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Consolidated Financial Statements at 31 December 2009 1

Grandi Stazioni S.p.A. CONSOLIDATED FINANCIAL

STATEMENTS AT 31 DECEMBER 2009


Grandi Stazioni S.p.A.

A company under the management and coordination of Ferrovie dello Stato S.p.A.

Share capital € 4,304,201.10 fully paid up

Headquarters: Via G. Giolitti n. 34 – 00185 ROME

EAR RM\841620

Tax Code and VAT Registration No. 05129581004


GOVERNING BODIES OF GRANDI STAZIONI SpA AND INDEPENDENT AUDITING FIRM Board of Directors: President: Ing. Mauro MORETTI

CEO: Dr. Fabio BATTAGGIA

Directors: Ing. Massimiliano CAPECE MINUTOLO DEL SASSO

Dr. Gaetano CASERTANO

Dr. Fabio CORSICO

Dr. Vittorio DE SILVIO

Avv. Maurizio MARCHETTI

Dr. Francesco ROSSI

Dr. Carlo VERGARA

Board of Auditors: President: Prof. Carlo CONTE

Acting Auditors: Prof. Claudio BIANCHI

Dr. Paolo BUZZONETTI

Alternate Auditors: Dr. Francesco ROSSI RAGAZZI

Dr. Giampiero TASCO

Independent Auditing Firm:

PRICEWATERHOUSECOOPERS S.p.A.


Contents

GOVERNING BODIES OF GRANDI STAZIONI SpA AND INDEPENDENT AUDITORS .................................................................................................................................................................... 3 MISSION OF THE GRANDI STAZIONI GROUP ....................................................................................... 5 REPORT ON OPERATIONS ........................................................................................................................................ 6 CONSOLIDATED RESULTS ACHIEVED IN 2009 ..................................................................................... 7 PRINCIPAL EVENTS IN THE YEAR ...................................................................................................................... 9 HUMAN RESOURCES ............................................................................................................................ 14 ENVIRONMENTAL POLICY.................................................................................................................. 18 CUSTOMER RELATIONS ............................................................................................................................... 20 MACROECONOMIC BACKGROUND .................................................................................................... 22 TRENDS IN REFERENCE MARKETS ................................................................................................................ 23 RISK FACTORS .............................................................................................................................................. 36 INVESTMENTS ............................................................................................................................................. 36 RESEARCH AND DEVELOPMENT ACTIVITIES ....................................................................................... 44 RELATIONS WITH RELATED PARTIES .......................................................................................................... 44 OWN EQUITY ............................................................................................................................................... 45 OTHER INFORMATION .......................................................................................................................... 45 SIGNIFICANT EVENTS AFTER THE CLOSURE OF THE FINANCIAL YEAR .................... 46 OUTLOOK............................................................................................................................................................................ 47 CONCOLIDATED GROUP SCHEDULES OF ACCOUNTS AND EXPLANATORY NOTES ................................................................................................................................................................................ 48 CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES ................................................. 49 CONSOLIDATED PROFIT AND LOSS ACCOUNT ................................................................................... 51 SCHEDULE OF OVERALL PROFITS/(LOSSES) RECORDED IN THE FINANCIAL YEAR ................................................................................................................................................................... 52 SCHEDULE OF CHANGES IN THE CONSOLIDATED SHAREHOLDERS’ EQUITY .. .... 53 CONSOLIDATED FINANCIAL OVERVIEW ................................................................................................. 54 EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ......... 55 ANALYSIS OF THE ITEMS IN THE CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES .................................................................................................................................................................... 81 ANALYSIS OF THE ITEMS IN THE CONSOLIDATED PROFIT AND LOSS ACCOUNT112 INITIAL TRANSITION TO THE IFRS ACCOUNTING PRINCIPLES ....................................... 128 ANNEX 1 ....................................................................................................................................................... 142


MISSION OF THE GRANDI STAZIONI GROUP

The Grandi Stazioni Group is part of the Ferrovie dello Stato Group and has been assigned the duty of refurbishing and managing Italy’s 13 main railway stations: Roma Termini, Milano Centrale, Torino Porta Nuova, Firenze Santa Maria Novella, Bologna Centrale, Napoli Centrale, Venezia Mestre and Santa Lucia, Verona Porta Nuova, Genova Piazza Principe and Brignole, Palermo Centrale and Bari Centrale, and also Prague Central, Mariànské Làzne and Karlovy Vary stations in the Czech Republic.

The guiding goal of the company and its subsidiaries is to disseminate a new concept of railway station among the general public: an enterprise with high business potential, a venue for city life and a lively and welcoming place, capable of offering quality services and opportunities for enjoying the time waiting for a train or spending one’s spare time. According to this new concept, stations fulfil a new urban function.

Briefly, the aims of the company’s mission are:

the refurbishment and valorisation of properties through leasing, promotional and advertising activities and the direct management of passenger areas and services;

to improve the quality and diversify travel services by enhancing the existing offering and constantly striving to improve customer satisfaction;

to promote new ways of using spaces, by introducing innovative services in the Network stations, such as service centres with numerous areas for shopping, a specialised general surgery unit, a gymnasium and numerous activities planned to fill spare time;

to harmonise the building complexes in stations with the surrounding urban fabric, with a view to integrating stations in the living city, facilitating access and inter-modality with all other means of transport;

to develop social projects and initiatives in favour of the disadvantaged people present in stations, in cooperation with volunteer organizations and bodies;

to spread a new concept of stations through communication strategies and cultural initiatives.

The terms and conditions of the station complexes lease contracts, with a duration of 40 years from 2000 for those in Italy and 30 years for those in the Czech Republic, provide for the unitary management and functional upgrading of the main station property complexes. Managing ordinary maintenance and providing services not related to train operations are part of the contractual undertakings, along with developing, funding and implementing a functional upgrading programme.


REPORT ON OPERATIONS


CONSOLIDATED RESULTS ACHIEVED IN 2009 Introduction These consolidated financial statements for the Grandi Stazioni Group have been drawn up in compliance with the international accounting principles (International Accounting Standards - IAS and/or International Financial Reporting Standards - IFRS) emanated by the International Accounting Standards Board (IASB) recognised by the European Union pursuant to EC Regulation 1606/2002 and in force since the closure of the financial year, and the interpretations of the International Financial Reporting Standards Committee (IFRIC) and Standing Interpretations Committee (SIC), homologated by the European Commission. These are the first consolidated financial statements drawn up according to the IFRS accounting principles.

Following the emanation of EC Regulation 1606/2002 and in relation to that disposed by implementing legislative decree 38/2005, as of the 2005 financial year, companies other than the issuers of financial instruments authorised to negotiate on stock markets which draw up consolidated financial statements may adopt the international accounting principles in drawing up their consolidated financial statements. Therefore, as of the 2009 financial year, Grandi Stazioni SpA has adopted the international accounting principles (International Accounting Standard IAS or International Financial Reporting Standards IFRS, the interpretations of the International Financial Reporting Standards Committee IFRIC and the Standing Interpretation Committee SIC homologated by the European Commission, hereinafter “IFRS-EU”), the transition date to the IFRS-EU being 1 January 2008. As regards previous financial years, Grandi Stazioni SpA used the right granted by paragraph 3 of art. 27 of Legislative Decree 127/1991 to not draw up its own consolidated financial statements, as these were drawn up by the parent company Ferrovie dello Stato SpA.

Grandi Stazioni SpA (hereinafter referred to as “GST, Parent Company” and/or “Group Leader”) is based in Italy. The company headquarters are in via G. Giolitti 34 – 00185 Rome.

The consolidated financial statements for the financial year closed on 31 December 2009 include the financial statements of the Group Leader, the Italian subsidiary Grandi Stazioni Ingegneria Srl (hereinafter “GSI”) and the foreign subsidiary Grandi Stazioni Ceska Republika Sro (hereinafter “GSCR”).

Main economic, equity and financial data in the consolidated financial statements

Amounts in millions of Euros 2008 2009 Operating income 180 207Operating costs 143 143Gross operating margin 37 64Operating result 28 51Net result 18 40Net capital invested 251 301Shareholders’ equity 108 136Net financial position 142 165


Consolidated financial statements indicators Consolidated financial statements indicators 2008 2009 Profitability ROE RN/MP* 20.25% 42.50% ROI RO/CI* 12.48% 18.74% ROS RO/RIC 15.38% 24.55% MOL/OPERATING INCOME MOL/RIC 20.48% 31.06% ROTATION OF CAPITAL INVESTED RIC/CI* 0.81 0.76 COST OF EMPLOYMENT /OPERATING INCOME

0.09 0.08

Solidity COVERAGE QUOTIENT (MP+Pcons)/AF 1.16 1.27 LEVEL OF FINANCIAL INDEBTEDNESS

DF/MP 1.55 1.72

Liquidity QUOTIENT OF AVAILABILITY AC/Pcorr 1.47 2.10 QUOTIENT OF LIQUIDITY (AC-RIM)/Pcorr 1.42 1.98

LEGEND

AC: Operating capital

CI*: Average net invested capital (between the start and end of the financial year) before equity investments

DF: Financial indebtedness

MOL: EBITDA

MP*: Average equity (between the start and end of the financial year) after the result at the end of the financial year

MP: Own means

Pcorr: Current liabilities (Short-term debts)

RIC: Operating income

RIM: Inventories

RN: Net result

RO: Operating result


PRINCIPAL EVENTS IN THE YEAR January

GST subscribed additional deed no. 1 for the tender concerning the consolidation of the trusses at Genova Piazza Principe, the new fire prevention tank at Genova Principe and the changes to the variable signalling, adjusting the overall value of the tender to 44.6 million Euros.

GST reached an economic agreement with certain companies in the FS Group for overcoming the so-called “Lodo Barbieri” (which regulated the leasing tariffs for companies in the FS Group) and the leasing contracts are currently being finalised.

A short-term loan contract was finalised between Grandi Stazioni SpA and Grandi Stazioni Ceska Republika s.r.o. for 2 million Euros to deal with the financial requirements of the latter company while awaiting the stipulation of a bridge loan from UniCredit MedioCredito Centrale SpA.

February

Following the termination of the refurbishment work in the areas open to the public in December 2008, GST inaugurated Torino Porta Nuova station.

The shareholding associate for advertising activities notified a request for arbitration aimed at ascertaining the failure by Grandi Stazioni SpA to fulfil its commitments concerning the achievement of the invoicing goals for 2008, the installation of part of the video communications system, the methods of adjusting the profits due from 2007 and the accounting of the returns, and demanding that it pay up the sum of 2.3 million Euros for costs, income not obtained and interest.

March

The Board of Directors of Grandi Stazioni SpA appointed Ing. Massimiliano Capece Minutolo del Sasso as a board member to replace Ing. Enrico Aliotti.

GST began the tender procedure for the transfer of the total shareholding in Grandi Stazioni Edicole srl.

GST reached a transaction agreement with the TCE awarded the Global Service tender for the property complex of Roma Termini, through which a litigation that arose at the end of 2008 was settled.

The mandatary of the TCE awarded the tender for work on the Central and South lots notified the transfer of the going concern, including ongoing negotiations with Grandi Stazioni SpA.

The Board of Directors of GST decided, as of 2009, to draw up the consolidated financial statements and to adopt the IFRS international accounting principles in doing so. During the same meeting, it was decided to adopt these principles for the financial statements as well.


April

The subsidiary GSCR stipulated an 18 month bridge loan for 19 million Euros with Unicredit MedioCredito Centrale and terminated the loan contract with UnicreditBank Czech Republic for 540 million Czech Krone (approximately 20.8 million Euros). As guarantee for the loan contract stipulated between GS Ceska Republika and Unicredit MedioCredito Centrale for the hedging of the financial requirements concerning the investment plan currently being implemented in some of the stations in the Czech Republic, GST issued a guarantee for up to a maximum of 20.9 million Euros. Following the initial payment of the loan in favour of Grandi Stazioni Ceska, the latter reimbursed the previous loan with Unicredit Bank Ceska.

May

The GST assembly of shareholders meeting on 5 May approved the financial statements at 31 December 2008 and decided to distribute dividends amounting to 80% of the net financial year result. During the same meeting, the Board of Directors and President were appointed, confirming the previous components. The new board will remain in office until the assembly meeting for the approval of the 2011 financial statements.

The shareholding in VVO srl was transferred from the subsidiary Grandi Stazioni Edicole srl to the subsidiary Grandi Stazioni Ingegneria srl.

Following the request for the extension of the period of usage of the loan for the Legge Obiettivo (law governing the modernisation of infrastructures and realisation of public works deemed “strategic and of preeminent national interest”) works submitted in December 2008, GST submitted to the Ministry of Infrastructures and Transport an initial proposal for the re-modulation of the interventions for the refurbishment and realisation of the complementary infrastructures in major stations (CIPE decisions 10 dated 14/3/03 and 129 dated 6/4/06).

GST exercised the right to a one year extension of the cleaning contracts currently in force on the entire network, as provided by the contract.

June

On 9 June, GST finalised the sale of the former departmental office building in Venice, under the conditions provided by the preliminary contract stipulated on 20 March 2007. In addition to the non application of the fines for delayed handover, Veneto Region was paid an additional sum of approximately 685,000 Euros for additional works carried out.

GST extended the maintenance contracts of the TCEs Rizzani de Eccher, Italiana Costruzioni and Consorzio Cooperative Costruzioni until 31 December 2009, and subsequently until 30 June 2010, in order to draw up the tender to be awarded jointly following the next expiry date of Roma Termini.

The Board of Directors of GST decided to postpone transition to the IFRS international accounting principles for the financial statements until the end of 2010.

On 24 June, the area for the Phase II works at Prague Central station was inaugurated, requalified by the subsidiary Grandi Stazioni Ceska Republika sro.


July

GST subscribed the contract with Metropark SpA, valid from 1 July, for the management of the car park at Piazza dei Cinquecento, at Roma Termini station. The annual amount agreed contractually is approximately 0.35 million Euros. The contract with the TAA for the management and maintenance of installations and cleaning services at the car park in Via Marsala entered into force simultaneously.

On 27 July, GST stipulated Additional Deed no. 2/bis, for the tender for the internal works at Milano Centrale station, which annuls and replaces the previous deed and adjusts the total value of the tender to 104.28 million Euros, net of reserves.

Again on 27 July, GST stipulated Additional Deed no. 2 for the tender for the refurbishment of the internal works at Napoli Centrale station, worth 10.6 million Euros. The total value of the tender was therefore adjusted to 51.11 million Euros, net of reserves.

August

On 1 August, Grandi Stazioni Ingegneria was incorporated through the detachment of 24 units from the parent company. The detached personnel of the Infrastructures Development Department switched to working with the new company, for which the management processes and mission were defined.

On 6 August, Trenitalia awarded GST a planning assignment worth approximately 0.25 million Euros for the adjustment of the Club Eurostar areas at Roma Termini, with the realisation of a new Customer Assistance area.

On 7 August, GST formalised specific agreements with the components of the Works Directorate in the context of the integrated tender for the refurbishment of Napoli Centrale. These agreements, worth 0.27 million Euros, adjusted the professional remunerations once the value of the works was increased.

During the course of the month, the expected vacating of the areas occupied by “Other RFI subjects – Dopo Lavoro Ferroviario (hereinafter DLF)” did not occur, and specific negotiations with RFI were begun as a consequence.

The areas in the departmental office building in Venezia Santa Lucia occupied by “Other RFI subjects – DLF” were vacated.

September

GST stipulated four agency contracts for the expansion of the internal commercial network for the management of advertising, promotions and sales.

As regards the tender for the refurbishment of the internal works at Torino Porta Nuova station, GST stipulated Additional Deed no. 3 on 7 September, which does not adjust the total value of the tender (47.65 million Euros net of reserves) but disciplines, among other things, the new timetable, the extra works (Trenitalia variant and signalling), the settling inspection (approximately 3.5 million Euros), the adjustment of the price of iron (0.53 million Euros) and the interest for delayed payment (0.27 million Euros).


Given the negative outcome of the competitive confrontation procedure undertaken for the transfer of the shareholding in the company Network Italia Edicola Srl (formerly Grandi Stazioni Edicole Srl), GST has begun direct consultations with the economic operators involved in the procedure to verify their interest in formulating an offer under partially modified conditions. This procedure led to the stipulation of 14 September 2009 of the deed for the transfer of the shareholding for a total amount of 12 million Euros with the company Dufry Italia Srl. The sale price, subject to a technical and economic congruity assessment through an external inspection, has been defined in consideration of the presence of silent partnership contracts between Network Italia Edicole Srl and the individual newsagents operating in the stations and include their work and licences. Furthermore, on 2 March 2009, a leasing contract was stipulated between Grandi Stazioni and Network Italia Edicole covering the stations in which Network Edicole operates, with a duration of 9 years and renewable under market conditions.

On 18 September, GST subscribed a deed of recognisance with the TCE at the head of the enterprise Ing. Claudio Salini Grandi Lavori SpA, which took over following the transfer of the going concern from Baldassini Tognozzi Pontello SpA. This agreement enabled the dispute which arose during the planning phase with the original contractor for the work on the Central and South lots to be settled. By effect of that established in the deed, the contractual terms for the execution of the complementary works at Firenze Santa Maria Novella station were amended. The redefined economic value of the works amounts to 8.3 million Euros and work has begun.

On 23 September, the Board of Directors of GST decided to adopt the Code of Ethics of the Ferrovie dello Stato Group and set up an Ethics Committee.

During the course of the month, as regards the North West lot, GST handed over some functional documentation for Genova Brignole and Piazza Principe stations. As regards RFI, the latter was awarded the variant works, for a total of 1.7 million Euros, concerning additional deed no. 1 previously subscribed with the Contractor on 30 January 2009.

On 30 September 2009, GST subscribed with the TCE at the head of the enterprise Claudio Salini Grandi Lavori SpA the “Report for the handover of Assets”, which marked the beginning of the tender works for the complementary works at Roma Termini station. The Contractor is carrying out the first phase works concerning pre-worksite activities and the drafting of the plan of intervention for works characterised by significant railway interference.

At the end of the month, the area of the former departmental office block in Rome, Building M, was vacated. This will enable GST to handover and stipulate the leasing contract with the Ranucci Group for the realisation of a reception structure.

October

GST signed the transaction deed with the TCE CMB/Fatigappalti for the refurbishment, conduction and maintenance of Verona Porta Nuova, Venezia Mestre and Venezia Santa Lucia stations, with the redefinition of the contractual amounts and renouncement of the reserves previously registered, and work was begun.


The reports for the partial handover of the works concerning Firenze S. Maria Novella and Venezia S. Lucia stations were signed.

New electrical utilities serving the station property complexes were registered by Rete Ferroviaria Italiana SpA to Grandi Stazioni SpA.

November

The Ministry of Infrastructures and Transport asked GST for some clarifications concerning the proposal for the modification of the interventions for the refurbishment and realisation of the complementary infrastructures in major stations (CIPE decisions 10 dated 14/3/03 and 129 dated 6/4/06), subordinating the extension of the period of usage of the loan for the Legge Obiettivo works, which expired in December 2008, to these clarifications.

December

The Club Eurostar lounges in Rome, Turin, Milan and Naples, realised by GST under contract to Trenitalia SpA, were inaugurated.

GST was paid the last instalment of 30 million Euros of the EIB loan totalling 150 million.

The Board of Directors of GST decided to adopt the SAP management system in two phases: 1) implementation of the system in support of management and accounting processes and 2) implementation of the system in support of business and human resources management processes.

The subsidiary Grandi Stazioni Ceska Republika sro completed the works at Marianske Lazne station in the Czech Republic.


HUMAN RESOURCES Composition of and changes to staffing level Number of employees at 31 December 2009 At 31 December 2009, 242 employees were on the Group payroll. An increase of 13 units is highlighted, compared to 31 December 2008, with the following increases and reductions:

Registered employees at 31 December 2008 229

In 28

Out -15

Employees at 31 December 2009 242

Net changes in the workforce, in detail:

PERSONNEL 31 December 2009 31 December 2008 Differences

Executives 13 12 1

Middle management 39 40 (1)

Non-management personnel 190175

13

TOTAL 242 227 13

Average number of employees in 2009 The average number of registered employees totalled 235 units, with the following breakdown by category:

REGISTERED PERSONNEL 2009 Average 2008 Average Differences

Executives 13 13 (1)

Middle management 41 41 (0)

Non-management personnel 182

180 2

TOTAL 235 234 1


In particular, the following executives and middle management personnel were recruited or stepped down during the year.

In January, one executive was added to the Grandi Stazioni SpA structure, responsible for the Business Development and Institutional Relations Department.

In March, Grandi Stazioni SpA terminated subordinate working relations with 2 executives, responsible for the Business Strategy and Legal and Corporate Affairs and Procurement Departments.

At the end of April, Grandi Stazioni SpA employed one executive to replace an external consultant as manager of the Infrastructures Development Department, which includes the posts of Technical Director of the Company, Manager of the contract between Ferrovie dello Stato and Grandi Stationi and Sole Director of Grandi Stazioni Ingegneria srl.

In May, Grandi Stazioni SpA terminated subordinate working relations with 2 employees, one executive responsible for the Property and Contracts structure and one middle management, while a fixed-term collaboration contract with an individual for the coordination of the “Informative Systems” management body was finalised.

At the beginning of July, Grandi Stazioni SpA employed two executives, the Manager of Legal and Corporate Affairs and the Manager for the Management of Tenders, with the function of Manager of Procedures (RUP).

In November, working relations with the manager of the Procurement management unit, part of the Legal and Corporate Affairs and Procurement Department, were terminated, and Grandi Stazioni Ceska Republika employed a Facility Management manager.

Labour Relations The year was characterised by the consolidation of the system of unitary commercial relations, aimed at open and direct discussion with both the Commercial Union organizations represented in Grandi Stazioni SpA as regards the matters provided by national laws, by the National Collective Labour Contract and the CIA.

The company intended to lay the foundations for constructive and profitable discussions from the viewpoint of the negotiations to be started in 2010 following the expiry of the Integrative Corporate Contract on 31 December 2009.

Training 2009 represented the starting point for the new corporate training policies, thanks to the following:

the consolidation of the training activities carried out until now by Grandi Stazioni: in 2009, 211 resources out of 235 were involved in training processes, at all levels of the hierarchy (non management personnel, middle management and executives) and in all corporate roles (operations, technical-specialised and management), for a total of 1,388 training hours at a total cost of 27,198 Euros, double that in 2008;

the process for finding the corporate training requirements aimed at drafting the new Corporate Training Plans for 2010 was started.


The training projects realised in 2009 were structured in consideration of the following thematic areas:

technical-regulatory updating; updates on Information Technical.

As regards technical and regulatory updating, training initiatives were realised that were transversal to all the corporate offices and also aimed at the specific professional requirements of the different corporate sectors. Specific importance was given to Safety: in line with the refurbishment requirements of the station complexes in the Grandi Stazioni network, specific interventions were undertaken for the Coordinator of Safety in Worksites, according to Legislative Decree 81/08. At a transversal level, the Training Plan concerning Health and Safety in the workplace, aimed at Executives, those responsible for safety and all corporate personnel, was implemented, according to that provided by Legislative Decree 81/08. As regards updates on Information Technology, training interventions were realised aimed at increasing both basic computer knowledge (Microsoft Office) and specialised interventions aimed at enhancing the management of the company’s computerised systems. Management Policy 2009 represented a year of internal reorganization and consolidation of existing structures for the Group. From an organizational and management viewpoint, the Group intended to continue the reorganization process started in 2008, by introducing policies aimed at the rationalisation of resources and specific focus on the various business sectors which jointly contribute towards the definition of the corporate mission. To this end, the Group undertook interventions aimed at: reorganising the Line Departments, mainly focusing on their respective businesses: Business Management Department, with the completion of the organizational structures

and their respective territorial workforces; Infrastructures Development Department, with the inclusion of the new manager and

organizational and corporate set-up, deriving from the incorporation of Grandi Stazioni Ingegneria, for the internationalisation of engineering services previously outsourced;

Sales and Advertising Department, on the basis of the sharing of the new commercial strategy and new internal procedures, especially in the direct management of sales, advertising and promotional processes and for the management of competitive procedures for leasing commercial areas;

rationalising the use of the workforce resources, valorising their professional qualifications through the following initiatives: participation in the project for the Weight Holding project for top management

positions, using the HAY methodology, definition of the remuneration policies for executives and consolidation of the current bonus systems;


start up of the project for the inclusion of new graduates and simultaneous identification of training programmes aimed at covering top management positions, where possible, through the valorisation of internal resources;

market research for positions with profiles not corresponding to the qualifications currently in the company or in the Ferrovie dello Stato Group.

Safety in the Workplace Activities concerning health and safety in the workplace, in compliance with the new regulatory regime introduced by Legislative Decree 106 dated 3 August 2009, mainly involved updating the Risk Assessment documents, campaigns for instrumental and environmental data collection (noise, micro-climates, lighting, non ionising radiation, legionella, drinking water, dust, etc.) in offices and public station areas, the updating of the emergency plans for railway complexes on the basis of the status of the refurbishment works in the station property complexes, carrying out health inspections and the planning and execution of corporate training projects.


ENVIRONMENTAL POLICY During the course of 2009, the main activities/interventions in the context of environmental policy were focused on the containment of consumption by increasing the efficiency of monitoring, an increase in the punctual recording of consumption figures and enhancement of the distribution networks aimed at eliminating losses and waste, the assessment of possible alternatives in terms of electricity supplies and the introduction of devices aimed at rationalising the consumption of utilities. Activities for the differential disposal of waste were also implemented. The following is the breakdown of these activities/interventions, subdivided by single fields of application. Energy

Carrying out a feasibility study for the realisation of photovoltaic installations (technical-economic hypothesis concerning the positioning of panels on the roofs of the station complexes).

Start-up at Roma Termini station of the project for the realisation of a system for automatically recording consumption levels in homogeneous station areas (buildings, areas of large dimensions, etc.), for the punctual monitoring of utilities and the analysis of their consumption levels.

Installation of electronic devices for the modulation of the absorption of energy

(inverters, etc.) on the basis of the effective usage of installations for the new devices in refurbished stations (escalators, lifts, mobile walkways, refrigerator groups, etc.).

Usage of combined systems for simultaneous cold-heat production (refrigerator

absorption machines in Roma Termini station) to enhance the overall performance of the installations.

Positioning of the institutional figure of Energy Manager within the Office responsible

for the operational management of stations and the creation of a specific Management Unit dedicated to the management of utilities, with specific reference to electricity.

Water supplies

Continuous monitoring of water consumption and assessment of the efficiency of the system for the punctual elimination of leaks.

Punctual identification of the effective station users for interventions aimed at

rationalising consumption levels.


Realisation of interventions for the modification of distribution circuits aimed at eliminating waste, avoiding incorrect manoeuvres and the consequent improper use of water, and attributing consumption to effective users with certainty.

Emissions

Realisation of new production plants with enhanced energy performance and reduced emission of pollutants in the refurbished stations of Napoli Centrale and Torino Porta Nuova.

Transformation of the gasoline installations in Naples station to methane gas

installations, with reduced environmental impact.

Continuous conduction activities in the thermal and refrigeration production plants, with daily analysis of the emission of pollutants and relevant regulation interventions.

Waste management

Keeping the entire system for the differentiated management of waste efficient: o maintenance of bins for the differentiated collection of waste; o study for the realisation of new ecological islands for differentiated collection; o study of additional improvements concerning waste disposal, also through

the involvement of local firms in the sector. Installation in the new public areas of the refurbished stations of specific “tripartite”

and “quadripartite” waste disposal bins for the collection of paper, plastic and aluminium in addition to “undifferentiated” waste.

Public health A specific non-smoking signage system has been implemented in stations and specific station areas allocated for smoking. Environmental monitoring An integrated environmental monitoring system has been developed aimed at guaranteeing the representation of the status of station environments and ensuring quality and safety in relation to matters and problems that may arise therein. In this regard, 1,400 instrumental data collections were conducted concerning

dust (60); water (700); electromagnetism (235); noise (405).


CUSTOMER RELATIONS Marketing

Marketing and Communications activities in 2009 were characterised by actions supporting the Business Areas, by constant focus on assessing customer satisfaction levels and the promotion of the corporate image. Activities concerning the following are highlighted: a) The first post refurbishment Customer Satisfaction survey conducted on Milano Centrale, to

support the operational choices concerning the plans for enhancing the services provided. b) The activities in support of the Business Leasing Area to stimulate purchases in the shops in

Roma Termini. c) The inauguration of the public areas of Torino Porta Nuova station. d) The starting of a new process for the management of Customer Relations with the aim of

the timely management of claims and the systematic generation of feedback in order to improve the enhancement plans.

Foreign expansion

From the viewpoint of expanding its activities, the Grandi Stazioni Group continued its search for new opportunities for expansion on foreign markets. In this context, the criterion for assessing priorities is based on the following indicators: - countries characterised by high rates of development and great potential for multi-

functional structures such as stations; - markets localised in the framework of the plans for expanding the railway axes provided by

the EU and international High Speed trains; - return on investments comparable to that of Grandi Stazioni SpA and capable of quickly

repaying investments. The expansion model used by the Grandi Stazioni Group is that already experimented in the Czech Republic through the subsidiary Grandi Stazioni Česka Republika. The following are highlighted among the Group’s main activities abroad: GS Česka Republika: For the second consecutive year, the subsidiary closed the financial year with a positive net result (financial statements drawn up according to the local accounting principles), proving the strengthening of the trend that should see it achieve its goals in the next two years. In 2009, management was characterised by the opening to the public of the areas refurbished during Phase II of the works at Prague Central (June 2009), the completion of the station of Marianske Lazne (December 2009) and the negotiations with Czech State Railways for the release of the company form the contract for Karlovy Vary station. At the end of 2009, the areas managed in the Czech Republic included commercial areas covering approx. 4,800 m2. As regards these areas, the available data shows a constant increase


in their monthly returns, showing that the public is appreciating the new services provided in these stations. Czech Republic: The Czech State Railways company ČD proposed to Grandi Stazioni SpA an evaluation of the opportunity of expanding its field of operations in the Czech Republic to other stations in the ČD Network. However, the initial analyses conducted are not encouraging as regards the involvement of Grandi Stazioni SpA, both because the stations in question are minor ones and the returns would not be compatible with the strategic goals of the company. Grandi Stazioni SpA would be willing to continue the project should quotas of support investments by the Czech State Railways company and/or local municipalities and/or the European Union be provided. India: After the handover of the documents required for the tender for the refurbishment, expansion and management of the railway station in New Delhi in February 2009, the Indian Ministry of Railways (MOR) has not yet published the shortlist of the 6 candidates to participate in the subsequent phase of the tender. Russia: In spite of the positive response obtained in 2008 by the works carried out by Grandi Stazioni on three stations in Russia, the management changes within the Russian Railways Group has meant that the continuing collaboration with Grandi Stazioni has been stalled. At the end of 2009, it was agreed to continue with the plan for the completion of the architectural concepts and the functional investment and management models for another 5 minor stations in the St. Petersburg area and the invoicing of the services provided was accepted. Egypt: GS has finalised a collaboration agreement of a consultancy nature with ERJET, the company responsible for the expansion of the main stations used by Egyptian National Railways (ENR) for the expansion of the seven main stations in Egypt. This agreement, worth approximately 700,000 Euros over three years, will be submitted for approval by the new Minster of Transport, to be appointed by early 2010. Slovakia: Grandi Stazioni SpA has begun to assess the possibility of collaboration in the framework of the refurbishment plan of the area in front of and including Bratislava Central station, for which the Polish company IPR has begun to obtain the required authorisations. USA: Grandi Stazioni SpA has begun to assess the project for a high speed railway link between Las Vegas (Nevada) and Victorville (California), called DesertXpress, for which participation and management in line with its own business model could be planned. The completion of the assessment of this opportunity is expected in the first half of 2010. Poland: The monitoring of the Polish market continued while awaiting developments that may interest Grandi Stazioni SpA.


