half-yearly financial report as at 30 june 2012 · 2012 half-yearly financial report 2 ......

HALF-YEARLY FINANCIAL REPORT AS AT 30 JUNE 2012

24 ORE Group

2012 HALF-YEARLY FINANCIAL REPORT

2

Corporate bodies 3

Structure of the 24 ORE Group 5

Highlights 6

MANAGEMENT REPORT FOR THE PERIOD ENDED 30 JUNE 2012 7

Operating performance and result in first half of 2012 7

Main income statement and statement of financial position figures of the 24 ORE

Group 9

Significant events in the first half 13

Group performance by operating segments 15

Related-party transactions 29

Principal risks and uncertainties 29

Other information 33

Events after the end of the reporting period 35

Outlook 36

CONDENSED HALF-YEARLY CONSOLIDATED FINANCIAL STATEMENTS OF THE 24 ORE GROUP AS AT 30 JUNE 2012 37

Separate financial statements 37

Notes to the financial statements 45

1. General information 45

2. Format, content and accounting standards adopted 47

3. Separate financial statements 47

4. Changes in accounting policies, errors, and changes in estimates 50

5. Risk management 50

6. Principal reasons for uncertainties in estimates 55

7. Scope of consolidation 56

8. Notes to the separate financial statements 58

9. Segment reporting 75

10. Other information 78

24 ORE Group


3

Corporate bodies

The Board of Directors and the Board of Statutory Auditors were elected by the Ordinary

Shareholders’ Meeting on 14 April 2010.

The Board of Directors and the Board of Statutory Auditors will remain in office until the

shareholders’ meeting held to approve the 2012 separate financial statements.

Board of Directors

Chairman Giancarlo CERUTTI

Chief Executive Officer Donatella TREU

Directors Luigi ABETE

Diana BRACCO

Pierluigi CECCARDI

Claudio COSTAMAGNA (1)

Mario D’URSO (2)

Antonio FAVRIN

Giampaolo GALLI (4)

Alberto MEOMARTINI

Nicoletta MIROGLIO

Antonello MONTANTE

Aurelio REGINA

Carlo TICOZZI VALERIO (3)

Marino VAGO

Secretary to the Board

Gianroberto VILLA

(1) Independent Director. Appointed on 10 May 2011 to replace Francesco Caio, who resigned

on 20 April 2011. Appointment confirmed by the Shareholders’ meeting of 23 April 2012

(2) Independent Director.

(3) Independent Director. Appointed on 14 February 2012 to replace Piero Gnudi, who resigned

on 2 December 2011. Appointment confirmed by the Shareholders’ meeting of 23 April

2012

(4) Non-executive Director resigned on 24 July 2012.

24 ORE Group


4

Board of Statutory Auditors

Chairman Luigi BISCOZZI

Standing statutory auditors Demetrio MINUTO

Maurilio FRATINO

Alternate Statutory Auditors Maria SILVANI

Fabio FIORENTINO

Internal Control & Audit Committee

Chairman Carlo TICOZZI VALERIO

Members Marino VAGO

Mario D’URSO

Human resources and compensation committee

Chairman Diana BRACCO

Members Claudio COSTAMAGNA

Mario D’URSO

Representative of special-category shareholders

Mario ANACLERIO

Corporate financial reporting manager

Massimo Luca ARIOLI

Internal control & auditing manager

Massimiliano BRULLO

Independent auditor

KPMG S.p.A.

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Structure of the 24 ORE Group

Il Sole 24 ORE S.p.A.

Nuova Radio S.p.A. 100%

Il Sole 24 ORE UK Ltd 100%

24 ORE Cultura S.r.l. 100%

Italia News S.r.l.

in liquidation20%

Newton Management

Innovation S.p.A.60%

Newton Lab S.r.l. 51%

Alinari 24 ORE S.p.A. 55%

Business Media Web S.r.l.

in liquidation60%

Diamante S.p.A. 30%

Innovare24 S.p.A. 100%

Esa Software S.p.A. 70%

Mondoesa Milano

Nordovest S.r.l49%

Fabbrica24 S.r.l. 100%

Cesaco S.r.l. 48%

Mondoesa Lazio S.r.l. 35%

Aldebra S.p.A 19.39% Mondoesa Emilia S.r.l. 40%

Mondoesa Laghi S.r.l. 33.7%

Companies included

in the scope of consolidation

Shopping 24 S.r.l. 100%

Operating associates

30%

Signet S.r.l. 70%

24 ORE Group


6

Highlights

• Consolidated revenues of €229.6 million, down by 5.7%, mainly due to the

performance of the advertising market.

• EBITDA equal to -€4.2 million, affected by the drop in advertising revenue, higher

charges linked to the increase in the cost of raw materials (+10%), postal rates for

mailing (+17% basic tariff, +34% Saturday tariff), the premium related to greater sales

volumes and the increased cover price as well as non-recurring personnel charges, which

generated a decrease of €14.9 million compared with the first half of 2011.

