand euro on equity (OCI reserve). 

The fair value of derivatives relating to transactions on tin(II) sulfate at December 31, 2011, was -18 thousand 

euro, reflected entirely under “Other current liabilities”. 

2011 derivative transactions on tin(II) sulfate had an impact of -18 thousand euro on equity (OCI reserve). 

19.3.2 Fair value – hierarchy 

In determining and documenting the fair value of financial instruments, the company uses the following 

hierarchy based on different measurement methods: 

level 1: financial instruments with prices quoted on active markets; 

level 2: prices quoted on active markets for similar financial instruments, or fair value determined with other 

measurement methods where all significant inputs are based on observable market data; 

level 3: fair value determined with measurement methods where no significant input is based on observable 

market data. 

276






At December 31, 2011, financial instruments stated at fair value were subdivided as follows: 

December 31, Level 1 Level 2 Level 3 



Derivatives - assets 1,537 1,537 

Other equity investments 6,019 6,019 

Derivatives - liabilities 12,593 12,593 

19.4 Interest-rate risk management 

The company interest-rate risk management policy is designed to minimize the cost of net financial liabilities 

and reduce exposure to fluctuation risks. It hedges two types of risk: 

1. the risk of variations in the market value of fixed-rate borrowing and lending transactions. Group fixed-rate 

debt is exposed to an “opportunity cost” risk in the event of a fall in interest rates. A change in interest rates 

will affect the market value of fixed-rate assets and liabilities and impact the consolidated profit or loss in the 

event of liquidation or early repayment of these instruments; 

2. the risk linked to future flows arising from floating-rate borrowing and lending transactions. A change in 

interest rates will have a negligible impact on the market value of floating-rate financial assets and liabilities 

but will affect finance costs and, consequently, future profits. 

The Group manages this dual risk as part of its general policy, performance targets and risk reduction targets 

by giving priority to hedges on future flows over the short- and medium-term, within the specified limits. 

It hedges interest-rate risks mainly by arranging interest-rate swaps and interest-rate options with top-ranking 

banks. Exposure in derivatives may never exceed the value of the underlying. 

277 


19.4.1 Interest-rate risk hedging 

The table below sets out the notional value of interest-rate derivatives by maturity: 

Maturity 

less than 

1 year 

Maturity 

1 to 2 

years 

Maturity 

2 to 5 

years 

Maturity 

more than 

5 years 


Cash flow hedges SWAPS 

pays Fixed / receives Floating 

400 M€ Euribor 3M 2.073% 100.0 125.0 175.0 - 400.0 

100 M€ Euribor 6M 2.696% 25.0 25.0 50.0 - 100.0 

Cash flow hedges Options 120.0 - - 120.0 

Total 245.0 150.0 225.0 - 620.0 

Total 

19.4.2 Exposure to interest-rate risk 

At December 31, 2011, 86% of Italcementi S.p.A. net debt (not including the fair value of derivatives) was at a 

fixed rate or hedged against the risk of rate increases. 84% of fixed-rate commitments arose from swapped 

contracts initially arranged at floating rates. 

Hedges are stated at nominal value for the period in question (consistently with instrument maturity) and do 

not include fixed-rate to fixed-rate contracts. 

19.4.3 Net debt at inception and after interest-rate hedging 

The evolution of net debt at December 31, 2011, is illustrated in the table below: 

12.31.2011 Maturity 

less than 

Maturity 

1 to 2 

Maturity 

2 to 5 

Maturity 

more than 


1 year years years 5 years 

Fixed-rate financial liabilities 100.5 0.2 0.2 0.6 99.5 

Fixed-rate financial assets (8.5) 0.0 0.0 0.0 (8.5) 

Floating- to fixed-rate hedges 500.0 125.0 150.0 225.0 0.0 

Fixed-rate ND after hedging 592.0 125.2 150.2 225.6 91.0 

Floating-rate financial liabilities 1,216.5 484.8 333.5 229.5 168.7 

Floating-rate financial assets (480.6) (380.6) - (100.0) - 

Floating-rate ND at inception 735.9 104.2 333.5 129.5 168.7 

Floating- to fixed-rate hedges (500.0) (125.0) (150.0) (225.0) - 

Optional hedges (120.0) (120.0) 0.0 - - 

Floating-rate ND after hedging 115.9 (140.8) 183.5 (95.5) 168.7 

Optional hedges 120.0 120.0 0.0 0.0 - 

Fair value of derivatives, net 11.1 0.5 2.4 8.2 

Total ND 838.9 104.9 336.1 138.3 259.7 

At December 31, 2011, a +0.5% change in the interest-rate curve would have had an impact of -0.6 million 

euro, that is, 1.8% of 2011 net finance costs. The impact on interest-rate derivatives in portfolio would be +5.7 

million euro on equity and immaterial on profit before tax. 

At December 31, 2011, a -0.5% change in the interest-rate curve would have had an impact of +0.6 million 

euro, that is 1.8% of 2011 net finance costs. The impact on interest-rate derivatives in portfolio would be -5.8 

million euro on equity and immaterial on profit before tax. 

19.5 Management of currency risk 

278






The company is structurally exposed to currency risks mainly on US dollar solid fuel purchases. 

The company hedges exposure to the currency risk with forward currency purchase contracts, as well as call 

and put options on exchange rates.These hedges are arranged with leading banks. 

19.5.1. Exposure to currency risk 

Foreign currency exposure refers largely to US dollars for solid fuel purchases. 

At December 31, 2011, a 10% rise in the US dollar against the euro would have had an impact on exchangerate 

derivatives in portfolio of +3.2 million euro on equity and an immaterial impact on profit before tax. 

At December 31, 2011, a 10% decrease in the US dollar against the euro would have had an impact on 

exchange-rate derivatives in portfolio of -3.2 million euro on equity and an immaterial impact on profit before 

tax. 

19.5.2 Currency risk hedges 

Currency hedges stated at the closing rates are illustrated below: 


Forward purchases 

Cash flow hedges US dollars 32.5 19.0 

Fair value hedges US dollars 1.4 

Total 33.9 19.0 

Options 

Cash flow hedges US dollars - 17.0 

Trading US dollars - 7.5 

Total - 24.5 

Exchange-rate derivatives at December 31, 2011, expire within 12 months 

19.6 Management of commodity risk 

CO 2 

Italcementi S.p.A. is exposed to market fluctuations on CO 2 emission rights prices, in connection with its 

surplus or deficit on the quotas allocated by its national government. 

From 2008 to 2011, Italcementi S.p.A. transacted forward EUA-CER swaps (forward EUA sales and forward 

CER purchases) distributed in the period 2009-2013, to diversify and optimize its CO 2 emission rights portfolio. 

Furthermore, in 2010 and 2011, Italcementi S.p.A arranged price risk hedges with respect to the sales of 

surplus emission rights planned in the fourth quarter of 2010 for 2011 and 2012. 

In 2011, in view of the surplus accumulated and the macroeconomic and industry scenario, Italcementi S.p.A. 

sold EUAs on the spot market for 28.0 million euro (18.4 million euro in 2010). 

In 2010 and 2011 Italcementi S.p.A. also operated on the spot and forward markets on behalf of the Group’s 

other European companies under an agency basis. 

279 


ELECTRICITY 

In 2011, Italcementi S.p.A. arranged price risk hedges on electric power purchases for 2011 and 2012. 

TIN (II) SULFATE 

In 2011, Italcementi S.p.A. arranged a modest volume of price risk hedges on tin(II) sulfate purchases for 2011 

and 2012. 

19.7 Management of equity risk 

Italcementi S.p.A. is exposed to market fluctuations on listed shares held in portfolio recognized under “Other 

equity investments”. Treasury shares held by Italcementi S.p.A. are measured at cost and deducted against 

equity under the “Treasury shares” reserve (see note 14). 

The risk of fluctuations in the value of these equity investments is not actively managed with financial hedging 

instruments. 

19.8 Hedge Accounting 

The effects arising from application of hedge accounting rules are summarized below. 

The specific equity reserve reflects fair value gains and losses on the effective component of cash flow hedges 

only. 

New derivatives recognized in equity totaled +344 thousand euro at December 31, 2011 (-1,796 thousand 

euro at December 31, 2010). The eliminated portion of the reserve relating to instruments that expired in 2011 

amounted to +9,858 thousand euro at December 31, 2011, compared with +19,452 thousand euro at 

December 31, 2010. The changes in equity relating to derivatives traded in 2010 and still in portfolio at 

December 31, 2011, amounted to -7,305 thousand euro (-14,694 thousand euro at December 31, 2010). 

The non-effective component of cash flow hedges in portfolio at December 31, 2011, recognized in profit or 

loss was immaterial in both 2011 and 2010. 

280






20. Trade payables 


Suppliers 114,287 109,933 4,354 

Group companies 28,350 22,539 5,811 

Total 142,637 132,472 10,165 

Details on payables due to Group companies are provided in the specific section on related parties. 



Amounts due to employees 15,330 20,618 ( 5,288) 

Amounts due to social security authorities 9,103 8,774 329 

Amounts due to tax authorities for VAT and withholdings 5,116 3,547 1,569 

Other amounts due 18,317 18,243 74 

Derivatives 30,353 3,339 27,014 

Accruals and deferred income 937 1,346 ( 409) 

Total 79,156 55,867 23,289 

“Accruals and deferred income” include grants related to assets to be posted to the income statement in future 

years in relation to amortization for 398 thousand euro. 


The company has provided guarantees for 2,284,773 thousand euro in the almost exclusive interest of Group 

companies for commitments to banks. The amount includes 2,244,312 thousand euro relating to guarantees 

issued to the subsidiary Italcementi Finance S.A. for the arrangement of new lines of credit and the bond loan. 

Contracts and orders issued for investments in property, plant and machinery at December 31, 2011, were as 

follows: 

(in thousands of euro) 12.31.2011 

under 1 year 1 to 5 years over 5 years 

Commitments for purchases of property, plant and 

equipment 18,910 18,910 - - 

281 



23. Revenue 

Revenue from sales and services totaled 613,793 thousand euro as follows: 

2011 2010 Change % change 


Sale of finished and semi-finished products 538,469 555,039 ( 16,570) -3.0 

Resale of products 18,926 22,350 ( 3,424) -15.3 

Revenue from services 56,397 36,697 19,700 53.7 

Total 613,792 614,086 ( 294) -0.0 

The company’s revenue arises almost entirely in Italy. 

2011 revenue includes revenue on operations with Group companies for 159,666 thousand euro: sales of 

products, staff transfers, as well as the provision of technical and administrative services under the existing 

contract (details at note 32 “Related parties”). 

24. Other revenue 

Other revenue totaled 32,255 thousand euro (27,459 thousand euro for 2010) and includes rental income and 

other income on assets for 5,915 thousand euro, recharges to subsidiaries of IT costs and services relating to 

Group organizational projects for 3,745 thousand euro, income for interruptibility of electricity supplies for 

19,870 thousand euro and other income for 2,725 thousand euro. 