MACROECONOMIC BACKGROUND The recession which began in the second half of 2008 and continued throughout 2009 highlighted its range, in terms of the sectors involved, and depth, in terms of the contraction rates registered, such as to make this crisis the worst since the second world war for western economies, with an initial forecast for the complete recovery of the previous situation not before 2012/2013. The anti-crisis action undertaken by both governments and central banks were oriented firstly towards supporting the financial system and then supporting the demands of consumers (considering only economic support policies, for example, 940 billion dollars were used overall in the United States, the Member States of the European Union allocated overall resources amounting to approximately 5.5% of the EU GDP, 25 billion in Italy for the triennium 2009/2011). Starting last summer, these stimuli have begun to generate the first signs of a slowdown in the reduction in trade exchange and the stability of the financial markets which, towards the end of the year, enabled a recovery process to be started with an initial slight increase in economic activity. However, the lack of trust still present on the financial markets and the repercussions on consumption due to the reduction in employment are the main limitations to the possibility of a significant and speedy recovery. Overall, trade exchanges at a global level reduced by 11.9% in 2009, and the global GDP reduced by 0.4%. In particular, the recession significantly affected the stronger economies (United States -2.6%, Japan -5.2% EU average -4.0%). On the other hand, emerging economies registered differing results; for example, of the BRIC countries (Brazil, Russia, India and China), only China and India registered increases, although lower than in the past (Brazil +0.1%, Russia -8.6%, China +8.1%, India +6.5%). As regards Italy, the domestic financial system highlighted a greater solidity compared to its main foreign competitors (USA, Great Britain, Germany, France and Spain) and the real economy, despite the limited number of policies supporting the overall demand tied to the scarcity of public resources available, following a first semester of recession, showed greater dynamism during the second part of the year. The annual GDP reduced by 5.1%, distinguished by the reduction in both domestic consumption (-1.2%) (this is especially due to the reduction of 1.8% in family expenditure, broken down as follows: -2.3% food products, -3.1% durables, sustained in the middle of 2009 by incentives, and 0.1% services) and investments (-12.2% of which: -17.2% for machinery and equipment and -7.9 for construction). Industrial production underwent an average annual reduction of 17.5%, registering the worst fall since 1991. The sectors most affected by the crisis were: metallurgy (-29%, with a reduction of over 20% in the usage of installations), the manufacturing of machines and equipment (-28%), the processing of wood/paper (-16.3%) and chemical (-12.9%). The performance of consumer prices enabled the mitigation of the effect of the compression of purchasing power for families, reaching +0.8%, slightly more than values in the Euro area. The price of oil significantly affected the containment of the general price index, with values reaching an annual average of 60 dollars per barrel (98 dollars per barrel in 2008).


The prospects of the Italian economy over the next few years are for a slow and still uncertain recovery of domestic and international consumption, linked to the transitory nature of the main factors that have sustained it until now, with a double slowdown on both businesses and families, in the former case by effect of the costs associated to the excess of production capacity and in the latter case due to the high level of unemployment. TRENDS IN REFERENCE MARKETS

Property markets

During the course of 2009, the property market underwent a further reduction. It was a year of crisis for all of Europe. The crisis was long lasting and profound, with significant effects, and difficult months are expected before an effective recovery. During the course of 2009, property markets reached their lowest levels, although the first signs of recovery were seen. The adjustment of prices during the last few years has enabled property operators to return to the market in order to make the most of any opportunities that may arise. The time required for the closure of major operations (over 40 million Euros) are reducing, showing that access to credit by investors is becoming easier. Therefore, it would appear obvious that 2009 has seen the worst of the crisis affecting the European property market. Although the second half of 2009 was less dramatic than the first, a long time will be required before returning to the levels reached prior to the crisis

Focus on Italy

Services/Office Market

During the course of 2009, the Office market slowed down further, in terms of both purchases and leases. The demand and the number of transactions are continuously falling (III quarter 2009: -18.9%, II quarter 2009: -5.4%, I quarter 2009: -20.4%), while the offer remains stable. In detail: prices progressively falling: -3.9% compared to 2008; sale and lease times still increasing, although with signs of recovery as regards major

operations: approximately 8 months and 5.5 months respectively; fees continuously reducing: -2.8% compared to I quarter 2009. Retail market

The Retail market was also characterised by signs of sufferance. Demand registered a further

fall, the exceptions being Venice and Rome, due to trade dynamics linked to the domestic and

international flow of tourists, as follows:

reduction in volume: the reduction in the third quarter 2009 (-17.7% compared to the

third quarter 2008) was less than in the first quarter 2009 (-23.8%);


increase in sale and lease times, to 7 months and 5 months respectively;

progressive fall in prices: -1.5% compared to 2008;

lease fees reducing: -1.3% compared to 2008.

Advertising Market

2009 was one of the most complex and difficult years for the communications market, and especially the advertising sector. Investments in advertising registered a total market decrease of -13.4% in 2009 compared to 2008 (A.C. Nielsen figures).

In particular: -10.2% TV and -21.6% press.

The External sector, the reference market for Grandi Stazioni Media, registered a significant reduction of -25.4%.

This segment is characterised by the presence of three multinational players: Clear Channel, CBS Outdoor and IGP Decaux, which together represent 42% of the sector, while 48% is broken down into a multitude of independent multi-regional operators. The market crisis and consequent reduction in marginality (due to the fixed costs of the guaranteed minimums) has also implied a drastic containment of costs and the resizing of sales structures for the multinationals.

In this general market context in which the company operates, outlined above, management trends were as follows.

Property market

During the course of 2009, activities were concentrated on the commercialisation and contracting of the areas made available in the refurbished stations. The serious crisis of the property market, which heavily influenced the retail market as well, implied a major reluctance on the part of all the operators preliminarily contracted in previous years to invest in new sales outlets and in executing contracts. The management of commercial relations in the network was therefore focused on all the activities functional to the status of the opening of businesses in Milano Centrale, Napoli Centrale and Torino Porta Nuova stations.

Discussions with all customers in possession of preliminary/verbal agreements providing for the reimbursement of expenses concerning the status of progress of the works were started and/or continued.

The discussions were aimed at confirming the interest of partners in stipulating definitive leasing contracts in all the stations involved in the preliminary commitments contained in these verbal agreements, in order to open all the sales outlets currently being realised in Milan, Naples and Turin stations to the public and also to minimise the risk of withdrawal from these agreements and consequent impacts in terms of costs for the company.


The commercialisation of these areas continued through the new procedure defined in 2008 for the competitive selection of commercial partners in Milano Centrale, Torino Porta Nuova and Napoli Centrale stations. Through the aforementioned procedure, 21 new assignments of commercial areas were formalised, of which 14 are already open to the public and 7 are soon to open, in Milano Centrale, Torino Porta Nuova and Napoli Centrale stations.

Expiring contracts were also renegotiated.

The discussions with so-called institutional subjects (Gruppo Torinese Trasporti and Agenzia Turismo Torino, ASL Milano) were started again and others are ongoing (Milan Provincial and local councils, Bologna local council) for the subscription of the relevant contracts, in the light of the expiry of previous relations and/or requests for reallocation to the refurbished complexes.

The main agreements reached during the year include:

GS – Network Italia Edicole: after subscription of the leasing contract on 14 September 2009, the first of the new formats were opened under the brand name “Hudson”, a total of 5 sales outlets, in the refurbished areas in Milano C.le and Torino P.N.

Discussions/renegotiations of preliminary agreements on finalised Networks: Miroglio, Imaginarium, Zannier Calzedonia Group, Salmoiraghi;

Retail Group and subsidiary companies: simultaneously to the handing over of the refurbished areas, and following the review of the station projects with the aim of improving flow, the boxes were replaced with fixed structures. The failed acceptance of this replacement, provided by a contractual clause, led to legal proceedings which were concluded successfully to enable the removal of all boxes in Milano Centrale;

Treni Servizi Integrati: following the definitive expiry of the tender contract concerning catering services onboard trains, GS has gradually handed these services over to the new contractor (Treno Servizi Integrati Srl) of the network areas required for this purpose. Following the assessment and cognisance of these areas in all stations, the relevant leasing contract is currently being finalised.

Areas used by companies in the FS Group

(GST 2008 revenues: 28.0 million – GST 2009 revenues: 25.7 million)

The management aspects of the vacating of the areas occupied to enable a complete valorisation by Grandi Stazioni SpA continued.


The new fees agreed were defined and invoiced and the overall leasing contracts to the FS Group are currently being finalised, and will replace previous expired agreements (Lodo Barbieri). These new fees have been accepted by the companies in the FS Group, with the exception of RFI, as regards Other RFI only, and especially those occupied by the DLF.

Trenitalia

(GST 2008 revenues: 17.2 million – 2009 GST revenues: 15.4 million)

In the light of the progress made in the refurbishment works in Milan, Turin and Naples, and the modification of the refurbishment projects for certain stations, an agreement has been reached with Trenitalia for the definitive identification of the commercial areas (ticket offices and Eurostar club) to be realised in the refurbished complexes in the network.

Ferservizi


An agreement has been reached for the new territorial offices at Palermo Centrale; the relevant areas will be inserted in the leasing contract which will replace the expired Lodo Barbieri.

Rete Ferroviaria Italiana


Alone among the companies in the Group, RFI did not accept all the conditions defined for the companies in the FS Group to overcome the Lodo Barbieri. During the course of 2009, in particular, RFI unilaterally failed to totally or partially recognise the areas occupied by the subjects accountable to it (for example DLF) which occupy the areas in the perimeter of Grandi Stazioni SpA. Discussions are ongoing between the parties in order to finalise a direct leasing contract between GS and DLF with a duration and fees still to be agreed that may also discipline 2009.

Properties owned


The usage of areas by both third parties (2009 revenues: 0.3 million), on the basis of the leasing contracts, and companies in the FS Group (2009 revenues: 4.6 million), according to the terms of the “side letter” dated 29.03.2001.

The most significant facts include:

the stipulation by GST with Veneto Region of the definitive contract for the purchase of the property in Venezia S. Lucia, for which the balance was paid on testing of the building, as mentioned in the principal events of the year;

the subscription by GST of the integrating deed to the preliminary contract with the Ranucci group for the management of a hotel in the departmental office block in Rome under improved conditions.


Advertising Market


As regards the advertising market, 2009 was a critical year in general. In its forecasts, AC Nielsen indicates a decrease of 14.5% for the overall market in the period January-November 2009; as regards the external advertising sector, this decrease is of approximately 25.3% for the same period. The Grandi Stazioni revenues performed substantially in line with the performance of the reference market.

In terms of advertising activity, 2009 was the year in which the business model was reviewed, with the inclusion of significant quotas of value and margin which in the previous model were to have been managed by third party players.

In particular, priority was given to the recovery of value from:

the setting up of an internal structure for the collection of advertising for direct management and contracts with 4 single mandatary agents from September and the implementation of a business procurement contract with an external agency;

direct management of negotiation rights with media centres;

realisation and development of new systems through tenders at significantly lower costs and outside the silent partnership contract;

expansion of promotional activities and events which, being direct and not subjected to support from the silent partner, led to the generation of positive margins for the company.

Furthermore, a market analysis was conducted which led to the repositioning of Grandi Stazioni Media, highlighting the centrality of the Grandi Stazioni SpA offer of the “events and promotions” product in the marketing mix of customers.

Although at a time of crisis, the commercial policy is structured to safeguard the value of assets with a strict pricing policy such as to enable Grandi Stazioni SpA to intercept the possible recovery of the market with increased marginality.

As regards the internal organization, specific emphasis was placed on processes. Specifically, the following steps were carried out during the financial year:

mapping and redefinition of the entire active and passive process through an analysis conducted by Deloitte and the updating of the informative system (in operation as of January 2010);

redefinition of the process concerning the active cycle – Revenues;

redefinition of the process concerning the passive cycle – Costs;

management of the administration and credit processes;

adjustment of the set-up to cover the required management roles.


The above actions will enable Grandi Stazioni to achieve returns with greater structural margins in 2010, thus enabling it to invest in its geographical coverage and the segments in demand (with further expansion of the network of single mandatary agents) and in the realisation of new advertising systems with interesting returns on investments.

Customer services

In 2009, action was taken to assess the new contract for “Awarding services for the management of hygiene Services on payment and luggage deposit”, aimed at offering a quality service, focusing on satisfying station customers with an economically balanced management system.

Hygiene services on payment


The revenue figures were characterised by multiple factors:

Delays in the realisation of the premises in Roma Giolitti due to the review of the concept and delays by the contracted firms;

restyling of the premises in Florence and tariff increases;

delays in the availability of the new premises in Naples due to the postponement of the refurbishment work in the station;

maintenance of the service in the premises at platform level next to platform 3 in Milan, having found the necessity for two service points in the station;

failed realisation of the payment services in Mestre station.

The result concerning the gross operating margin of assets was safeguarded through the careful management of costs and the management activities involved.


Luggage deposit on payment


The trend of involution registered in the last few years continued this year, with a decrease in the flow of luggage which penalised the economic results of the entire network.

The reasons for this are:

less movements in terms of journeys/holidays;

reduction in travel times, with the consequent lack of overnight stays due to high speed services;

refurbishment work in stations which, with the presence of worksites, penalised the legibility and accessibility of the service;

changes in the culture of travelling, involving the use of hang luggage when travelling;

increase in the use of trolleys, facilitating the transporting of luggage.

This asset essentially benefitted from qualitative interventions deriving from the finalisation of the new contract for assigning services concerning the storage of luggage, without any economic returns.

Car parking on payment


In 2009, the new model for the direct management of the Grandi Stazioni car parks was implemented, with a management contract awarded to Metropark for the car park in Piazza dei Cinquecento in Rome.

The car park with hourly tariffs in Via Marsala in Rome (46 spaces) was opened, in which 11 spaces were leased to the company Anas in integration of the leasing contract in force for the offices.

An improvement was registered in terms of revenues from the car park in Verona (+25% of the returns), managed in silent partnership with Metropark.

As regards the car parks in Bari and Florence, included in the deed of acknowledgement between Grandi Stazioni and RFI, the annual subscription formula for the companies in the FS Group was implemented, debited among the condominium costs.


ECONOMIC PERFORMANCE AND FINANCIAL POSITION

Reclassified consolidated profit and loss account

in thousands of Euros

31.12.2009 31.12.2008 Difference

- Revenues from provision of services

- Differences in contracted work in progress - Other receipts and revenues

169,425

8,449

29,402

175,100

2,752

2,202

(5,675)

5,697

27,200

Production value 207,276 180,054 27,222

Labour costs

Other costs

(16,237)

(129,079)

(16,775)

(135,993)

538 6,914

Capitalisation – inventory changes 2,412 9,588 (7,176)

Operating costs (142,904) (143,180) 276

GROSS OPERATING MARGIN 64,372 36,874 27,498

Depreciations and write-downs

Allocations for risks and charges (10,822)

(2,665)

(7,142)

(2,034) (3,680)

(631)

OPERATING RESULT 50,885 27,698 23,187

Balance of financial management 9,566 (142) 9,708

RESULT BEFORE TAX 60,451 27,556 32,895

Income tax (20,899) (9,564) (11,335)

FINANCIAL YEAR RESULT

Net Group result

Net third parties result

39,552

39,561 (9)

17,992

18,072 (80)

21,560

21,489 71

Production value in 2009 totalled 207.3 million Euros, a net increase of 27.2 million Euros compared to 2008, due to the joint effect of the increases in contracted work in progress, increase in other revenues and decrease in revenues from the provision of services. The operating costs totalled 143.0 million Euros, down by 0.3 million Euros compared to 2008 due to the lesser labour and other costs and the decrease in capitalisations and inventories, analysed in detail below. The gross operating margin totalled 64.4 million Euros, an improvement of 27.5 million Euros compared to 2008. The economic result for the 2009 financial year registered net profits of 39.6 million Euros, up by 21.6 million Euros compared to the previous financial year. The reasons for this significant improvement are attributable mainly to the capital gains from the sale of the property in Venice and the positive balance of financial management deriving


from the capital gains from the sale of the total shareholding in Network Italia Edicole srl (formerly GS Edicole srl). Below is an analysis of the reclassified consolidated profit and loss account. The “Revenues from the provision of services” totalled 169.4 million Euros and are broken down as follows:

Amounts in millions of Euros 2009 2008 DIFF

Leasing 81.4 81.2 0.2

Reimbursement of condominium costs 64.9 65.1 -0.2

Media 11.4 19.6 -8.2

Engagement and special installations 3.2 1.1 2.1

Works planning and direction - 0.1 -0.1

Customer services 7.9 7.3 0.6

Miscellaneous 0.6 0.7 -0.1

Totals 169.4 175.1 -5,7

Revenues from leases were up by 0.2 million Euros, due to:

- 2.0 million Euros for release by the FS Group of property owned by the company; +2.2 million Euros for increased surface area leased and leasing fees for properties

under the management perimeter. Revenues from the reimbursement of condominium costs were down by 0.2 million Euros, due to a decrease in assets/costs managed compared to the previous financial year. Media revenues were down by 8.2 million Euros compared to the previous financial year due to the recession. Revenues from Engagement and other special installations were up by 2.1 million Euros compared to the previous financial year and in counter tendency to media revenues. Revenues from work planning and direction on behalf of third parties were down by 0.1 million Euros, in as much as during the period in question, no engineering contracts were finalised and the revenues accrued are included in the item changes to contracted work in progress. Revenues from customer services were up by 0.6 million, due to the management of car parks and hygiene services. The item “Changes in contracted work in progress” totalled 8.4 million Euros and concerns engineering services and works realised but not completed, and is not therefore included in the revenues. This item is up by 5.7 million Euros compared to the previous financial year due to the works realised on behalf of third parties and the usual engineering services.


The item “Other revenues and income” totalled 29.4 million Euros, broken down as follows

Amounts in millions 2009 2008 DIFF

Reimbursement of completed works 3.6 - 3.6

Property sales 24.1 - 24.1

Other revenues and income 1.7 2.2 (0.5)

Totals 29.4 2.2 27.2

“Other revenues and income” increased by 27.2 million Euros compared to the previous financial year. This increase is mainly due to the sale of the departmental office building in Venice, for 24.1 million, and the reimbursement for the works carried out on behalf of third parties in Turin and Rome, for 3.6 million Euros, not recorded in the previous financial year. “Labour costs”, totalling 16.2 million Euros, were down by approximately 0.5 million Euros, mainly due to the lesser incentives for exodus recognised to personnel compared to the previous financial year. “Other costs” totalled 129.1 million Euros and are basically broken down as follows:

Amounts in millions of Euros 2009 2008 DIFF Raw materials, consumables 0.2 0.4 (0.2) Services Cleaning 21.9 22.8 (0.9) Maintenance Utilities Engineering services

16.6 14.9 8.9

18.3 12.6 2.8

(1.7) 2.

Station services 6.5 8.9 (2.4) Improvement of own assets - 8.1 (8.1) Fees for silent partnership agreements 2.5 4.3 (1.8 ) Costs of services to customers 4.9 4.1 0.8 Supplies 1.0 3.1 (2.1) Professional services 2.8 2.7 0.1 Insurance premiums 1.1 1.2 (0.1) IT services 0.9 0.6 0.3 Consultancies 1.4 0.5 0.9 Advertising and promotional costs 0.9 0.4 0.5 Directors remuneration 0.5 0.9 (0.4) Travel and overnights 0.1 0.1 - Other 2.7 2.7 - Services sub-total 87.6 94.1 (6.5) Use of third party assets 34.6 35.4 (0.8) Other management costs 6.6 6.1 0.5 Totals 129.1 136.0 (6.9)

The purchase of raw and subsidiary materials totalled 0.2 million Euros and was down by 0.2 million Euros compared to the previous financial year.


Service costs totalled 87.6 million Euros, down by 6.5 million Euros compared to 2008. The decrease in service costs is mainly due to:

-8.1 million Euros for works carried out during the course of 2008 on the property in Venice sold in 2009;

+6.1 million Euros for costs concerning engineering services from third parties; -3.9 million Euros for reduced supplies and payments for silent partnerships linked to

the reduction in media revenues; -2.6 million Euros for cleaning and maintenance concerning public areas; -2.4 million Euros for station services; +2.3 million Euros for the attachment of new utilities; +0.9 million Euros for consultancies; +0.8 million Euros for customer service costs.

The use of third party assets totalled 34.6 million Euros, down by 0.8 million Euros compared to the previous financial year. This decrease is due to the reduction in the retroactive fees for the contract for the use of the station complexes and the reduction in the passive leasing fees. Other management costs totalled 6.6 million Euros, up by 0.5 million Euros compared to the previous financial year, and mainly comprise tax payables. “Capitalisations” totalled 2.4 million Euros, down by 7.2 million Euros, and comprise the costs of the technical structure used during the refurbishment interventions. This reduction is traceable to the zeroing of the changes in contracted works in progress concerning the works carried out during the course of 2008 on the property owned in Venice sold during the course of 2009. “Depreciations and write-downs” totalled 10.8 million Euros, of which 5.0 million was due to depreciations, and were up by 3.7 million Euros compared to the previous financial year. This increase is due to:

+1.1 million Euros for the increase in amortizations of properties, plants and machinery due to the inclusion of the amortization of the property owned in Bologna;

-0.4 million Euros due to the lack of depreciations on properties, plants and machinery; -0.4 million Euros as the net effect of a reduction in the amortization of intangible

assets, due to the amortization period ending; +2.4 million Euros for increased write-downs on trade receivables; +1.0 million Euros due to the lack of the recovery of value of trade receivables.

The credit depreciation fund increased from 5.6 to 10 million Euros during the financial year, taking into account the use of 1.5 million Euros for definitive losses, and concerns:

6.9 million Euros for leasing receivables, reimbursement of additional and media costs; 3.1 million Euros credit for the reimbursement of works in previous financial years.


“Allocations for risks and charges” totalled 2.7 million Euros, up by 0.6 million Euros compared to the previous financial year, and are constituted by allocations to the risk fund concerning:

1.3 million Euros for civil disputes (totalling 4.2 million Euros); 1.4 million Euros for disputes and dependent and autonomous labour disputes (totalling

2.0 million Euros); 0.4 million Euros for fiscal disputes.

The balance of “Financial management” totalled 9.6 million Euros of income, an improvement of 9.7 million Euros compared to the previous financial year, and is broken down as follows:

12.0 million Euros from capital gains from the sale of the shareholding in Network Italia Edicole srl;

1.3 million Euros from financial income, down by 3,5 million compared to 2008 due the failed receipt of dividends by the dissolved subsidiaries;

-3.7 million Euros from financial costs, down by approximately 1.3 million compared to 2008 due to the reduction in interest rates.

By effect of that outlined above, “Income tax” totalled 20.9 million Euros, up by 11.3 million Euros compared to the previous financial year.


Reclassified consolidated statement of assets and liabilities

in thousands of Euros

31.12.2009 31.12.2008 Difference ASSETS

Net working capital 25,036 14,314 10,722

Other net assets 12,415 4,767 7,648Operating capital 37,451 19,081 18,370

Net intangible assets 90 102 (12)

Net tangible assets 271,671 237,453 34,218Shareholdings - - -Net capital equipment 271,761 237,555 34,206

Staff severance indemnity (-) (2,010) (2,014) 4

Other provisions (-) (6,611) (4,103) (2,508)Other provisions (8,621) (6,117) (2,504)

NET INVESTED CAPITAL 300,591 250,519 50,072HEDGING

Net short-term financial position (36,701) (19,992) (16,709)

Net medium/long-term financial position 201,777 162,267 39,510Net financial position 165,076 142,275 22,801

Equity 135,515 108,244 27,271

HEDGING 300,591 250,519 50,072

“Net invested capital”, posted at 300.6 million Euros at 31 December 2009, was up by 50.1 million Euros compared to the closure of the 2008 financial year, due to changes posted under the “net capital equipment” (+34.2 million Euros), “operating capital” (+18.4 million Euros) and “other provisions” (-2.5 million Euros) items, while the “hedging” item increased due to changes in the “net financial position” (+22.8 million Euros) and “equity” (+27.3 million Euros) items. The reclassified statement of assets and liabilities highlights in particular: a 28.1 million Euros increase in operating capital, mainly due to the increase in contracted

works in progress and trade receivables and the reduction in properties to be sold and trade payables;

a 34.2 million Euros increase in net capital equipment, mainly due to the increase in tangible assets;

an increase of 22.8 million Euros in the net financial position, due to the increase in medium/long-term debts for the financing of the refurbishment works and the short-term financial credit and current quota of medium/long-term loans. However, it must be highlighted that, before the expected expiry of the request for the final instalment


concerning the EIB loan (31 December 2009), the last 30 million Euros were requested and paid out and invested in the short-term;

an increase of 27.3 million Euros in equity, by effect of the profits achieved in 2009 net of the dividends paid out and the items in the overall profit and loss account for the financial year registered directly under shareholders’ equity.

RISK FACTORS Through its activities, the company is exposed to a number of financial risks: environment/context risks, strategic/operating risks and compliance risks. The Group’s operating and financial policies aim, among other things, to minimise the adverse impact of such risks on its financial performance. The company hedges exposure to certain risks by means of derivative financial instruments. As regards detailed information concerning these risk factors, see that described in the appropriate section in the “Explanatory notes to the consolidated financial statements” (note 7). INVESTMENTS Works Contracts Situation

Completed contract works

Roma Termini: Completion of phase 2 works.

The second phase of works in Roma Termini station has virtually been completed. In particular, the drafting of the final accounts and acceptance testing activities in connection with the refurbishment of Building D are approaching completion. Ongoing contract works Internal works on Italian stations (Milano Centrale, Torino Porta Nuova, Napoli Centrale stations, North West Lot, North East Lot, Central Lot, South Lot, Roma Termini Plates and Video-surveillance) and Czech stations (Prague Central). Milan Contract

As regards the Milan Contract, Additional Deed no. 2 bis was stipulated on 27 July 2009, which annuls and replaces the previous deed and adjusts the total value of the Contract to 104.28 million Euros, net of reserves and sums available for economies.

This Deed contains all the extra work that was required for the completion of the Contract, worth approximately 6.5 million Euros, removes the 3.5 million Euros acceleration premium, recognising approximately 4.9 million Euros to the Contractor for reserves (compared to 64.1 million Euros requested), which are added to the 3.5 million Euros previously recognised. The


adjustment of the price of iron deriving from Ministerial Decree 390 dated 30 April 2009 remains to be defined, but can be estimated as being 0.99 million Euros (received after closure of the inspection). The date for the completion of all the refurbishment activities is expected to be by the end of March 2010. The progress of the refurbishment of Milano Centrale station had reached approximately 90.23% of the contracted value (AD no. 2 bis) by 31 December 2009.

Turin Contract

As regards the Turin Contract, Additional Deed no. 3 was stipulated on 7 September 2009, which adjusts the total value of the Contract to 47.65 million Euros, net of reserves, and disciplines among other things the new timetable, the extra works (Trenitalia variant and signalling), the settlement inspection (which accounts for approximately 3.5 million Euros), the adjustment of the price of iron by 0.53 million Euros, interest for delayed payments, for 0.27 million Euros, and the sums available for economies.

Production was substantially in line with forecasts, except for some differences due to the postponement during the course of 2009 of the works concerning the Metro GTT exits and the pedestrian underpass, the worksite areas of which were only made available after delays.

The progress of the refurbishment activities in Turin station have reached 99.69% of the contracted value (AD no. 3).

Naples Contract

As regards the Contract for the refurbishment of Napoli Centrale, Additional Deed no. 2 was stipulated on 24 July 2009, for a total amount of 10.6 million Euros, which adjusts the total value of the Contract to 50.24 million Euros, net of reserves and the amounts available for economies.

This Deed includes 0.3 million Euros for the adjustment of the price of steel ex MD 390/2009 and disciplines the new timetable, extra works and the quality settlement inspection, recognising 1.8 million Euros to the Contractor for reserves (compared to 17.1 million Euros requested), which are added to the 1.8 million Euros recognised by AD no. 1.

The works are expected to be completed by the end of June 2010.

The progress of the refurbishment of Napoli Centrale station had reached 84.87% of the contracted value (AD no. 2) by 31 December 2009.

North West Lot Contract

As regards the Contract for the North West Lot, while awaiting the conclusion of the approval procedure for the executive design, the contractor was given some functional information for Genova Brignole and Genova Principe as of September 2008.

On 30 January 2009, Additional Deed no. 1 was subscribed, concerning the consolidation of the trusses at Genova Principe, the new fire-prevention tank at Genova Principe and the changes to the variable RFI signalling, adjusting the total value of the Contract to 44.6 million Euros.


RFI has recognised the expenses for the variant works concerning Additional Deed no. 1, totalling 1.9 million Euros.

