to download Telecom Italia Annual Report 2011 - Company Reporting

Review of Operating and Financial
Performance - Telecom Italia Group
2011 Consolidated Operating Performance
The main profit indicators in 2011 compared to 2010 are the following:
(millions of euros) 2011 2010 Change (a-b)
(a) (b) amount % % organic
Revenues 29,957 27,571 2,386 8.7 2.7
EBITDA 12,246 11,412 834 7.3 -
EBITDA margin 40.9% 41.4% (0.5)pp
Organic EBITDA margin 41.2% 42.3% (1.1)pp
Depreciation and amortization, Gains (losses) on disposals
and Impairment reversals (losses) on non-current assets (5,485) (5,548) 63 1.1
EBIT before goodwill impairment loss 6,761 5,864 897 15.3
Goodwill impairment loss (7,364) (46) (7,318) °
EBIT (603) 5,818 (6,421) ° 5.1
EBIT margin n.s. 21.1% n.s.
Organic EBIT margin 22.7% 22.2% 0.5pp
Profit (loss) before tax from continuing operations (2,624) 4,132 (6,756) °
Profit (loss) from continuing operations (4,267) 3,582 (7,849) °
Profit (loss) from Discontinued operations/Non-current
assets held for sale (13) (7) (6) °
Profit (loss) for the year (4,280) 3,575 (7,855) °
Profit (loss) for the year attributable to owners of the
Parent (4,726) 3,121 (7,847) °
Normalized profit (loss) for the year attributable to
owners of the Parent 2,604 2,608 (4) (0.2)
Revenues
Revenues amount to 29,957 million euros in 2011, increasing 8.7% compared to 27,571 million euros
in 2010 (+2,386 million euros). In terms of the organic change, consolidated revenues increased 2.7%
(+785 million euros).
Specifically, the organic change in revenues is calculated by excluding:
• the effect of the change in the scope of consolidation (+1,703 million euros), principally in reference
to the entry of the Argentina Business Unit since October 13, 2010;
• the effect of exchange differences (-74 million euros, due to the change in the exchange rates of the
Brazil Business Unit (1) and of the Argentina Business Unit (1) for +15 million euros and -77 million
euros, respectively, and other Group companies for -12 million euros);
(1) The average exchange rate used to translate the Brazilian real to euro (expressed in terms of units of local currency per 1 euro), is equal to
2.32669 in 2011 and 2.33215 in 2010. The average exchange rate used to translate Argentine pesos (expressed in terms of units of local
currency per 1 euro) is equal to 5.74419 in 2011 and 5.18735 in 2010. The effect of the change in exchange rates is calculated by applying,
to the period under comparison, the foreign currency translation rates used for the current period.
Report on Operations Review of Operating and Financial Performance - Telecom Italia Group 15