Raw materials and supplies of 341,433 thousand euro were as follows: 



Raw materials and semi-finished goods 64,260 66,876 ( 2,616) -3.9 

Fuel 109,319 108,400 919 0.8 

Packaging, materials and machinery 39,223 34,298 4,925 14.4 

Finished goods 13,871 18,746 ( 4,875) -26.0 

Electricity, water and gas 111,332 122,590 ( 11,258) -9.2 

Change in inventories of raw materials, consumables, other 3,428 4,600 ( 1,172) -25.5 

Total 341,433 355,510 ( 14,077) -4.0 

282






26. Services 

Services totaled 176,110 thousand euro, as follows: 



External services and maintenance 58,779 58,452 327 0.6 

Transport 51,679 56,941 ( 5,262) -9.2 

Legal fees and consultancy 14,173 16,394 ( 2,221) -13.5 

Rents 7,314 8,461 ( 1,147) -13.6 

Insurance 2,216 2,154 62 2.9 

Other 41,949 34,090 7,859 23.1 

Total 176,110 176,492 ( 382) -0.2 

“Other” includes recharges for staff and intra-group services for 56,109 thousand euro. 


Employee expense totaled 176,412 thousand euro, as follows: 



Wages and salaries 109,863 110,027 ( 164) -0.1 

Social security contributions and pension fund provisions 43,282 43,267 15 0.0 

Cost of stock option plans ( 505) 713 ( 1,218) n.s. 

Other costs 23,772 22,605 1,167 5.2 

Total 176,412 176,612 ( 200) -0.1 

“Other costs” refer to directors’ remuneration and expense relating to staff such as the canteen service, 

insurance, travel expenses and training. 


Italcementi defined contribution plans relate to pension and medical assistance plans, with similar treatment 

given to the post-employment benefits paid to supplementary funds and to the fund for post-employment 

benefits paid to private-sector employees managed by the INPS national insurance board. The total cost 

recorded under employee expense was 8,750 thousand euro. 

The number of employees is set out below: 

(unità) 2011 2010 

Numero dipendenti alla fine del periodo 2.511 2.657 

Numero medio dipendenti 2.616 2.741 

283 


Stock options 

The company has set up stock option plans for directors and managers who have particular roles in the 

Group. 

Stock options refer to ordinary shares; the features of the plans are described in the Directors’ report in the 

sections on Corporate Governance and Stock option plans. The exercise of options is on a 1:1 basis. 

The terms and conditions of Italcementi S.p.A. stock option plans at December 31, 2011, were as follows: 

Grant date 

No. options 

granted 

Exercise period 

Options 

exercised 

Options 

cancelled 

Unexercised 

options 

Subscription price 

per share 

March 7, 2003 965,945 1.1.2006 - 12.31.2012 924,820 - 41,125 € 

8.627 

March 17, 2005 1,053,600 3.17.2008 - 3.16.2015 6,475 28,900 1,018,225 € 

13.387 

March 7, 2006 631,403 3.7.2009 - 3.6.2016 4,187 50,325 576,891 € 

16.890 

March 7, 2007 1,020,200 3.7.2010 - 3.6.2017 - 49,525 970,675 € 

23.049 

June 20, 2007 701,250 6.20.2010 - 6.19.2015 - 701,250 - € 

23.706 

March 26, 2008 623,300 3.26.2011 - 3.25.2018 - - 623,300 € 

12.804 

June 4, 2008 1,564,750 6.4.2011 - 6.3.2018 - - 1,564,750 € 

13.355 

Total 6,560,448 935,482 830,000 4,794,966 

With reference to the stock option plan for senior managers granted on June 4, 2008, at the Board meeting of 

March 4, 2011, the directors assessed the performance targets assigned at inception, which provided for a 

maximum grant of 2,000,000 options. The targets achieved led to a grant of a total of 1,564,750 options; the 

difference with respect to the maximum number of 2,000,000 generated a reduction in the plan value of 1,709 

thousand euro, with a gain of 611 thousand euro on the 2011 income statement. 

The grant date is the date of the Board of Directors’ meeting that approved the stock option plan. 

The average residual life of unexercised options is approximately 2 years and 7 months. 

The number and average exercise price of options in the periods in question are set out below: 

number of 

options 


number of options 

average 

subscription 

price 

average 

subscription 

price 

Unexercised options at start of year 5,230,216 € 15.447 6,280,216 € 16.828 

Cancelled during the period ( 435,250) ( 1,050,000) 

Unexercised options at end of year 4,794,966 € 15.637 5,230,216 € 15.447 

Vested options at end of year 4,794,966 2,606,916 

During 2011 no options were exercised. 

The average ordinary share price in financial year 2011 was 5.9 euro (7.2 euro in 2010). 

The option exercise price at December 31, 2011, was between 8.627 euro and 23.049 euro. 

Only options granted after November 7, 2002, that had not vested at December 31, 2003, were measured and 

recognized at the date of transition to the IFRS. 

The following table sets out the details of all the company’s stock option plans and their cost, carried under 

“employee expense”: 

284







Grant date 

No. options 

granted 

Employee expense 

Vesting period 2011 2010 

March 7, 2007 796,443 3 years - 273 

June 20, 2007 701,250 3 years - ( 1,407) 

March 26, 2008 520,840 3 years 105 463 

June 4, 2008 620,750 3 years ( 611) 1,384 

Total 2,639,283 ( 506) 713 

Stock option plan fair value at the grant date is estimated using a binomial model that takes dividends into 

account. The total option term is ten years. Volatility projections assume that past volatility, determined as the 

annual average for the past period net of extraordinary events, is indicative of future trends. 

No other stock option plan feature is taken into consideration when measuring fair value. 


Other operating income, net of expense, amounted to 43,941 thousand euro, as follows: 

(in thousands of euro) 2011 2010 Change % change 

Other taxes 4,415 4,586 ( 171) -3.7 

Losses and provision for bad debts 7,726 2,542 5,184 n.s. 

Provision for environmental restoration, quarries, other 978 1,413 ( 435) -30.8 

Miscellaneous expense 5,581 5,656 ( 75) -1.3 

Miscellaneous income ( 62,641) ( 27,112) ( 35,529) n.s. 

Total ( 43,941) ( 12,915) ( 31,026) n.s. 


“Miscellaneous income” included net income on the sale of CO 2 emission rights for 27,999 thousand euro, 

discounted income from the reimbursement of “new entry” CO 2 quotas recognized for 2008-2012 for 18,984 

thousand euro, income from the allocation of white certificates for 8,030 thousand euro and amounts for the 

use of alternative fuels for 3,237 thousand euro. 


Non-recurring income, net of non-recurring expense, amounted to 8,239 thousand euro (3,101 thousand euro 

in 2010) and refers to net gains from the sale of assets for 16,337 thousand euro, of which 12,440 thousand 

euro from disposals of property, and to net expense for reorganizations for 8,098 thousand euro. 

285 



Finance income, net of finance costs, amounted to 109,819 thousand euro, as follows: 


(in thousands of euro) Income Costs Income Costs 

Interest income 8,026 5,046 

Interest expense (39,415) (37,626) 

Subtotal 8,026 (39,415) 5,046 (37,626) 

Net interest in respect of net financial position - (31,389) - (32,580) 

Dividends and other income from equity investments 151,256 122,883 

Other finance income 43,206 7,237 

Capitalized finance costs - 1,029 

Other finance costs (52,177) (20,514) 

Total finance income (costs) 202,488 (91,592) 135,166 (57,111) 

Gains/(losses) on interest-rate derivatives 125 (196) 

Gains/(losses) on exchange-rate derivatives 135 (535) 

Net exchange-rate differences (1,337) 1,456 

Exchange-rate differences and derivatives (1,077) 725 

Total finance income (costs), exchange-rate differences and derivatives 109,819 78,780 

Net interest in respect of net debt totaled 31,389 thousand euro in 2011 compared to 32,580 thousand euro in 

2010, a decrease of 1,191 thousand euro. 


Income tax reflected income of 24,074 thousand euro, as follows: 

2011 2010 Change 


Current tax ( 10,767) ( 36,743) 25,976 

Deferred tax ( 12,603) ( 9,824) ( 2,779) 

Prior-year tax 96 ( 8,812) 8,908 

Surpluses in allocation to provision for tax ( 800) - ( 800) 

Total ( 24,074) ( 55,379) 31,305 

286






The reconciliation between the theoretical tax charge and the effective tax charge reflected on the income 

statement is set out below: 

Ires Irap Total 


Loss before tax (a) ( 17,072) ( 17,072) 

Difference in the taxable base between IRES and IRAP (b) 58,221 

(c) = (a+/-b) ( 17,072) 41,149 

Applicable tax rate (%) (d) 27.50 3.90 31.40 

Theoretical tax charge (e) = (d) x (c) ( 4,695) 1,605 ( 3,090) 

Tax effect on permanent differences: 

(f) 

- foreign dividends and other exempt income ( 40,202) ( 552) ( 40,754) 

- non-deductible costs 19,682 808 20,490 

Net effect for the year of unrecognized deferred taxes on 

temporary differences (g) 12,440 40 12,480 

Advantage from participation in tax consolidation (h) ( 12,462) - ( 12,462) 

Effective tax charge (i) = da (e) a (h) ( 25,237) 1,901 ( 23,336) 

Effective tax rate (%) 147.83 4.62 152.45 

Other tax items not related to the loss for the year (j) ( 738) 

Effective tax charge reflected in income statement 

for 2011 (l) = (j) + (j) 

( 24,074) 


Data relating to transactions with related parties and their impact on the company’s financial position and 

results of operations are set out in the following tables: 

287 


Breakdown of receivables and payables with related parties 


Description Company Amount % impact on 

financial 

statements 

items 

Carrying 

amounts 

Reference 

Trade receivables Ciments Français S.A. 37,487 

Calcestruzzi S.p.A. 26,757 

S.Francesco s.c.a.r.l. 3,412 

Italgen S.p.A. 2,068 

Ciments du Maroc S.A. 1,930 

C.T.G. S.p.A. 1,708 

Ciments Calcia S.A. 1,595 

Essroc Corporation 1,334 

Vassiliko Cements Works Ltd 1,200 

Intercom S.r.l. 851 

Helwan Cement Co. 738 

Suez Cement 640 

Other companies 3,174 

Other related parties 53 

Total trade receivables 82,947 29.9% 276,999 Note 7 

Current account receivables and 

other financial assets 


Cementificio di Montalto S.p.A. 85,451 

International City for Ready Mix Co. 

Loan 19,226 

Nuova Sacelit S.r.l. 17,071 

Calcementi Jonici S.r.l. 13,039 

Intercom S.r.l. 10,684 

Bravosolution S.p.A. 

Debenture loan 3,799 

Bravosolution S.p.A. 2,130 

Ing. Sala S.p.A. 4,562 

C.T.G. S.p.A. 2,912 

Other companies 256 

Total current financial assets 375,470 99.9% 375,758 Note 10 

Other assets Ciments Calcia S.A. 5,070 

Devnya Cement AD 1,685 

Italcementi Finance S.A. 1,253 

Sociedad Financiera Y Minera S.A. 1,029 


Total other current assets 10,024 13.4% 74,570 Note 8 

Other non-current assets 

Ciments Français S.A. 