The executive designs for the Internal Works of the North West Lot were approved on 8 June 2009, while the fulfilment of the CIPE prescription (Decision 10/2003 and Decision 129/2006) is currently being assessed by RFI and the Bodies involved, prior to the overall handover of activities.

Additional Deed no. 2 is currently being issued, which disciplines the approval of the executive design of the Internal Works only, the consequent new timetable and the relevant extra works.

As at 31 December 2009, services had been provided for the design and works totalling 4.5 million Euros.

North East Lot Contract

During the course of 2009, the questions concerning the status of the dispute with the Contractor of the North-East Lot (TCE CMB Fatigappalti) were resolved.

On 8 October 2009, Grandi Stazioni S.p.A. subscribed with the TCE CMB a Private Deed aimed at resolving the pending questions concerning the design, adjustment of the economic contractual framework and enabling the works to start immediately.

The new Economic Framework of the Contract therefore totals 38.3 million Euros, net of 10.5 million Euros for the definition of the extra work and maintenance costs, of which 1.5 million Euros accrued as regards the design activities.

On 28 October 2009, the activities for the handover of the selection of variant works at Venezia S. Lucia station were carried out, concerning the access road to the worksite and the structural consolidation of the so-called Bar Maccario area.

Central Lot and South Lot Contract

As regards the Central and South Lots, the conclusion of the discussions between BTP and the firm Claudio Salini Grandi Lavori s.r.l. for the transfer of the going concern inclusive of the contracts with Grandi Stazioni should be highlighted.

The above procedure was completed with the stipulation of the deeds for the formal takeover of the firm Claudio Salini from BTP as leader of the TCE. This has led to the re-composition of the ongoing pre-dispute situations.

As regards the Contract for Firenze Santa Maria Novella, a Deed of Acknowledgement was stipulated on 18 September 2009, aimed at acknowledging the modifications to the contract and the terms for the execution of the services concerning the refurbishment works, adjusting the value of the entire works to 8.3 million Euros.

The updated value of the Central Lot totals 43.2 million Euros (by effect of the Deed of Acknowledgement of which above and the removal of the works concerning the Variable IaP), while the Production Value as at 31 December 2009 totalled 0.5 million Euros (entirely matured for Firenze Santa Maria Novella).


The value of the contract for the South Lot totals 46.24 million Euros.

Roma Termini Plates Contract

On 30 September 2009, the refurbishment works for the Contract for the Complementary Works at Roma Termini were started, through the stipulation of the Report for the handover of Activities. The TCE headed by the company Ing. Claudio Salini Grandi Lavori SpA is carrying out the complex first phase activities concerning the pre-worksite set-up and development of intervention plans to reduce interference to railway operations to a minimum.

The value of the contract totals 82.71 million Euros.

Video-surveillance Contract

On 9 February 2009, Additional Deed no. 1 was formalised with the Sielte/Honeywell TCE, for a total amount of 10.74 million Euros, which adjusted the total value of the contract to 42.16 million Euros.

As at 31 December 2009, production totalled 27.41 million Euros.

Variant Expansion

As regards the remaining works for the Central Lot, North East Lot and South Lot Contracts, designs are being finalised for the expansion of the non substantial variants, which will enable the programme to be concluded in general terms without additional financing from the Legge Obiettivo funds compared to those originally assigned.

For this reason, Grandi Stazioni S.p.A. is planning some variants for these works, which it will approve in its quality of the firm awarded the contract pursuant to art. 169, paragraph 3 of the “Code for public contracts concerning works, services and supplies in implementation of directives 2004/17/EC and 2004/18/EC” (Legislative Decree 163 dated 12 April 2006 and subsequent updates). Following the request for information by the technical mission unit of the Ministry of Infrastructures and Transport, a proposal was submitted for the adjustment of the amounts to be financed and the lowering of the tender by CIPE decision.

Activities carried out in 2009

It should be stated preliminarily that during the course of 2009, a series of contracts were subjected to reclassification, concerning interventions already partly completed. These reclassifications concerned on one hand assets improperly classified previously under the category of Complementary Infrastructures and Video-surveillance (Legge Obiettivo) and on the other refinancing initiatives by RFI (for approximately 13.0 million Euros), both concerning assets previously classified under ongoing fixed assets and deposits (Upgrading of Lighting Systems and Remote Management/Remote Control).

“Internal Works” intervention plan (Refurbishment + Complementary Works + Railway Areas Interventions)

As regards the overall economic framework of expenditure of 173.1 million Euros (financed by Grandi Stazioni) and 196.3 million Euros (financed by RFI) for the refurbishment works as at


31 December 2009, the progress of these investments has been approximately 30.4 million (Grandi Stazioni) and 22.0 million Euros (RFI), totalling 52.4 million Euros.

It should be highlighted that the goal of 80% of investments accrued established by the RFI/Grandi Stazioni contract dated 14 April 2000 was achieved during the course of 2009, for the refurbishment of the so-called Internal Works on Property Complexes totalling 369.27 million Euros, of which 196.25 million Euros are the so-called Maximum Amount for RFI and 173.01 million the so-called Maximum Amount for Grandi Stazioni. The overall progress of the RFI and Grandi Stazioni investments as at 31 December 2009 totalled 297.36 million Euros, amounting to 80.53% of the financing established by the aforementioned Contract.

Activities carried out

As regards the activities carried out, these are mainly connected to refurbishment activities (carried out by the contractors) and the engineering work in the realisation phase by Grandi Stazioni SpA (Direction of Works, Safety in the executive phase and Testing) in Naples, Milan, Turin, Genova Principe and Genova Brignole stations (GS-RFI funds). Other activities carried out are those involved in the development and assessment of the executive designs and the study of the design variants, preliminarily to starting work on the remaining contracts.

“Legge Obiettivo” complementary works (Infrastructures + CCTV)

As regards the overall economic expenditure of 209.8 million Euros (Infrastructures) and 51.0 million Euros (Integrated Video-surveillance in the 13 major stations) by the State (in addition to the 23.68 million Euros for Infrastructures by Grandi Stazioni SpA), the main progress was made by the investments concerning the supply of the new video-surveillance system (firm issuing the contract: TCE – SIELTE/Honeywell) for approximately 7.9 million Euros (cumulative progress of 60% of the value of the entire contract). The total of the relevant investments resulting in 2009 was approximately 9.9 million Euros.

Activities carried out

The engineering work concerning the development of the design variants for the North East, Central and South Lots and the Roma Termini Contract were started.

Other interventions (financed by GS, RFI and Trenitalia S.p.A.)

During the course of 2009, an agreement was reached between Grandi Stazioni S.p.A. and Trenitalia S.p.A. for all the locations of the Trenitalia commercial areas in the network stations. As regards the services deriving from the execution of the new layout of the premises in Milano C.le, Torino Porta Nuova and Napoli C.le, Trenitalia issued the assignment for design and execution to Grandi Stazioni S.p.A., worth approximately 5.2 million Euros, to reimburse that already paid in advance by Grandi Stazioni S.p.A. and to guarantee the economic hedging of the additional interventions being started. Currently, the development of the design, which has included numerous implementations requested by Trenitalia for the adjustment of the layout of its commercial areas, has raised this amount from 5.2 million to approximately 6.9 million Euros (implying the undertaking of specific initiatives aimed at obtaining the additional funds required).


Furthermore, as regards the adjustment of the areas at Roma Termini, Trenitalia also issued an additional assignment for the design and execution of the interventions required for the adjustment of the Club Eurostar in Rome and consequent realisation of the new Customer Assistance area, which cost 0.385 million Euros. Also for these services, Trenitalia requested certain implementations for the adjustment of the layout of its premises to the standards of the Group, leading to an increase of approximately 0.1 million Euros (for which the implementation of the financing already provided was requested). The overall amount accrued by Trenitalia in 2009 totalled 3.8 million Euros, thus divided respectively between Roma Termini (0.34 million Euros), Milano Centrale (0.636 million Euros), Napoli Centrale (1.231 million Euros) and Torino Porta Nuova (1.670 million Euros). As regards the remaining network stations, an agreement is being finalised for the preliminary design of the Trenitalia commercial areas, required for the finalisation of a similar design and execution assignment with Grandi Stazioni S.p.A. Progress is also being made on the investments in properties owned, totalling 1.3 million Euros (financed by Grandi Stazioni), for the completion of the work on the properties in Bologna (for which technical-administrative testing has been started), Napoli Palazzo Alto (work restarting after suspension due to the need to vacate the premises occupied by Trenitalia and RFI) and Venice (part of the property sold to Venice Region was handed over). There were also other investments made by Grandi Stazioni SpA for 0.2 million Euros, due to initiatives of various sorts mainly linked to the Grandi Stazioni “commercial expansion”. Lastly, progress must also be highlighted for other investments by RFI totalling 18.7 million Euros for various activities concerning:

Progress in the fixed and variable signalling (Milano Centrale, Torino Porta Nuova, Napoli Centrale, Genova Brignole, Genova Piazza Principe, Bologna Centrale, Firenze S.M.N., Venezia Mestre and Venezia S. Lucia stations), for a total value of approximately 8.7 million Euros;

As part of the Milano Centrale contract, interventions charged to RFI due to the shifting of railway installations, worth approximately 1.7 million Euros;

Interventions of various sorts financed by the various departmental divisions of RFI (Milan, Naples, Venice, Genoa) concerning the raising of the walkways to a height of “+55” for the platforms to be used for HS train stops and, for Genova P.P. station, the subsequent realisation of a ramp for cars, worth 4.1 million Euros;

Interventions for the upgrading of the lighting systems and installation of remote management and remote control devices in Bologna Centrale, Firenze S.M.N., Milano Centrale, Roma Termini, Venezia Mestre, Venezia S. Lucia and Verona Porta Nuova stations worth approximately 4.2 million Euros;

Interventions for the predisposition of the High Speed station canopies in Bologna Centrale, Napoli Centrale, Torino Porta Nuova and Venezia S. Lucia stations worth approximately 0.5 million Euros.


Activities carried out The activities described below were thus carried out during the course of 2009:

Completion of the interventions for the functional adjustment of the part of the property being sold to Veneto Region (Grandi Stazioni SpA funds) and simultaneous start-up of the works for the functional adjustment of the commercial areas in the same property on the ground floor owned by Grandi Stazioni;

Completion of initiatives of various sorts linked to GS “commercial expansion” (Grandi Stazioni funds), including the adjustment of the offices and warehouses in building B at Roma Termini, handed over to the tenants;

Installation of new variable signalling devices at Milano Centrale, Torino Porta Nuova, Napoli Centrale, Genova Brignole, Genova Piazza Principe, Bologna Centrale, Firenze S.M.N., Venezia Mestre and Venezia S. Lucia stations;

As part of the Milano Centrale contract, interventions were carried out by RFI linked to the shifting of railway installations (RFI funds);

Works for the execution of the new commercial layouts of Trenitalia in Milano Centrale, Torino Porta Nuova, Napoli C.le and Roma Termini stations;

Interventions for the upgrading of the lighting systems and installation of remote management and remote control devices in Bologna Centrale, Firenze S.M.N., Milano Centrale, Roma Termini, Venezia Mestre, Venezia S. Lucia and Verona Porta Nuova stations;

Interventions for the predisposition of the High Speed station canopies in Bologna Centrale, Napoli Centrale, Torino Porta Nuova and Venezia S. Lucia stations;

Interventions of various sorts financed by the various departmental divisions of RFI (Milan, Naples, Venice, Genoa) concerning the raising of the walkways to a height of “+55” for the platforms to be used for HS train stops and, for Genova P.P. station, the subsequent realisation of a ramp for cars.


Grandi Stazioni SpA Investments in Refurbishments charged to the Grandi Stazioni Group

Progress Reclassification Progress Progress Whole life Progressat 31/12/08 2008 2009 at 31/12/09 cost at 31/12/09

M€ M€ M€ M€ M€ %Internal refurbishing and upgrading works 127.1 - 0.7 30.4 156.8 203.4 77%Bari Centrale 0.8 0.8 1.6 5.3 30%Bologna Centrale 1.6 2.0 3.6 9.9 36%Firenze S. M. Novella 1.6 0.5 2.1 6.1 34%Genova Brignole 0.7 0.3 1.0 5.2 19%Genova Principe 1.5 0.4 1.9 7.5 25%Milano Centrale 43.5 - 0.4 12.5 55.6 58.4 95%Napoli Centrale 19.1 8.5 27.6 33.0 84%Palermo Centrale 1.0 0.7 0.1 1.8 5.8 31%Roma Termini 27.4 1.2 0.2 28.8 29.5 98%Torino Porta Nuova 26.2 3.4 5.0 27.8 28.9 96%Venezia Mestre 0.7 0.1 0.2 1.0 3.2 31%Venezia S. Lucia 1.9 0.2 0.5 2.6 7.3 36%Verona Porta Nuova 1,1 0.1 0.2 1.4 3.3 42%

Compl. infrastructures and videosurveillance (L.O 43.7 - 5.6 9.7 47.8 284.5 17%Bari Centrale 0.7 0.7 11.5 6%Bologna Centrale 1.1 0.1 1.2 23.2 5%Firenze S. M. Novella 0.3 0.3 3.1 10%Genova Brignole 0.2 0.2 0.4 5.5 7%Genova Principe 1.3 0.3 1.6 14.1 11%Milano Centrale 1.0 1.0 7.7 13%Napoli Centrale 0.8 0.8 23.6 3%Palermo Centrale 0.3 0.3 4.7 6%Roma Termini 2.6 - 0.2 0.4 3.8 103.6 4%Torino Porta Nuova 0.5 0.5 9.8 5%Venezia Mestre 0.3 0.2 0.5 5.3 9%Venezia S. Lucia 0.2 0.1 0.3 3.2 9%Verona Porta Nuova 0.8 0.5 1.3 13.2 10%Tutte le stazioni 5.4 5.4 5.4 100%Integrated Video-surveillance 27.2 - 5.4 7.9 29.7 50.6 59%

Properties owned by GS 26.5 1.4 27.9 44.6 63%Bologna Centrale 7.8 7.8 7.9 99%Firenze S. M. Novella 0.1 0%Genova Piazza Principe 1.0 0%Napoli Centrale 16.5 0.3 16.8 26.6 63%Roma TerminiVenezia S. Lucia (ground floor) 2.2 1.1 3.3 9.0 37%

Other GS works 6 1.9 0.2 8.1 8.7 93%OVERALL TOTALS 203.3 - 4.4 41.7 240.6 541.2 44%


RESEARCH AND DEVELOPMENT ACTIVITIES In 2009, the Group carried out research and development activities in order to assess the use of alternative energy sources.

In particular, Grandi Stazioni conducted a feasibility study for the realisation of photovoltaic installations by installing panels on the roofs of the various station complexes.

These activities implied costs of approximately 0.1 million Euros, all recorded in the profit and loss account.

RELATIONS WITH RELATED PARTIES As regards relations with related parties, see that described in the appropriate section of the “Explanatory notes to the consolidated financial statements” (Note 45).


OWN EQUITY At 31 December 2009, Grandi Stazioni S.p.A. did not hold own shares and/or shares in its parent company, either directly or through a trust company or intermediary. During the course of 2009, the company did not purchase or alienate own shares and/or shares in the parent company, either directly or through a trust company or intermediary.

OTHER INFORMATION

Inquiries and legal proceedings under way

In October 2008, the company filed a criminal complaint with the Public Prosecutor’s Office at the Rome Law Courts, for the crimes of which in articles 56, 640, 640 bis and 319 of the Penal Code.

The matter concerns invoices issued by a supplier for the execution of activities carried out in the main Italian stations for the removal of presumed interferences between the video advertising system and the integrated video surveillance works.

On 27 May, an injunctive decree was notified to the company for the payment of the invoices in question. The company has challenged this decree.

On 16 June, as a cautionary measure, the magistrate investigating the report submitted by Grandi Stazioni ordered the seizure of the invoices issued, suspecting an attempted fraud against the company Grandi Stazioni SpA.

An inquiry is currently being conducted by the judicial authorities.

As regards the fatal accident which occurred in 2008 in the Naples worksite, involving an employee of the sub-contracted TCE awarded the relevant tender contract, criminal proceedings are ongoing, and the individuals working for the firms carrying out the works have been sent up for trial, Grandi Stazioni SpA having no liability whatever in the matter. The information concerning the civil disputes and any potential liabilities is provided in the supplementary notes in the commentary on the item “Provision for risks and charges”.

Risk Management

During the course of the financial year, Grandi Stazioni updated the Risk Management System, and, in particular, reviewed the system for the mapping of corporate risks and the identification and assessment of the existing controls and/or those to be implemented for the containment of the aforementioned risks.

Legislative Decree 231/2001 concerning the administrative liability of the bodies

During the 2009 financial year, following the regulatory and legal changes concerning Legislative Decree 231/2001 and the corporate reorganization process, the Organization and Management Model of Grandi Stazioni was updated and a “Special Part” was included in it which highlights, for example and not exhaustively, the methods according to which the crimes


provided by the Decree could occur within the framework of the main corporate processes and the suitable control elements identified and implemented by the Company.

Quality Certification of the activities conducted by Internal Auditing

UNI EN ISO 9001:2008 certification of the Quality Management System was obtained on 3 December 2009, in the context of the Ferrovie dello Stato Group project, concerning auditing activities and the activities ex Legislative Decree 231/2001.

Information relating to the parent company’s activities pursuant to article 2497 ter.

The parent company Ferrovie dello Stato S.p.A. did not exercise significant influence over the management decisions taken by the company during the activities conducted in 2009.

Payments to the independent auditors

It should be highlighted that, pursuant to art. 37, para. 16 of Legislative Decree 39/2010 and letter 16bis of art. 2427 of the Civil Code, the total payments made to the independent auditors, including any payments made to it for carrying out other auditing activities, fiscal consultancies and services other than legal auditing, totalled 80 thousand Euros. SIGNIFICANT EVENTS AFTER THE CLOSURE OF THE FINANCIAL YEAR GST sent to the Ministry of Infrastructures and Transport the documentation required for the extension of the period of usage of the financing for the Legge Obiettivo works and the adjustment of the economic framework indicated in CIPE decision no. 129/2006. Grandi Stazioni filed a criminal complaint for the crimes of which in arts. 640, 61 no. 7 and 11 of the Penal Code and 2625 of the Civil Code in relation to the conduct of former directors and managers of the company and the legal representative of the firm awarded assistance and consultancy services aimed at the stipulation of a leasing contract and subsequent sale. The certificate of testing was issued for the works concerning the sale of the property complex located in Venice and the balance of the contractual price was cashed in, net of withholdings of 0.3 million Euros.


OUTLOOK Based on planned company activities and management strategies, the approved Budget foresees that the value of production will improve in 2010 and determine a better gross operating margin and operational result compared to the 2009 financial year. As regards the net result, taking into account the extraordinary operations that occurred during 2009, a slight decrease is expected for 2010, but in line with previous financial years. On the equity and financial side, the following events are expected:

an improvement in the net working capital; an increase in the net fixed capital resulting from new investments; a fall in the net financial position resulting from the improvement in the short-term

financial position; an increase in own equity as a result of the improved result for the financial year.


CONSOLIDATED GROUP SCHEDULES OF ACCOUNTS AND EXPLANATORY NOTES


CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES

Thousands of Euros Note 31 December

200931 December

2008 1 January

2008

Assets

Properties, plants and machinery 9 215,436 183,092 139,350Intangible assets 11 90 102 639Non-current trade receivables 16 8,650 9,428 5,013Property investments 10 56,235 54,361 80,447Shareholding investments accounted using the NE method

- - -

Non-current financial assets including derivatives 13 - 137 769Assets for prepaid taxes 12 6,380 4,439 3,837Other non-current assets 14 30,268 16,865 11,005

Total non-current assets 317,059 268,424 241,060

Inventories 15 14,610 6,570 5,344Current trade receivables 16 113,812 84,303 82,820Tax receivables 18 - 2,933 931Current financial assets including derivatives 13 7,583 17,807 22,687Liquid assets and equivalent means 17 60,307 7,222 9,183Other current assets 14 15,618 16,720 10,248Non-current assets owned for Sale 8 - 41,757 -

Total current assets 211,930 177,312 131,213

Total assets 528,989 445,736 372,273


Thousands of Euros Note 31 December

200931 December

2008 1 January

2008

Shareholders’ equity

Share capital Reserves Results brought forward Result for the period

19

4,304 80,370 7,210 39,561

4,30477,6964,15818,072

4,304 75,044 4,352 13,221

Total Group shareholders’ equity 131,445 104,230 96,921

Capital and reserves

4,079 4,094 3,824Result for the period (9) (80) -Total Third parties shareholders’ 4,070 4,014 3,824

Total Shareholders’ Equity 135,515 108,244 100,745

Liabilities

Medium/long-term loans 20 201,230 162,334 132,742Staff severance and other benefits 21 2,010 2,014 2,236

Non-current financial liabilities, including derivatives 23 547 70 -Non-current deferred income 25 5,638 6,253 7,443Provisions for risks and charges 22 6,611 4,103 2,390Payables for deferred taxes 12 8,617 2,668 1,719Other non-current liabilities 26 3,142 4,221 4,046Total non-current liabilities 227,795 181,663 150,576

Current quota of medium/long-term loans 20 31,189 5,037 251Trade payables 24 103,386 118,316 90,059Payables for income tax 27 7,716 - -Current deferred income 25 14,881 12,479 11,914Short-term provisions for risks and charges 22 - - -

Other current liabilities 26 8,507 19,997 18,728Total current liabilities 165,679 155,829 120,952

Total shareholders’ equity and li bili i

528,989 445,736 372,273


CONSOLIDATED PROFIT AND LOSS ACCOUNT Thousands of Euros Note 2009 2008

Revenues

Revenues from sales and services

Changes in inventories of products being processed, semi-processed and finished Other income

28

29

30

169,425

8,44929,402

175,100

2,7522,202

Total revenues 207,276 180,054

Costs

Raw, subsidiary materials, consumables, goods Services

Use of third party assets Personnel costs Other operating costs Costs for internal works capitalised

31 32

33 34 35

36

(207) (87,583)(

34,641 (16,237) (6,648)

2,412

(444)(94,081)(35,380)(16,775)(6,088)9,588

Total operating costs (142,904) (143,180) Gross operating margin 64,372 36,874


Depreciations (value recovery) of properties, plants and machinery

Allocations for risks and charges

37

38 39

(10,822)

-

(2,665)

(6,724)

(418)(2,034)

Operating result 50,885 27,698

Financial income Financial costs

Quota of profits/losses in shareholdings accounted using the shareholders’ equity method

40

41

13,323(3,757)

-

4,859

(5,001)

-

Result before taxes 60,451 27,556

Income tax 42 (20,899) (9,564)

Result for the period for ongoing assets 39,552 17,992

Result for the period for assets destined to be sold net of fiscal effects

- -

Net result for the period 39,552 17,992Net Group result

Net third parties result 39,561

(9)18,072

(80)


SCHEDULE OF OVERALL PROFITS/(LOSSES) RECORDED IN THE FINANCIAL YEAR

Thousands of Euros Note 31.12.2009 31.12.2008

Net result for the period Group and Third Parties 39,551 17,992

Other components of overall profit and loss account

Effective quota of differences in fair value of the hedging of financial flows

(477) (381)

Conversion reserves 132 550Profits (losses) from actuarial benefits (92) (48)Fiscal effect 157 118

Other components of the overall financial year profit and loss account, net of fiscal effects 19 (280) 239Total overall financial year profit and loss account 39,271 18,231

Group 39,215 18,041

Third parties 56 190


SCHEDULE OF CHANGES IN THE CONSOLIDATED SHAREHOLDERS’ EQUITY

Thousands of Euros Group Shareholders’ equity

Balance at 1 January 2008

Share capital

4,304

Legal reserve

861

Reserve for overpricing of shares

58,309

Extraordinary reserve

15,649

Reserve for

conversion of items

in foreign currency

Reserve for financial

instruments assessment

225

Other reserves

Profits (losses)

brought Reserve for Reserve for forward

reassessment own shares (accumulated)

4,352

Financial year result

13,221

Total Group Shareholders’ equity

96,921

Third parties Shareholders’

Equity

3,824

Total Shareholders’

Equity

100,745 Total profits / (Losses)

recorded

of which: 280 (276) (35) 18,072 18,041 190 18,231

- profits / (losses) recorded directly in the shareholders’ equity

280 (276) (35) (31) 270 239

- financial year profits 18,072 18,072 (80) 17,992

Dividends distributed (10,732) (10,732) (10,732)

Allocation of prev. financial year result

2,683 (194) (2,489) - 0

Balance at 31 December 2008 4,304 861 58,309 18,332 280 (51) (35) - - 4,158 18,072 104,230 4,014 108,244 Total Profits / (Losses) recorded

of which:

67 (346) (67) 39,561 39,215 56 39,271

- profits/(losses) recorded directly in the shareholders’ equity

67 (346) (67) (346) 65 (280)



Allocation of prev. financial year result

3,020 3,052 (6,072) - -

Balance at 31 December 2009 4,304 861 58,309 21,352 347 (397) (102) - - 7,210 39,561 131,445 4,070 135,515


CONSOLIDATED FINANCIAL OVERVIEW Thousands of Euros Note 2009 2008

Financial flows deriving from operating activities

Net financial year result 39,552 17,992

Adjustments for:

Amortization of properties, plants and machinery 9 4,382 3,379

Amortization of intangible assets 11 135 580

Amortization of property investments 10 1,692 1,586

(Recovery of) write-downs of properties, plants and machinery - 418

Net financial costs (9,566) 142

Profits from sales of properties, plants and machinery

Income from sales of non-current assets owned for sale 8 (24,147)

Financial year income tax 20,899 9,564

Changes in inventories 15 (8,040) (1,226)

Changes in trade receivables (23,096) (5,898)

Changes in other assets (12,301) (12,332)

Changes in trade payables and other liabilities (13,427) 29,076

Changes in employee funds and benefits 2,504 1,491

Interest paid (5,787) (7,918)

Income tax paid (6,242) (11,219)

Income components recorded directly under shareholders’ equity 19 (281) 239Net cash flow generated by operating activities (33,723) 25,874

Financial flows deriving from investments

Interest received 927 2,451

Dividends received - 2,596

Income from sales of non-current assets owned for sale 8 57,900 -

Income from Ferrovie c/a 10,690 4,880

Income from the sale of shareholdings 6,365 -Net increases in properties, plants and machinery, intangible assets and property investments

(37,828) (44,151)

Purchase of non-current assets owned for sale 8 (4,293) (17,257)

Net cash flow absorbed by investments 33,761 (51,481)

Financial flows deriving from financial assets

Income deriving from the grating of loans 20 72,885 95,273

Reimbursement of loans and other changes 20 (7,528) (60,707)

Payment of debts for financial leasing 20 (309) (188)

Dividends paid out 19 (12,000) (10,732)

Net cash flow generated/(absorbed) by financial assets 53,048 23,646

Net decrease in cash flow and equivalent means 53,086 (1,961)

Cash flow and equivalent means at the start of the financial year 17 7,222 9,183

Cash flow and equivalent means at the end of the financial year 17 60,307 7,222


EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1 Introduction

These consolidated financial statements of the Grandi Stazioni Group (hereinafter “Parent company” and/or “Group leader”) have been drawn up in compliance with the international accounting principles (hereinafter International Accounting Standards-IAS and/or International Financial Reporting Standards-IFRS) issued by the International Accounting Standards Board (IASB), recognised by the European Union pursuant to EC Regulation 1606/2002 and in force on closure of the financial year and the interpretations of the International Financial Reporting Standards (IFRIC) and Standing Interpretations Committee (SIC), homologated by the European Commission (the reference principles and interpretations are hereinafter defined as “IFRS”). These are the fist consolidated financial statements drawn up using the IFRS accounting principles.

Following the emanation of EC regulation 1606/2002 and in relation to that disposed by implementing legislative decree 38/2005, as of the 2005 financial year, companies other than the issuers of financial instruments admitted for negotiation on regulated stock markets which draw up consolidated financial statements may adopt the international accounting principles in drawing up their consolidated financial statements. Therefore, the Board of Directors of Grandi Stazioni SpA decided in March 2009 to draw up consolidated financial statements as of the 2009 financial year, according to the international accounting principles (International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS), the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) and the Standing Interpretations Committee (SIC) homologated by the European Commission, hereinafter “IFRS-EU”), with transition date to the IFRS-EU on 1 January 2008, and to not exercise the right granted by paragraph 3 of art. 27 of Legislative Decree 127/1991 of not drawing up its own consolidated financial statements as they were already drawn up by the parent company Ferrovie dello Stato SpA, as was done in previous financial years.

As these are the first consolidated financial statements, the company having invoked in previous financial years the exoneration provided by paragraph 3 of art. 27 of Legislative Decree 127/91, the consolidated financial statements for 2008 were also required to be drawn up in compliance with the IFRS for comparative purposes. Therefore, in the context of the process of transition to the IFRS and for the drawing up of the consolidated financial statements to 31 December 2009 according to these principles, the consolidated financial statements for 2008 and the equity situation at the date of transition to the IFRS (1 January 2008) were adjusted. As provided by paragraphs 39 and 40 of international accounting principle IFRS 1, in explanatory note 47, the document entitled “Effects of the transition to the international accounting principles (IFRS)” is thus included. This document contains the schedules for reconciliation between the accounts drawn up by the Grandi Stazioni Group on the basis of the IFRS international accounting principles and the corresponding situations drawn up on the basis of the previous accounting principles (equity situation at 1 January 2008 and 31 December 2008, profit and loss account and financial overview for the 2008 financial


year), with commentary and the relevant effects on the shareholders’ equity and net financial position.

2 Group activities and structure of the consolidated financial statements

Grandi Stazioni S.p.A. (hereinafter “Parent company” and/or “Group leader”) is based in Italy.

The Company’s legal headquarters are in Via G. Giolitti 34 – 00185 ROME.

The consolidated financial statements at 31 December 2009 include the financial statements of the Group leader and the Italian and foreign companies (hereinafter defined together with Grandi Stazioni S.p.A. as “Grandi Stazioni Group”) over which the former has the right to directly or indirectly exercise control, determining their financial and management choices and obtaining the relevant benefits.

The list of shareholdings is included in the section entitled “Perimeter, criteria and methods of consolidation” (note 6) enclosed with these explanatory notes.

The principal activity of the Grandi Stazioni Group is the refurbishment and management of station complexes.

