to download Telecom Italia Annual Report 2011 - Company Reporting

The Telecom Italia Group consolidated financial statements for the year ended December 31, 2011 and
the comparative figures for the prior year have been drawn up in accordance with
international accounting standards issued by the International Accounting Standards Board and
adopted by the European Union (“IFRS”).
The Telecom Italia Group, in addition to the conventional financial performance measures established
by IFRS, uses certain alternative performance measures in order to present a better understanding of
the trend of operations and financial condition. Specifically, these alternative performance measures
refer to: EBITDA, EBIT, the organic change in revenues, EBITDA and EBIT and accounting and adjusted
net financial debt. Further details on such measures are presented under “Alternative performance
measures”.
Furthermore, the part entitled “Business Outlook for the Year 2012” contains forward-looking
statements in relation to the Group’s intentions, beliefs or current expectations regarding financial
performance and other aspects of the Group’s operations and strategies. Readers of the Annual Report
are reminded not to place undue reliance on forward-looking statements; actual results may differ
significantly from forecasts owing to numerous factors, the majority of which are beyond the scope of
the Group’s control.
PRINCIPAL CHANGES IN THE SCOPE OF CONSOLIDATION
Companies entering the scope of consolidation:
• Tim Fiber – Brazil: on October 31, 2011, acquisitions were made for a 100% stake in the company
Eletropaulo Telecomunicações Ltda and a 98.3% stake in AES Communications Rio de Janeiro S.A.,
both telecommunications infrastructure operators in the states of San Paolo and Rio de Janeiro,
now renamed Tim Fiber SP and Tim Fiber RJ, respectively. The acquisitions were carried out
through the subsidiary Tim Celular S.A. – Brazil Business Unit.
• 4GH group - Domestic: on July 27, 2011, the 4G Holding group entered the scope of consolidation
(in the Domestic Business Unit) after the acquisition of 71% of the ordinary shares of
4G Holding S.p.A. which in turn holds 100% of 4G Retail S.r.l.. The acquisition of 4G Holding, with
its approximate 200 points-of-sale located in the most important shopping malls in Italy, will enable
Telecom Italia to build up its positioning in the retail distribution market specialized in the sale of
telephony equipment and broaden its nationwide presence.
• Sofora – Telecom Argentina group: on October 13, 2010, the Sofora – Telecom Argentina group
entered the scope of consolidation following the increase, from 50% to 58%, of the stake held by
the Telecom Italia Group in the share capital of Sofora Telecomunicaciones S.A., the controlling
holding company of the Telecom Argentina group. During 2011, further shares were acquired
which increased the economic interest in the Telecom Argentina group from 16.2% at
December 31, 2010 to 22.7% at December 31, 2011.
Companies exiting the scope of consolidation:
• Loquendo – Domestic: on September 30, 2011, Loquendo S.p.A. was sold and consequently exited
the scope of consolidation.
• BBNed and Elettra: in 2010, Elettra (a company included in the Domestic Business Unit –
International Wholesale), sold on September 30, 2010, and the BBNed group (included in Other
Operations), sold on October 5, 2010, exited the scope of consolidation.
Annual Report 2011 Key Operating and Financial Data - Telecom Italia Group 12