Loan 100,000 

Italmobiliare S.p.A. 

Receivables for tax consolidation 72,794 

Italcementi Finance S.A. 

Debenture loan 8,551 

Ciments Calcia S.A. 3,443 



Total other non-current assets 187,189 93.3% 200,708 Note 5 

288






(Breakdown of receivables and payables with related parties – cont.) 


Description Company Amount % impact on 

financial 

statements 

items 

Carrying 

amounts 

Reference 

Trade payables Ciments Français S.A. ( 6,923) 

Gruppo Italsfusi S.r.l. ( 6,214) 

Italmobiliare S.p.A. ( 4,544) 

C.T.G. S.p.A. ( 4,392) 

Italgen S.p.A. ( 1,199) 

BravoSolution S.p.A. ( 992) 

Interbulk Trading S.A. ( 916) 

Cementificio di Montalto S.p.A. ( 893) 

Intercom S.r.l. ( 449) 

Other companies ( 1,828) 

Other related parties ( 114) 

Total trade payables ( 28,464) 20.0% 142,637 Note 20 

Current account payables and other Italcementi Finance S.A. 

financial liabilities 

Loan ( 45,324) 

Silos Granari della Sicilia S.r.l. ( 9,463) 

Italcementi Ingegneria S.r.l. ( 5,253) 

SAMA S.r.l. ( 5,175) 

Gruppo Italsfusi S.r.l. ( 3,335) 

Esa Monviso S.p.A. ( 3,268) 

Aliserio S.r.l. ( 1,981) 

Italgen S.p.A. ( 1,371) 

Other companies ( 738) 

Total current financial liabilities ( 75,908) 22.4% 338,555 Note 19 

Italcementi Finance S.A. 

Loan ( 208,882) 

Total non-current financial liabilities ( 208,882) 25.1% 832,068 Note 19 

Other liabilities Ciments Calcia S.A. ( 6,180) 

Devnya Cement AD ( 4,782) 

Sociedad Financiera Y Minera S.A. ( 1,458) 

Compagnie des Ciments Belges ( 934) 

Vulkan Ead ( 822) 


Other related parties ( 50) 

Total other current liabilities ( 14,595) 18.4% 79,156 Note 21 

Other non-current liabilities Ciments Calcia S.A. ( 2,827) 

Devnya Cement AD ( 926) 

Compagnie des Ciments Belges ( 275) 

Sociedad Financiera Y Minera S.A. ( 573) 


Total other non-current liabilties ( 4,799) 17.7% 27,145 Note 19 

289 


Commitments with related parties 


Description Company Amount 

Guarantees provided to Group 

companies Italcementi Finance S.A. ( 2,244,312) 

Interbulk Trading ( 16,000) 

Bravosolution US ( 6,183) 

Medcem S.r.l. ( 3,000) 

Eurotech Cement Shpk ( 2,500) 

Shqiperia Cement Company Shpk ( 2,500) 

Calcementi Jonici S.r.l. ( 2,833) 

Italgen S.r.l. ( 3,957) 

Bravobuild Espana S.a.s. ( 283) 


Total commitments ( 2,281,573) 

290






Breakdown of revenue and costs with related parties 


Description Company Notes Amount % impact on 

financial 

statements items 

Carrying 

amounts 

Reference 

Sales of finished and semifinished 

products, raw materials 

and supplies Calcestruzzi S.p.A. 76,727 


San Francesco S.c.a.r.l. 6,899 

Intercom S.r.l. 6,322 

Cementi della Lucania S.p.A. 3,229 

Calcementi Jonici S.r.l. 1,559 


Interbulk Trading S.A. 301 


Total sales of goods 103,951 16.9% 613,792 Note 23 

Revenue for staff services 

and technical administrative 

services 

Ciments Francais S.A. 

employee recharges 

and Group structures 42,384 


C.T.G. S.p.A. 2,968 

Essroc Corporation 1,412 


Vassiliko Cement Works Ltd technical assistance 600 

Devnia Cement AD 452 

Ciments Calcia S.A. 369 

Axim Italia S.r.l. 338 

Italmobiliare S.p.A. 297 

Helwan Cement 256 

Bravosolution S.p.A. 207 

Silos Granari della Sicilia S.r.l. 187 

Cementificio di Montalto S.p.A. 165 

Sociedad Financiera Y Minera S.A. 148 



Total revenue for services 55,893 9.1% 613,792 Note 23 

291 


(Breakdown of revenue and costs with related parties – following) 



financial 


Carrying 

amounts 

Reference 

Other revenue Ciments Français S.A. recharges of SW 

licenses- 

SW maintenance, 

development of 

Group projects 3,412 

C.T.G. S.p.A. 

lease fee and income 

for company branch 

2,819 

Calcestruzzi S.p.A. 857 

Al Badia Cement JSC 696 

Axim Italia S.r.l. 120 



Total other revenue 8,516 26.4% 32,255 Note 24 

Other income Other companies 11 

Other expense Other companies ( 53) 

Other related parties 

payments to Fondazione 

Italcementi and other 

expense ( 600) 

Total other operating expense ( 642) -1.5% 43,941 Note 28 

Net gains from the sale of 

assets Various companies 32 

Total net gains from the sale of assets 32 0.2% 16,337 Note 29 

292






(Breakdown of revenue and costs with related parties – cont.) 



financial 


Carrying 

amounts 

Reference 

Dividends and other income 

from equity investments Ciments Français S.A. 133,957 


S.I.I.L. SA 3,096 

Cementi e Calci S. Marinella S.r.l. 2,334 

Axim Italia S.r.l. 1,299 

C.T.G. S.p.A. 850 

Silos Granari della Sicilia S.r.l. 706 

Gruppo Italsfusi S.r.l. 288 

Total dividends and other income from equity investments 148,524 98.2% 151,256 Note 30 

Interest income on 

intragroup accounts Calcestruzzi S.p.A. 3,389 

Ciments Français S.A. 1,590 


International City for Ready Mix 280 

Italgen S.p.A. 244 

Nuova Sacelit S.r.l. 230 

Intercom S.r.l. 199 

Calcementi Jonici S.r.l. 195 

Axim S.p.A. 146 

BravoSolution S.p.A. 111 


Total interest income 7,956 99.1% 8,026 Note 30 

Fees on guarantees and 

commodity derivatives Ciments Calcia S.A. 8,958 


Sociedad Financiera Y Minera 1,815 

Compagnie des Ciments Belges 957 

Vulkan Ead 624 

Italcementi Finance S.A. 302 

Halyps Building Mat. S.A. 199 


Other finance income 16,013 37.1% 43,206 Note 30 

293 





fiancial 


Carrying 

amounts 

Reference 

Raw materials, fuel, semifinished 

and finished products 

and 

electricity consumption Interbulk Trading S.A. clinker and fuel ( 57,393) 

Intercom S.r.l. clinker ( 21,675) 

Italgen S.p.A. 

electricity 

consumption 

( 12,966) 

Cementificio di Montalto S.p.A. products ( 11,385) 

Axim Italia S.r.l. additives ( 2,442) 

SAMA S.r.l. limestone ( 1,476) 

Medcem S.r.l. 

transfer of cement and 

clinker ( 608) 

Socli S.A. hydraulic lime ( 600) 

Gruppo Italsfusi S.r.l. transfer of clinker ( 600) 


Total goods and utilities expense ( 109,867) 32.2% 341,433 Note 25 

Services Gruppo Italsfusi S.r.l. transport on sales ( 33,718) 

C.T.G. S.p.A. 

specific projects, 

technical assistance 

and research (net 

of capitalized projects 

for 6,618 thousand 

euro) 

( 8,620) 

Ciments Francais S.A. recharge of 

employees and Group 

structures ( 7,262) 

BravoSolution S.p.A. e-commerce services ( 3,104) 

Silos Granari della Sicilia S.r.l. storage and deposit ( 1,551) 

Italmobiliare S.p.A. staff transfers ( 416) 

Italcementi Finance S.A. ( 321) 

Cementificio di Montalto S.p.A. ( 203) 

Italgen S.p.A. ( 197) 


Other related parties consultancy ( 632) 

Total services ( 56,741) 32.2% 176,109 Note 26 

Employee expense Italmobiliare S.p.A. ( 4,409) 


Total employee expense ( 4,459) 2.5% 176,412 Note 27 

294









financial 


Carrying 

amounts 

Reference 

Interest expense on 

intragroup accounts and fees 

Italcementi Finance S.A. ( 10,804) 

Silos Granari della Sicilia S.r.l. ( 107) 

SAMA S.r.l. ( 89) 

Italcementi Ingegneria S.r.l. ( 89) 

Gruppo Italsfusi S.r.l. ( 72) 

Esa Monviso S.p.A. ( 71) 

Aliserio S.r.l. ( 32) 


Total interest expense ( 11,314) 28.7% 39,415 Note 30 

Fees on guarantees and 

commodity derivatives Ciments Calcia S.A. ( 8,588) 

Devnya Cement AD ( 5,535) 

Sociedad Financiera Y Minera ( 1,945) 

Italcementi Finance S.A. ( 1,699) 

Compagnie des Ciments Belges ( 1,148) 


Halyps Building Material S.A. ( 311) 

Other finance costs ( 20,214) 38.7% 52,177 Note 30 

Other transactions with related parties 

During the year dividends were paid to the parent company Italmobiliare S.p.A. for a total of 13,169 thousand 

euro (13,169 thousand euro in 2010). 

295 


Impact of transactions with related parties on cash flows: 

Cash flows 

(in thousands of euro) Amount % 

Cash flow from operating activities with related parties 107,705 n.s. 

Total A) - from statement of cash flows 2011 36,064 

Cash flow from investing activities with related parties ( 11,405) 12.7% 

Total B) - from statement of cash flows 2011 ( 90,090) 

Cash flow from financing activities with related parties 60,871 113.7% 

Total C) - from statement of cash flows 2011 53,558 

Change in cash and cash equivalents with related parties 157,171 

Change in cash and cash equivalents on statement of cash flows (A+B+C) ( 468) 


Compensation to directors and the chief operating officer 

Compensation paid to the directors and the chief operating officer of Italcementi S.p.A. for the positions they 

covered is detailed below: 


Short-term benefits: compensation and remuneration 9,465 6,770 

Post-employment benefits: provision for leaving and end-of-term entitlements 1,260 1,257 

Other long-term benefits: length-of-service bonuses and incentives 3,624 2,410 

Share-based payments (stock options) 3 809 

Total 14,352 11,246 

296







The following tables itemize non-recurring transactions and their impact on equity, the financial position and 

results of operations 

2010 

Equity Loss for the period Net debt 

(in thousands of euro) Amount % Amount % Amount % 

Carrying amounts 1,814,316 ( 34,360) 745,762 

Net gains from the sale of noncurrent 

assets 

8,888 0.5% 8,888 -25.9% 10,009 1.3% 

Other non-recurring income 

(expense) ( 5,787) ( 5,787) - 

Taxes on non-recurring 

transactions 

( 1,021) 0.1% ( 1,021) -3.0% - 

Total 2,080 0.1% 2,080 -6.1% 10,009 1.3% 

Figurative amount without 

non-recurring transactions 1,812,236 ( 36,440) 755,771 


Equity Profit of the period Net debt 

(in thousands of euro) Amount % Amount % Amount % 

Carrying amounts 1,784,648 7,002 838,977 

Net gains from the sale of noncurrent 

assets 

16,337 0.9% 16,337 233.3% 18,279 2.2% 

Other non-recurring income 

(expense) ( 8,098) ( 8,098) - 

Taxes on non-recurring 

transactions 

( 2,721) 0.2% ( 2,721) 38.9% - 

Total 5,518 0.3% 5,518 78.8% 18,279 2.2% 

Figurative amount without 

non-recurring transactions 1,779,130 1,484 857,256 

297 



Pursuant to the CONSOB Regulation for issuers, the table below sets out fees paid to the independent 

auditors KPMG S.p.A. and to companies belonging to the KPMG network. 