In particular, it operates at a national level in the 13 major Italian railway stations: Roma Termini, Milano Centrale, Torino Porta Nuova, Firenze Santa Maria Novella, Bologna Centrale, Napoli Centrale, Venezia Mestre and Santa Lucia, Verona Porta Nuova, Genova Piazza Principe and Brignole, Palermo Centrale and Bari Centrale, and at an international level in the 2 railway stations of Prague Central and Marianskè Lazne.

In carrying out its design and works direction activities, the execution of feasibility studies and technical consultancies, Grandi Stazioni collaborates with its subsidiary Grandi Stazioni Ingegneria.

The purpose behind the activities of the Group is that of making the public aware of a new station concept: a business with high economic potential, an attraction point for the city and a warm and welcoming place, able to offer quality services and opportunities to pass the time in a more pleasant and enjoyable way. Stations have a new urban role to play in this new concept.

Briefly, the goals of the corporate mission are:

refurbishment and valorisation of the properties through leasing, promotional and advertising activities and direct management of passenger areas and services;

improvement of the quality and diversification of travel services by improving the existing offer and constant commitment towards better customer satisfaction;

promotion of new methods of using the areas, introducing innovative services to the stations in the Network, such as a services centre with numerous shopping logos, a specialised general surgery unit, gymnasium and numerous leisure activities;

integration of the station property complexes with the surrounding urban fabric to transform stations into a living part of the city, facilitating access to and inter-modality with all other means of transport;


development of social projects and initiatives in favour of disadvantaged people using stations, in collaboration with voluntary bodies and associations;

affirmation of the new station model through communication policies and cultural initiatives.

The Group structure is described in Annex 1 to these explanatory notes.

The approval and publication of these consolidated financial statements of Grandi Stazioni S.p.A. for the financial year closed on 31 December 2009, pursuant to IAS 10, was decided by the Board of Directors of the Parent company on 16 March 2010.

3 Compliance with the IFRS

These consolidated financial statements of Grandi Stazioni S.p.A. (hereinafter “Parent company” and/or “Group leader”) have been drawn up in compliance with the international accounting principles (hereinafter International Accounting Standards-IAS and/or International Financial Reporting Standards-IFRS) issued by the International Accounting Standards Board (IASB), recognised by the European Union pursuant to EC Regulation 1606/2002 and in force on closure of the financial year and the interpretations of the International Financial Reporting Standards (IFRIC) and Standing Interpretations Committee (SIC), homologated by the European Commission (the reference principles and interpretations are hereinafter defined as “IFRS”).

4 Basis for presentation

The consolidated financial statements are drawn up with a view to continuing activities, applying the general criterion of historical cost, excluding the items that according to the IFRS are recorded at fair value, as indicated in paragraph 5 below, “Accounting principles applied”.

These consolidated financial statements include the Schedule of the equity and financial situation, the profit and loss account, the schedule of the overall profits/(losses) recorded in the financial year, the schedule of changes to the shareholders’ equity, the financial overview and explanatory notes. The schedule of the equity and financial situation is presented on the basis of the scheme providing for the distinction between current and non-current assets and liabilities, with specific separation of assets and liabilities owned for sale. Current assets, including cash flow and equivalent means, are those which are to be realised, transferred or used in the normal operating cycle of the Group or the twelve months subsequent to the closure of the financial year. Current liabilities are those that are expected to be extinguished in the normal operating cycle of the Group or the twelve months subsequent to the closure of the financial year. In the profit and loss account, costs are classified on the basis of their nature. The company has included all income and cost items for one financial year in two separate schedules including the profit and loss account and schedule of the overall profit and loss account. The indirect method has been used for drawing up the financial overview.

The IFRS were applied in coherence with the indications in the “Framework for the preparation and presentation of financial statements” and no critical events occurred such as to require derogations pursuant to IAS 1, paragraph 19.


The currency used by the Group in the presentation of the consolidated financial statements is the Euro, the currency in which the Group leader Grandi Stazioni S.p.A. operates, and all values are expressed in thousands of Euros unless otherwise stated.

5 Accounting principles applied

The accounting principles described below have been applied coherently in all the periods included in these consolidated financial statements and by all the bodies in the Group.

Properties, plants and machinery

Properties, plants and machinery are valued at their purchase cost net of accumulated amortization and write-downs determined according to the methods described below.

Their cost includes all expenses sustained directly in preparing the assets for their use and any other costs for disposal and removal that may be sustained as a consequence of contractual obligations requiring the assets to be returned to their original condition. The cost of items manufactured includes the cost of the materials used and the manual labour involved, other costs directly attributable to ensuring the item is in the location and conditions required for it to function as envisaged by company management, costs for the disassembly and removal of the item and clearing of the site it is located on and the financial costs sustained during the period of usage of the item.

If an element of properties, plants and machinery is composed of various components with different useful lifetimes, these components are accounted separately (significant components).

Properties, plants and machinery are recorded net of accumulated amortization and any write-downs, determined according to the methods described below.

Should an item subject to amortization be composed of distinctly identifiable elements with significant different lifetimes from the other parts of the item, amortization is carried out separately for each of the parts comprising the item in application of the component approach principle.

The following are the estimated useful lifetimes:

Rate

Civil engineering works 3%

Plants and machinery 5%-20%

Industrial and trade equipment 20%

Other assets:

- Furniture and accessories 12%

- Electronic machines 20%

- Office equipment 40%

- Motor vehicles 25%


The methods of amortization, useful lifetimes and remaining values are reviewed at the date of the financial statements.

The cost sustained for the replacement of part of an element belonging to the category “Properties, plants and machinery” is added to the accountable value of the element in question if it is probable that the relevant future benefits will be reaped by the Group and if the cost of the element can be reliably determined. The accountable value of the replaced part is removed. The costs for the ordinary maintenance of properties, plants and machinery are recorded in the profit and loss account for the financial year they are sustained in.

If there are specific indicators as regards the risk of failed recovery of the loading value of properties, plants and machinery, they will be subjected to a verification to assess any write-downs (“impairment test”) as described in the relevant paragraph.

Properties, plants and machinery are no longer recorded in the financial statements after they are sold or when there are no longer future economic benefits expected from their use. Any losses or profits (calculated as the difference between the sale value, net of sales costs, and loading value) are recorded in the financial year they are written-off in.

Property investments

Property investments are the real estate properties owned in order to obtain leasing fees and/or obtain an increase in the capital invested and are not destined for sale in the normal execution of business activities. Furthermore, the property investments are not used in the production or the supply of goods or services or in the management of the company and are valued at the cost determined according to the same methods as those indicated for properties, plants and machinery. The relevant fair value is also indicated for these assets.

Land annexed to both civil and industrial buildings is not amortized, in as much as it is an element with an unlimited lifetime. Buildings are amortized at a rate of 3%.

Assets in leasing

The financial leasing contracts, which substantially transfer the risks and benefits of ownership of the asset leased to the Group, are recorded among properties, plants and machinery from the starting date of the lease at the fair value of the asset leased or, if less, the current value of the leasing fees. The liabilities in the profit and loss account include a debt for the same amount, which is progressively reduced on the basis of the reimbursement plan for the quotas of capital included in the fees provided contractually.

The leasing fees are split between capital quota and interest quota, so as to ensure the application of a constant interest rate on the remaining balance of the debt (capital quota). The financial costs are debited to the profit and loss account. Assets are amortized applying the criterion and quotas indicated in the paragraph on Properties, plants and machinery.

The contracts for which the lessor partially keeps all the risks and benefits typical of the property are considered as operational. Therefore, the fees of operational leasing contracts are attributed to the profit and loss account for the duration of the contract.


Deposits on leasing fees

As regards the subsidiary Grandi Stazioni Ceska, the ongoing contract with České dráhy, a.s., on the basis of the substance of the operation, has been qualified as an operational leasing contract recorded in the accounts as follows.

All the costs directly related to the refurbishment of station complexes contractually charged to Grandi Stazioni Ceska are dealt with as deposits on leasing fees and are therefore initially suspended under the item “other non-current assets” and included in the profit and loss account at constant quotas for the remaining duration of the ongoing operational leasing contract. These costs suspended as advance leasing fees include the construction costs, design costs, insurance and other costs directly attributable to the refurbishment of station complexes, including the financial costs, management fees and assignment fees sustained during the refurbishment period and throughout the duration of the leasing contract.

Intangible assets

Intangible assets are constituted by non-monetary elements, identifiable and without physical consistency, controlled by the company and capable of producing future economic benefits. Identification is defined with reference to the possibility of distinguishing the intangible assets acquired with respect to goodwill. This requirement is usually satisfied when (i) the intangible asset is traceable to a legal or contractual right, or (ii) the asset is separable, in other words can be sold, transferred, granted in leasing or exchanged autonomously or as an integral part of other assets. Control by the company involves the power to use the future economic benefits deriving from the asset and the possibility of limiting its access by others.

Intangible assets are only recorded at the cost determined according to the same methods as those indicated for properties, plants and machinery when they can be reliably valued.

The Grandi Stazioni Group possesses the following types of intangible assets, the lifetime of which has been defined as described:

Rate

Concessions, licences and similar rights 33%

After initial registration, the cost or fair value of intangible assets with a definite lifetime is rectified by the relevant amortizations accumulated and any write-downs, determined according to the methods described below. Amortization starts when the intangible asset in question is available for use and is systematically divided in relation to the remaining possibility of use, in other words on the basis of its estimated useful lifetime.

The useful lifetime is reviewed on an annual basis and any changes, if deemed necessary, are made using the method of prospective application.

Research costs are attributed directly to the profit and loss account for the financial year they are sustained in. Development costs sustained in relation to a specific project are only capitalised when the following are proven: (i) the technical possibility of completing the intangible asset to make it available for use or sale; (b) the intention of completing said asset to


reuse it or transfer it to third parties; (c) the methods by which it will generate probable future economic benefits; (d) the availability of technical, financial or other resources to complete its development; (e) its capacity to reliably evaluate the cost attributable to the asset during its development; (f) the existence of a market for the products and services deriving from the asset or its usefulness for external purposes. The costs capitalised only include the expenses sustained that are directly attributable to the development process or the costs of materials, manual labour directly involved and a reasonable quota of the general production expenses. The development costs that do not have these characteristics for capitalisation are recorded in the profit and loss account at the moment they are sustained.

After initial registration, the cost of the development expenses recorded among equity assets is rectified by the relevant amortizations accumulated and any write-downs, determined according to the methods described below.

Intangible assets with an indefinite useful lifetime cannot be subjected to systematic amortization but are subjected to an at least annual recoverability assessment (impairment test).

Write-down of assets (impairment test)

On closure of the financial statements, the accountable value of properties, plants and machinery, property investments, intangible and financial assets and shareholdings is subjected to a verification to determine whether there are indicators of write-downs in these assets.

Should these indicators exist, the recoverable value of the assets will be estimated in order to determine the amount of the write-down (“impairment test”). The recoverable value is the greater of the fair value of an asset or the unit generating financial flows net of the cost of sale and its usage value, and is determined for each single asset, except in the case in which the asset in question generates financial flows that are not mainly independent of those generated by other assets or groups of assets, in which case the Group estimates the recoverable value of the unit generating cash flows to which the asset belongs.

In determining the usage value, the Group actualises the estimated future financial flows, using a pre-tax rate of actualisation that reflects the market assessments of the temporal value of cash and the specific risks of the asset in question.

If the accountable value of an asset or unit generating cash flows is more that its recoverable value, the asset has lost value and is therefore written down until it reaches its recoverable value.

Write-downs sustained by a functioning asset are recorded in the profit and loss account in the cost categories coherent with the function of the asset which has lost value.

Lastly, during the closure of the consolidated financial statements, the Group assesses the existence of indicators of a reduction in write-downs previously recorded and, should these indicators exist, makes a new estimate of the recoverable value. The value of an asset previously depreciated can only be recovered if there have been changes to the estimates used in determining its recoverable value after the last recorded durable loss. In such cases, the recoverable value of the asset is brought in line with the recoverable value, without the value


thus increased exceeding the accountable value that would have been determined, net of amortizations, if no write-downs had been recorded in previous years. Any recovery in value is recorded as income in the profit and loss account. Once a recovery in value has been recorded, the amortization quota of the asset is rectified in future periods, in order to split the modified accountable value, net of remaining values, in constant quotas throughout its remaining lifetime.

Shareholdings

Shareholdings destined for sale or in the course of liquidation in the short-term are recorded among the current assets, at the lesser of the loading value and fair value, net of sales costs.

Inventories

Contracted works in progress are valued on the basis of the contractual payments accrued with reasonable certainty in relation to the progress of the works using the criteria of the percentage of completion, determined using the cost to cost method, such as to attribute the revenues and economic result of the contract to the financial years of competence in proportion to the costs sustained. The positive or negative difference between the value executed of contracts and that of deposits received is recorded respectively in the assets or liabilities in the statement of assets and liabilities, taking into account depreciations to the works carried out to cover for risks linked to the failure by the contractors to recognise the works executed.

The revenues from the contract, in addition to the contractual payments, include the variants, price reviews and any leftover reserves to the extent to which it is probable that they represent effective revenues that may reliably be determined.

Should losses be expected in the completion of the activities in a contract, this is immediately recorded in the financial statements in full, independently of the status of progress of the contract.

Financial instruments

Financial instruments include the financial assets and liabilities the classification of which is determined at the time of their initial recording in the accounts on the basis of the purpose for which they were acquired.

Non-derivative financial instruments

Loans, receivables and deposits are recorded at the time they originate.

Financial assets are removed from the statement of assets and liabilities when the right to receive cash flows from the instrument in question is extinguished and the Company has substantially transferred all the risks and benefits concerning the instrument and its control.


Financial assets at fair value recorded in the profit and loss account

A financial instrument is classified at the fair value recorded in the profit and loss account if it is owned for negotiation or designated as such when initially recorded. Financial instruments are designated at the fair value recorded in the profit and loss account when the Group manages these investments and bases its purchase and sale decisions on their fair value in compliance with a documented strategy for managing the risk or investment. The transaction costs attributable are recorded in the financial year profits or losses at the time they are sustained. Financial instruments at the fair value recorded in the profit and loss account are valued at their fair value and any changes are recorded in the financial year profits or losses.

Investments owned until expiry

If the Group has the objective intention and capacity to own debit securities until their expiry, these are classified in the category “owned until expiry”. Investments owned until expiry are initially recorded at their fair value, increased by any directly attributable transaction costs. Subsequently to their initial recording, they are valued at their amortized cost using the criterion of effective interest, net of any write-downs that may occur. Should any investments owned until expiry with a not insignificant value be transferred or reclassified before their expiry date, all the investments owned until expiry must be reclassified among the financial assets available for sale and the Group may no longer classify any investments in the category “owned until expiry” during the current financial year and the following two financial years.

Loans and credit

Loans and credit are financial assets which involve fixed or calculable payments and are not floated on an active stock market. These assets are initially recorded at their fair value, increased by any directly attributable transaction costs. Subsequently to their initial recording, they are valued at their amortized cost using the criterion of effective interest, net of any write-downs that may occur.

Loans and credit include trade receivables and other receivables.

Financial assets available for sale

Financial assets available for sale are those non-derivative financial assets that have been designated as such and are not classified in the preceding categories. The Group investments in capital securities and certain debt securities are classified among the financial assets available for sale. After their initial recording, they are valued at their fair value and any changes in their fair value, other than write-downs and differences in exchange rate on the monetary elements available for sale, are recorded among the other components of the Schedule of overall profits/(losses) recorded in the financial year and included in the shareholders’ equity under the reserve for evaluation at fair value. Whenever an investment is eliminated, the amount of the cumulative losses or profits is removed from the other components in the profit and loss account and recorded in the financial year profits or losses.


Non-derivative financial liabilities

Financial liabilities concern loans, trade payables and other obligations to be paid and are valued at their amortized cost, using the criterion of effective interest rate. Should there be any change to the expected cash flows and there is a possibility that they can be reliably estimated, the value of the loans is recalculated in order to reflect this change on the basis of the current value of the new expected cash flows and the internal performance rate initially calculated. Financial liabilities are classified among the current liabilities, unless the Company has an unconditional right to defer their payment for at least 12 months after the date of the financial statements.

Financial liabilities are removed from the financial statements when the Company has transferred all the rights and risks concerning the instrument in question or when they are extinguished.

The non-derivative financial liabilities of the Group are represented by the loan contracts, bank overdrafts, trade payables and other payables.

These financial liabilities are initially recorded at their fair value, increased by any directly attributable transaction costs. Subsequently to their initial recording, they are valued at their amortized cost using the criterion of effective interest.

Financial assets and liabilities may be compensated and the amount deriving from compensation is included in the schedule of the equity and financial situation if, and only if, the Group has the right to compensate these amounts and intends to regulate the balance on a net basis or realise the assets and regulate the liabilities simultaneously.

Trade payables

Trade payables are initially recorded at their fair value and subsequently valued at their amortized cost. Trade payables for which the expiry is within the standard trading terms are not actualised.

Liquid assets and equivalent means

Liquid assets and equivalent means include all balances in cash and deposits on call with an expiry date of three months or less. For the purposes of the financial overview, the bank account overdrafts reimbursable on demand, which represent an integral part of the management of the cash on hand of the Group, are included among the components of liquid assets and equivalent means.

Derivative financial instruments

The Group only uses derivative financial instruments with the intent of hedging, in order to reduce the risks deriving from fluctuations in interest and exchange rates. The derivative financial instruments used by the Group, mainly fixed-term contracts and currency options, are valued at their fair value and accounted as financial assets (liabilities).

According to that established by IAS 39, derivative contracts may be accounted according to the methods established for hedging operations (“hedge accounting”) only if, at the start of the hedging operation:


a formal designation exists and the hedging operation is documented;

it is assumed that hedging is highly effective;

any transactions not yet completed subject to hedging from exposure to the risk of changes in financial flows are deemed highly probable; and

effectiveness can be reliably measured.

Should a derivative contract be designated to hedge the risk of changes in the fair value of the instruments to be hedged (“fair value hedge”), the profits and losses deriving from the changes in the fair value of the hedging instrument are recorded in the profit and loss account. The instruments being hedged are coherently adjusted in order to reflect the changes in fair value associated to the hedged risk.

When an instrument is designated to hedge the risk of changes in the future cash flows of an asset or liability recorded in the financial statements or an instrument deemed highly probable (“cash flow hedge”), it is recorded at its fair value with the relevant changes being attributed directly to the shareholders’ equity as regards the effective part. The cumulative profits or losses are removed from the shareholders’ equity and attributed to the profit and loss account coherently with the economic effects produced by the hedged operation. Any ineffective parts are accounted immediately in the profit and loss account.

Fair value is determined on the basis of the official quotations used for instruments exchanged on stock markets. As regards the instruments not exchanged on stock markets, the fair value is determined using the expected cash flows on the basis of the curve of the market interest rates at the relevant date and converting the values in currencies other than the Euro at the exchange rates in force at the end of the period.

Derivatives are accounted at the date of negotiation.

Staff Severance Indemnity and other employee benefits

The liabilities concerning short-term employee benefits paid out during the course of working relations are recorded for the amount accrued at the date of closure of the financial statements.

The liabilities concerning employee benefits paid out on termination of working relations or subsequently through defined benefit programmes, mainly represented by the Staff Severance Indemnity for subordinate work with Italian companies accrued at 31 December 2006 (or, if applicable, at the later date of subscription to a complementary social security fund) are recorded in the financial year they accrued in, net of advance payments made, and are determined on the basis of actuarial estimates and recorded by competence coherently with the services provided required for obtaining benefits; liabilities are evaluated by independent actuaries. The profits and losses deriving from the actuarial calculation are entirely attributed to the shareholders’ equity in the relevant financial year, taking into account the deferred fiscal effects.

Following the approval of Law 296/2006 “2007 State Budget” and subsequent decrees and regulations, the Staff Severance Indemnity quotas accrued as of 1 January 2007, in the case of


allocation to the INPS Treasury Fund, and as of 30 June 2007 or prior date of subscription, in the case of the option of complementary social security funds, are qualified as defined contribution plans and they are therefore accounted in a similar method to that for contributory payments of a different nature, and are recorded in the liabilities for the amount accrued at the date of closure of the financial year.


Provisions for risks and charges

The allocations for the provisions for risks and charges are recorded when, at the reference date in question, there is a legal or implicit obligation towards third parties deriving from a past event and it is probable that in order to satisfy these obligations, an outgoing of resources will be required, the amount of which can be reliably estimated. These allocations are recorded at the value representative of the best estimate of the total amount the company would pay to extinguish the obligation or transfer it to third parties at the date of closure of the financial year. Allocations to the provisions for risks and charges are recorded at their current value at the date of closure of the financial year.

Revenues

The revenues from the sale of goods are valued at the fair value of the payment received or to be paid, taking into account the value of any returns, allowances, trade discounts and premiums. Revenues are recorded when the recoverability of the payment is probable and the relevant costs can be reliably estimated.

Contributions for installations and operating costs

Contributions for installations are intended as the sums paid by the State and other Public Authorities to the Group for the realisation of initiatives aimed at the construction, reactivation and expansion of properties, plants and machinery, commensurate to their cost. The contributions in capital account in question are accounted in the financial statements on condition that the prerequisite of reasonable certainty is realised, which may be based on either obtaining the formal decisions to grant adopted by the Public Authorities granting them or on the systems provided by specific legal dispositions. Contributions for installations are deducted directly from the assets they refer to and are also used, as a reduction factor, in calculating the amortization rates.

Contributions for operating costs are intended as the sums paid by the State or other Public Authorities to the Group to reduce the costs and expenses sustained. These contributions are recorded in the financial statements by competence on condition that the prerequisite of reasonable certainty is realised, which may be based on either a formal decree for granting or a system provided by the specific legal disposition in question. Contributions for operating costs are attributed to the profit and loss account to reduce the cost item they refer to.

Costs

Costs are recorded by competence. The costs for the purchase of goods are recorded in the profit and loss account by competence if the significant risks and benefits connected to the ownership of the goods have been transferred to the Group. The costs for the purchase of goods are recorded in the consolidated profit and loss account net of returns, allowances, trade discounts and premiums concerning quantity.

The costs for services are recognised by competence on the basis of the time of their receipt. Advertising and research costs are entirely attributed to the profit and loss account.


Financial costs and revenues

The financial costs and revenues include the interest payable on medium and long-term loans, on current bank account operations, on financial leasing contracts in compliance with the effective interest rate, interest due, dividends due, profits and losses on exchange rates and profits and losses on the hedging instruments recorded in the profit and loss account.

The interest due and payable are recorded in the profit and loss account by competence, using the effective interest method. The dividends are recorded in the profit and loss account when the rights of shareholders to receive them are established.

Income tax

The current financial year income tax is determined on the basis of a realistic forecast of the costs to be absolved in application of the fiscal regulations in force and are recorded, in the context of the equity situation, net of advance payments and withholdings made. Any excess receivables are recorded in the assets section of the statement of assets and liabilities in the item “Tax receivables”, while payables are recorded in the item “Payables for income tax”.

Prepaid and deferred taxes are recorded in order to reflect the future tax benefits and/or costs deriving from the temporal differences between values accounted and assets and liabilities recorded in the financial statements and corresponding values considered for the purpose of calculating current taxes, and any fiscal losses that can be brought forward.

The receivables for prepaid taxes are recorded in the financial statements, in respect of the principle of prudence, if there is a reasonable certainty as to the existence in future financial years during which the deductible temporal differences will arise, which has led to their recording under prepaid taxes, of taxable income amounting to not less than the differences to be annulled.

Receivables for prepaid taxes concerning the fiscal benefit for losses to be brought forward are recorded in the financial statements if the following conditions, in particular, exist: there is a reasonable certainty of obtaining future taxable income that may be absorbed by the losses brought forward, within the period in which they are deductible according to the tax laws, the losses in question derive from clearly identified circumstances and it is reasonably certain that these circumstances will not arise again in future.

Deferred and prepaid taxes are determined on the basis of the tax rates provided for the taxation of income in the financial years in which the temporal differences will be annulled. The effect of changes in the tax rates for the aforementioned income will be accounted in the financial year in which the relevant legal measures are approved.

The parent company Grandi Stazioni S.p.A. and subsidiary Grandi Stazioni Ingegneria S.r.l. adhered to the national consolidated fiscal regime in the 2007 financial year, drawn up by the parent company Ferrovie dello Stato S.p.A., of which in art. 117 of the T.U.I.R.

The fiscal consolidation contract provides that, as regards the taxable income achieved and transferred to Ferrovie dello Stato S.p.A., the subsidiaries are bound to also transfer “adjustments for taxes” to the latter, net of the receivables transferred within the legal deadline


provided for the payment of the balance and deposits concerning the receivables transferred. In order to identify the measure and terms for payment, any compensatory steps taken by the parent company in the framework of Group tax will not be taken into account.

As regards the transfer of fiscal losses, the company Ferrovie dello Stato S.p.A. must pay to its subsidiaries indemnities amounting to the losses that they themselves would have used autonomously in the absence of Group taxation.

Irap is paid up autonomously by each of the companies adhering to the fiscal consolidation regime.

Discontinued operations and assets owned for sale

Non-current assets (or written-off groups) for which the accountable value will be recovered mainly through their sale rather than through continuing use are presented separately from other assets and liabilities in the equity and financial situation.

Immediately prior to being classified as destined for sale, they are recorded on the basis of the specific IFRS applicable to each asset, and subsequently recorded at the lesser of the accountable value and the presumed fair value, net of the relevant sales costs. Any losses are recorded immediately to directly adjust the non-current assets (or written-off groups) classified as owned for sale with counter-value in the profit and loss account.

The economic effects of economic operations concerning assets destined for sale (or written-off groups), net of the relevant fiscal effects, are recorded as a single item in the consolidated profit and loss account, as are the figures for the comparative financial year.

A discontinued operation represents a part of the business that been written-off or classified as owned for sale and:

represents an important branch of business or geographical business area;

is part of a coordinated plan for the disuse of an important branch of business or geographical business area;

is an asset acquired exclusively for the purpose of being sold.

The results of discontinued operations – be they discontinued or classified as owned for sale and to be discontinued – are recorded separately in the profit and loss account, net of fiscal effects. The corresponding values for the previous financial year, if any, are reclassified and recorded separately in the profit and loss account, net of fiscal effects, for comparison.

Use of estimates and evaluations

The drawing up of these consolidated financial statements, in application of the IFRS, required the formulation of estimates and assumptions that had an effect on the values of assets and liabilities in the consolidated financial statements and relevant informative notes, and on the potential assets and liabilities at the date of the consolidated financial statements. The estimates and relevant hypotheses are based on previous experience and other factors deemed reasonable in the circumstances. The results achieved may differ from these estimates. Estimates were


used, in particular, to determine and record allocations to the provisions for risks and charges and write-downs of receivables, to determine the useful lifetime of goods, to estimate the future recovery of prepaid taxes, to assess the recovery of non-current assets and to assess the recovery of assets destined to be written-off. The estimates and assumptions are reviewed periodically and the effects of any changes are reflected in the consolidated profit and loss account, should this affect that period only. Should the review of the estimates affect both current and future periods, the changes are recorded in the period in which the review is conducted and in relevant future periods.

New standards and interpretations not yet adopted

During the course of the 2009 financial year, the European Commission homologated the following new principles or interpretations applicable as of 1 January 2010:

“Review of IAS 27 consolidated and separate financial statements”. This new standard establishes that the accounting effects of changes in shareholding interests held in the parent company that do not determine loss of control must be recorded in the shareholders’ equity. In the case of controlling holdings being transferred, any remaining interest must be re-measured at the relevant fair value at the date on which control is transferred. The Grandi Stazioni Group does not expect any impact from the future application of the new dispositions.

“Amendment of IAS 39 Financial instruments: Recording and evaluation – elements qualifying for hedging”. With this integration to the IAS 39 in force, the IASB intends to clarify the conditions under which certain financial/non-financial instruments can be considered as “hedged items” in a hedging operation. The Grandi Stazioni Group does not expect any impact from the future application of the new dispositions.

“Amendment of IAS 32 Financial instruments: Recording in the financial statements”. This amendment clarifies that the rights, options or warrants giving the right to the acquisition of a fixed number of instruments representing the capital of the same body which issued these rights for a fixed amount in any currency must be classified as instruments representing capital if (and only if) the body offers the rights, options or warrants proportionately to all holders of the same class of instruments representing capital not constituted by derivatives. The amendments must be applied retroactively for all financial years beginning after 31 January 2010. The Grandi Stazioni Group does not expect any impact from the future application of these amendments.

“Review of IFRS 3 Business Combinations”. Significant amendments have been made to the method of accounting corporate aggregation operations. These include:

- the obligation of recording the changes in value recognised subsequently by the purchaser in the profit and loss account, and also of the transaction costs for the aggregation operation;

- the possibility of options, as regards the method of initial recording of the criterion of so-called full goodwill, or partial goodwill;


- the obligation, in the case of the acquisition of further shareholdings subsequently to taking over control,, of recording the positive difference between the purchase price and the corresponding quota of net accountable equity to adjust the shareholders’ equity;

- The obligation to record the effects deriving from the evaluation at fair value, at the date of takeover of control, of the holdings previously held in the profit and loss account in cases of corporate aggregation in several phases.

The Grandi Stazioni Group does not expect any impact from the future application of these amendments.

“IFRIC 12 – Agreements for services granted”. This interpretation states that, in the presence of specific characteristics of the concession deed, the infrastructures involved in the supply of public services granted be recorded in the intangible assets and/or financial receivables, according to whether, respectively, the concessionary has the right to debit the end user for the services provided and/or has the right to receive a predetermined payment from the public grantor. The new interpretation is applicable to both infrastructures realised or acquired from a third party by the grantor pursuant to the service agreement and existing ones that the grantor allows the concessionary to access pursuant to the service agreement. In particular, IFRIC 12 is applicable to agreements for services granted by public bodies to private bodies if:

- the grantor controls or regulates which services are to be provided by the concessionary with the infrastructure, who they should be provided to and at what price;

- the grantor controls any remaining significant interest in the infrastructure at the end of the agreement, through ownership or otherwise.

The Grandi Stazioni Group does not expect any impact from the future application of the new dispositions.

“IFRIC 15 – Agreements for the construction of real estate properties”. This interpretation describes the criteria for the accounting of the revenues and costs deriving from the subscription of a contract for the construction of a real estate property, clarifying when to apply the dispositions of “IAS 11 Contracted works” and “IAS 18 Revenues”. It also regulates the accounting process to be applied to the revenues deriving from the supply of additional services for the property being built.


