ANNUAL REPORT

ANSALDO ENERGIA FINANCIAL STATEMENTS 2009
87
Industrial buildings 3-5%
Plant and machinery 5-20%
Minor equipment 12.5-40%
Furniture 12-20%
Vehicles 20-25%
• decreases of Euro 52 thousand deriving from disposals net of depreciation;
• an increase of Euro 2,334 thousand as a result of the merger of Ansaldo Ricerche S.p.A.;
• decreases of Euro 2,863 thousand for transfers to the income statement and the recovery of advances;
• a decrease of Euro 6,500 thousand as a result of the transfer of the Legnano property in Piazza
Monumento to assets held for sale following the completion of the preliminary contract.
9. Equity investments
Euro/thousand 31.12.2009 31.12.2008
Opening balance 40,181 19,135
Acquisitions/subscriptions and capital increases 2,632 23,814
Revalutations/impairment (22,818) (2,648)
Merger eliminations (1,032) (138)
Sales 55 2
Mergers 1,011 20
Closing balance 19,919 40,181
The changes in the year relate mainly to:
1. – the writedown of subsidiary Ansaldo Fuel Cells S.p.A. by Euro 19,316, as a result of a permanent loss which
the Company's plans do not foresee recovering. The value of the investment was subject to impairment testing,
performed on the basis of the business plan prepared by the subsidiary, demonstrating the recoverability of
capitalised costs (a key item under balance sheet assets) incurred to develop fuel cells of a duration and
efficiency such as to make the product a commercial proposition with regard to its application to CCS (Carbon
Capture and Sequestration). The business plan envisages 5 years' more product development and sales starting
in 2013, followed by a period of 12 years in which demand for the product is forecast to increase strongly.
According to the plan the Company will start to generate positive cash flow as of 2020, achieving revenue
volumes of more than Euro 1 billion annually at the end of the forecast period.
Cash flow after the period considered by the plan (terminal value) was extrapolated based on the final period of
the plan.
The assumptions on which the plan is based are:
• the best possible estimate of the future market for CCS applications;
• the best possible estimate of the share fuel cell technology will have in the aforementioned market;
• an international regulatory framework that makes the reduction of CO 2
emissions mandatory;
• the technical development of the product will ensure its competitiveness with regard to other technologies;
• the financial requirement for product development and to start production is estimated at about Euro 80
million.
The cash flows considered have been discounted at a rate (WACC) of 20.3%, which takes account of all risk
items deriving from the nature of the business and the fact that the Company is in its start up phase. The
impairment test demonstrated that the full value of the investment can be recovered. This result was also
confirmed by the sensitivity analysis performed both on the discount rate and forecast future cash flows;
2. – the writedown of associated Company Turboenergy S.p.A. by Euro 1,000 thousand is based on the
valuation of the Company on an equity basis according to IFRS rather than Italian accounting standards;
NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2009