KPMG S.p.A. Other italian 

companies in the 


KPMG Network 

Audit services 610 

Other attestation services 5 

Other legal, fiscal and corporate services 306 

Total 615 306 


No other events occurred after December 31, 2011, with respect to those already described out in the relevant 

section of the notes to the consolidated financial statements. 



The Chairman 


298

Annexes 

299 


Annex 1 

Highlights from the most recent financial statements of Italmobiliare S.p.A. 

(the company that exercises management control and coordination) 

(euro) 

12/31/2010 12/31/2009 


restated 

Total non-current assets 1,369,218,719 1,413,174,015 

Total current assets 160,098,195 154,142,545 

Total assets 1,529,316,914 1,567,316,560 

Equity: 

Share capital 100,166,937 100,166,937 

Reserves 235,262,353 324,577,457 

Treasury shares, at cost (21,226,190) (21,226,190) 

Retained earnings 761,492,044 843,441,182 

Total equity 1,075,695,144 1,246,959,386 

Total non-current liabilities 144,270,791 267,973,086 

Total current liabilities 309,350,979 52,384,088 

Total liabilities 453,621,770 320,357,174 

Total equity and liabilities 1,529,316,914 1,567,316,560 

Income statement 2010 2009 restated 

Revenue 67,707,046 92,179,600 

Operating expense, other operating income (expense) (32,552,799) (27,479,219) 

Recurring EBITDA 35,154,247 64,700,381 

Other non-recurring income (expense) (600,001) 3,034,058 

EBITDA 34,554,246 67,734,439 

Amortization and depreciation (119,093) (64,170) 

EBIT 34,435,153 67,670,269 

Finance costs (49,257) (22,146) 

Impairment losses on financial assets (190,472) (19,727,777) 

Profit before tax 34,195,424 47,920,346 

Income tax expense 1,041,659 4,721,851 

Profit for the period 35,237,083 52,642,197 

300

Representation form pursuant to art. 154-bis, par. 5 TUF in relation to the 

separate financial statement (pursuant to art. 81-ter of Consob Regulation n° 

11971/99, and subsequent modifications and integrations) 

1. The undersigned Carlo Pesenti, Chief Executive Officer and Carlo Bianchini, the Manager 

in charge of preparing the company’s financial reports, of Italcementi S.p.A., having also 

taken into account the provisions of Article 154-bis, paragraphs 3 and 4, of the Italian 

Legislative Decree February no. 58 of 24 February 1998, hereby certify: 

the adequacy in relation to the legal entity features and 

the effective implementation 

of the administrative and accounting procedures for the preparation of the separate financial 

statement over the course of the period from January 1 st , 2011 and December 31 st , 2011. 

2. The representation of the adequacy of the administrative and accounting procedures 

adopted in the preparation of separate financial statements as at December 31 st , 2011 is 

based on a form identified by Italcementi according to the CoSO framework (illustrated in the 

CoSO Report) and also takes into account the document “Internal Control over Financial 

Reporting – Guidance for Smaller Public Companies”, both issued by the Committee of 

Sponsoring Organizations of the Treadway Commission, representing a generally accepted 

international framework. 

3. It is also certified that: 

3.1 the separate financial statement: 

a) has been drawn up in accordance with the international accounting standards 

recognised in the European Union under the EC regulation 1606/2002 of the 

European Parliament and of the Council of 19 July 2002; 

b) is consistent with the entries in the accounting books and records; 

c) is capable of providing a true and fair representation of the assets and liabilities, 

profits and losses and financial position of the issuer and the group of companies 

included in the consolidation. 

3.2 The directors’ report includes a reliable analysis of the performance and the results of 

operations, and the overall situation of the issuer and the group of companies included 

in the consolidation, together with a description of the main risks and uncertainties they 

are exposed to. 

Signed by: Carlo Pesenti, Chief Executive Officer 

Signed by: Carlo Bianchini, Manager in Charge 

March 2 nd , 2012 

This report has been translated into the English version solely for the convenience of international 

readers 

301 


Report of the Board of Statutory Auditors under art. 153 of the Consolidated 

Law on Finance 


In compliance with the provisions set forth by Consob, we hereby refer that we carried out the supervisory 

activity we are in charge of during the fiscal year ended on December 31, 2011. Indeed, we monitored the 

compliance with the laws and the By-laws, as well as the observance of correct management principle, by 

obtaining information by the Directors concerning the activities carried out and transactions having a significant 

impact on the financial statements undertaken by the Company and its subsidiaries. 

In this regard, we can reasonably state that the mentioned transactions have been performed in compliance 

with the applicable laws and company By-laws and they did not appear clearly careless, risky, in potential 

conflict of interest or not consistent with shareholders meeting resolutions’ or such as to compromise the 

corporate assets’ integrity. 

As far as our supervisory activity is concerned, we supervised the adequacy of the organizational structure of 

the company, obtaining, to this extent, on one hand information from the executives in charge of the relevant 

functions, and on the other hand liaising on this matter with the Audit Firm during periodical meetings. In this 

connection, we have no remarks to report. 

We checked the adequacy of the instructions given by the Company to its subsidiaries under art. 114, par 2 of 

the Consolidated Law on Finance, as well as the compliance with the fulfillments under art. 36 of Regulation on 

Markets. 

We supervised the adequacy of the internal control system, the risk management and the accountingadministrative 

system, as well as its reliability in fairly representing management operations. 

To this end: 

- We periodically met the Chief Executive Officer, who is also executive director responsible for 

overseeing the internal control system, and he illustrated the activities carried out by each Department 

involved in the operation of the control system, in relation to which we report hereinbelow; 

- We reviewed the quarterly reports of the Manager in charge of preparing the company’s financial 

reports, whose contents have been in-depth examined during several meetings. We therefore obtained 

information, inter alia, on the activities undertaken in order to update the “Reference operating model 

for the assessment of the internal control system regarding the financial disclosure”, by introducing new 

procedures and adjusting those already existing; on the review of the Group accounting principles 

manual; on the periodic update of the analysis aimed at identifying processes having significant impact 

on financial reporting to be subject to operational planning; on the definition of actions to be undertaken 

as a consequence of the results of administrative and accounting audits carried out by the Internal 

control Department; 

- We examined the periodic reports prepared by the Risk Management Department, which had been 

illustrated by the manager in charge of said department during specific meetings. We therefore were in 

the position to acknowledge the scheduled actions, aimed at improving the company’s performance by 

measuring, managing and controlling previously identified main risks, and that risks mitigation 

procedures were extended to the whole Group; 

- We assessed the Audit Plan proposed by the Controller for the 2011 fiscal year, and we had been 

monitoring its progress during the year. We hereby report that the Plan had been properly executed 

and that it concerned operating procedures, IT systems, compliance issues, as well as certain audits 

302






which had not been originally scheduled; 

- We continuously liaised with the Audit Firm, and we examined the documents prepared by the latter 

concerning their action plan and its execution; 

- We attended the Internal Control Committee meetings and, anytime the items on the agenda deemed it 

appropriate, we examined them jointly the Committee; 

- We met the Compliance Committee members and, by examining their reports, we acknowledged from 

time to time the updating process of the “Organizational, Management and Control Model”, adopted by 

the company according to Legislative Decree 231/2001; 

- We liaised with supervisory bodies of the main subsidiaries and no data nor information emerged that 

we deem appropriate to highlight in this report; 

- We also met the Statutory Auditors of the parent company Italmobiliare S.p.A. in order to have a 

proficient exchange of information. 

Having recalled that the audit international standards provide for a Quality Assessment Review on the internal 

control system to be performed by independent auditors at least every five years, we hereby report that the 

company appointed the Institut de l’audit e du control internes (IFACI) to undertake such assessment. IFACI 

has recently completed its diagnostic analysis on the Department in charge of the control system and on the 

operating methods followed by the latter, and it confirmed a substantial compliance with the IIA/IFACI 

framework standards in terms of duties, organization and efficiency of such Department. 

Based on the outcome of the undertaken activities and taking into account the ascertained regularity and the 

order of the financial information flow generated within the different corporate areas, we hereby assess the 

adequacy of the internal control system in force within the Company. Such system, updated on an ongoing 

basis and, consequently, subject to a positive evolution process, significantly contributes to the Company 

efficiency and effectiveness’ improvement process and, in particular, to the risk management. 

In our capacity as Internal control and audit Committee, according to the provisions of art. 19 of the Leg. 

Decree 39/2010, we hereby confirm that there are no remarks thereupon to be reported at the shareholders’ 

meeting. 

In the execution of our supervisory activity, we did not notice unusual or atypical transactions, undertaken with 

Company’s subsidiaries or related parties or with third parties. 

With reference to infra-group transactions or ordinary transactions with related parties executed during the 

year, we noted that directors properly highlighted and illustrated in the Directors’ Report, which we refer to, the 

relevant features and the financial impact. As far as we are concerned, we acknowledge that these 

transactions have been executed in the interest of the Company and in compliance with the provided 

procedure. To this extent, we point out that, as of January 1, 2011, the “Procedures for transactions with 

related parties” according to the CONSOB Regulation of January 24, 2010 and the subsequent explanatory 

report of September 24, 2010, whose guidelines were already adopted by the Board of Directors in its meeting 

of November 5, 2010, are currently in place. 

The pending legal proceedings have been duly illustrated in the Management Report and they appear to be 

carefully defended for the purposes of protecting the company. 

We report that no criticalities emerged during meetings with the Audit Firm; this is confirmed, on one hand, by 

the Report under art. 19, third paragraph, of Legislative Decree 39/2010 which was presented by the Audit 

Firm to this Board on March 26, 2012 and which states that, in the execution of the audit activities, no 

significant lacks in the Internal control system with reference to the financial disclosure process emerged. 

303 


On the other hand, the absence of any criticalities in the internal control and accounting systems of the 

company is confirmed also in the Audit Firm Reports on the separate and consolidated financial statements, 

dated March 26, 2012 which do not raise any remarks nor disclosure recalls. In these reports, the Audit Firm 

also confirmed consistency of directors’ reports with the respective financial statements, so assessing 

compliance, in the financial statements, with the provisions of art. 123-bis of the Consolidated Law on Finance 

and of the Consob/Isvap/Banca d’Italia joint Regulation no. 4, dated March 3 rd 2010. 