“IFRIC 16 – Hedging of a net investment managed abroad”. This interpretation is applicable to companies which intend to hedge the exchange risk deriving from a “net investment managed abroad”. The main dispositions of the aforementioned interpretation are described below:

- only the difference in exchange rate between the functional currency (not that presented) used by the foreign management and that of its parent company (the latter intended at any level – last or intermediate) can be hedged;


- as regards the consolidated financial statements, the exchange rate risk connected to a net investment managed abroad can only be designated as hedged once, even if more than one company in the Group has hedged its own exposure;

- the hedging instrument can be owned by any company in the Group (excluding the company hedged);

- Should foreign management be terminated, the amount reclassified in the profit and loss account in the consolidated financial statements from the translation reserve is the same as the profits/losses equivalent to the effective portion of the hedging instrument.


“IFRIC 17 – Distribution to shareholders of assets not represented by liquid assets”. This interpretation clarifies the methods of presentation of the dividends paid out in assets other than cash to the possessors of capital. In particular:

- dividends must be recorded when they are decided upon;

- the company must value dividends at the fair value of the net assets to be paid out;

- the company must record the difference between book value and fair value in the profit and loss account.


“IFRIC 18 – Transfer of assets by customers”. This interpretation clarifies the accounting process for assets received from customers functional to the supply of goods and services during the period in which access to the goods/services is guaranteed.


6 Perimeter, criteria and methods of consolidation

The consolidated financial statements for the financial year closed on 31 December 2009 include the financial statements of the Group leader Grandi Stazioni S.p.A. and those of the Italian and foreign companies it has control over, directly or indirectly. In particular, the scope of consolidation includes the subsidiary companies over which it has direct or indirect decision-making powers as regards financial and management policy in order to obtain benefits from their activities. The financial statements of the subsidiaries are included in the consolidated financial statements as soon as the Parent company begins to exercise control and until such control ceases.

The scope of consolidation includes, in addition to the Group leader, the Italian subsidiary Grandi Stazioni Ingegneria S.r.l. and foreign subsidiary Grandi Stazioni Ceska Republika Sro.


See Annex 1 to these notes for the analytical list at 31 December 2009 of the companies included in the scope of consolidation, which indicates the main identification details and shareholding relations for each of these companies.

The following criteria and methods of consolidation are adopted in drawing up the consolidated financial statements:

The assets and liabilities, revenues and costs of the consolidated subsidiary companies are undertaken according to the method of global integration, eliminating the loading value of the shareholdings held by the Parent company to cover the relevant shareholders’ equity. The quota of the shareholders’ equity and financial year result due to the minority shareholders (“third parties”) is recorded in a suitable item of the statement of assets and liabilities and consolidated profit and loss account. There were no cases in which the purchase price of the shareholding was more or less than the shareholders’ equity of the company acquired.

Receivables and payables, revenues and costs concerning transactions between the companies in the scope of consolidation are removed. The profits and losses consequent to operations carried out between the companies in the scope of consolidation and relevant values in the group equity are removed, net of fiscal effects.

The quotas of shareholders’ equity and financial year result of the companies in the scope of consolidation due to “third parties” are highlighted in suitable items in the statement of assets and liabilities and the consolidated profit and loss account.

Any dividends distributed by consolidated companies using the methods of global integration are removed from the profit and loss account, which includes the financial year results achieved.

The financial statements of the consolidated companies working in currencies other than the Euro are converted into Euros, applying the following criteria: (i) the exchange rate in force on closure of the financial year to the equity assets and liabilities, including goodwill and consolidation adjustments; (ii) historical exchange rates to the shareholders’ equity; (iii) average business exchange rates to the profit and loss account, if similar to those in force on the date of the respective operations. Differences in exchange rate from conversion deriving from the application of different exchange rates for the assets and liabilities, shareholders’ equity and profit and loss account are recorded in an item in the shareholders’ equity entitled “Reserve from translation” for those concerning the Group and under the item “net third parties equity” for those concerning third parties. This reserve is transferred to the profit and loss account when the shareholding terminates. The equity and economic figures used for conversion are those expressed in working currency. Any consolidation differences are treated using the same method as that described for the integral method.

The infra-group profits and losses are removed proportionately, as are the other consolidation adjustments.


In order to enable the predisposition of the consolidated financial statements on the basis of the IFRS, all the consolidated companies have predisposed a specific reporting package, on the basis of the IFRS accounting principles adopted by the Group and previously described, reclassifying and/or rectifying their accounts figures.

There were no changes to the scope of consolidation for the 2009 financial year compared to the 2008 financial year.

7 Risk management

The Group is exposed to the following risks:

credit risk;

liquidity risk;

market risk.

This section provides information concerning the exposure of the Group to each of the risks listed above, the goals, policies and processes for the management of these risks and the methods used to assess them and the management of the Group capital. These consolidated financial statements include additional quantitative information.

The overall responsibility for the creation and supervision of a risk management system for the Group lies with the Board of Directors. The strategy of the Grandi Stazioni Group for the management of financial risks is compliant to and coherent with the corporate goals defined by the Board of Directors of the Group leader in the context of the strategic plans from time to time approved and is aimed at managing and controlling these risks.

Credit risk

The credit risk is the risk that a customer or one of the counter parties in a financial instrument causes financial losses by failing to fulfil an obligation and derives mainly from trade receivables and the financial investments of the Group.

In order to define the strategies and guidelines for the trade receivables policy, grant credit lines to clients, fragment the credit risk, control the solvency of customers and start credit recovery operations, during the course of the financial year, the parent company set up the post of Credit Manager and issued an organizational procedure for credit management.

The prospects for the recovery of credit are assessed position by position, taking into account the indications of the office managers and internal and external legal experts who follow the recovery process.

Credit for which there was a probability of losses at the date of the financial statements was consequently depreciated.

It should also be pointed out that the Group received fidejussions and/or cautionary deposits covering approximately one quarter of the total annual instalments.

Liquidity risk


The liquidity risk is the risk that the Group may find it difficult to fulfil the obligations associated to financial liabilities to be regulated by handing over liquid assets or other financial assets.

The loans stipulated to finance the refurbishment of both station complexes and property investments have all been paid out and are structured on the basis of the estimated future cash flows expected from the leasing contracts.

As regards Grandi Stazioni S.p.A., it should be pointed out that the payment of contributions due for the Legge Obiettivo works, which amounted to 230.7 million Euros at the end of 2008, was suspended in 2009 while awaiting the extension of the period of usage of the relevant loan, which expired on 31 December 2008.

The contractual expiries of the financial liabilities, including interest to be paid, are included in the following table:


Contractual financial flows

Accounting Over 6 months or

31 December 2009 value less 6-12 months 1-2 years 2-5 years 5 years Non-derivative financial liabilities

Bank loans 232,197 22,737 7,925 15,958 47,774 137,803

Liabilities for financial leasing 222 137 85 - - -

Trade payables 103,386 39,233 64,153 - - -

Total 335,805 62,107 72,163 15,958 47,774 137,803



31 December 2008 value less 6-12 months 1-2 years 2-5 years 5 years Non-derivative financial liabilities

Bank loans 166,840 5,392 2,300 11,316 35,084 112,748

Liabilities for financial leasing 531 135 174 222 - -

Trade payables 118,316 58,881 59,435 - - -

Total 285,687 64,408 61,909 11,538 35,084 112,748



1 January 2008 value less 6-12 months 1-2 years 2-5 years 5 years Non-derivative financial liabilities

Bank loans 132,914 2,073 2,263 9,294 28,693 90,591

Liabilities for financial leasing 79 79 - - - -

Trade payables 90,059 39,236 50,823 - - -

Total 223,052 41,388 53,086 9,294 28,693 90,591

As regards the stratification of the flows expected from derivative financial instruments, see that described in the following paragraphs “Exchange rate risk” and “Rate risk”


Market risk

The market risk is the risk that the fair value of future financial flows from a financial instrument fluctuate following changes in market prices, changes in exchange rates, interest rates or the floating of instruments representing capital. The goal of managing the market risk is the management and control of the exposure of the Group to this risk within acceptable levels, at the same time optimising the performance of investments. The Group uses hedging operations in order to manage the volatility of results.

The fair value of a derivative contract is determined using the official figures for instruments traded on stock markets. The fair value of instruments not quoted on stock markets is determined using evaluation models suited to each category of financial instrument and using the market figures for the date of closure of the accounting financial year (such as interest rate, exchange rate, volatility) actualising the expected cash flows on the basis of the market interest rate curve on the reference date and converting the values in currencies other than the Euro at the exchange rates in force at the end of the period provided by the European Central Bank.

There were no changes to the criteria for the evaluation of derivatives at the end of the financial year compared to those adopted at the end of the previous financial year. The effect of these evaluations on the profit and loss account and statement of assets and liabilities are therefore due exclusively to everyday market dynamics.

The notional value of a derivative contract is the amount on the basis of which flows are exchanged. The notional amounts of the derivatives included herein do not necessarily represent the amounts exchanged between the parties, and consequently cannot be considered as a measure of the credit exposure of the Company.

The financial assets and liabilities concerning the derivative instruments of the Group are:

cash flow hedge derivatives, concerning the hedging of the risk of changes in cash flows or the exchange rate risk connected to long-term indebtedness indexed at a variable rate;

trading derivatives concerning the hedging of the tax and exchange rate risk which are not required to be designated as cash flow hedge or fair value hedge operations or which do not satisfy the formal hedging requirements of IAS 39.

Exchange rate risk

This risk is encountered exclusively by the subsidiary Grandi Stazioni Ceska, which during the course of 2009, stipulated a medium-term (18 month) loan in Euros with Mediocredito Centrale, expiring on 19 October 2010. As the working currency used by the subsidiary is the Czech Krone, the company deemed it opportune to hedge the exchange rate risk by stipulating three cross-currency rate swap contracts with BNP Parisbas. The terms of the swap contracts were defined in order to reduce the impact of the future payment of interest on the above-mentioned loan.


The following table highlights the exposure of the Group to the exchange rate risk on the basis of notional value.

Euro CZK Euro CZK Euro CZK

31 December 2009 31 December 2008 1 January 2009

Loan - Mediocredito Centrale 15,000 396,975 - -

The main exchange rates applied during the course of the financial year were as follows:

Euro Average exchange rate End of financial year rate upfront

CZK 26.11 26.455

The following table indicates the notional and fair value of the derivative contracts on exchange rates expressed in thousands of Euros at 31 December 2009:

Description Effective from Notional Fair value Fair value asset Fair value liability

at at at at at at at at 31.12.09 31.12.08 31.12.09 31.12.08 31.12.09 31.12.08 31.12.09 31.12.08

Cross currency rate swap Paribas 03-Aug-09 9,000 - 254 - 254 - - - Cross currency rate swap BNP

Paribas 04-Aug-09 3,000 - 89 - 89 - - - Cross currency rate swap BNP

Paribas 23-Sep-09 3,000 - 127 - 127 - - -

TOTAL 15,000 - 470 - 470 - - -

The following table indicates the cash flows expected in coming financial years concerning the aforementioned derivative financial instruments for hedging interest rates:

Fair value Stratification of expected cash flows

at 31.12.2009 2010 2011 2012 2013 2014 Later

Cross currency rate swap BNP Paribas 254 254 - - - - -




Sensitivity analysis

If the exchange rate of the Czech Krone (CZK) to the Euro had been 5% more at 31 December 2009, all other variables being unchanged, it can be estimated that the shareholders’ equity would have been down by 15 thousand Euros due to the decrease in the fair value of exchange rate derivatives. On the other hand, if the exchange rate of the Czech Krone (CZK) to the Euro at that date been 5% less, all other variables being unchanged, the shareholders’ equity would have been up by 15 thousand Euros due to the increase in the fair value of exchange rate derivatives.

Exchange rate risk

The loans stipulated by the group are normally regulated at a variable rate increased by a spread. The economic results of the group are therefore significantly influenced by the performance of interest rates.

The policy of the group is to minimise the risk linked to interest rates as much as possible in the medium-term, so as to remain substantially exposed only to the risks linked to property assets.

At 31 December 2009, an IRS contract stipulated in 2006 is ongoing to hedge the variable rate loans totalling 30 million Euros to ensure a differential on the 6-monthly EURIBOR of 245 basis points and a maximum rate of 4.30%.

During the course of 2009, 2 interest rate swap contracts were stipulated with the financial institutes Calyon and RBS to hedge the risk of changes in interest rate on the loan stipulated during the course of 2008 with the EIB, thus ensuring that the company has a fixed rate of 3.635% and 3,738% respectively. The derivate interest rate option contract subscribed with Mediobanca during the 2006 financial year, originally to hedge the risk of changes in interest rates deriving from the loan then ongoing with Monte dei Paschi di Siena, was maintained even subsequently to the termination of this loan (which occurred in 2008) and was destined to hedge the same rick as regards the EIB loan.

All the contracts indicated are qualified as cash flow hedge contracts. The expiry of these contracts does not exceed the expiry of the underlying financial liabilities so that any change in fair value and/or expected cash flows of these contracts is balanced by a corresponding change in the fair value and/or expected cash flows of the underlying position.

Interest rate swap contracts usually provide for the periodic exchange of flows on interest at variable rates against flows on interest at fixed rates, both calculated on the same notional reference capital.

Interest rate option contracts provide for the periodical payment of an interest rate differential calculated on a notional capital reference, once specific predefined values are achieved (so-called strike). These limit values determine the maximum rate (so-called cap) or minimum rate (so-called floor) on which the indebtedness will be indexed by effect of the hedging.

Interest rate option contracts are usually stipulated when the fixed interest rate achievable through an interest rate swap is considered to be too high with respect to the expectations of Grandi Stazioni as regards future interest rates. In addition, the use of interest rate options is


considered appropriate in periods of uncertainty as to the future performance of rates, enabling benefits to be had from any reductions in interest rates.

The following table indicates the notional derivative contracts on interest rates broken down by type of contract, at 31 December 2009 and at 31 December 2008:

Notional value

Thousands of Euros 31.12.2009 31.12.2008 1.01.08

Interest rate swap 50,000 - -

Interest rate option 30,000 30,000 30,000

Total 80,000 30,000 30,000

It should be pointed out that the group has no ongoing operations of a speculative nature or not connected to its exposure to debts.

The following table indicates the notional and fair value of the derivative contracts on interest rates broken down by accounting designation (IAS 39) at 31 December 2009, at 31 December 2008 and at 1 January 2008:

Notional value Fair value

Thousand of Euros 31.12.09 31.12.08 1.01.08 31.12.09 31.12.08 1.01.08

Interest rate swap RBS 20,000 - - (70) - -

Interest rate swap Calyon 30,000 - - (377) - -

Cap Mediobanca 30,000 30,000 30,000 (101) (70) 311

80,000 30,000 30,000 (548) (70) 311

Lastly, the following table indicates the expected cash flows in coming financial years concerning the aforementioned derivative financial instruments:

Cash flows expected from derivatives on interest rates

Thousands of Euros Fair value Stratification of expected cash flows

at 31.12.2009 2010 2011 2012 2013 2014 Later

CFH derivatives on exchange rates

Interest rate swap RBS (70) (468) (220) (144) (32) 49 990

Interest rate swap Calyon (377) (733) (361) (247) (79) 43 1,317

Cap Mediobanca (101) (75) (37) - - - -


The Group does not designate any of the three derivative instruments indicated as hedging instruments according to the fair value hedging model. Consequently, any changes in interest rates on closure of the financial statements would have no effect on the profit and loss account.

The following table highlights the fair value of the derivatives and consequent impact on the Shareholders’ equity at 31 December 2009 and at 31 December 2008 (gross of relevant taxes) which, under equal conditions, would have been obtained by a change of +100 bps or -100 bps in the reference interest rates.

Thousands of Euros - 100 bps Fair Value +100 bps

31 December 2009 Interest rate swap RBS (1,817) (70) 1,472

Interest rate swap Calyon (3,013) (377) 1,949

Cap Mediobanca (111) (101) (61)

Sensitivity of financial flows (net) (4,941) (548) 3,360

31 December 2008

Interest rate swap RBS - - -

Interest rate swap Calyon - - -

Cap Mediobanca (176) (70) 13

Sensitivity of financial flows (net) (176) (70) 13

ANALYSIS OF THE ITEMS IN THE CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES

8 Non-current assets owned for sale

At 31 December 2008, the non-current assets owned for sale were constituted by:

Former departmental office building in Venice reclassified for 41,745 thousand Euros from the property investments following the stipulation of a preliminary purchase contract with Veneto Region. This sale was finalised by the stipulation of the definitive purchase deed on 9 June 2009 for an amount totalling 70,185 thousand Euros, inclusive of an additional payment recognised to the Veneto Region, for the major works realised, totalling approximately 685 thousand Euros and net of the fine withheld by the counter party following the findings that emerged during final testing.

Shareholding in Grandi Stazioni Edicole S.r.l. reclassified among the assets owned for sale following the start-up during the 2008 financial year of a competitive procedure aimed at the winding up of the shareholding. On 14 September 2009, the deed for the transfer of the shareholding in the company Network Italia Edicole Srl (formerly Grandi Stazioni Edicole Srl) to Dufry Italia Srl for 12 million Euros was stipulated.


These operations involved the following during the financial year closed on 31 December 2009:

as regards the building in Venice, the recording of a surplus of 24,147 thousand Euros gross of the fiscal effect recorded in the item Other income;

as regards the Shareholding, the recording of a surplus of 11,988 thousand Euros gross of the fiscal effect recorded in the item financial income.

The following table shows the equity impact of the operations described.

Description Values at

1.01.2008 Increases Decreases

Values at

31,12,2008 Increases Decreases

Values at

31.12.2009

Properties destined for sale - 41,745 - 41,745 4,293 (46,038) -

Shareholdings destined for sale - 12 - 12 - (12) -

TOTAL - 41,757 - 41,757 4,293 (46,050) -

9 Properties, plants and machinery

Below is the schedule of the consistency of the properties, plants and machinery at the start and end of the financial year, with the relevant movements. During the course of 2009, there were no changes to the estimated useful lifetime of these assets.

Civil

works

Plants and

machinery

Industrial

and trade

equipment Other

assets

Assets under

construction

and deposits

Total Cost or replacement cost

Cost or replacement cost at 1

January 2008 7,892 25,711 6,521 7,008 133,097 180,229

Contributions in capital account at 1 January 2008 (23,027) (23,027)

Increases 368 191 1,764 61,916 64,239

Contributions received (7,129) (7,129)

Decrease for disuse (64) (360) (424)

Reclassification of assets owned for sale (9,194) (9,194)

Reclassification 420 (420) -

Balance at 31 December 2008 7,892 26,079 6,712 9,128 154,883 204,694

Balance at 1 January 2009 7,892 26,079 6,712 9,128 154,883 204,694

Increases 780 2,929 172 166 44,386 48,433

Contributions received -


Decrease for write-offs (15) (291) (306)

Reclassification 4,264 (819) (15,197) (11,752)

Balance at 31 December 2009 8,672 33,272 6,869 8,184 184,072 241,069

Civil

works

Plants and

machinery

Industrial

and trade

equipment Other

assets

Assets under

construction

and deposits

Total


Balance at 1 January 2008 425 7,720 5,184 4,523 - 17,852

Financial year amortizations 263 1,491 698 927 - 3,379

Write-downs 418 418

Disuse (47) (47)

Balance at 31 December 2008 688 9,211 5,882 5,403 418 21,602

Balance at 1 January 2009 688 9,211 5,882 5,403 418 21,602

Financial year amortizations 289 2,569 721 803 - 4,382

Write-downs -

Reclassification (49) - (49)

Disuse (14) (288) - (302)

Balance at 31 December 2009 977 11,780 6,589 5,869 418 25,633

Accountable values

At 1 January 2008 7,467 17,991 1,337 2,485 110,070 139,350

At 31 December 2008 7,204 16,868 830 3,725 154,465 183,092

At 1 January 2009 7,204 16,868 830 3,725 154,465 183,092

At 31 December 2009 7,695 21,492 280 2,315 183,654 215,436

The increases in the item Assets under construction and deposits totalling 61,916 thousand Euros in 2008 and 44,386 thousand Euros in 2009 refer to the capitalisation of external and internal costs mainly concerning design and works costs for the refurbishment activities ongoing in stations, prevalently in Milan, Turin and Naples.

9,194 thousand Euros of the Assets under construction and deposits were reclassified in 2008 among the non-current assets owned for sale, in as much as they concern improvements carried out to the former departmental office building in Venice destined for sale (see note 8). The reclassifications made during 2009 concerned 3,698 thousand Euros for the entry into service of the station complex at Roma Termini, 4,264 thousand Euros for the entry into service of the installations and machinery concerning the building owned in Bologna (classified among property investments), 3,566 thousand Euros for civil engineering works carried out on the Bologna building and therefore reclassified under property investments and the remaining 3,669 thousand Euros for the reclassification from assets under construction and deposits to


contracted works in progress carried out following the subscription with RFI and Trenitalia of an agreement on the basis of which the latter have recognised to the group leader the reimbursement of the expenses sustained for the refurbishment of the station complexes.

It should be pointed out that during the course of 2008, contributions for plants of 7,129 thousand Euros were recorded referring to works in progress for the “complementary works on the stations complexes”, as approved in the programme for strategic infrastructures (Law 443/2001 – so-called Legge Obiettivo).

The increase in Plants and Machinery recorded in 2009, totalling 2,929 thousand Euros, refers mainly to the acquisition/realisation of various plants on the station complexes currently being refurbished.

Lastly, it should be pointed out that the only depreciation due to write-downs recorded, totalling 418 thousand Euros, concerns the 2008 financial year and was accounted to cover the non-existence of advertising plants in progress.

At 31 December 2009, the item Other assets included furniture and accessories purchased in 2008 through a financial leasing contract stipulated with Fercredit SpA (Ferrovie dello Stato Group). The historical cost of these assets, recorded in 2008, totalled 600 thousand Euros, amortized at 31 December 2009 for 200 thousand Euros. To cover these assets, a corresponding financial debt of 600 thousand Euros was recorded in 2008, reimbursed on 31 December 2008 for 110 thousand Euros and on 31 December 2009 for 268 thousand Euros.

10 Property investments

The following table shows the consistencies of the property investments and their movements as of 1 January 2008.

Land Buildings Total

Cost or cost replacement


Increases

Written-off

Reclassifications and assets owned for sale

18,902

(5,713)

76,099

(23,260)

95,001

-

-

(28,973)

Balance at 31 December 2008 13,189 52,839 66,028

Balance at 1 January 2009 13,189 52,839 66,028

Increases Transferred from properties, plants and machinery 3,566 3,566

Transferred to assets owned for sale Written-off Balance at 31 December 2009 13,189 56,405 69,594


Balance at 1 January 2008 - 14,554 14,554

Financial year amortization 1,586 1,586


Transferred to assets owned for sale (4,473) (4,473)

Written-off Balance at 31 December 2008 - 11,667 11,667

Balance at 1 January 2009 - 11,667 11,667

Financial year amortization 1,692 1,692

Transferred to assets owned for sale Written-off Balance at 31 December 2009 - 13,359 13,359

Land Buildings Total

Accountable values

At 1 January 2008 18,902 61,545 80,447

At 31 December 2008 13,189 41,172 54,361

At 1 January 2009 13,189 41,172 54,361

At 31 December 2009 13,189 43,046 56,235

The item property investments includes non instrumental land and buildings valued at cost, and specifically includes the value of the properties bordering the stations of Roma Termini, Napoli Centrale, Venezia Santa Lucia and Genova Piazza Principe purchased on 29 March 2001 from Ferrovie dello Stato S.p.A. and the property complexes located in Bologna and Florence purchased on 20 December 2001 from Poste Italiane S.p.A..

The reclassification to Non-current assets owned for sale carried out in the financial statements at 31 December 2008 concerns the portion of the property complex in Venice, as per the operation described in note 8 above.

The positive difference of 3,566 thousand Euros registered in 2009 for the item Buildings refers to the reclassification of the property owned in Bologna, as already described in note 9 above.

There are mortgages totalling 62.5 million Euros on the properties in Rome, Venice and Naples.

The property investments indicated include various properties occupied by companies in the Ferrovie dello Stato Group and/or by third parties from which the parent company receives indemnities or leasing fees. For more details on relations with related parties, see note 45.

The Group leader has asked an independent external expert to evaluate the investments in properties owned. This evaluation was conducted using the reconstruction cost method, on the basis of which the following intervals for estimating the market value were determined, bearing in mind that these are old buildings:

the value of similar new properties would total 102 million Euros;

the value of similar old buildings would total 60 million Euros.

As the inspection values are in excess of the accountable values, the values in the financial statements were not adjusted.


11 Intangible assets

The table below shows the consistencies of the intangible assets constituted exclusively by software and usage licences.

Concessions,

licences and

similar rights

Total

Cost or cost replacement


Increases

Written-off

4,275

43

-

4,275

43

-

Balance at 31 December 2008 4,318 4,318

Balance at 1 January 2009 4,318 4,318

Increases 121 121

Written-off - -




Financial year amortization 580 580

Written-off - -



Financial year amortization 133 133

Written-off 0


Accountable values

At 1 January 2008 639 639

At 31 December 2008 102 102

At 1 January 2009 102 102

At 31 December 2009 90 90

It should be pointed out that during the course of 2008, the Group did not sustain costs for research and development activities. During the course of 2009, costs for research and development activities were sustained and attributed directly to the profit and loss account for a total of 100 thousand Euros concerning feasibility studies for the realisation of photovoltaic systems in the station complex areas.


12 Receivables for prepaid taxes and liabilities for deferred taxes

The following schedules illustrate the consistency of the receivables for prepaid taxes and the liabilities for deferred taxes and the movements that occurred during 2008 and 2009 as regards the deferred taxation recorded due to the main temporal differences recorded among the accounts figures and the corresponding fiscal values.

31.12.2009 31.12.2008 01.01.2008

Total of the temporal

differences (rate %)

Fiscal effect



Fiscal effect



Fiscal effect

Assets for prepaid taxes

Differences in value on properties, plants and machinery, on intangible assets and on assets destined for sale

341 32.21% 110 1,003 32.21% 323 960 32.21% 309

Financial costs 0 27.50% 0 3 27.50% 1 0 27.50% 0

Depreciation contracted work 445 32.21% 143 344 32.21% 111 282 32.21% 91

Contributions 1,253 32.21% 404 2,430 32.21% 783 3,618 32.21% 1,165

Representation expenses 26 32.21% 8 52 32.21% 17 88 32.21% 28

Credit depreciation fund 9,163 27.50% 2,520 5,079 27.50% 1,397 4,169 27.50% 1,146

Directors remuneration 464 27.50% 128 166 27.50% 46 118 27.50% 32

Provisions for risks and charges

6,163 30.69% 1,892 3,527 32.21% 1,136 1,758 32.21% 566

Evaluation of financial instruments 549 27.50% 151 70 27.50% 19 0 27.50% 0

Tax and tributary costs 2,680 27.50% 737 1,310 27.50% 360 1,055 32.20% 340Council tax

61 27.50% 17 59 32.21% 19 0 32.21% 0Advertising Allocation for personnel costs 876 27.50% 241 666 27.50% 183 575 27.50% 158

Professional services not completed in the year 0 32.21% 0 20 27.50% 5 0 27.50% 0

Allocation for collaborators costs 5 27.50% 1 0 27.50% 0 0 27.50% 0

Interest on arrears 12 27.50% 3 0 27.50% 0 0 27.50% 0

Other temporal differences 79 32.21% 25 121 32.21% 39 2 32.21% 1

TOTAL 22,117 6,380 14,852 4,439 12,625 3,837

Assets for prepaid taxes totalled 6,380 thousand Euros at 31 December 2009, up by 1,941 thousand Euros compared to 31 December 2008. This difference is principally affected by the temporal differences that emerged following the allocations made to the credit depreciation fund and provision for risks and charges.


It should be pointed out that there are no back dated fiscal losses on which the Group should have recorded prepaid taxes.

31.12.2009 31.12.2008 01.01.2008 Total of the

temporal differences

(rate %)

Fiscal effect



Fiscal effect



Fiscal effect

Liabilities for deferred

taxes

Financial costs 8,470 27.50% 2,329 5,926 27.50% 1,630 2,508 27.50% 690

Differences in value on

properties, plants and

machinery, on

intangible assets and

on assets destined for

sale

1,728 32.20% 556 2,498 32.20% 804 2,499 32.20% 805

Eval. financial instruments 340 27.50% 94 340 27.50% 94 311 27.50% 86

Staff Severance Indemnity 330 27.50% 91 437 27.50% 120 506 27.50% 139

Difference for assets in financial leasing 203 32.21% 65 64 32.21% 21 0 32.21% 0

Division of capital gains 19,935 27.50% 5,482 0 27.50% 0 0 27.50% 0

TOTAL 31,006 8,617 9,265 2,668 5,824 1,719

The liabilities for deferred taxes totalled 8,617 thousand Euros at 31 December 2009, up by 5,949 thousand Euros, mainly attributable to the deferred taxes recorded on the surplus realised by the sale of the former departmental office building in Venice, broken down fiscally over 5 financial years.