The Directors drafted the separate and consolidated financial statements in accordance, as provided for, with 

IAS/IFRS Accounting Standards, as implemented by the EU, highlighting the occurred updates, and they 

provided the information requested by the aforementioned Regulation no. 4 of March 3rd 2010 in the Directors’ 

report. 

As to the impairment test, the Directors approved criteria and methods to be followed, also confirming the 

economic data used for income forecasts if not consistent with the those included in the 2010-2014 Business 

Plan. 

We point out that Calcestruzzi S.p.A., which had been excluded from the management and coordination 

activity of the company in the recent past, was reconsolidated during 2011. 

We ascertained that the Remuneration Committee had been properly proposing guidelines (both in the merit 

and procedurally) concerning the definition and execution of the company’s remuneration policy; said 

guidelines are included in the Remuneration Report, approved by the Board of Directors, and to be submitted 

to the Shareholders’ meeting under art. 123-ter of Consolidated Law on Finance. 

The Company’s compliance with the Corporate Governance Code, drafted by the Corporate Governance 

Committee of listed companies, is illustrated in the appropriate section of the Directors’ report and we deem 

such illustration to be adequate and exhaustive. As far as our intervention is concerned, we assessed the 

existence of professional and independence requisites for the members of this Board and we also monitored 

the application of the self-examination procedure followed by the Board of Directors, with specific regard to the 

requisites set out for the independent directors. 

With reference to our supervisory activity concerning the Audit Firm independence requisite under art. 17, par. 

9, let a), of Legislative Decree 39/2010, we hereby acknowledge the contents of the “Transparency Report” 

updated as at December 2011 and drafted by the Audit Firm and published on its web site, and we also 

received the written statement provided by art. 17, par. 9, let a), of Legislative Decree 39/2010 on March 26, 

2012. 

Moreover, the Audit Firm informed us about its remuneration for activities other than those related to its audit 

activity and received by itself or by domestic and foreign entities belonging to its network. 

With reference to the “Principles on the Audit Firm independence” released by the National Board of 

Accountants as referred to in Consob resolution no. 15185, we note that such remuneration, reported 

hereunder (figures Euro/000), does not appear to represent any criticality impacting on the Audit Firm’s 

independence. 

Activities 

Italcementi and its 

italian subsidiaries 

Ciment Français and 

its subsidiaries 

Total 

Attestation 5 56 61 

Other 315 72 387 

Total 320 128 448 

The Board of Statutory Auditors and the Audit Firm did not issue any opinions provided by law during the fiscal 

year. 

304






No complaints under art. 2408 of the Italian Civil Code nor claims of any other nature reached this Board 

during the fiscal year. 

During our supervisory activity and based on the obtained information, we find no omissions, exceptionable 

actions, irregularities or any other material facts worth to be reported to the Supervisory Authorities or to be 

mentioned in this Report. 

The activity of this Board was conducted in no. 11 meetings, and by attending no. 6 Board of Directors’ 

meetings, no. 2 Executive Committee meetings, no. 5 Internal Control Committee meetings and no. 5 

Remuneration Committee meetings. Furthermore, as previously mentioned, we met the Comités des comptes 

of Ciments Français S.A. and the supervisory body of Italmobiliare S.p.A. 

We do not have any remarks on the approval of the financial statements as at December 31, 2011, as 

prepared by the Directors and on the dividend distribution proposal. 

Dear Shareholders, upon approval of the financial statements as at December 31, 2011 our three-year office 

shall expire. We thank you for your trust and we hereby invite you to appoint a new Board of Statutory Auditors 

in accordance with law and the By-laws. 

The Board of Statutory Auditors 

(Prof. Maria Martellini) - Chairman 

(Prof. Mario Comana) – Standing Auditor 

(Dott.ssa Luciana Gattinoni) - Standing Auditor 


305 


308

Extraordinary session 

309 


Report of the Board of Directors 

Proposed amendments to articles 5 (Share capital), 15 (Appointment of the Board of Directors), 16 

(Replacement of Directors), 26 (Appointment of the Board of Statutory Auditors) and 27 

(Replacement of statutory auditors) of the company By-Laws 


You have been called to discuss and resolve upon the proposed amendments to: 

• art. 5 of Italcementi S.p.A. by-laws (the “By-laws”) to reflect the shareholders’ resolution of last year which 

revoked the «Incentive Plan reserved to Directors of the Company and its subsidiaries vested with special 

offices in compliance with the articles of associations or who perform specific operating duties», not 

renewing the authorization to Directors to increase the share capital to serve the said Incentive Plan revoked 

by the last shareholders’ meeting, for the non-executed part, expiring in 2012, 

• art. 15, 16, 26 and 27 of the By-laws in order to comply with certain provisions introduced by Law no. 120, of 

July 12, 2011 (the “Law 120”), amending Legislative Decree 24 February 1998, no. 58 (“TUF”), regarding the 

equity of access to the administration and control bodies of listed companies. 

Art. 5 (Share capital) 

The shareholders’ meeting of June 20, 2007 granted the power to the Board of Directors, according to art. 

2443 of the Italian Civil Code, to increase the share capital against consideration, within 5 years as of the 

above mentioned resolution, for a maximum amount of Euro 3,000,000, and with the exclusion of the preemption 

right under art. 2441 of the Italian Civil Code, par. 5, to serve the Incentive plan reserved to Directors 

of the Company and subsidiaries vested with special offices in accordance with the articles of association or 

who perform specific operating duties, as approved by the shareholders during the same meeting. 

The Board of Directors meeting of March, 5, 2010, upon proposal of the Remuneration committee and having 

assessed the achievement of performance targets’ degree originally assigned, granted: 

• no. 401.250 options to the Chairman; 

• no. 300.000 options to the Chief Executive Officer. 

Both the Chairman and the Chief Executive Officer waived the granting of stock options to themselves. No 

further granting of options has been resolved by the Board of Directors. 

Following the Board of Directors’ resolution and the subsequent waiver of both the Chairman and the Chief 

Executive Officer, no further options granted under the «Stock option Plan for Directors - 2007» are 

outstanding. 

Last year’s shareholders meeting, in agreement with the proposal of the Board of Directors, resolved upon the 

revocation, for the non-executed part, of the Stock option Plan for Directors approved by the shareholders’ 

meeting of June 20,2007. 

Thus, there are no reasons to maintain in the By-laws this last paragraph whose repeal is hereby proposed. 

310




Annual Report 27 


Current text 

Article 5 

Share capital 

The share capital is EUR 282,548,942, broken down 

into 177,117,564 ordinary shares and 105,431,378 

savings shares, with a face value of EUR 1 each. 

The share capital can be increased also by means of 

assets in kind or receivables, provided that legal 

provisions are complied with. 

In the event the share capital is increased, the right 

of option can be ruled out within a limit of ten per 

cent of the pre-existing share capital, in compliance 

with legal provisions.. 

The Board of Directors is given the power so that it 

can, once or various times within the period of five 

years from the decision of the shareholders at their 

Extraordinary Meeting dated April 28, 2008: 

a) under art. 2443 of the Italian Civil Code, increase 

share capital by a maximum amount of nominal 

EUR 500,000,000, free-of-charge or by payment, 

by issuing ordinary and/or savings shares and/or 

coupons (warrants) for deferred subscribing; 

b) under art. 2420-ter of the Italian Civil Code, issue 

bonds to be converted into ordinary and/or 

savings shares or with rights of purchase and 

subscription, up to a maximum amount of EUR 

500,000,000, within the limits from time to time 

allowed by law, 

all with the widest powers connected to it, including 

those of offering the shares and convertible bonds as 

options or with a warrant under the form as per the 

penultimate clause of art. 2441 of the Italian Civil 

Code; reserve up to a quarter of them under art. 

2441 of the Italian Civil Code, last clause; define the 

provisions and reserves to enter as capital in the 

event of free-of-charge increase; define issue price, 

conversion rates, terms and modes for the execution 

of the operations. 

With a resolution dated April 19 th , 2011, the 

extraordinary shareholders’ meeting attributed to the 

Board of Directors: 

- the power, pursuant to art. 2443 Italian Civil Code, 

to increase the share capital on one or more times 

within a period of five years from the above 

resolution, for a maximum nominal amount of 

6,000,000 euro through the issue, free of charge 

and/or against consideration, of up to 6,000,000 

Proposed text 

Article 5 

Share capital 

The share capital is EUR 282,548,942, broken down 

into 177,117,564 ordinary shares and 105,431,378 

savings shares, with a face value of EUR 1 each. 

The share capital can be increased also by means of 

assets in kind or receivables, provided that legal 

provisions are complied with.. 

In the event the share capital is increased, the right 

of option can be ruled out within a limit of ten per 

cent of the pre-existing share capital, in compliance 

with legal provisions.. 

The Board of Directors is given the power so that it 

can, once or various times within the period of five 

years from the decision of the shareholders at their 

Extraordinary Meeting dated April 28, 2008: 

a) under art. 2443 of the Italian Civil Code, increase 

share capital by a maximum amount of nominal 

EUR 500,000,000, free-of-charge or by payment, 

by issuing ordinary and/or savings shares and/or 

coupons (warrants) for deferred subscribing; 

b) under art. 2420-ter of the Italian Civil Code, issue 

bonds to be converted into ordinary and/or 

savings shares or with rights of purchase and 

subscription, up to a maximum amount of EUR 

500,000,000, within the limits from time to time 

allowed by law, 

all with the widest powers connected to it, including 

those of offering the shares and convertible bonds as 

options or with a warrant under the form as per the 

penultimate clause of art. 2441 of the Italian Civil 

Code; reserve up to a quarter of them under art. 

2441 of the Italian Civil Code, last clause; define the 

provisions and reserves to enter as capital in the 

event of free-of-charge increase; define issue price, 

conversion translation rates, terms and modes for 

the execution of the operations. 

With a resolution dated April 19 th , 2011, the 

extraordinary shareholders’ meeting attributed to the 

Board of Directors: 

- the power, pursuant to art. 2443 Italian Civil Code, 

to increase the share capital on one or more times 

within a period of five years from the above 

resolution, for a maximum nominal amount of 

6,000,000 euro through the issue, free of charge 

and/or against consideration, of up to 6,000,000 

311 


Current text 

ordinary and/or savings shares, to be reserved, 

pursuant to art. 2441 par 8, Italian Civil Code: 

• for employees of Italcementi S.p.A. and its 

subsidiaries, in the event of a free of charge 

issue, 


subsidiaries, and for employees of its parent 

companies and of other companies controlled 

by such parent companies, in the event of an 

offer for subscription; 

both in Italy and abroad and in accordance with 

the laws in force in the countries of the 

beneficiaries; 

- the power, consequently, to establish the share 

entitlement rights, to determine the time, 

procedures, characteristics and conditions of the 

offer to employees and to establish the share 

issue price, including any share premium. 

By means of resolution dated June 20, 2007 at their 

Extraordinary Meeting, the shareholders assigned to 

the Board of Directors: 

- the right, under art. 2443 of the Italian Civil Code, 

to increase the share capital by payment, once or 

various times within the period of five years from 

the above resolution, for a maximum amount of 

EUR 3,000,000 (three million) by issuing a 

maximum of 3,000,000 (three million) ordinary 

and/or savings shares, with a nominal value of 

EUR 1 (one) each, with the exclusion of the right 

of option under art. 2441 of the Italian Civil Code, 

5th clause, within the framework of the bonus plan 

reserved to the directors of the company and of 

subsidiaries that hold specific positions in line with 

the by laws or that have specific operative tasks; 

- the right, as a consequence, to establish the due 

date of the shares, to determine times, modes, 

features and terms of the offer and to establish 

the issue price of the shares, including the 

relevant premium. 

Proposed text 

ordinary and/or savings shares, to be reserved, 

pursuant to art. 2441 par 8, Italian Civil Code: 


subsid-iaries, in the event of a free of charge 

issue, 


subsid-iaries, and for employees of its parent 

companies and of other companies controlled 

by such parent companies, in the event of an 

offer for subscription, 

both in Italy and abroad and in accordance with 

the laws in force in the countries of the 

beneficiaries; 

- the power, consequently, to establish the share 

entitlement rights, to determine the time, 

procedures, characteristics and conditions of the 

offer to employees and to establish the share 

issue price, including any share premium. 

REPEALED 

Art. 15 (Appointment of the Board of Directors), 16 (Replacement of Directors), 26 (Appointment of the 

Board of Statutory Auditors) and 27 (Replacement of statutory auditors) 

Art. 1 of Law 120 amended articles 147-ter and 148 of TUF concerning respectively the appointment methods 

and composition requirements of the administration and control bodies of listed companies, requiring the 

amendment of the by-laws in order to provide for the allocation of Directors and Statutory Auditors to be 

appointed, according to the principle, to be applied for three consecutive mandates, which ensure a gender 

balance in such way that the less represented gender gets at least one third of elected Directors and Statutory 

Auditors. 

312






The new provisions of articles 147-ter and 148 of TUF will be applicable upon the first renewal of the Board of 

Directors and Board of Statutory Auditors of listed companies occurring after one year as of the entry into 

force of Law 120, occurred on August 12, 2011. 

Thus, it is necessary to amend the Company By-laws and, in particular those articles governing composition, 

appointment and replacement of Directors and Statutory Auditors. The By-laws must also set forth provisions 

concerning, inter alia, the modalities according to which lists shall be formed, as well as additional criteria to be 

applied to identify each member of the mentioned corporate bodies in a way that the gender balance as outcome 

of the polls is ensured, as well as replacement modalities of members ceased serving during the office. 

By-laws provisions, amended according to the above, will be therefore applicable as of the renewal of the 

Board of Directors whose term of office will expire upon approval of the financial statements as at December 

31, 2012. However, a transitional regime is provided for and it sets out that for the first term of office under the 

new provisions of Law 120, a portion equal to at least one fifth of elected Directors and Statutory Auditors, 

instead of the higher percentage of one third applicable when said provisions will be fully applicable, shall be 

reserved to the less represented gender. 

In light of the above, the proposed amendments to articles 15, 16, 26 and 27 of the By-Laws are set out below. 

Current text 

Article 15 

Appointment of the Board of Directors 

The Board of directors is appointed based on lists 

whose objective is to ensure that the minority has 

the minimum number of directors envisaged by law. 

Only those Shareholders having the right to submit 

lists who, alone or together with other shareholders. 

prove that, as at the day on which the lists are 

submitted to the Company, they own a total holding 

in share capital with voting rights which is no lower 

than that determined under current laws and 

regulations. 

The notice of call to the Meeting to resolve on the 

appointment of the Board of directors includes 

modes, deadline and the amount of shares 

necessary to submit the lists of candidates for the 

position. 

No shareholder may present, or participate in 

presenting, not even by means of another person or 

a trust company, more than one list or vote in more 

than one list. 

Shareholders who belong to the same group and the 

shareholders who are members of a shareholders’ 

agreement whose object is company shares, cannot 

present or vote for more than one list, not even by 

means of another person or trust companies. 

Lists submitted that breach these conditions will not 

be accepted. 

Proposed text 

Article 15 

Appointment of the Board of Directors 

The Board of directors is appointed based on lists 

whose objective is to ensure that the minority has 

the minimum number of directors envisaged by law 

and the current provisions on gender balance are 

complied with. 

Only those Shareholders having the right to submit 

lists who, alone or together with other shareholders. 

prove that, as at the day on which the lists are 

submitted to the Company, they own a total holding 

in share capital with voting rights which is no lower 

than that determined under current laws and 

regulations. 

The notice of call to the Meeting to resolve on the 

appointment of the Board of directors includes 

modes, deadline and the amount of shares 

necessary to submit the lists of candidates for the 

position. 

No shareholder may present, or participate in 


a trust company, more than one list or vote in more 

than one list. 

Shareholders who belong to the same group and the 


agreement whose object is company shares, cannot 


means of another person or trust companies. 

Lists submitted that breach these conditions will not 

be accepted. 

313 


Current text 

In each list, the names of candidates must be listed 

by means of a progressive number. 

Each candidate can only be present in one list or 

he/she shall be ineligible. 

Lists must be submitted to the company head office 

no later than the twenty-fifth day preceding the date 

of Meeting called, on a first or single call, in order to 

resolve upon the appointment of the members of the 

Board of Directors; this must be mentioned in the 

notice of call, without prejudice to any other forms of 

public disclosure set forth by the applicable laws and 

regulations. 

Together with each list, by the deadline above, the 

following must be filed at the company head office: 

a) statements by means of which the candidates 

accept their candidature and state, under their 

own responsibility, that there are no causes for 

ineligibility and that they are in possession of the 

good reputation requirements established by law; 

b) a short curriculum vitae with personal and 

professional features of each candidate, stating 

the management and control positions held in 

other companies; 

c) statements by each candidate about their possible 

independence as required by law, if any; 

d) information regarding the identity of shareholders 

who have submitted the lists; 

e) a statement by the shareholders, other than those 

who own, even jointly, a controlling or relative 

majority stake, which states that there are no 

connections, as is defined by current laws and 

regulations. 

The certification or attestation providing evidence of 

the ownership of the share capital percentage 

required by the laws applicable at the time of the list 

submission may be produced even after its 

submission, provided that such certification is 

received by the Company within the deadline set out 

by the applicable laws and regulations concerning 

the publication of the lists by the Company. 

Proposed text 

In each list, the names of candidates must be listed 

by means of a progressive number. 

Each candidate can only be present in one list or 


Lists must be submitted to the company head office 

no later than the twenty-fifth day preceding the date 



Board of Directors; this must be mentioned in the 

notice of call, without prejudice to any other forms of 

public disclosure set forth by the applicable laws and 

regulations. 

Lists including a number of candidates equal to 

or more than three, shall be made up of 

candidates representing both genders, so that 

one or the other gender represents at least one 

third (rounded up) of the candidates. 


following must be filed at the company head office: 

a) statements by means of which the candidates 

accept their candidature and state, under their 

own responsibility, that there are no causes for 

ineligibility and that they are in possession of the 

good reputation requirements established by law; 

b) a short curriculum vitae with personal and 


the management and control positions held in 

other companies; 

c) statements by each candidate about their possible 

independence as required by law, if any; 

d) information regarding the identity of shareholders 

who have submitted the lists; 

e) a statement by the shareholders, other than those 

who own, even jointly, a controlling or relative 


connections, as is defined by current laws and 

regulations. 









314






Current text 

Any list submitted without complying with the 

provisions above is considered as not being 

submitted. 

In the event more than one list is presented: 

- all Directors to be elected are elected from the list 

that has obtained during the Meeting the highest 

number of votes, on the basis of the progressive 

order with which they are listed in the list, with the 

exception of the minimum number reserved by law 

to the minority list; 

- the minimum number of directors reserved by law 

to the minority are elected from the minority list 

that has obtained the highest number of votes and 

is not connected in any way, not even directly, 

with the reference shareholders; 

- if various lists have obtained the same number of 

votes, a ballot shall be performed between these 

lists with the participation of all entitled to vote 

who are present at the Meeting, and the 

candidates from the list that obtains the relative 

majority of share capital represented at the 

Meeting will be elected. 

For the purpose of the subdivision of directors to 

elect, the lists shall not be considered that have not 

obtained a percentage of votes that is at least equal 

to half that required for their presentation. 

If a subject connected to a reference shareholder 

has voted for a minority list, the connection only 

becomes relevant for the purposes of the exclusion 

of the elected minority director if the vote has been 

decisive for the election of that director. 

In the event only one list is presented, all the 

candidates included in that list are elected, with a 

relative majority vote of the share capital represented 

at the Meeting. 

Proposed text 

Any list submitted without complying with the 


submitted. 

In the event more than one list is presented: 

- all Directors to be elected are elected from the list 

that has obtained during the Meeting the highest 

number of votes, on the basis of the progressive 

order with which they are listed in the list, with the 

exception of the minimum number reserved by law 

to the minority list; 

- the minimum number of directors reserved by law 

to the minority are elected from the minority list 

that has obtained the highest number of votes and 

is not connected in any way, not even directly, 

with the reference shareholders; 


votes, a ballot shall be performed between these 

lists with the participation of all entitled to vote 

who are present at the Meeting, and the 

candidates from the list that obtains the relative 

majority of share capital represented at the 

Meeting will be elected. 

For the purpose of the subdivision of directors to 

elect, the lists shall not be considered that have not 

obtained a percentage of votes that is at least equal 

to half that required for their presentation. 



becomes relevant for the purposes of the exclusion 

of the elected minority director if the vote has been 

decisive for the election of that director. 

In the event only one list is presented, all the 

candidates included in that list are elected, with a 

relative majority vote of the share capital represented 

at the Meeting. 

If by means of the mechanism of the list vote or 

further to the poll on the single list filed, the 

Board of Directors composition results non 

compliant with the applicable laws on gender 

balance, the necessary replacements shall be 

performed by choosing within the list which 

obtained the highest number of votes or within 

the sole filed list starting from the last candidate 

of the captioned list. 

315 


Current text 

If there are no lists, and in the event by means of the 

mechanism of the list vote, the number of elected 

candidates is lower than the minimum number 

envisaged by the By-laws for its establishment, the 

Board of directors is appointed or supplemented by 

the Shareholders’ Meeting with the legal majority, as 

long as the presence of the minimum number of 

directors required by current laws and regulations 

who have the requirements of independence is 

guaranteed. 

Any elected director who, during the term, no longer 

has the requirements of good reputation required by 

law or by the By laws, shall forfeit his office. 

If the requirements of independence required by law 

are no longer present, the director concerned must 

immediately inform the Board of directors. 

This event implies the director’s forfeiture of office, 

with the exception of the case when such 

requirements are still held by the minimum number 

of directors envisaged by current laws and 

regulations. 