Recorded in the profit and

loss account

Prepaid taxes Balance Recorded Recorded in Balance Allocations Released Recorded in Balance

1.1.2008 in the profit

and loss

account

the net

equity

31.12.2008 the net

equity

31.12.2009



machinery, on intangible

assets and on assets

destined for sale 309 14 0 323 124 (337) 0 110

Financial costs 0 1 0 1 0 (1) 0 0

Depreciation contracted work 91 20 0 111 115 (83) 0 143

Contributions 1,165 (383) 0 783 0 (379) 0 404

Representation expenses 28 (12) 0 17 0 (9) 0 8

Credit depreciation fund 1,146 251 0 1,397 1,411 (288) 0 2,520

Directors remuneration 32 14 0 46 125 (43) 0 128


Provision for risks and charges

566 570 0 1,136 765 (9) 0 1,892

Evaluation of financial instruments 0 0 19 19 0 0 132 151

Prepaid taxes Balance

1.1.2008

Recorded in the

profit and loss

account

Recorded in the net equity

Balance

31.12.2008

Recorded in the profit and

loss account

Recorded in

the net

equity

Balance

31.12.2009Allocations Released

Tax and tributary costs 340 20 0 360 461 (84) 0 737

Council tax Advertising 0 19 0 19 0 (2) 0 17 Allocations for personnel

costs 158 25 0 183 58 0 0 241 Professional services not

completed in the year 0 5 0 5 0 (5) 0 0 Allocation for

collaborator costs 0 0 0 0 1 0 0 1

Interest on arrears 0 0 0 0 3 0 0 3

Other temporal differences 1 38 0 39 0 (14) 0 25

Total 3,837 583 19 4,439 3,063 (1,254) 132 6,380

Deferred taxes

Financial costs 690 940 0 1,630 702 (3) 0 2,329



machinery, on

intangible assets and

on assets destined for

sale 805 (1) 0 804 0 (248) 0 556 Evaluation of financial

instruments 86 93 (85) 94 0 0 0 94 Staff Severance Indemnity

139 (5) (14) 120 0 (3) (26) 91

Differences for assets

in financial leasing 0 21 0 21 44 0 0 65

Division of capital gains 0 0 0 0 5,482 0 0 5,482

Total 1,719 1,048 (99) 2,668 6,228 (254) (26) 8,616

Total components recorded in NE 118 158


13 Non-current and current financial assets (including derivatives)

The following table shows the composition of the financial assets at the date of transition to the IFRS and at the end of the 2008 and 2009 financial years.

Balance at Balance at Balance at 31.12.2009 31.12.2008 1.01.2008

Non-current financial assets

Liquid assets bound to MPS medium/long term - - 22

Financial assets available for sale (shareholdings) - 6 120

Costs accessory to loans - 131 316

Derivative financial instruments for hedging - - 311 TOTAL - 137 769

Balance at Balance at Balance at 31.12.2009 31.12.2008 1.01.2008

Current financial assets

Receivables from parent company for inter-company c/a 7,113 17,807 22,687 Derivative financial instruments 470 - -

TOTAL 7,583 17,807 22,687

It should be pointed out that the accountable values indicated correspond to the respective fair values determined at the date of the financial statements.

The costs accessory to loans included in the non-current financial assets are constituted by the commissions and expenses sustained by the parent company (131 thousand Euros) in 2008 and the subsidiary Grandi Stazioni Ceska (316 thousand Euros) in 2007 for the starting up of medium and long term loans.

The costs in question were suspended while awaiting the payment or completion of the payment of the respective loans. With specific reference to the parent company, the payment of the loan by the EIB to which the costs refer was concluded during the course of 2009, while as regards the subsidiary, the payment of the loan by Unicredit Bank Czech Republic was concluded in 2008. Therefore, the negative difference recorded at 31 December 2009 is due to the reclassification of the costs in question in reduction of the relevant financial debt for the calculation of the amortized cost.

The receivables from the parent company are constituted by the balance of the inter-company current account with Ferrovie dello Stato S.p.A. through which the income and payments concerning the ongoing economic relations with FS Holding, Ferservizi, Italferr, RFI and Trenitalia pass. At 31 December 2009, the balance of the inter-company current account totalled 7,113 thousand Euros. This current account is regulated under conditions in line with the market and on the basis of a contract providing for an active interest rate of the Euribor (monthly average) rate minus a spread of 0.175% annually. The average rates applied for the 2008 and 2009 financial year were 4.18% and 0.76% respectively.


The item “derivative financial instruments” is constituted exclusively by the fair value at 31 December 2009 of three derivative instruments started during the course of the financial year by the subsidiary Grandi Stazioni Ceska with the aim of hedging the exchange rate risk deriving from the loan in Euros granted by UniCredit MedioCredito Centrale S.p.A.. These financial instruments are qualified as trading financial instruments.

The derivative financial instruments in question are recorded at fair value at the respective dates of the financial statements and in the context of the hierarchy for determining fair value, the calculation made is level 2, in other words the fair value has been measured using input data different from the quoted prices (in a market for identical financial instruments) which are observable on the assets directly (as prices) and indirectly (as price derivatives).

See note 7, paragraphs entitled “Exchange rate risk” and “Rate risk” for information on the derivative financial instruments of the Group.

14 Other non-current and current assets

Other non-current assets

This item is broken down as follows:

Balance at31.12.2009

Balance at 31.12.2008

Balance at1.01.2008

Other non-current assets Irpeg receivables transferred by Ferrovie dello Stato S.p.A. 2,838 3,354 3,870

Cautionary deposits 5 8 7

Deposits on leasing fees 27,425 13,503 7,128

TOTAL 30,268 16,865 11,005

The Irpeg receivables of 2,838 thousand Euros at 31 December 2009 refer to the remaining Irpeg receivables (with expiry over 12 months) transferred from Ferrovie dello Stato S.p.A. in 2004, used in each financial year in the maximum limit provided by the laws in force on the matter (Legislative Decree 241/97).

The accountable value of the Deposits on leasing fees includes the direct and indirect costs sustained by the subsidiary Grandi Stazioni Ceska for the refurbishment of Prague and Mariànské Làzne stations. As described in note 5 (“Accounting principles applied”), the costs are suspended between non-current assets and debited to the profit and loss account in constant instalments for the remaining duration of the leasing contract with Czech Railways (Ceske Drahy a.s.). In 2009 and 2008, the total costs debited to the profit and loss account totalled 401 thousand Euros and 254 thousand Euros respectively; see note 33 “Costs for the use of third party assets” in this regard.


Other current assets




Balance at1.01.2008

Other current assets

Other tax receivables 130 902 870

Receivables from personnel 37 23 34

Cautionary deposits 240 172 125

Deposits to Suppliers 14,006 7,786 6,708

Group VAT receivables - 5,259 -

Deferred costs 1,086 910 837

Other 119 1,668 1,674

TOTAL 15,618 16,720 10,248

The item Deposits to suppliers includes the deposits made to suppliers for services not yet supplied but provided contractually. The increase of 6,220 thousand Euros, compared to 2008, concerns deposits made to suppliers for contractual commitments formalised for the ongoing refurbishment of station complexes.

The item deferred costs includes costs for insurance premiums, council advertising tax, rents due and software maintenance, which are suspended as they are due in future financial years.

15 Inventories

Inventories are composed as follows:

Balance at Balance at Balance at Description 31.12.2009 31.12.2008 1.01.2008

Contracted works in progress 28,978 15,989 13,175

Deposits received (13,923) (9,075) (7,549)

Depreciation fund (445) (344) (282)

TOTAL 14,610 6,570 5,344

The contracted works in progress concerning tenders not completed at 31 December 2009 have been recorded in the inventories, on the basis of the contractual amounts regulated by the contracts stipulated mainly with the then parent company Ferrovie dello Stato Società di Trasporti e Servizi per Azioni, now RFI S.p.A., on 27 February 1997 and 26 April 2000, and the agreement dated 27 July 2000, extended until 31 December 2009.

The increase recorded in the item contracted works in progress at 31 December 2009 compared to the previous financial year, totalling 12,989 thousand Euros, is due: 8,501 thousand Euros to payments contractually accrued in the financial year for works provided, 3,669 thousand Euros and 819 thousand Euros to two reclassifications of the item Properties, plants and machinery (ongoing fixed assets and deposits and other assets respectively) conducted following the subscription with RFI and Trenitalia of an agreement on the basis of which they recognised the


group leader the reimbursement of the expenses sustained for the refurbishment of the station complexes. See note 8 in this document for further details.

The following table shows the movements for the period in the depreciation fund, in which the allocations and releases concerning the losses expected are highlighted.

Release of Balance at Allocations Balance at

Usage excessive 31.12.2007 31.12.2008 funds

Allocations Usage

Release of excessive

funds Balance at 31.12.2009

Depreciation Fund works 282 256 (194) In progress

344 357 (256) 445

TOTAL 282 256 - (194) 344 357 - (256) 445

16 Non-current and current trade receivables

The trade receivables are broken down as follows:



Balance at1.01.2008

Current trade receivables Current ordinary customers 70,004 53,509 56,093

Trade receivables from subsidiaries - - 322

Trade receivables from parent company 478 449 276

Trade receivables from other related companies 53,332 35,976 31,529

Total current receivables 123,814 89,934 88,220

Depreciation fund

Depreciation fund receivables from ordinary customers (9,141) (5,631) (4,389)

Depreciation fund receivables from other related companies (861) - (1,011)

Total depreciation fund current receivables (10,002) (5,631) (5,400)

TOTAL CURRENT TRADE RECEIVABLES 113,812 84,303 82,820



Balance at1.01.2008

Non-current trade receivables

Non-current ordinary customers

Depreciation fund

Depreciation fund receivables from ordinary customers

8,650

-

9,428

-

5,013

-TOTAL NON-CURRENT TRADE RECEIVABLES 8,650 9,428 5,013


The hierarchy of the receivables at the date of the financial statements is as follows:

Gross Value

31.12.2009

Depreciation

31.12.2009

Gross Value

31.12.2008

Depreciation

31.12.2008

Gross Value

31.12.2007

Depreciation

31.12.2007

Not yet expired 85,919 (3,124) 82,257 (2,951) 80,431

Expired by 0-30 days 10,624 3,100 4,115

Expired by 31-120 days 24,092 3,894 1,900

Expired by 121-365 days 1,333 3,735 1,695

Over one year 10,495 (6,878) 6,376 (2,680) 5,093 (5,400)

Total 132,464 (10,002) 99,362 (5,631) 93,233 (5,400)

The following are the revenues from ordinary transactions with single customers, which constitute over 10% of the Group revenues for the 2008 and 2009 financial years:

revenues from Rete Ferroviaria Italiana totalling 54,520 thousand Euros in 2008 and 54,557 thousand Euros in 2009;

revenues from Trenitalia totalling 34,412 thousand Euros in 2008 and 29,597 thousand Euros in 2009.

These revenues are all connected to ordinary leasing and tenancy activities.

17 Liquid assets and equivalent means


Description Balance at31.12.2009


Balance at1.01.2008

Bank and post office deposits 28,333 7,209 9,177

Cheques 74 6 -

Cash and other securities on hand 10 7 6

“Time deposit” operations 31,890 - -

Total 60,307 7,222 9,183

The balance represents the liquid assets and existence of cash and securities at 31 December 2009.

The time deposit operations are deposits with a short-term duration (1 month) on which active interest accrues at higher rates than the average for ordinary deposits.

The positive change in the liquid assets and equivalent means is mainly due to the cash on hand traceable to the sale of the property owned by the group leader and described previously.


18 Tax receivables

The tax receivables at 31 December 2009 showed a balance of zero; the corresponding values at the end of the previous financial year and at 1 January 2008 are indicated in the following table:

Balance at

Description 31.12.2009 Balance at 31.12.2008

Balance at1.01.2008

Ires for fiscal consolidation - 2,677 870

Irap receivables - 256 61

Total - 2,933 931

19 Shareholders’ equity

The goals of Grandi Stazioni S.p.A. as regards the management of capital are based on the creation of value for shareholders, guaranteeing the interests of stakeholders and safeguarding corporate continuity, as well as maintaining an adequate level of capitalisation so as to enable the strengthening of the equity and financial structure of the Company and the Group, also in consideration of the significant investments currently being made.

The changes that occurred during the 2009 and 2008 financial years for the main items in the consolidated shareholders’ equity are analysed in the following schedule.


Thousands of Euros Net Group Equity


Share capital

4,304

Legal reserve

861

Reserve for overpricing of shares

58,309

Extraordinary reserve

15,649

Reserve for conversion of items in foreign currency

Reserve for evaluation of financial instrument

225

Other reserves

Profits Reserve (losses) for brought Reserve for own forward

revaluation shares (accumulated)

4,352

Financial year result

13,221

Total Shareholders’ equity of the Group

96,921

Third party Net

Equity

3,824

Total Net

Equity

100,745 Overall profits / (losses)

recorded

of which: 280 (276) (35) 18,072 18,041 190 18,231

- profits / (losses) recorded directly in N.E.

280 (276) (35) (31) 270 239



Allocation of prev. bus. year result

2,683 (194) (2,489) - 0

Balance at 31 December 2008 4,304 861 58,309 18,332 280 (51) (35) - - 4,158 18,072 104,230 4,014 108,244 Overall profits / (losses) recorded

of which:

67 (346) (67) 39,561 39,215 56 39,271

- profits / (losses) recorded directly in N.E.

67 (346) (67) (346) 65 (280)



Allocation of prev. bus. year result

3,020 3,052 (6,072) - -

Balance at 31 December 2009 4,304 861 58,309 21,352 347 (397) (102) - - 7,210 39,561 131,445 4,070 135,515


Share capital

The share capital of the Group leader at 31 December 2009, fully subscribed and paid-up, was constituted by 83,334 ordinary shares worth a nominal 51.65 Euros each, totalling 4,304,201.10 Euros. At 31 December 2009, on the basis of the findings in the Book of Shareholders, the share capital was held 60% by Ferrovie dello Stato S.p.A. and 40% by Eurostazioni S.p.A..

Legal Reserve

The legal reserve, totalling 861 thousand Euros, was unchanged compared to 31 December 2008, as it had reached the limit of which in art. 2430 of the Civil Code (20% of the share capital).

Reserve for Overpricing of Shares

The reserve for overpricing of shares is traceable to the increase in capital carried out on 28 July 2000 and was unchanged compared to the previous financial year.

Extraordinary

The extraordinary reserve derives from the allocation of the profits from previous financial years not destined for distribution. This reserve increased by 2,683 thousand Euros in the 2008 financial year and 3,019 thousand Euros in the 2009 financial year.

Reserve for conversion of items in foreign currency

The conversion reserve includes all the exchange rate differences deriving from the conversion of the financial statements of the foreign subsidiary Grandi Stazioni Ceska.

Reserve for the hedging of financial flows

The reserve for the hedging of financial flows includes the effective quota of the net difference accumulated in the fair value of the instruments for the hedging of financial flows concerning hedged operations which have not yet arisen, taking into account the relevant fiscal effect. See note 7, paragraph entitled “rate risk” and note 23 “Non-current financial liabilities (including derivatives)”.

Other reserves

The item other reserves includes exclusively the quota of profits/(losses) deriving from the actuarial calculation entirely attributed to the shareholders’ equity in the financial year in question, taking into account the relevant deferred fiscal effects.

Following that decided by the Assembly of Shareholders on 5 May 2009, the group leader carried out the distribution of dividends on the 2008 financial year, totalling 12,000 thousand Euros, during the course of the 2009 financial year.

On 16 March 2010, the Board of Directors of the Group leader proposed the distribution of dividends totalling 12,500 thousand Euros, amounting to 150 Euros per share.


Other components of the Schedule of overall profits/(losses) recorded in the financial year

The section on the consolidated accounts schedules includes the Schedule of (overall) profits/losses recorded in the financial year, which highlights the other components of the overall economic result net of the fiscal effects. The following table details the gross amount and the relevant fiscal effect of these other components. (Thousands of Euros) 31.12.2009 31.12.2008

Gross amount

Fiscal effect

Net amount

Gross amount

Fiscal effect

Net amount

Other components of the overall profit and loss account

Effective quota of differences in fair value of the hedging of financial flows

(477) 131 (346) (381) 105 (276)

Conversion reserve 132 132 550 550

Profits (losses) from actuarial benefits (92) 26 (66) (48) 13 (35)

Other components of the overall profit and loss account for the year, net of the fiscal effects

(437) 157 (280) 121 118 239

20 Medium/long term and short-term loans

The medium/long-term loans and relevant current quotas are broken down by nature in the following table: Balance at Balance at Balance at

Description 31.12.2009 31.12.2008 1.01.2008

Total loans

Loans from banks 232,197 166,840 132,914

Payables for financial leasing 222 531 79

Total 232,419 167,371 132,993

Current quota of medium/long-term loans

Current quota of loans from banks 30,967 4,728 172

Current quota of liabilities for financial leasing 222 309 79

Total current quota of medium/long-term loans 31,189 5,037 251

Total medium/long-term loans 201,230 162,334 132,742

As regards the breakdown of the contractual expiries of these financial liabilities, inclusive of interest to be paid, see note 7 (“Risk management”), paragraph entitled “Liquidity risk”.


The terms and conditions for the ongoing loans are as follows:

Banca BIIS Mortgage Curency

EUR

Nominal

interest

rate Euribor 6 months

Expiry year 2022

31/12/2009

Nominal Accounting value value

31/12/2008


01/01/2008


Rome Property +0,95% 16,284 16,284 17,285 17,285 18,237 18,237Banca BIIS Mortgage EUR Euribor 6 months 2022 Venice Property +0,95% 48,852 48,852 51,852 51,852 54,712 54,712Bipop Carire EUR Euribor 6 months 2013

+0,80% 2,311 2,311 2,946 2,946 3,273 3,273EIB Loan EUR Euribor 6 months 2023 150,001 149,696 92,000 91,794 - -

+ spread variabile

MPS + Calyon EUR Euribor 6 months 2021 - - - - 56,692 56,692

Loan +0,95% Unicredit Medio EUR Euribor 12 months 2010 15,084 15,054 - - - -Credito Centrale + 1,7% Loan Unicredit Bank CZK Pribor 12 months 2028 - - 3,348 2,963 - -Czech Republic + 1,5% Loan Total Loans

232,532 232,197 167,431 166,840 132,914 132,914

It should be pointed out that the accountable values of the loans detailed in the above table are representative of the fair values.

The loans refer to:

the debt contracted by the parent company with the Credit institute Banca BIIS (Banca Infrastrutture Innovazioni e Sviluppo; Infrastructures Innovations and Development Bank) due to the starting-up of two real estate mortgages guaranteed by the properties in Rome, Venice and Naples totalling 80 million Euros originally. Both of the contracts were stipulated on 6 March 2003, with a twenty-year duration, and both provide for the pre-amortization of the interest for the first three years only and the return of the capital in the next 17 years at a variable rate of the six-monthly Euribor plus a spread of 0.95%. During the year, a change was registered due to the reimbursement of the respective capital quotas;

the Bipop Carire loan stipulated by the parent company on May 2005 for a total amount of 3.25 million Euros, aimed at supporting the investments in shareholdings in Italian companies abroad (Law 100/90 – SIMEST). This has a duration of 8 years, provides for the amortization of the interest for the first three years only and the return of the capital in the next five years at a variable rate of the six-monthly Euribor plus a spread of 0.8%;

the loan subscribed with the EIB (European Investment Bank), stipulated by the parent company in April 2008 for 150 million Euros for the realisation of the internal refurbishment works in stations. The operation involves the Caylon Bank and Cassa Depositi e Prestiti S.p.A. in the role of Guarantors. The duration is 15 years as of the first payment (30 June 2008); reimbursement is to occur in six-monthly instalments at constant capital as of 30 June 2010 and with an interest rate of


the six-monthly Euribor offered for a duration of six months increased or decreased by the number of base points communicated by the Bank to the Company. In June 2008 and October 2008, two additional guarantee deeds were subscribed, with the Banca Caylon S.A. and the Cassa Depositi e Prestiti S.p.A. respectively, to which a six-monthly commission is recognised, amounting to 45 base points, to be calculated on the amount in capital line of the payments made from time to time. The contract provides for the obligation of informing the guarantor as regards the methods of hedging the debt (historical with figures in the financial statements at 31 December 2008 and prospective with figures from the 2009 budget), which at 31 December 2009 had been fulfilled. To cover the loan, the hedging contract with Mediobanca was maintained and two new contracts were subscribed during the course of 2009 for IRS hedging, the details of which can be found in paragraph 23 below. It should be pointed out that to cover the starting-up of this loan, accessory costs were sustained totalling 340 thousand Euros used for the reduction of the value of the financial debt in calculating the amortized cost;

the debt contracted by the subsidiary Grandi Stazioni Ceska with Unicredit Mediocredito Centrale S.p.A. on 20 April 2009 for a value of 19 million Euros, of which 15 million Euros was paid out at 31 December 2009. To cover the starting-up of this loan, accessory costs were sustained totalling 30 thousand Euros of which used for the reduction of the value of the financial debt in calculating the amortized cost. This loan is guaranteed by the parent company Grandi Stazioni for a total of 20,900 thousand Euros.

During the course of 2008, the loan contract stipulated by the parent company in 2005 with Monte dei Paschi di Siena through the use of resources obtained from the activation of the EIB (European Investment Bank) loan described above was rescinded.

The following table illustrates the expiries of the liabilities for financial leasing:

Current value of the minimum

payments for the 2009 leasing

Current value of the minimum payments for the 2008

leasing

Current value of the minimumpayments for the 2007

leasing

Within the financial year 222 309 79

Between one and five financial years - 222 41

Over five financial years

222 531 120

At 1 January 2008, there was only one ongoing financial leasing contract stipulated by Grandi Stazioni S.p.A. with Monte dei Paschi di Siena, a leasing concerning 1,200 self-service baggage trolleys, and this contract ended during the 2009 financial year.


At 31 December 2009, there was only one ongoing financial leasing contract stipulated by the parent company during the course of 2008 with Fercredit concerning office furniture and accessories which is to expire in the 2010 financial year.

As regards these contracts, the Group recorded amortizations during the 2008 and 2009 financial years totalling 135 thousand Euros and 179 thousand Euros respectively, in addition to financial costs totalling 16 thousand Euros and 12 thousand Euros respectively.

21 Staff Severance Indemnity and other employee benefits

The following table illustrates the changes that occurred since 1 January 2008 in the current value of the liabilities due for obligations and benefits constituted exclusively by the SSI.

2009 2008

Obligations and benefits defined at 1 January 2008 2,014 2,236

Benefits paid out by the plan (210) (354)

Other changes 21 (13)

Social security costs for current work s and interest 92 97

Actuarial profits (losses) recorded in the shareholders’ equity 93 48

Liabilities for obligations and benefits defined at 31 December 2,010 2,014

It should be pointed out that there are no assets in the defined benefits plan and that the cost in the profit and loss account for 2008 and 2009 is constituted exclusively by the financial costs deriving from the actualisation of the SSI, totalling 97 thousand Euros and 92 thousand Euros respectively.

As already highlighted in the section concerning the accounting principles applied, the Group has opted for the recording of actuarial losses/profits directly in the shareholders’ equity, and the impacts deriving from the calculation of the SSI in the overall profit and loss account are thus summarised.

2009 2008

Total amount at 1 January 35 0

Actuarial losses recorded during the financial year 93 48

Fiscal effect (26) (13)

Total amount at 31 December 102 35


Actuarial hypotheses

The following is a summary of the main assumptions made in the actuarial estimate process:

2009 2008

Rate of actualisation 4.20% 4.50%

Expected rate of turnover of employees 4.50% 4.50%

Expected rate of anticipations 1% 1%

Probability of death RG48 RG48

Annual rate of increase in the SSI 3% 3%

Annual rate of inflation 2% 2%

The hypotheses concerning expected mortality are based on published statistics and mortality tables.

The average number of employees on the Group books for the 2009 financial year was 235 units, broken down as follows by category:

22 Provision for risks and charges

The following table shows the consistencies at the start and end of the year and movements in 2008 and 2009 of the provision for risks and charges.

Description Balance at 1.01.2008

Allocations Usage Balance at 31.12.2008

Allocations Usage Balance at 31.12.2009

Disputes against personnel

Disputes against third parties:

Fiscal disputes

Civil disputes

2,390

631

1,759

635

1,399

(321)

(56)

(265)

635

3,468

575

2,893

575

2,090

2,090

(157)

(128)

(29)

1,210

5,401

447

4,954

Total

Non-current Current

2,390

2,390

-

2,034 (321) 4,103

4,103

-

2,665 (157) 6,611

6,611

-

PERSONNEL ON THE BOOKS 2009 average 2008 average Difference

Directors 12 13 (1)

Managers 41 41 (0)

Employees 182 180 2

TOTAL 235 234 1


Civil-law disputes arisen in previous periods

CBS Outdoor

Viacom Express, the previous advertising contractor, in a writ of summons issued in 2004, requested the termination of alleged illegal behaviour attributed to Grandi Stazioni SpA, claiming the payment of damages in connection therewith, and to hold it harmless from any claims lodged by third parties against it in connection with the violations allegedly committed by Grandi Stazioni SpA. The company entered an appearance, requesting that all the plaintiff’s claims be disallowed and, by way of counterclaim, to assess the damage caused to its honour and to its business reputation by the former advertising contractor, as a result of its own illegal conduct.

In 2007, CBS Outdoor Holding SRL (the new name adopted by Viacom Express in the meantime) served a further summons to Grandi Stazioni SpA featuring a large number of petitions and applications, which in part had already been brought in 2004 and in part were new, totalling approximately 4,6 million Euros.

The joinder of the proceedings was decided in 2008 and the case is due to be examined in the hearing in April 2009, when the conclusions of the proceedings are to be heard.

In a sentence dated 20 November 2009, the law courts rejected the demands made by the claimant and ordered it to pay two-thirds of the legal cost of the proceedings, the remaining third being paid jointly by the parties.

Various network users and customers

Numerous suits brought against Grandi Stazioni S.p.A. are pending before various courts, relating to claims for damages between 2,000 Euros and 100,000 Euros, for accidents that occurred inside the stations to network users and customers.

Also, an individual user served a summons in 2007 on Grandi Stazioni SpA and Ferrovie dello Stato SpA with the request that they be ordered to pay the sum of 3 million Euros by way of damages for the accident which occurred to him in 2004 in the vicinity of Roma Termini station.

Considering that suitable third-party liability insurance policies have been taken out, it is deemed that, in the event that it loses the cases, Grandi Stazioni will not incur significant costs.

Newsstands of the former Co.ve.s. circuit

Many of the managers of the newsstands in stations and who belonged to the former Co.ve.s (Cooperativa Vendita e Stampa) circuit, which wound up in 1998, filed a number of petitions in 2005 under article 447 bis of the Italian Civil Procedures Code, requesting Grandi Stazioni SpA to acknowledge the existence of a commercial lease since 1 January 1999. Grandi Stazioni SpA, consistently with the view it has always held in relations with the managers, filed an application claiming that there was never a valid lease and re-iterating that the premises were illegally occupied.

For some of the suits, the defendants were ordered to pay the company indemnities for their protracted occupation without a lease, for the entire period until the premises were actually vacated.


During 2008, the company reached settlement agreements with most of the newsagents; the object of these agreements was a new management model for this activity (so-called “Associazione in partecipazione”, or silent partnership agreement Project), to which the newsagents could adhere. The result was that, in the cases in which court proceedings were pending, the parties abandoned the court proceedings after ending the disputes by means of settlement agreements.

During the course of 2009, News Termini srl filed a petition under art. 447 bis of the Italian Civil Procedures Code to ascertain and declare the nullity of the silent partnership agreement contract from 2006 and the existence of a leasing contract from 2002, declaring nullity as regards an article and claiming compensation of 5 million Euros.

The risk of losing the case is merely possible, but there is a risk that the credit posted may arise, which has been taken into account in the evaluation of this credit.

Romartificio SRL

Grandi Stazioni SpA filed proceedings in 2007 against Romartificio SRL, requesting the Court to order the termination of the silent partnership contract dated 2002 and the vacating of the premises occupied in Roma Termini station, as well as the payment of credit due to it amounting to 0.1 million Euros.

Romartificio SRL, which appeared at the hearing, explained its counter claims and requested damages totalling 16 million Euros.

In 2008, the magistrate deemed the case ready for a decision, and disallowed the Parties’ request to provide evidence, settling the date for the specification of the conclusions in October 2008.

In January 2010, the magistrate ordered the vacating of the premises, ordering Romartificio to pay the legal costs. Romartificio vacated the premises of its own free will.

A negative outcome to this dispute is deemed highly unlikely; no allocation has therefore been made to the provision for risks, as in previous years.

Consorzio Alberghi del Territorio Veneto

The Consorzio Alberghi del Territorio Veneto (Veneto consortium of hotels), filed a petition, served in 2007, under article 447 bis of the Italian Civil Procedures Code, requesting repayment of the alleged excess amount unduly paid by way of rental fee.

The company appeared at the hearing, challenging all of the opposing party’s requests as unfounded.

Since the company is a creditor of the consortium for the latter’s failure to pay its rental fees, the risk to the realisation of the posted credits has been taken into account in the evaluation of these credits.

Suppliers

One supplier initiated proceedings with a petition and injunction against Grandi Stazioni SpA ordering the acknowledgement of a consideration for the rental of advertising space, for 0.1 million Euros.

The company challenged the request in its entirely.


As matters stand, a negative outcome appears likely and the allocation to the provision for risks made in the previous financial year has been maintained.

Advertising agents

Grandi Stazioni SpA has initiated court proceedings to assess the termination of the agency contracts and requesting that the company’s former advertising agents be ordered to pay damages resulting from contractual non-fulfilment, for an amount to be established during the court proceedings, and not less than 6 million Euros.

The former agents appeared at the hearing, requesting, by way of counterclaim, that the court establish that the contract had been terminated owing to non-fulfilment by Grandi Stazioni SpA and that the company be ordered to pay the commissions, over commissions and premiums on concluded business transactions for 3.8 million Euros, damages due to non-performance and early termination of the contract for 42.3 million Euros, and agency fees, as provided for in article 1751 of the Italian Civil Code, for 8.3 million Euros, for a total of 54.4 million Euros.

As matters stand, a negative outcome appears likely with respect to commissions and agency fees and possible with respect to the payment of damages; therefore, the commissions deemed payable were posted as debts, and the disputed commissions and fines for termination of the agency contract were allocated to the provision for risks.

Works contractors

The Temporary Consortium of Enterprises which was awarded the works contract for the North-East lot brought court proceedings requesting the termination of the contract for the executive project design and the functional upgrading works of the station buildings and complementary infrastructural works relating to the railway stations of Venezia Mestre, Venezia S. Lucia and Verona Porta Nuova, and an order that Grandi Stazioni SpA pay 3.3 million Euros for lost profit, 0.6 million Euros for services performed but not accounted for, 3.6 million Euros for unpaid project design services and 10.8 million Euros for damages.

Subordinately, the Temporary Consortium of Enterprises requested that the company be ordered to allow contract performance, besides paying the same TCE 20.0 million Euros in connection with the provisions posted in the accounts with respect to the contracted works.

After a settlement agreement was reached in this controversy, the case was abandoned, and the works by the TCE awarded the contract have begun again.

Civil-law disputes arisen in the financial year

Suppliers

One supplier filed proceedings with a petition and injunction aimed at obtaining the payment of the sum of 3 million Euros in relation to the ascertained movement of installations, cable ducts, monitors and pictures, carpentry work and video-communication advertising equipment required to enable the realisation of the video-surveillance systems in the stations in the network of Grandi Stazioni, which


filed opposition to the decree of injunction. As matters stand, a negative outcome appears merely a possibility, and allocations were not therefore made.

One supplier of engineering services filed a petition and injunction to obtain the payment of the remuneration due to it. Grandi Stazioni filed opposition to the decree of injunction, with counterclaims aimed at ascertaining non-fulfilment by the supplier.

A negative outcome appears merely a possibility, and therefore no allocations have been made to the provision for risks. Furthermore, the company has requested the suspension of the civil-law proceedings, given that criminal proceedings are pending, which has already been commented on in the Other information section of the Management Report.

Silent partnership associates

One partnership associate has initiated arbitration proceedings to ascertain non-fulfilments by Grandi Stazioni and order it to pay 2 million Euros for lost revenues, 0.3 million Euros for costs for the failure to install advertising space and 0.03 million Euros for interest on arrears. Grandi Stazioni appeared at the hearing, asking that the demands made be rejected.

There is a possibility that certain requests made by the associate will be accepted, and an allocation has therefore been made to the provision for risks.

Dependent employees

One former director initiated legal proceedings under art. 414 of the Italian Civil Procedures Code to order the company to pay for damages to professional image and biological damages following the downgrading of the duties and responsibilities previously assigned to him, compensation for damages following dismissal ascertained as being without just cause and biological damages. A negative outcome appears probable, and an allocation has therefore been made to the provision for risks.

Termination of shareholdings

As regards the termination of the shareholding in Network Italia Edicole srl (formerly Grandi Stazioni Edicole srl), the right to compensation for presumed non-fulfilment concerning the failure to respect the right of pre-emption and presumed pre-contractual responsibility has been raised. Despite no formal request for damages being filed, it was deemed opportune to increase the provisions of 1.3 million Euros previously allocated for other civil-law proceedings which are about to reach a positive outcome by 1.8 million Euros and depreciate the credit posted by 0.7 million Euros, which includes implicit interest for payment delayed for over one year.

Tax disputes arisen in previous periods

In 2001, the Guardia di Finanza (Italian finance police) served a “Processo Verbale di Constatazione” (official Notice of Assessment) charging the company with failure to withhold tax on employee incomes for the years 1997-2000 for 1.2 million Euros, plus fines.

The decisions by which the Tax Board of the Province of Rome upheld the appeals filed by the company against the notices of assessment relating to 1997 and 1998 for 0.3 million Euros, served by the Inland Revenue Service in 2005, were lodged with the Registry in 2008. The Inland Revenue Service


appealed against these sentences to the Regional Tax Board of Rome; the hearing for the discussion of the 1997 and 1998 payments is set for March 2010, while for the 1999 and 2000 payments, a date for the hearing has not yet been fixed. As matters stand, a negative outcome appears probable, and the allocation to the provision for risks made in previous years has therefore been maintained.

In 2006, the Guardia di Finanza served an official Notice of Assessment notifying the inclusion in the company’s taxable income of certain revenues relating to the 2004 fiscal year, with respect to IRAP/IRES (tax on production activities and corporate income tax), along with an increase in VAT due; the proceedings were concluded in December 2009, by adhesion before the DRE (Regional Directorate) for Lazio for all IRAP and VAT due, and, after a significant reduction in the increased tax requested following proceedings initiated with the same DRE for Lazio, for IRES.

23 Non-current financial liabilities (including derivatives)

Non-current financial liabilities are broken down as follows: Balance at

31.12.2009 Balance at Balance at

31.12.2008 1.01.2008

Non-current derivative financial instruments

Interest rate hedging swap / Calyon 376 - -

Interest rate hedging swap / RBS 70 - -

CAP / Mediobanca 101 70 -

TOTAL 547 70 -

The interest rate swap contracts were stipulated during the course of 2009 by the parent company to hedge the risk of changes in interest rate deriving from the loan contract with the EIB; see note 20 for details.

The derivative contract subscribed with Mediobanca in 2006, originally to hedge the risk of changes in interest rate deriving from the loan then ongoing with Monte dei Paschi di Siena, was maintained even subsequently to the termination of this loan (in December 2008) and allocated to hedge the same risk as regards the EIB loan.

All the contracts described previously are qualified as cash flow hedge contracts, and therefore the value recorded in the financial statements constitutes the fair value determined at the end of the year and recorded in a specific item in the shareholders’ equity. It should be pointed out that the derivative instrument ongoing with Mediobanca showed a positive fair value at 1 January 2008, and was therefore also recorded in the “Non-current financial assets (including derivatives)”; see note 13.

The following table contains information relating to the Interest rate swap and Cap operations concerning the EIB loan, which was described in the paragraph on loans.


Operation Financing Institute

Original reference

capital Notional value

Euro/000

Fair value (*) Euro/000

Internal Diary swap

Date of stipulation

Start date

Expiry date

Parameter for

IndexingFixed

rate

TOTAL 80,000 547

(*) Positive value indicates that due to the bank.

The derivative financial instruments in question are recorded at fair value at the respective dates of the financial statements and in the context of the hierarchy for determining fair value, the measurement made is level 2, in other words measurement of the fair value was made using input data different from quoted prices (in a market for identical financial instruments) which are observable directly (as prices) and indirectly (as price derivatives) for these assets.

For details on the derivative financial instruments of the Group, see not 7 paragraphs entitled “Exchange rate risk” and “Rate risk”.

24 Trade payables

Trade payables are broken down as follows: Balance at Balance at Balance at

Description 31.12.2009 31.12.2008 1.01.2008

Trade payables to third parties 91,215 104,836 79,318

Trade payables to parent company 348 148 163

Trade payables to associates 11,823 13,332 10,578

Total 103,386 118,316 90,059

The significant change in trade payables to third parties, compared to those at 31 December 2008, is due to the reduction of costs for investments and services and the greater punctuality in the payment times of suppliers.

For more details on the payables to the parent company and associates, see note 45 “Related parties”.

I.R.S. (Interest Rate Swap)/ Calyon

I.R.S. (Interest Rate Swap)/ RBS

EIB loan 150 million EIB loan 150 million

30,000 (with amortizing structure from 30 June 2017) 20,000 ( with amortizing structure from 30 June 2017)

08/09/2009 376 Ferrovie dello Stato confirmation

date

25/11/2009 70 Ferrovie dello Stato confirmation

date

31-Dec-09 30-Jun-23 - 3.738%

31-Dec-09 30-Jun-23 - 3.635%

CAP/ Mediobanca

EIB loan 150 million

30,000 101 - 27/03/2006 30/06/2006 30/06/2011 -

4.300% (base) less 0.245% (spread)


25 Non-current and current deferred revenues

The non-current deferred revenues are broken down as follows:

The current deferred payables are broken down as follows: Description Balance at Balance at Balance at

31.12.2009 31.12.2008 1.01.2008

Ongoing leases 12,477 11,291 10,728

Reimbursement of costs 1,777 - -

Deferred income: Jubilee Year 627 1,188 1,186

Total current deferred revenues 14,881 12,479 11,914

The deferred income for the Jubilee Year concerns the remaining quota of contributions obtained for the realisation of the work carried out in Roma Termini station during the Jubilee Year in 2000, which are attributed to the profit and loss accounts in subsequent financial years in relation to the remaining useful lifetimes of the single interventions carried out reduced by the amortizations for the period. The negative difference in 2009 and 2008, totalling 1,176 thousand Euros and 1,189 thousand Euros respectively ( both the current and non-current quotas) concerns the quota allocated to hedge the amortizations in 2009 and 2008.

The deferred revenues concerning ongoing leases refer to the rent due in the first quarter of the following financial year, invoiced in advance during December.

The deferred revenues for the reimbursement of costs refer to the revenues attributable to future financial years for the reimbursement of costs invoiced during the year; these revenues will be included in the profit and loss accounts in subsequent financial years on the basis of the duration of the leases.

26 Other non-current and current liabilities

Other non-current liabilities

The other non-current liabilities are broken down as follows: Description Balance at Balance at Balance at

31.12.2009 31.12.2008 1.01.2008

Cautions over 12 months 304 343 176

Payables to parent companies 2,838 3,354 3,870

Other - 524 -

Total other non-current liabilities 3,142 4,221 4,046

Description Balance at 31.12.2009



Deferred income: Jubilee Year 5,638 6,253 7,443

Total 5,638 6,253 7,443


The other non-current liabilities are mainly constituted by payables to parent companies concerning the remaining debt towards Ferrovie dello Stato S.p.A. for the IRPEG credit transferred by the latter to the Group leader Grandi Stazioni S.p.A. in 2004, as already mentioned in the item “other non-current assets” (note 14).

The item cautionary deposits claimable after the following financial year includes the deposits made by tenants to guarantee the proper fulfilment of leasing contracts.

At 31 December 2008, the item “Other” includes the guarantee withholdings made by the subsidiary Granid Stazioni Ceska from its main supplier Metrostav A.S. to guarantee the proper execution of the contract.

Other current liabilities

The other current liabilities are broken down as follows: Description Balance at Balance at Balance at

31.12.2009 31.12.2008 1.01.2008

Deposits to customers 556 2,704 528

Payables to parent companies 224 139 107

Payables to parent companies for Group VAT 567 - 1,353

Payables to the State for VAT 191 - -

Payables to social security agencies 1,060 1,041 1,143

Cosap - Tarsu – ICI payables 3,494 1,360 1,505

Other payables 2,035 14,272 13,486

Withholdings at source 380 481 606

Total other current liabilities 8,507 19,997 18,728

The increase in payables for “Cosap – Tarsu – ICI” local taxes compared to the previous year is due to the debt recorded by effect of the transaction finalised during the year through closure by partial settlement of the dispute with Naples City Council for ICI tax for 2004-2006.

The payables to social security agencies are constituted by the following:

Description Balance at Balance at Balance at

31.12.2009 31.12.2008 1.01.2008

INPS 696 629 731

INAIL 2 4 10

Payables for contributions on competences and leave not taken 172 193 200

INPS –Treasury Fund 80 107 92

Other complementary funds 110 108 110

Total payables to social security agencies 1,060 1,041 1,143


The other payables are constituted by the following: Balance at Balance at Balance at

Description 31.12.2009 31.12.2008 1.01.2008

Deferred personnel remuneration 1,315 1,181 1,082

Personnel for leave not taken 161 220 265

Remuneration of company officers 75 65 25

Various creditors 484 12,806 12,114

Total 2,035 14,272 13,486

The reduction in the item various creditors compared to the previous financial year is attributable mainly to the recovery at the time of the sale of the “former departmental” office building in Venice on 9 June 2009 of the confirmatory down payment of 12 million Euros received by Veneto Region on stipulation of the “preliminary sales contract”.

27 Income tax payables

This item totalled 7,716 thousand Euros at 31 December 2009, broken down as follows:

Description Balance at Balance at Balance at 31.12.2009 31.12.2008 1.01.2008

Irap payables 1,291 - -

Payables to parent company for fiscal consolidation 6,425 - -

Total 7,716 - -

As regards the IRAP payables and payables to the parent company for fiscal consolidation, these represent the IRAP and IRES payables accrued at 31 December 2009 respectively to the State and the parent company Ferrovie dello Stato S.p.A., net of deposits made.


ANALYSIS OF THE ITEMS IN THE CONSOLIDATED PROFIT AND LOSS ACCOUNT

The following is an analysis of the items in the consolidated profit and loss account for the 2009 financial year compared to the previous year.

TOTAL REVENUES AND INCOME

The total consolidated revenues and income for 2009 amount to 207,346 thousand Euros, an increase of 27,291 thousand Euros compared to the previous financial year.

The revenues and income for 2009 are broken down as follows:

Description 2009 2008 Difference

Income from sales and services 169,425 175,100 (5,675)

Differences in the inventory of products being processed, semi-processed and finished 8,449 2,752 5,697

Other income 29,402 2,202 27,200

TOTAL 207,276 180,054 27,222

28 Revenues from sales and services

This item totalled 169,495 thousand Euros and is broken down as follows:


Income from Long-Term Leases 51,058 48,797 2,261

Indemnities for Occupation of and Failure to Vacate Areas 30,394 32,391 (1,997)

Engagement activities and special installations 3,153 1,120 2,033

Income from Tenancy Costs 64,854 65,120 (266)

Income from Design and Works Direction Activities - 79 (79)

Income from Management of Advertising Spaces 11,390 19,549 (8,159)

Income from customer services 7,927 7,324 603

Other Income from sales and services 650 720 (70)

Total income from sales and services 169,425 175,100 (5,675)

The increase in income from leases is due to the action undertaken during the financial year on certain station areas, which involved an increase in the surface area leased and the fees. The balance at 31 December 2009 also includes the capital gains registered following the ordinary updating of the estimates, totalling -311 thousand Euros.

The “income from indemnities for occupation of and failure to vacate areas” (93% of which concerns companies in the Ferrovie dello Stato Group) show a decrease due to the vacating of areas during the year by these companies. The “income from tenancy costs” (approximately 91% of which refers to companies in the Ferrovie dello Stato Group) remained substantially in line with the previous period.


The decrease in the item income from the management of advertising spaces is particularly significant, and confirms the general negative trends in the sector, which are especially acute. The income from customer services concern hygiene services, baggage drop-off and parking; the improvement compared to the previous period mainly concerns the management of car parks and hygiene services.

The income from long-term leases refer for 49,712 thousand Euros to revenues accrued by the parent company in Italy and 1,346 thousand Euros to revenues achieved by the parent company Grandi Stazioni Ceska.

29 Differences in contracted works in progress

This item totalled 8,449 thousand Euros, an increase of 5,697 thousand Euros compared to 2008, and is broken down as follows:


Financial year increase 8,550 2,814 5,736

Recovery of previous years losses 256 194 62

Depreciation for future losses (357) (256) (101)

Total 8,449 2,752 5,697

The difference in works in progress in 2009, accounted using the criterion of percentage of completion (“cost to cost” method) shows a positive value of 8,449 thousand Euros, and refers to the evaluation of the progress of the payments accrued during the year for the execution of the technical activities required for the implementation of refurbishment, restructuring, upkeep and valorisation activities on the property complex at Roma Termini station and the other 12 stations being managed together, carried out mainly by RFI. The aforementioned difference is recorded net of the losses expected in subsequent financial years for their completion, examined individually.

30 Other income

Other income totalled 29,402 thousand Euros and showed an increase of 27,199 thousand Euros compared to 2008; the item is broken down as follows:


Income from transfer of non-current assets owned for sale 24,147 0 24,147

Other income 5,255 2,202 3,053

Total 29,402 2,202 27,200


The income from the transfer of non-current assets owned for sale is traceable to the operations for the sale of the departmental office building in Venice. See that already described in paragraph 8 with reference to the Non-current assets owned for sale for more details.

The item other income refers to the income deriving mainly from works carried out for third parties concerning two contracts finalised in the year for Turin and Rome stations (3,636 thousand Euros). The remainder of this item is constituted mainly by income consequent to advertising and promotional activities by the parent company (840 thousand Euros), reimbursements of condominium costs (408 thousand Euros) and income obtained as reimbursement of costs sustained by Grandi Stazioni in raising the qualitative or functional standards in stations, invoiced during the year and discounted on the basis of the number of years provided by the relevant leasing contract (76 thousand Euros).

COSTS

The consolidated production costs totalled 142,975 thousand Euros, a reduction of 206 thousand Euros compared to the previous year. They are composed as follows:


Raw, ancillary, consumer materials and goods 207 444 (237)

Service costs 87,583 94,081 (6,498)

Costs for use of third party assets 34,641 35,380 (739)

Personnel costs 16,237 16,775 (538)

Other operating costs 6,648 6,088 560

Costs for in-house works capitalised (2,412) (9,588) 7,176

TOTAL 142,904 143,180 (276)

The breakdown of the items comprising the production costs is illustrated in the tables and commentary below.

31 Raw, ancillary, consumable materials and goods

This item totalled 207 thousand Euros, registering a reduction of 237 thousand Euros compared to the previous year and is broken down as follows:


Purchase of materials 206 443 (236)

Transport of materials purchased 1 1 (0)

Fuel and lubricants 0 1 (1)

Total 207 444 (237)

The decrease compared to the previous year is mainly attributable to the savings made on the purchase of consumer materials for office use and other consumer materials.


32 Service costs

The service costs totalled 87,583 thousand Euros, a reduction of 6,498 thousand Euros compared to the previous year. The following table shows the breakdown of this item:


Contracted services and works: 59,923 70,605 (10,682)

-Services – Security 6,471 8,884 (2,414)

- Cleaning 21,885 22,812 (928)

- Maintenance 16,630 18,281 (1,651)

- Utilities 14,937 12,576 2,362

- Improvements to assets owned 0 8,051 (8,051)

Miscellaneous services: 27,660 23,476 4,184

- Consulting 1,363 474 889

- Engineering services 8,896 2,793 6,103

- Professional services 2,805 2,745 60

- Utilities 456 430 26

- Insurance premiums 1,083 1,215 (132)

- IT services 861 605 256

- Commissions 953 3,147 (2,193)

- Directors remuneration 499 898 (399)

- Auditors remuneration 57 57 0

- Travel and hotel expenses 57 55 3

- Advertising and promotional costs 925 396 530

- Remuneration for silent partnership agreements 2,486 4,265 (1,778)

- Costs for services to customers 4,899 4,096 803

- Other services 2,320 2,300 19

Total 87,583 94,081 (6,498)

The differences in contracted services and works compared to the same period in the previous year mainly concern: a reduction in costs for services, security and cleaning and maintenance, a general rationalisation of costs in the context of the management of condominiums and the cessation of trolley services and a reduction in the improvements to assets owned sustained in the previous year and concerning the former departmental office building in Venice, sold during the course of 2009.


The differences in miscellaneous services concern the increase in “costs for services to customers”, mainly due to the costs for the management of hygiene, left luggage and parking services, “Consulting”, “advertising and promotional” expenses required to re-launch the image of the company, “IT services” and “engineering services”. As regards the latter, the significant change is due mainly to more works being realised during the year. The decreases are due to the reduction in costs for supplies and silent partnerships closely related to the negative performance of Advertising revenues, the reduction in costs for “directors remuneration”, which previously included the wages paid to the director who left office due to his mandate being terminated in advance, and other decreases due to the increased efficiency of other cost areas.

It should be highlighted, pursuant to art. 37, para. 16 of Legislative Decree 39/2010 and letter 16bis of art. 2427 of the Italian Civil Code, that the professional services include the payments made by the group to the independent firm of auditors, including any payments made to the firm during the financial year for other auditing and fiscal consultancy services and services other than legal auditing, totalling 80 thousand Euros.

33 Costs for use of third party assets

This item totalled 34,641 thousand Euros, a reduction of 739 thousand Euros compared to 2008, and is broken down as follows:


Bank transfer rent relating to RFI S.p.A. 33,573 34,291 (718)

Bank transfer rent relating to Sistemi Urbani Sp.A. 188 0 188

Property leases 459 795 (337)

Operational leasing fees 422 293 128

Total 34,641 35,380 (739)

The difference is due mainly to the reduction in the bank transfer rent relating to RFI, which is a consequence of the decrease registered mainly in advertising revenues; following the partial split-off of certain areas previously owned by RFI, FS Sistemi Urbani took over the ownership of some of the areas managed by the group leader, and part of the bank transfer rent is therefore due to the latter.

The reduction registered in property leases is due to the expiry of some leasing contracts for accommodation or vital in dealing with the transitory movement of personnel of the Ferrovie group from areas being refurbished. This item includes the costs sustained by the subsidiary company Grandi Stazioni Ceska for the leasing of management offices, totalling 30 thousand Euros.

The operational leasing fees mainly include the release of advance leasing fees paid by the subsidiary company Grandi Stazioni Ceska. The accountable value of these fees includes all the direct costs sustained for the refurbishment of Hlavní nádraží and Mariánské Lázně stations in Prague. These costs are initially suspended in the item “other non-current assets” and then included in the profit and loss account in constant quotas for the remaining duration of the operating lease ongoing with České dráhy


a.s.. These costs were recorded in the profit and loss account of the subsidiary as of the 2008 financial year.

The operational leasing fees concerning the subsidiary Grandi Stazioni Ceska recorded in the profit and loss accounts for 2009 and 2008 totalled 401 thousand Euros and 254 thousand Euros respectively. The duration of the subsidiary’s leasing contract is 30 years as of the final testing expected during the refurbishment phase.. At 31 December 2009, the refurbishment of Mariánské lázně station had been completed, while the refurbishment of Praha-Hlavní nádraží station will be completed by 31 December 2012.

The costs suspended as advance leasing fees mainly include the construction costs, in addition to design and insurance costs and other costs directly attributable to the refurbishment of station complexes, including the financial costs, management fees and assignment fees paid during the period of refurbishment and throughout the duration of the leasing contract.

The table below summarises the overall value of the advance leasing fees at 31 December 2009 and the quotas recorded in the profit and loss account in 2008 and 2009 respectively.

31 December 2009

Advance leasing fees 28,080

Quotas recorded in the profit and loss account in 2008 (254)

Quotas recorded in the profit and loss account in 2009 (401)

Net accountable value 27,425

34 Personnel costs

This item totalled 16,237 thousand Euros, with a reduction of 538 thousand Euros compared to 2008, and is broken down as follows:


Wages and salaries 10,745 10,729 16

Obligatory social security contributions 3,305 3,229 76

Costs relating to defined pension plans (post reform SSI) 725 742 (17)

Other costs 1,462 2,075 (613)

Costs relating to defined benefit plans 0 0 0

Total 16,237 16,775 (538)

This amount includes all employee costs, including promotions, transfers from one category to another, allocations required by the law and those for premiums and incentives accrued on the basis of the merit-based personnel policies.


The reduction registered in labour costs in 2009 compared to 2008 is mainly due to the item “other costs” for lesser incentives for exodus paid out during the year.

The other personnel costs also include the cost sustained for detached personnel, for trainee workers, meal vouchers, travel and hotels and the cost concerning the annual health insurance quota for employees stipulated following the signing of the second level company agreement on 11 September 2007.

As regards the composition of the differences in the corporate workforce, see that described in note 21.

35 Other operating costs

The other operating costs totalled 6,719 thousand Euros, an increase of 631 thousand Euros compared to 2008, and is broken down as follows:


- Losses from alienation of production cycle goods 3 0 3

- Representation costs 18 23 (5)

- Membership and contributions to various Bodies 43 42 1

- Other 358 707 (349)

- ICI 1,297 493 804

- Local Advertising Tax 835 560 275

- Tax expenses (Tarsu - Tosap - Cosap) 3,528 3,521 7

- Other taxes – Registration Fees 566 742 (177)

Total 6,648 6,088 560

The main differences are a consequence of an increase in the “ICI” costs recorded, following the settlement by partial settlement of a dispute with Naples City Council concerning ICI for 2004-2006 and an increase in the “Local Advertising Tax” due to the updating of the estimates of taxes due in previous financial years. A decrease in other costs and registration fees and other taxes was also recorded.

36 Costs for in-house works capitalised

The costs for in-house works capitalised totalled 2,412 thousand Euros at 31 December 2009, and were down by 7,176 thousand Euros compared to the previous year.

The significant decrease compared to the previous year is a consequence of the works carried out in 2008 and capitalised on the property in Venice.


37 Amortizations and losses (recoveries) in value

This item totalled 10,822 thousand Euros, an increase of 4,096 thousand Euros compared to 2008 and is broken down as follows:


Amortization of properties, plants and machinery 4,382 3,379 1,003

Contributions in capital account (1,176) (1,189) 13

Amortization of property investments 1,692 1,586 106

Amortization of intangible assets 133 580 (447)

Write-downs of trade receivables 5,791 3,380 2,411

Recoveries in value of trade receivables 0 (1,012) 1,012

Total 10,822 6,724 4,098

The increase recorded in the amortization of properties, plants and machinery is mainly due to the transfer to the entry into service of some of the works concerning Roma Termini station complex and the entry into service of plants, machinery and civil engineering works concerning the building owned in Bologna.

The write-downs of trade receivables were determined on the basis of their analysis and their level of recoverability.

The item contributions in capital account refers to the quota for the financial year of the contributions paid out by the Ufficio per Roma Capitale (Rome Capital Office) for the refurbishment of the works concerning the 2000 Jubilee events, calculated in relation to the duration of the works in question.

38 Depreciation (recoveries in value) of properties, plants and machinery

The depreciation of properties, plants and machinery showed a value of zero at 31 December 2009. In the previous financial year, this item totalled 418 thousand Euros and included the depreciation due to write-downs concerning the non-existence of advertising plants being realised.

39 Allocations for risks and charges

This item totalled 2,665 thousand Euros and is broken down as follows:


Allocations for risks - Legal disputes – civil-law 1.310 1.399 (89)

- Legal disputes – labour disputes 1.355 635 720

TOTAL 2.665 2.034 631


The increase registered in 2009 is due to an additional allocation made to the provision for risks to cover the better forecast as regards the probable negative outcome of disputes arising with suppliers and customers and claims made by former collaborators and employees of the company. See note 22 “Provision for risks and charges” for more details.

40 Financial revenues

The item Financial revenues totalled 13,323 thousand Euros at 31 December 2009, up by 8,464 thousand Euros compared to the previous year. Financial revenues are broken down as follows:


Interest receivable on bank deposits 367 615 (247)

Interest receivable from parent companies 334 1,610 (1,276)

Dividends receivable from associates - 2,596 (2,596)

Other financial revenues from others 11 38 (27)

Profits on exchange rates 146 - 146

Surplus from the transfer of non-current assets owned for sale 11,988 - 11,988

Net difference in the fair value of derivative instruments 476 - 476

Total 13,323 4,859 8,464

The “Surplus from the transfer of non-current assets owned for sale” was achieved following the total transfer of the shareholding in Network Italia Edicole S.r.l. (ex Grandi Stazioni Edicole S.r.l.) in September 2009 for a price of 12 million Euros.

The item “Interest receivable from parent companies” concerns the interest accrued on the inter-company bank account held with Ferrovie dello Stato S.p.A., the conditions of which are detailed in note 13 “non-current and current financial assets (including derivatives)”.

The “Interest receivable on bank accounts” concerns the interest accrued during the course of the year on bank assets. The average liquid assets available were down compared to the previous financial year and the interest rates recognised decreased significantly.

As regards the item “net difference in the fair value of derivative instruments”, it should be highlighted that during the course of 2009, the subsidiary Grandi Stazioni Ceska stipulated three cross currency rate swap contracts with BNP PARISBAS S.A., the details of which are included in note 7, paragraph entitled “Exchange rate risk”. These contracts were stipulated with the aim of hedging the exchange rate risk deriving from the loan in Euros granted during the course of the year by UniCredit MedioCredito Centrale S.p.A..

The favourable trends in exchange rate between the Czech Krone and the Euro in 2009 and the forecasts for 2010 meant that financial revenues of 476 thousand Euros were recorded, representative of the positive fair value of derivatives at 31 December 2009.


41 Financial expenses

The item Financial expenses totalled 3,757 thousand Euros at 31 December 2009, down by 1,256 thousand Euros compared to the previous year. Financial expenses are broken down as follows:


Interest on long-term loans 5,825 8,233 (2,408)

Interest payable on bank accounts 14 2 12

Other interest payable to others 174 60 114

Losses on exchange rates 242 15 227

Costs for the financial actualisation of non-current liabilities 87 97 (10)

Losses for reduction in value of securities owned until expiry 1 25 (24)

Non effective quota of differences in fair value of the hedging of financial flows 0 0 0

Financial expenses capitalised (2,586) (3,431) 845

Total 3,757 5,001 (1,244)

The item interest on long-term loans refers to the interest due on the mortgages contracted by the group leader with the Banca BIIS (Banca Infrastrutture Innovazione e Sviluppo – Infrastructures Innovation and Development Bank – formerly OPI) and the loan contracted by the subsidiary Grandi Stazioni Ceska with UniCredit MedioCredito Centrale S.p.A.. See note 20 “short and medium-term loans” for more details. Their significant decrease compared to 2008 is due to the reduction of the Euribor 6-monthly tax (basis for the calculation of the cost of financial supplies), albeit in the presence of an increase in indebtedness recorded during the period, due to the drawing out of the EIB loan. The item losses on exchange rates is attributable to the losses recorded by the subsidiary Grandi Stazioni Ceska.

The financial expenses capitalised refer to the financial expenses sustained for the loans specifically dedicated to the refurbishment of station complexes included in the production cost for the entire period of realisation of the assets. The aforementioned expenses sustained have been capitalised in their uncertainty; therefore, the rate of capitalisation applied is equal to the effective interest rate used for the definition of the amortized cost of the loan and is described in paragraph 20.


42 Income tax

Income tax at 31 December 2009 totalled 20,899 thousand Euros, an increase of 11,335 thousand Euros compared to the previous year. Income tax is broken down as follows:

Description 2009 2008 Difference Current taxes

Irap 3,406 2,114 1,292

Ires 13,286 6,962 6,324

Adjustments relating to previous years 42 23 19

Prepaid and deferred taxes

(Allocation)/use of prepaid taxes (1,809) (583) (1,226)

Allocation /(use) of deferred taxes 5,974 1,048 4,926

20,899 9,564 11,335

Below is the reconciliation schedule between effective and theoretical Ires and Irap fiscal costs.

2009 2008

Consolidated pre-tax result 60,452 27,556 Theoretical taxes 16,624 27.5% 7,578 27.5%

Permanent differences and lesser items 3,019 5.0% (426) -1.5%Temporal differences (15,158) -25.1% (1,814) -6.6%

Taxable amount 48,313 25,316

Current financial year IRES 13,286 22.0% 6,962 25.3%

Current financial year IRAP 3,406 5.6% 2,114 7.7%


43 Contractual commitments and guarantees

The guarantees provided to third parties are summarised below: Balance at

31.12.2009 Balance at 31.12.2008


Fidejussions - in favour of other associated companies 116 - -

- in favour of others 500 500 500

Other personal guarantees - in favour of subsidiary companies 20,900 - -

TOTAL 21,516 500 500

The guarantees summarised above refer:

116 thousand Euros to a fidejussion granted by Ferrovie dello Stato in favour of Metropark in the interest of Grandi Stazioni to guarantee e contract for the leasing of miscellaneous equipment and expiring on 1 January 2013;

500 thousand Euros to a fidejussion granted by Intesa-San Paolo in the interest of Grandi Stazioni, in favour of Venice City Council (Central Management Office), originally expiring on 10 September 2008 and extended tacitly every year, to guarantee the ongoing restructuring works to the former departmental office building in Venice, with automatic renewal until receipt of a withdrawal notification by the city council;

20,900 thousand Euros to a guarantee granted by the Group leader in favour of Unicredit – Medio Credito Centrale in the interest of Grandi Stazioni Ceska Republika to guarantee the loan contract (bridge loan agreement) stipulated between the credit institute and the foreign subsidiary, expiring on 19 October 2010.