Article 16 

Replacement of directors 

If during the year, because of resignations or other 

causes, one or various directors no longer hold their 

office, the others, as long as the majority always 

consists of directors appointed by the shareholders, 

replace them by means of a resolution approved by 

the Board of statutory auditors. 

Directors are replaced, without prejudice to the 

compliance with the requirements of good reputation 

and independence as per art. 15, by means of the 

appointment of the candidates that were not elected 

and who belong to the same list of the former 

directors according to the original order of 

submission. If this is not possible, the Board of 

directors shall take care of the case under the law. 

Proposed text 

Then, if the minimum percentage required by the 

current applicable laws and regulations on 

gender balance results not to be met, similar 

replacements will be performed again within the 

list which obtained the highest number of votes 

or within the sole filed list. 

If there are no lists, and in the event by means of the 

mechanism of the list vote, the number of elected 

candidates is lower than the minimum number 

envisaged by the By-laws for its establishment, the 

Board of directors is appointed or supplemented by 

the Shareholders’ Meeting with the legal majority, as 

long as the gender balance under the current 

applicable laws and regulations is ensured and, 

in any case, provided that the presence of the 

minimum number of directors required by current 

laws and regulations who have the requirements of 

independence is guaranteed. 

Any elected director who, during the term, no longer 

has the requirements of good reputation required by 

law or by the By laws, shall forfeit his office. 

If the requirements of independence required by law 

are no longer present, the director concerned must 

immediately inform the Board of directors. 

This event implies the director’s forfeiture of office, 

with the exception of the case when such 

requirements are still held by the minimum number 

of directors envisaged by current laws and 

regulations. 

Article 16 

Replacement of directors 

If during the year, because of resignations or other 

causes, one or various directors no longer hold their 

office, the others, as long as the majority always 

consists of directors appointed by the shareholders, 

replace them by means of a resolution approved by 

the Board of statutory auditors. 

Directors are replaced, without prejudice to the 

compliance with the requirements of good reputation 

and independence as per art. 15, by means of the 

appointment of the candidates that were not elected 

and who belong to the same list of the former 

directors according to the original order of 

submission. If this is not possible, the Board of 

directors shall take care of the case under the law. 

316






Current text 

Directors appointed this way hold their office until the 

following shareholders’ meeting. 

The shareholders shall decide with respect to the 

replacement of directors, under the principles as per 

art. 15, based on the relative majority of share 

capital represented at the Meeting. 

The term of Directors so appointed will expire with 

those already in office at the moment of their 

appointment. 

Article 26 

Appointment of the Board of statutory auditors 

The Board of statutory auditors is appointed based 

on lists aimed at ensuring the appointment of one 

Acting Auditor and one Substitute Auditor 

representing the minority. 

Only those Shareholders have the right to present 

the lists who, alone or together with other 

shareholders, prove that they hold, as at the day on 

which the lists are submitted to the Company, a total 

percentage of share capital with voting right that is 

no lower than that determined under the current 

regulation for the appointment of the Board of 

directors. 

Modes, terms and participation fee required for the 

presentation of the lists of candidates for the office 

are indicated in the notice of call of the Meeting 

called to resolve on the appointment of the Board of 

statutory auditors. 

No Shareholder may present, or participate in 


a trustee company, more than one list, or vote in 

more than one list. 

Shareholders belonging to the same group and 


agreement whose object is Company shares cannot 


Proposed text 

The above shall be in any case carried out in 

compliance with the current applicable laws and 

regulations on gender balance. 

Directors appointed this way hold their office until the 

following shareholders’ meeting. 

The shareholders shall decide with respect to the 

replacement of directors, under the principles as per 

art. 15, based on the relative majority of share 

capital represented at the shareholders’ meeting, 

and in any case in compliance with the current 

applicable laws and regulations on gender 

balance. 

The term of Directors so appointed will expire with 

those already in office at the moment of their 

appointment. 

Article 26 

Appointment of the Board of statutory auditors 

The Board of statutory auditors is appointed based 

on lists aimed at ensuring both the appointment of 

one Acting Auditor and one Substitute Auditor 

representing the minority and the compliance with 

the curent applicable laws and regulations on 

gender balance. 

Only those Shareholders have the right to present 

the lists who, alone or together with other 

shareholders, prove that they hold, as at the day on 

which the lists are submitted to the Company, a total 

percentage of share capital with voting right that is 

no lower than that determined under the current 

regulation for the appointment of the Board of 

directors. 

Modes, terms and participation fee required for the 

presentation of the lists of candidates for the office 

are indicated in the notice of call of the Meeting 

called to resolve on the appointment of the Board of 

statutory auditors. 

No Shareholder may present, or participate in 


a trustee company, more than one list, or vote in 

more than one list. 

Shareholders belonging to the same group and 


agreement whose object is Company shares cannot 


317 


Current text 

means of another person or by means of trustee 

companies. 

Lists presented that breach these conditions shall 

not be accepted. 

Each list comprises two sections: one for the 

candidates for the office of Acting Auditor and the 

other for the candidates for the office of Substitute 

Auditor. 

The names of no more than three candidates for the 

office of Acting Auditor and no more than three 

candidates for the office of Substitute Auditor must 

be listed in each section, by means of a progressive 

number. 

Each candidate can only participate in one list, or 


The lists must be filed with the company head office 

not later than the twenty-fifth day preceding the date 



Board of Statutory auditors; this must be mentioned 

in the notice of call, without prejudice to any other 

forms of public disclosure set forth by the applicable 

laws and regulations. 


following is filed: 

a) statements by means of which the individual 

candidates accept the candidacy and state, under 

their own responsibility, that there are no causes 

for ineligibility or incompatibility, and that they 

have the requirements stated in law for the office; 

b) a short curriculum vitae about personal and 


the management and control offices held at other 

companies; 

c) information regarding the identity of the 

shareholders who have presented the lists; 

Proposed text 

means of another person or by means of trustee 

companies. 

Lists presented that breach these conditions shall 

not be accepted. 

Each list comprises two sections: one for the 

candidates for the office of Acting Auditor and the 

other for the candidates for the office of Substitute 

Auditor. 

The names of no more than three candidates for the 

office of Acting Auditor and no more than three 

candidates for the office of Substitute Auditor must 

be listed in each section, by means of a progressive 

number. 

Each candidate can only participate in one list, or 

he\she shall be ineligible. 

The lists must be filed with the company head office 

not later than the twenty-fifth day preceding the date 



Board of Statutory auditors; this must be mentioned 

in the notice of call, without prejudice to any other 

forms of public disclosure set forth by the applicable 

laws and regulations. 

Lists including a number of candidates equal to 

or more than three, shall be made up of 

candidates representing both genders, so that 

one or the other gender represents at least one 

third (rounded up) of the candidates to the of fice 

of Acting auditor and of at least one third 

(rounded up) of the candidates to the of fice of 

Substitute auditor. 


following is filed: 

a) statements by means of which the individual 

candidates accept the candidacy and state, under 

their own responsibility, that there are no causes 

for ineligibility or incompatibility, and that they 

have the requirements stated in law for the office; 

b) a short curriculum vitae about personal and 


the management and control offices held at other 

companies; 

c) information regarding the identity of the 

shareholders who have presented the lists; 

318






Current text 

d) the statement of shareholders, other than those 

who hold, even jointly, a controlling or a relative 


relationships of connection, as defined by current 

regulations. 









A list presented without complying with the 


presented. 

In the event that, as at the expiration date of the 

twenty-fifth day term preceding the date of Meeting 

called, on a first or single call, in order to resolve 

upon the appointment of the members of the Board 

of Statutory auditors, only one list has been filed, or 

only lists presented by shareholders who are 

connected to each other under current regulations, 

within the term provided by the applicable laws and 

regulations, further lists can be presented, and the 

percentage of share capital threshold mentioned in 

the notice of call will be halved. 

In the event various lists are presented: 

- two Acting Auditors and two Substitute Auditors 

are elected from the list that has obtained the 

highest number of votes at the Meeting, based on 

the progressive order with which they are listed in 

the sections of the list; 

- the third Acting Auditor and the third Substitute 

Auditor are elected from the minority list that has 

obtained the highest number of votes in the lists 

presented and voted on by the shareholders that 

are not connected in any way, not even indirectly, 

with the reference shareholders, based on the 

progressive order with which they are listed in the 



votes, a ballot vote will be carried out between 

these lists by all entitled to vote at the Meeting, 

and the contestants will be elected from the list 

that obtaines the relative majority of share capital 

represented at the Meeting. 

Proposed text 

d) the statement of shareholders, other than those 

who hold, even jointly, a controlling or a relative 


relationships of connection, as defined by current 

regulations. 









A list presented without complying with the 


presented. 

In the event that, as at the expiration date of the 

twenty-fifth day term preceding the date of Meeting 

called, on a first or single call, in order to resolve 

upon the appointment of the members of the Board 

of Statutory auditors, only one list has been filed, or 

only lists presented by shareholders who are 

connected to each other under current regulations, 

within the term provided by the applicable laws and 

regulations, further lists can be presented, and the 

percentage of share capital threshold mentioned in 

the notice of call will be halved. 

In the event various lists are presented: 

- two Acting Auditors and two Substitute Auditors 

are elected from the list that has obtained the 

highest number of votes at the Meeting, based on 

the progressive order with which they are listed in 

the sections of the list; 

- the third Acting Auditor and the third Substitute 

Auditor are elected from the minority list that has 

obtained the highest number of votes in the lists 

presented and voted on by the shareholders that 

are not connected in any way, not even indirectly, 

with the reference shareholders, based on the 

progressive order with which they are listed in the 



votes, a ballot vote will be carried out between 

these lists by all entitled to vote at the Meeting, 

and the contestants will be elected from the list 

that obtaines the relative majority of share capital 

represented at the Meeting. 

319 


Current text 



becomes relevant, for the purpose of excluding the 

elected minority Auditor, if the vote was decisive for 

the election of the Auditor. 

In the event one single list has been presented, all 

the contestants included in that list are elected by a 

relative majority vote of share capital represented at 

the Meeting. 

In the event no list has been presented, the Board of 

statutory auditors shall be appointed by the 

shareholders’ meeting by means of a relative 

majority vote of share capital represented at the 

Meeting. 

The Chairman of the Board of statutory auditors will 

be the person listed at the top of the list presented 

and voted by the minority, or the first name on the 

single list presented or the person appointed by the 

Meeting in the event no list has been presented. 

Any elected Auditor who, during office, no longer has 

the necessary requirements according to regulations 

and by laws, forfeits office. 

Article 27 

Replacement of Statutory Auditors 

In the event of replacement of an Acting Auditor, 

he/she shall be replaced by the Substitute Auditor 

belonging to his/her same list. 

If this is not possible, he/she shall be replaced, 

according to the original order of presentation, by the 

candidate placed in the same list as the one that left, 

without considering the initial section of belonging. 

Proposed text 



becomes relevant, for the purpose of excluding the 

elected minority Auditor, if the vote was decisive for 

the election of the Auditor. 