44 Potential liabilities and assets

As regards the potential liabilities, see that described in detail in note 22 concerning the “Provision for risks and charges”.

It should also be pointed that there are no potential assets for which it is deemed probable that there will be an increase in assets.


45 Related parties

Remuneration of Directors, Auditors and Managers with strategic responsibilities

The remuneration of the managers with strategic responsibilities are detailed in the following table, which has been drawn up with reference to the period they were in office and on the basis of the principal of competence.

2009 2008

Directors - Emoluments 499 492

- Severance Indemnities for outgoing Directors - 406

Auditors

- Emoluments 57 57

Managers with strategic responsibilities (**)

- Wages and salaries 1,606 1,491

- Bonuses and other incentives 522 338

Total 2,684 2,784

(*) During the course of the financial years in question, a total of 8 office managers filled the roles of Managers with strategic responsibilities.

Other operations with related parties

The inter-relations between the Grandi Stazioni Group and other related parties are conducted according to criteria of substantial correctness from a viewpoint of reciprocal economic convenience on the basis of ordinary market conditions, which are identified with the support of external professionals if required.

The inter-company operations conducted within the Ferrovie dello Stato Group, of which Grandi Stazioni is a member, pursue the common goal of creating value. In this regard, it must be highlighted that, in coherence with the new 2007-2011 Industrial Plan of the Ferrovie dello Stato Group, a more rational allocation of assets and resources within the Group is being implemented, in order to concentrate the focus of each company on its own core business, improving the valorisation and usage of the company equity not strictly related to the everyday activities of the companies in the Ferrovie Group, assigning this duty to specialised individuals, also through split-offs and conferments, and increasing synergy and economies at an infra-group level.

These processes and operations occur in respect of the specific sector, civil law and tax related regulations, in compliance with the guidelines of the supervising Ministries and taking into account the characteristics and peculiarities of the activities carried out by most companies in the Ferrovie dello Stato Group.

Below is a summary table representing the main active and passive relations ongoing during the year with subsidiary and parent companies and other associated companies. Relations with the company exercising management and coordination activities and with the companies subject to these management and coordination activities are also highlighted.


Name Active relations Passive relations

Parent companies

Ferrovie dello Stato (a)

Commercial and other: Tenancy costs Occupancy of complexes Occupancy indemnities Reimbursements Fiscal consolidation Pool VAT Financial: Inter-company bank account Interest

Commercial and other: Services Remuneration of management bodies Payables for transfer of tax receivables Detached personnel

Sister companies

Trenitalia (b)

Commercial and other: Tenancy costs Occupancy indemnities Occupancy of complexes Leases Reimbursements

Commercial and other: Deposits on engineering works Reimbursements

Rete Ferroviaria Italiana (b)

Commercial and other: Tenancy costs Occupancy indemnities Occupancy of complexes Engineering payments Reimbursements Leases

Commercial and other: Retrocession fees Maintenance Deposits on engineering works Utilities Services

Ferservizi (b)

Commercial and other: Tenancy costs Occupancy indemnities Occupancy of complexes Reimbursements

Commercial and other: Remuneration of management bodies Travel costs Fees

TAV (b)

Commercial and other: Tenancy costs Leasing Reimbursements

Fercredit (b) Commercial and other:

Leasing

FS Sistemi Urbani (b) Commercial and other:

Retrocession fees

Cisalpino (b) Commercial and other: Tenancy costs Leasing

Italferr (b)

Commercial and others: Tenancy costs Reimbursements Leasing

Commercial and other: Detached personnel

Metropark

Commercial and other: Reimbursements Leasing Facility

Commercial and other: Services Hiring of equipment

Other related parties

Anas Commercial and other: Leasing

Poste Italiane Commercial and other: Leasing

Commercial and other: Services

Rai Commercial and other: Leasing


Name Active relations Passive relations

Parent companies

Studiare Sviluppo Commercial and other: Leasing

Eni Commercial and other:

Services

Enel Commercial and other: Services

Cassa Depositi e Prestiti Commercial and other: Commissions

(a) Company exercising management and coordination activities (direct parent company)

(b) Company subjected to management and control activities by (a).

Below are also the equity and economic values deriving from the above relations.

The relations with the companies in the Ferrovie dello Stato Group were mainly of a commercial nature, and , therefore, the costs and revenues and the relevant payables and receivables refer to: the leasing of stations areas, reimbursement of accessory costs, recovery of costs for detached personnel, supply of general group services and business travel services.

Lastly, it should be highlighted that there is an inter-company bank account between Ferrovie dello Stato S.p.A. and Grandi Stazioni S.p.A., through which the receipts and payments concerning economic relations with FS Holding, Ferservizi, Italferr, RFI and Trenitalia transit. At 31 December 2009, the balance of the inter-company bank account totalled 7,113 thousand Euros.

Below are the equity and economic values deriving from the relations indicated above (values in thousands of Euros).

Commercial and other relations

31.12.2009 2009

31.12.2008

2008 31.12.2007

2007

Payables/ deferred

Payables/ deferred

Payables/ deferred

Name Receiv. revenues Costs Reven. Receiv. revenues Costs Reven. Receiv. revenues Costs Reven

Subsidiaries

GS Servizi - - - - - - - - 322 37 3 321

Parent companies

Ferrovie dello Stato 478 6,305 546 289 8,386 3,656 221 417 1,146 5,530 216 299

Other associates

Trenitalia 18,674 178 29,597 7,000 803 100 34,412 10,899 713 31,978

Rete Ferroviaria Italiana 25,450 25,295 34,903 54,557 18,119 12,248 36,005 54,520 14,275 10,000 37,065 53,014

Ferservizi 2,372 367 13 4,005 5,896 438 23 5,851 1,835 379 92 5,863

TAV 8 5 - 38 27 5 - 35 10 4 - 72


Fercredit - 24 277 - - 110 124 - - 457

Fs Sistemi Urbani - 188 188 - - - - - - -

Cisalpino 52 22 - 101 41 21 113 - - -

Italferr 6,714 2,365 54 10,100 4,645 2,421 133 9,827 3,322 2,268

Metropark 62 139 195 277 248 177 382 177 114Total other associates 53,332 28,583 35,630 98,675 35,976 16,223 36,498 105,027 30,518 13,935

Financial relations

Name

Subsidiary companies

31.12.2009 2009 31.12.2008 2008 01.01.2008

ReceivablesPayable

Guarantee and

Commit. Costs Income

Guarantees and

Receivables Payables Commit. Costs

Income

Guarantees and

Receivables Payables Commit.

GS Servizi

Parent companies

- - - - - - - - 2,596 - - -

Ferrovie dello Stato


7,113 116 - 334 17,808 - - - 1,610 22,687 - -

Cassa Depositi e Prestiti - - 263 - - - - - - - - -

TOTAL 7,113 - 116 263 334 17,808 - - - 4,206 2,687 - -


Anas S.p.A. 2,239 - - 5,121 1,017 1,385 -

Poste Italiane S.p.A. 159 - 2 423 112 371 106 456

RAI S.p.A. 101 - - 84 82 98 326 347

Studiare Sviluppo S.r.l. 110 - - 118 - - - -

Eni S.p.A. - 2,187 3,257 - - 577 2,108 - - 710 1,992 -

Enel S.p.A. - 2,100 3,288 - - 6 184 - - 71 367 -Total other related parties 2,609 4,287 6,547 5,746 1,210 583 2,292 1,854 432 781 2,359 803

TOTAL 56,419 39,175 42,723 104,710 45,572 20,462 39,011 107,298 32,418 20,283 39,792 101,943


46 Facts occurring after the date of the financial statements

It should be pointed out that no events occurred after 31 December 2009 that may have a significant impact on the consolidated financial statements closed on that date.

As regards the parent company Grandi Stazioni, the following should be highlighted:

the documentation required for the extension of the period of usage of the loan for the Legge Obiettivo works and the re-modulation of the economic framework indicated in CIPE decision 129/2006 has been sent to the Ministry of Infrastructures and Transport;

Grandi Stazioni has submitted an official complaint for the crimes of which in arts. 640, 61 no. 7 and 11 of the Penal Code and 2625 of the Civil Code in relation to the conduct of former directors and managers of the company and the legal representative of the company awarded an assistance and consultancy contract aimed at the stipulation of a leasing contract and subsequent sale;

the testing certificate has been issued for the works concerning the sale of the property complex in Venice and the balance of the contractual price cashed in, net of a withholding of 0.3 million Euros already recorded in the financial statements closed on 31 December 2009.

As regards the parent company Grandi Stazioni Ceska, the following should be highlighted:

on 30 March 2010, the company subscribed an agreement with Ceské dràhy a.s., by which the refurbishment activities provided in the original agreement for Karlovy Vary were excluded from the company’s commitments. Consequently, the operational leasing contract was modified, and currently involves only the two stations in Prague and Mariànské Làzné;

in February 2010, the Board of Directors of the company awarded the facility management contract for the two stations in the preceding paragraph to ISS Facility Services Sro.

INITIAL TRANSITION TO THE IFRS ACCOUNTING PRINCIPLES

47 Effects of the transition to the international accounting principles (IFRS)

Introduction

Following the emanation of EC Regulation 1606/2002 and in relation to that disposed by implementing Legislative Decree 38/2005, as of the 2005 financial year, companies other than the issuers of financial instruments admissible for trading on stock markets which draw up consolidated financial statements can adopt the international accounting principles in drawing up their consolidated financial statements. Therefore, since the 2009 financial year, Grandi Stazioni SpA has adopted the international accounting principles (International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS), the interpretations emanated by the International Financial Reporting Interpretations Committee (IFRIC) and the Standing Interpretation Committee (SIC) homologated by the European Commission, hereinafter “IFRS-EU”), with transition date to the IFRS-EU at 1 January 2008.


As regards previous financial years, Grandi Stazioni SpA exercised the right granted by paragraph 3 of art. 27 of Legislative Decree 127/1991 to not draw up its own consolidated financial statements, as they were drawn up by the parent company Ferrovie dello Stato SpA. In the context of the process of transition to the IFRS-EU, and for the purposes of drawing up the consolidated financial statements at 31 December 2009 according to these principles, the predisposition of the reconciliation schedules provided by paragraphs 24 a) and b) of IFRS 1 has been necessary, these comprising the following accounts documents:

Equity-financial situation at the date of transition to the IFRS-EU (1 January 2008);

Equity-financial situation at 31 December 2008;

Profit and loss account for the 2008 financial year.

The accounting principles described in note 5 have been applied in the preparation of the consolidated financial statements at 31 December 2009, the comparative figures at 31 December 2008 and the opening equity-financial situation at the date of transition 1 January 2008. Therefore, in drawing up the opening equity-financial situation, the Group used the figures that would have been represented according to the ITA Gaap making them compliant with the IFRS. The analysis of the impacts of transition from the ITA Gaap to the IFRS on the equity, financial and economic situation of the Group are described below.

This information has been drawn up solely for the purpose of ensuring transition to the IFRS-EU and enabling the drawing up of the initial consolidated financial statements of the Grandi Stazioni Group for the financial year closed on 31 December 2009 according to the IFRS-EU. Therefore, not all the schedules, comparative information and commentary notes that would have been required for the complete representation of the equity-financial situation and economic result of the Group in compliance with the IFRS-EU have been included.


Reconciliation of the shareholders’ equity 1 January 2008 31 December 2008

Effect of Effect of

transition transitionThousands of Euros note ITA GAAP to the IFRS IFRS ITA GAAP to the IFRS IFRS

Assets

Properties, plants and machinery a,b,c,d 117,226 22,124 139,350 93,706 89,386 183,092Intangible assets b,e 105,238 (104,599) 639 149,280 (149,178) 102 Non-current trade receivables 5,013 5,013 9,255 172 9,427Property investments c 80,447 80,447 54,361 54,361

Shareholdings accounted with NE method - - - - - -

Non-current financial assets including derivatives f 143 626 769 6 131 137 Receivables for prepaid taxes a,c,e,i 3,762 75 3,837 4,241 198 4,439Other non-current assets a 3,877 7,128 11,005 3,362 13,503 16,865

Total non-current assets 235,259 5,801 241,060 259,850 8,573 268,423

Capital gains g,i 12,893 (7,549) 5,344 56,276 (49,706) 6,570

Current trade receivables a 82,817 3 82,820 84,469 (166) 84,303Tax receivables a 1,444 (513) 931 3,451 (518) 2,933Current financial assets including derivatives 22,687 22,687 17,819 (12) 17,807Liquid assets and equivalent means a 9,373 (190) 9,183 7,222 7,222Other current assets a 9,903 345 10,248 16,194 526 16,720Non-current assets owned for sale i - - - 41,757 41,757

Total current assets 139,117 (7,904) 131,213 185,431 (8,119) 177,312

Total assets 374,376 (2,103) 372,273 445,281 454 445,735


Thousands of Euros Shareholders’ equity

note

ITA GAAP

Effect of transition

to the IFRS

IFRS

ITA GAAP

Effect oftransition

to the IFRS

IFRS

Share capital 4,304 - 4,304 4,304 - 4,304

Reserves 74,819 225 75,044 77,792 (96) 77,696

Results brought forward 418 3,934 4,352 (680) 4,838 4,158

Result for the period 12,990 231 13,221 15,146 2,926 18,072

Total Group shareholders’ equity 92,531 4,390 96,921 96,562 7,668 104,230

Total Third parties shareholders’ equity 3,892 (68) 3,824 4,289 (275) 4,014

Total Shareholders’ equity 96,423 4,322 100,745 100,851 7,393 108,244

Liabilities Medium/long-term loans a 132,701 41 132,742 162,703 (368) 162,335SSI and other employee benefits h 2,743 (507) 2,236 2,452 (438) 2,014Non-current financial liabilities, including derivatives

- - - - 70 70

Non-current deferred revenues 7,443 - 7,443 6,253 - 6,253

Provision for risks and charges 2,390 - 2,390 4,103 - 4,103

Payables for deferred taxes c,d,f,h,i - 1,719 1,719 - 2,668 2,668

Other non-current liabilities 4,046 - 4,046 3,521 699 4,220

Total non-current liabilities 149,323 1,253 150,576 179,032 2,631 181,663Current quota of medium/long-term loans a 172 79 251 4,728 308 5,036

Trade payables a 90,167 (108) 90,059 118,916 (600) 118,316

Income tax payables a 1 (1) - 6 (6) -

Current deferred revenues 11,914 - 11,914 12,583 (104) 12,479Short-term provision for risks and charges - - - - - -

Other current liabilities g 26,376 (7,648) 18,728 29,165 (9,168) 19,997Total current liabilities 128,630 (7,678) 120,952 165,398 (9,570) 155,828

Total shareholders equity and liabilities 374,376 (2,103) 372,273 445,281 454 445,735


Reconciliation of the profit and loss account 2008

Thousands of Euros

Revenues note ITA GAAP

Effect of transition

to the IFRS IFRS

Revenues from sales and services a 174,901 199 175,100 Differences in inventories of products being processed, semi-processed and finished 2,752 2,752 Other income a 3,438 (1,236) 2,202 Total revenues 181,091 (1,037) 180,054

Costs

Raw, ancillary, consumable materials and goods a (472) 27 (445) Services f (94,771) 690 (94,081) Use of third party assets a (35,310) (70) (35,380) Personnel costs h (16,851) 76 (16,775) Other operating costs a (6,344) 256 (6,088) Costs for in-house works capitalised e 10,613 (1,025) 9,588 Total operating costs (143,135) (46) (143,181)

Gross operating margin

37,956 (1,083) 36,873

Depreciations and write-downs a,c,e (8,115) 1,391 (6,724)

Depreciations (recovery in value) of properties, plants and machinery (418) (418) Allocations for risks and charges (2,034) (2,034)

Operating result

27,389 308 27,697

Financial income 4,866 (6) 4,860

Financial costs a,d,f,h (8,376) 3,375 (5,001) Quota of profits/losses on shareholdings accounted using the shareholders equity method - - -

Pre-tax result

23,879 3,677 27,556

Income tax a,c,d,e,f,h (8,616) (948) (9,564)

Result for the period for continuing activities 15,263 2,729 17,992

Result for the period for assets destined for

sale net of the fiscal effects i - - -

Net result for the period 15,263 2,729 17,992 Group 15,146 2,926 18,072 Third parties 117 (197) (80)


Impact on financial reporting

The reconciliation schedule for financial reporting is not presented, as the application of the IFRS-EU accounting principles did not have a significant impact.

Initial adoption of the IFRS-EU

The equity and financial situations at 1 January 2008 and 31 December 2008 and the consolidated profit and loss account, and the schedule of the overall consolidated profit and loss account, for the 2008 financial year, elaborated on the basis of the IFRS-EU, have been drawn up applying to the overall data drawn up according to the ITA Gaap the adjustments and reclassifications required to make these accounts documents compliant with the criteria for presentation, reporting and evaluation provided by the IFRS-EU.

The effects deriving from transition to the IFRS-EU derive from changes to the accounting principles, and consequently, as required by IFRS 1, they are reflected in the initial shareholders equity at the date of transition (1 January 2008).

Passage to the IFRS-EU has implied that the estimates previously formulated according to the ITA Gaap have been maintained, unless the adoption of the IFRS-EU has required the formulation of estimates according to different methods.

No derogations to the application of the IFRS-EU were applied in the drawing up of these schedules.

As required by IFRS 1, at the date of transition to the new accounting principles (1 January 2008), an equity and financial situation has been drawn up in which:

only the assets and liabilities recordable on the basis of the new principles have been recorded;

the items previously indicated in the financial statements according to methods other than those provided by the IFRS-EU have been reclassified;

the assets and liabilities have been recorded at the values that would have been determined of the new accounting principles had always been applied, except for the exemptions and options allowed by IFRS 1, and indicated hereafter;

all the adjustments resulting from the initial application of the IFRS-EU have been recorded with counter-items in the shareholders equity, taking into account the fiscal effect recorded between assets for prepaid taxes or liabilities for deferred taxes.

The re-elaboration of the initial equity and financial situation at 1 January 2008 and the accounts schedules for the consolidated financial statements at 31 December 2008 required that the Grandi Stazioni Group make the following choices among the options provided by the IFRS-EU:

methods of presenting the financial statements schedules: as regards the schedule of the equity and financial situation, the so-called “current/non-current” criterion for presentation and classification was adopted; as regards the profit and loss account, the schedule providing for


the classification of costs according to their nature was adopted. This implied the reclassification of the items in the schedules provided by arts. 2424 and 2425 of the Civil Code;

optional exemptions provided by IFRS 1 during the initial application of the IFRS-EU (1 January 2008):

- employee benefits (IAS 19): the value of the Staff Severance Indemnity has been determined at the date of transition on the basis of actuarial methods and hypotheses. The Grandi Stazioni Group has decided to record all the accumulated actuarial profits and losses existing at 1 January 2008 in the profit and loss account, as with subsequent actuarial profits and losses;

- designation of the financial instruments recorded prior to 1 January 2008: the classification of the financial instruments must be done at the moment of their initial recording in the financial statements and may subsequently be modified only in certain circumstances. However, IFRS 1 allows for the allocation of financial instruments in the different categories on transition to the IFRS-EU principles, in derogation of the general rule. The Grandi Stazioni Group has decided to apply this derogation;

- reserve for net differences in exchange rate deriving from the translation of the financial statements of consolidated companies operating in countries not in the Euro area: as allowed by IFRS 1, the Group has made use of the exemption and considered the net differences in exchange rates at the date of transition as nil;

- financial costs: as allowed by IFRS 1, the Group has made use of the possibility provided by IAS 23 (reviewed) of applying the principle as of a date prior to 1 January 2009. The Grandi Stazioni Group has decided to capitalise the financial costs concerning the assets qualified as of 1 January 2000, which is the date on which the initial refurbishment works started in all stations except Roma Termini.


Commentary on the main IFRS-EU adjustments

a) Leasing

On the basis of the ITA Gaap, the leasing contracts stipulated by the Group leader were dealt with as “operational”. At the date of transition, the characteristics of the leasing contracts were evaluated in the light of the IFRS-EU and the contracts classified as “financial” leasing.

This classification has implied an increase in the item properties, plants and machinery and the liabilities in the equity and financial situation and an increase in the financial costs and amortizations, as well as the reduction of operating costs, in the profit and loss account.

The above impacts are summarised as follows:

Thousands of Euros 1 January 2008 31 December 2008

Consolidated profit and loss account

Revenues (1,037)

Operating costs 563

Depreciations and write-downs 23

Financial costs 43

Fiscal effect 43

Net result for the period (365)

Consolidated equity and financial situation

Properties, plants and machinery (7,219) (13,282)

Non-current financial assets, including derivatives 315 -

Other non-current assets 7,128 13,503

Total current assets (354) (158)

Medium/long-term loans (40) 156

Other non-current liabilities - (699)

Current quota of medium/long-term loans (79) (308)

Total current liabilities 208 803

Effect of differences in translation - (502)


Shareholders equity (142) (507)

b) Improvements to third party assets

At 1 January 2008 and 31 December 2008, the Group included the costs sustained for the refurbishment of station complexes owned by third parties in the Intangible Assets.

These costs, although capitalised, did not have the requirements to be classified as Intangible assets as defined by IAS 38. Therefore, in the absence of the characteristics of intangibility, the aforementioned costs, according to that disposed by IAS 16, were reclassified in the item Properties, plants and machinery, as they were civil engineering works and various installations.




-

Net result for the period -


Properties, plants and machinery 103,648 148,175

Intangible assets (103,648) (148,175)

Shareholders equity - -

c) Property investments

The Group leader Grandi Stazioni SpA owns property complexes in its name bordering the stations of Roma Termini, Napoli Centrale, Venezia Santa Lucia, Genova Piazza Principe, Bologna and Florence.

All the property complexes indicated above are owned for the purpose of receiving leasing fees or for the appreciation of the capital invested, and are therefore classified in the item Property Investments.

The criterion chosen for subsequent evaluation is the cost, rather than fair value. In this regard, given that the net value of the properties at the date of transition was not applied as the deemed cost, an adjustment was made concerning the recovery of the amortizations recorded according to the ITA Gaap on the plot of land where the buildings are located.



Depreciations and write-downs 396

Fiscal effect 19

Net result for the period 415

Consolidated equity and financial situation Properties, plants and machinery (76,814) (51,446)

Property investments 80,447 55,475


Shareholders equity 2,699 3,114

d) Financial costs

The loans started in 2005 with MPS and 2008 with the EIB concern the realisation of the refurbishment works on all the station complexes (excluding Roma Termini, where the works were almost completed in previous years). IAS 23 (reviewed) implies that companies bound to draw up their financial statements according to the IFRS-EU must record the financial costs which can be


capitalised in the immobilised assets. For this purpose, as indicated previously, the Grandi Stazioni Group has defined 1 January 2000 as the date of validity of the obligation to capitalise the financial costs, given that, as of the aforementioned date, the refurbishment works in the station complexes started and, subsequently (2005 and 2008), the aforementioned loans were stipulated. Furthermore, the effects of the adoption of the calculation of the amortized costs on some of the loans started by the Group were recorded.

The impacts of the adjustment due to the adoption of IAS 23 (reviewed) are summarised as follows:



Financial costs 3,432

Fiscal effect (944)

Net result for the period 2,488


Properties, plants and machinery 2,508 5,940

Fiscal effect (689) (1,633)

Shareholders’ equity 1,819 4,307

c) Intangible assets

The intangible assets, especially in the item “Other”, recorded according to the ITA Gaap included internal costs capitalised not specifically traceable to the individual tenders completed or being completed.

These costs do not have the requirements to be classified as Intangible Assets as defined by IAS 38, and therefore, during the initial adoption of the IFRS-EU, they were brought forward to reduce the shareholders’ equity at the date of transition and, in the 2008 financial year, were included directly among the operating costs.

The impacts of adjustment were as follows:



Costs for in-house works capitalised (1,025)

Depreciations and write-downs 973 Fiscal effect 17



Intangible assets (952) (1,004) Fiscal effect 306 323

Shareholders’ equity (646) (681)


f) Recording of the CFH reserve and the effect of the amortized cost of loans

As regards the loan stipulated with the EIB during the course of the 2008 financial year, accessory costs were sustained and included in the profit and loss account during the course of the same financial year on the basis of the ITA Gaap. With the adoption of the IFRS-EU, the loan was recorded using the amortized cost method. By this method, the financial liability is determined using the criterion of effective interest; the effective interest rate is the rate which exactly actualised the estimated future payments throughout the expected lifetime of the loan. In particular, the adjustment involves the recovery of the payments accessory to the loan which are brought forward in direct reduction of the financial debt, with a consequent positive impact on the profit and loss account for 2008.

Furthermore, starting on 30 June 2006 and expiring on 30 June 2011, the Group leader Grandi Stazioni S.p.A. stipulated with Mediobanca Banca di Credito Finanziario S.p.A. a contract for hedging the interest rate risk (IRS) on a notional capital totalling 30 million Euros, on the basis of which Grandi Stazioni receives, on a six-monthly basis, remuneration amounting to the 6-monthly Euribor and pays a financial cost amounting to the 6-monthly Euribor with a cap of 0.245%, up to a maximum of 4.30%. On the basis of the dispositions of IAS 39, the aforementioned derivative instruments have been qualified as cash flow hedge, and therefore the differences in fair value are recorded in a specific reserve in the shareholders’ equity.

The impacts of the adjustment are as follows:



Services 340

Financial costs (3)

Fiscal effect (94)

Net result for the period 243


Non-current financial assets, including derivatives 311 131

Medium/long-term loans - 206

Non-current financial liabilities, including derivatives - (70)


Shareholders’ equity 225 192

g) Capital gains

At 1 January 2008 and 31 December 2008, the Group had “Contracted works in progress” mainly concerning the RFI renders for which the advance payments made were invoiced in the liabilities of the statement of assets and liabilities.


On the basis of that disposed by IAS 11, the tenders in question were recorded as follows:

the ongoing tenders for which the costs sustained, plus (or minus) the relevant margins, exceed the advance payments invoices are recorded net of the advance payments received;

the ongoing tenders for which the costs sustained, plus (or minus) the relevant margins, are less than the advance payments invoiced are recorded in the liabilities in reduction of the advance payments received.

The impacts of the adjustment are as follows:





Capital gains (7,549) (9,075)

Other current liabilities 7,549 9,075 Shareholders’ equity - -

g) Employee benefits

The debts concerning the Staff Severance Indemnities, in the financial statements drawn up according to the ITA Gaap, was recorded on the basis of the provisions of the law. On the basis of that disposed by IAS 19, and according to the indications of the OIC contained in the “Operating guide for transition to the international accounting principles”, the SSI is considered as a defined benefit plan and has been re-calculated using actuarial methods.

The model of accounts reporting chosen by the company in compliance with IAS 19 para. 93A and 93B provides for the recording of all actuarial profits and losses net of the relevant fiscal effect directly in a reserve in the shareholders’ equity. Therefore, the effect on the profit and loss account for the 2008 and 2009 financial years corresponds exclusively to the effect of the interest rates due deriving from the actuarial calculation.



Personnel costs 76

Financial costs (97) Fiscal effect 6



SSI and other employee benefits 506 438



Shareholders’ equity 367 318

i) Non-current assets owned for sale

At 31 December 2008, the Group leader owned Properties destined for sale recorded in the item Capital gains and concerning the net accountable value of the departmental property in Venice.

The accountable value of this property complex was recovered through a sale operation rather than through its continuing use, and this property therefore comes under the scope of applicability of IFRS 5 and at 31 December 2008, was reclassified under the item Non-current assets owned for sale. Contrarily, as regards the FTA (1 January 2008), in the absence of the requirements provided by IFRS 5, it was included in the category Property Investments (see point c)).

At 31 December 2008, Grandi Stazioni S.p.A. included the net accountable value of the shareholding held in Grandi Stazioni Edicole under the item Non immobilised financial assets while awaiting sale during the course of the 2009 financial year. Given that the accountable value of this shareholdings will be recovered mainly through a sale operation rather than through its continuing use, it will come under the scope of applicability of IFRS 5, and as at 31 December 2008, has been reclassified under the item Non-current assets owned for sale. Contrarily, as regards the FTA (1 January 2008), in the absence of the requirements provided by IFRS, it was included in the category “Non-current financial assets, including derivatives".





Property investments (1,114)

Capital gains (40,631)

Current financial assets, including derivatives (12)

Non-current assets owned for sale 41,757 Shareholders’ equity - -


Schedule of reconciliation of shareholders’ equity and net result for the period

As required by IFRS 1, the following is the schedule of reconciliation of the shareholders’ equity at 1 January 2008 and 31 December 2008 and the net result for the period for 2008, with reference to the comments concerning the adjustments made to the balances predisposed according to the ITA Gaap.

Thousands of Euros 1 January 2008 31 December 2008 note Shareholders’

equity Result Shareholders’

equity

ITA GAAP balance 96,423 15,263 100,851

Adjustments: Effect of leasing a (142) (365) (507)Cancellation of amortizations on land concerning buildings owned c,i 2,699 415 3,114Capitalisation of intangible assets d 1,819 2,488 4,307Cancellation of intangible assets e (646) (35) (681)Recording of the CFH reserve and the amortized costs of loans f 225 240 189Recording of the effect of the actualisation of employee benefits h 367 (14) 318Recording of exchange rate differences on financial statements in foreign currency

- 653

IFRS balance 100,745 17,992 108,244


Grandi Stazioni Ingegneria Srl

Grandi Stazioni Ceska Republika s.r.o.

Management of design,planning and worksdirection services instation complexesmanaged by the Groupin Italy and abroad.

Refurbishment, valorisation and management of the station complexes of Prague Central and Marianske Lazne.

ANNEX 1 Scope of consolidation at 31 December 2009 and 31 December 2008

100% 51%

grandi stazioni s.p.a. · governing bodies of grandi stazioni spa and ... rotation of capital...

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