In the event one single list has been presented, all 

the contestants included in that list are elected by a 

relative majority vote of share capital represented at 

the Meeting. 

If by means of the mechanism of the list vote or 

further to the poll on the single list filed, the 

Board of Statutory auditors composition (Acting 

Auditors) results non compliant with the 

applicable laws on gender balance, the 

necessary replacements shall be performed by 

choosing within the section for Acting auditors 

of the list which obtained the highest number of 

votes or within the sole list filed starting from the 

last candidate of the captioned list. 

In the event no list has been presented, the Board of 

statutory auditors shall be appointed by the 

shareholders’ meeting by means of a relative 


Meeting, provided that the gender balance stated 

by the current applicable laws and regulations is 

complied with. 

The Chairman of the Board of statutory auditors will 

be the person listed at the top of the list presented 

and voted by the minority, or the first name on the 

single list presented or the person appointed by the 

Meeting in the event no list has been presented. 

Any elected Auditor who, during office, no longer has 

the necessary requirements according to regulations 

and by laws, forfeits office. 

Article 27 

Replacement of Statutory Auditors 

In the event of replacement of an Acting Auditor, 

he/she shall be replaced by the Substitute Auditor 

belonging to his/her same list. 

If this is not possible, he/she shall be replaced, 

according to the original order of presentation, by the 

candidate placed in the same list as the one that left, 

without considering the initial section of belonging. 

320






Current text 

If the Chairman of the Board of statutory auditors 

has to be replaced, this office will be taken by the 

minority Auditor. 

Auditors appointed under the clauses above shall 

hold their office until the next meeting. 

If auditors need to be added to the Board: 

- to replace the Auditor elected in the majority list, 

the new Auditor is appointed by means of a 

relative majority vote of share capital represented 

at the Meeting, choosing from the candidates 

listed in the original majority list; 

- to replace the Auditor elected in the minority list, 




listed in the original minority list; 

- to simultaneously replace Auditors elected in the 

majority list and in the minority list, the new 

Auditors are appointed by means of a relative 


Meeting, choosing, from the candidates indicated 

in the list in which each Auditor being replaced 

appeared, a number of Auditors equal to the 

number of Auditors leaving belonging to the same 

list. 

If it is not possible to proceed under the previous 

clause, the Meeting called for completing the Board 

of statutory auditors shall resolve thereupon by the 

relative majority of the share capital represented at 

the Meeting, without prejudice to the principle as per 

clause 1 of the previous article. However, the 

Chairman of the Board of statutory auditors shall be 

the minority auditor. 

Proposed text 

If the Chairman of the Board of statutory auditors 

has to be replaced, this office will be taken by the 

minority Auditor. 

Auditors appointed under the clauses above shall 

hold their office until the next meeting. 

If auditors need to be added to the Board: 

- to replace the Auditor elected in the majority list, 




listed in the original majority list; 

- to replace the Auditor elected in the minority list, 




listed in the original minority list; 

- to simultaneously replace Auditors elected in the 

majority list and in the minority list, the new 

Auditors are appointed by means of a relative 


Meeting, choosing, from the candidates indicated 

in the list in which each Auditor being replaced 

appeared, a number of Auditors equal to the 

number of Auditors leaving belonging to the same 

list. 

If it is not possible to proceed under the previous 

clause, the Meeting called for completing the Board 

of statutory auditors shall resolve thereupon by the 

relative majority of the share capital represented at 

the Meeting, without prejudice to the principle as per 

clause 1 of the previous article. However, the 

Chairman of the Board of statutory auditors shall be 

the minority auditor. 

The above mentioned replacement procedures 

must, in any case, comply with the current 

applicable laws and regulations on gender 

balance. 

321 


The proposed amendments do not grant shareholders that do not approve them the withdrawal right pursuant 

to art. 2437 Italian Civil Code. 

* * * 


If you agree with the proposed amendments set out above, we invite you to resolve upon the following 

resolution: 

“The extraordinary shareholders’ meeting of Italcementi S.p.A. of April 18, 2012, having examined the Report of 

the Board of Directors, 


a) to approve the amendment to articles 5 (Share capital), 15 (Appointment of the Board of Directors), 16 

(Replacement of Directors), 26 (Appointment of the Board of Statutory Auditors) and 27 (Replacement of 

Statutory Auditors) of the company By-Laws in the contents set out above; 

b) to grant to the Chairman, the Executive Deputy Chairman, the Deputy Chairman and the Chief Executive 

Officer in office, even severally, the broadest powers to make to the adopted resolutions any amendments, 

adjustments, supplements and additions, provided that these are of a formal nature, that might be necessary 

or that might be requested by the competent Authorities”. 


On behalf of the Board of Directors 

The Chairman 

(Giampiero Pesenti) 

322

Summary of resolutions 

The Annual General Shareholders’ meeting, held on April 18, 2012 in Bergamo, via Madonna della Neve 

no. 8, chaired by Mr. Giampiero Pesenti, having attended, in their own and by proxy no. 161 

shareholders, holders of no. 120,380,837 ordinary shares over no. 177,117,564 ordinary outstanding 

shares, 

resolved 

Ordinary session: 

1) to approve the financial statements as at December 31, 2011, which reflect a profit of Euro 

7,001,950.82, along with the relevant Directors’ Report; 

2) to apportion the profit of the year as follows: 

Profit for the year 7,001,950.82 

To the legal reserve - 





Total dividend 7,001,853.72 

Residual amount 97.10 

To the 2011 earnings reserve in favor of savings shareholders 97.10 

(1) net of the 105,500 treasury savings shares held at March 2, 2012 

- to withdraw the amount of: 

* Euro 3,635,176.77 from Retained earnings, which, as a result, is reduced to zero; 

* Euro 29,802,872.79 from the Extraordinary reserve, which, as a result, decreases from Euro 

478,026,655.72 to Euro 448,223,782.93, 

by assigning Euro 0.12: 

- to the 173,324,535 outstanding ordinary shares, net of the 3,793,029 ordinary treasury shares held 

as at March 2, 2012; 

- to the 105,325,878 outstanding savings shares, net of the 105,500 savings treasury shares held 

as at March 2, 2012; 

3) to agree upon the Remuneration Report prepared by the directors; 

4) having revoked the resolution authorizing the acquisition and disposal of treasury shares adopted by 

the ordinary Shareholders' Meeting of April 19th, 2011: 

- to authorize, pursuant to art. 2357 of the Italian Civil Code, the purchase of ordinary and/or 

savings treasury shares, within 18 months as of the resolution date in order to: 

• dispose of treasury shares: 

* to be transferred to employees and/or directors in connection with stock option plans reserved 

to employees and/or directors; 

* for medium/long-term investment purposes; 

323 


• operate, in compliance with current regulations, directly or through intermediaries, in order to limit 

anomalous trends in share prices and to regularize stock exchange prices to face temporary 

distortions caused by excessive volatility or low trading liquidity; 

• create a treasury stock portfolio to serve extraordinary financial transactions or for other 

purposes deemed to be in the financial, business and /or strategic interests of the company; 

• offer shareholders an additional tool to monetize their investments. The purchase price of each 

share shall not exceed 15% of the average reference share price occurred on the same regulated 

market in the three sessions preceding each transaction; the overall consideration to be paid by the 

company for the purchase shall in no case exceed the amount of 100 million euro; the maximum 

number of ordinary and/or savings shares acquired shall not have an overall nominal value, including 

treasury shares already held as of the date hereof by the company and by the subsidiaries, in excess 

of one tenth of the share capital. 

Furthermore: 

• the purchasing shall normally be conducted so that equitable treatment of shareholders is ensured 

and offers to purchase directly matched with pre-determined offers to sell are not allowed, or, 

taking into account the various possible purposes, in any other manner allowed under current laws 

and regulations governing the stock market on which the transactions are performed; 

• the shares shall be disposed of in any manner deemed appropriate to achieve the objectives 

pursued, directly or through intermediaries, in compliance with current applicable national and 

European laws and regulations; 

• treasury shares purchases and sales shall be performed in compliance with applicable laws and, 

specifically, with laws and regulations governing the stock market on which the transactions are 

performed; 

- to severally grant to the Chairman, Executive Deputy Chairman, Deputy Chairman and Chief Executive 

Officer in office from time to time any power to proceed with the purchases and sales and in any case 

to execute the above resolutions, also through attorneys-in-fact, complying with any requirements 

presented by the competent authorities; 

5) to appoint, by supplementing the Board of Directors, Messrs. Carlo Garavaglia and Giulio Antonello, 

who will remain in office until expiration of the current Board of Directors, i.e. upon approval of the 

financial statements as at December 31, 2012; 

6) to appoint members of the Board of Statutory Auditors for the three year period 2012-2014, i.e. upon 

approval of the financial statements as at December 31, 2014, Messrs: 



Mario Comana 


Luciana Ravicini 


Chairman 

Acting auditor 

Acting auditor 

Substitute auditor 



and to fix the Chairman’s annual compensation in Euro 75,000 and in Euro 50,000 the annual 

compensation for each Acting auditor; 

324

7) to increase the total amount of rights to participate in the «Long term monetary incentive plan for 

officers, linked to the appreciation of Italcementi shares» from the current 669,000 to 2,221,000. 

Extraordinary session: 

To amend articles 5 (Share capital), 15 (Appointment of the Board of Directors), 16 (Replacement of 

Directors), 26 (Appointment of the Board of Statutory auditors) and 27 (Replacement of Auditors) of the 

Company By-Laws. 

325 


Corporate bodies resulting from the appointments of April 18, 2012 



Giampiero Pesenti 1 Chairman 

Pierfranco Barabani 1 Executive Deputy Chairman 

Lorenzo Renato Guerini 8 Deputy Chairman 

Carlo Pesenti 1-2 Chief Executive Officer - CEO 

Giulio Antonello 7 

Alberto Bombassei 4-7 


Alberto Clô 3-5-6-7 

Federico Falck 1-5-6-7 


Carlo Garavaglia 7 

Italo Lucchini 4 


Yves René Nanot 1 


Ettore Rossi 7-9 

Attilio Rota 1-5-6-7 

Carlo Secchi 5-6-7 

Elena Zambon 7 

Emilio Zanetti 4-7 

Paolo Santinoli 10 Secretary to the Board 



Acting Auditors 



Mario Comana 

Substitute Auditors 


Luciana Ravicini 


Chief Operating Officer 

Giovanni Ferrario 

Chairman 



Audit firm 


KPMG S.p.A. 

326 

1 Member of the Executive Committee 

2 Executive Director responsible for overseeing the functioning of the internal control system 

3 Lead independent director 

4 Member of the Remuneration Committee 

5 Member of the Internal Control Committee 

6 Member of the Committee for Transactions with Related Parties 

7 Independent Director (in accordance with the Voluntary Code of Conduct and Legislative Decree no.58 of February 24, 1998) 

8 Independent Director (in accordance with the Legislative Decree no.58 of February 24, 1998) 

9 Member of the Compliance Committee 

10 Secretary to the Executive Committee

April 2012 

Project of LSVmultimedia 

Olginate - Lecco

2011 Annual Report - Italcementi Group

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