• Group loss of €8.4 million, down by €3.9 million compared with the first half of 2011.

• Positive net financial position of €41 million with an improvement of €36 million

compared with the first quarter of 2012.

• Circulation revenues for the daily newspaper was positive (+ €2.1 million), thanks to

the growing sales volumes (+12.4%) driven by subscriptions and digital copies. Average

daily readers reading the newspaper rose by 5.4%, recording a total of 1,243,000

people (January-March 2012 against September-December 2011 – source Audipress).

Growing pdf and iPad subscribers: +93% over December 2011 with more than 35,000

subscribers, 30,000 of which are annual. In the first half of 2012, the mobile version of

the www.ilsole24ore.com website grew by +112.0% among average daily unique

browsers and +149.9% of average daily pages. The daily paper ranks third among

national newspapers.

• GOP accounts for 30.0% of revenues of the Tax&legal area, compared with 29.2% of

the same period of the previous year. Digital revenues grew from 39.2% to 47.4%.

• The Group’s digital revenues grew by 1.4% to 23.9% compared with the same period

of 2011.

• System advertising revenue decreased by 11.5% (-9.8% on a comparable consolidation

basis) against -9.5% of the market (source Nielsen). Trend of the advertising sales

agency higher than the market in Radio (+1.7% vs. -5.5%), and Internet, with

IlSole24ore.com net of funds obtaining +22.8% vs. +16.3% of the market (source: FCP –

AssoInternet).

• Radio 24 confirms its position among the top ten most listened to national radio stations

with 1,903,000 listeners and a loyalty of 41%. Its market share in seconds grew from

8.3% in the first half of 2011 to 8.9% at 30 June 2012 (source: Eurisko Radio Monitor

research).

• Good performance of Il Sole 24 ORE brand software products (revenue +1.1%).

24 ORE Group


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MANAGEMENT REPORT FOR THE PERIOD ENDED 30 JUNE 2012

Operating performance and result in first half of 2012

Market environment

The very difficult macro economic situation of 2011 proved markedly recessive in the first half of

2012. In this context, the paper publishing market continues a further contraction and compression

of business.

The negative trend is confirmed also for 2012, which is seriously affected by the heavy economic

crisis in progress, causing growing difficulties for the final demand of companies, public entities

and households The self-employment sector also recorded a considerable drop in turnover

consequently to both a reduction in customers and the delay in collection fees.

Since the Group is mainly engaged with the entrepreneurial world, the figures regarding newly

established and discontinued companies are particularly important for it. In 2011 the newly

registered companies were 391,310, while the discontinued ones were 393,463; in the first quarter

of 2012 (latest data available), on the other hand, new registrations reached 120,278 against

158,870 discontinuations, down by almost 38,500 units, equal to 24% (source: Movimprese-

Infocamere).

The advertising market as a whole, thus considering all media including television, contracted by

9.5% relative to the figure for the same period of 2011 (Source: Nielsen Media Research - January-

May 2012), thus further worsening the negative trend of the start of the year.

The press suffered considerably: daily newspapers as a whole dropped by 13.5%, paid dailies

decreased by 12.3% and magazines declined by 13.8%. Radio’s performance dropped (-5.5%), with

the online segment being the only one experiencing growth (+10.6%) and Internet display rising by

16.3%.

In terms of circulation, it is worth mentioning that the ADS certification method has changed. Since

April 2012, the moving average for the twelve months is no longer communicated, but only the

monthly data (the only data available refers to the months of April and May) and, therefore, the

comparison with the previous period is no longer homogenous. In this new context, the ADS

average of the eight main paid dailies (source: ADS) grew by 0.9%.

Performance of the 24 ORE GROUP

HIGHLIGHTS OF 24 ORE GROUP (in thousands of euro) 1

st Half 2012 1

st Half 2011

Revenue 229,589 243,482

Gross operating profit (loss) (4,201) 10,727

Operating profit (loss) (13,702) (2,930)

Profit (loss) before tax (13,974) (2,327)

Profit (loss) from continuing operations (8,909) (4,601)

Profit (loss) from discontinued operations - 104

Profit (loss) attributable to owners of the parent (8,420) (4,535)

Net financial position 41,141 42,091 (1)

Equity attributable to owners of the parent 238,289 247,940 (1)

Employee headcount at end of year 1,874 1,911 (1)

(1) Value related to 31 December 2011

24 ORE Group


8

In the six months in question, the 24 ORE Group obtained consolidated revenues of €229.6

million, with a change of -5.7% relative to the €243.5 million of the same period of 2011. This

result derives from the revenue growth in the Digital Area (+7.9%), in the Culture Area (+71.9%),

and in the Radio Area (+3.0%), which only partly offset the decrease in the advertising revenue (-

11.6%) and in magazines and books.

Gross operating profit (Ebitda) was negative at €4.2 million, decreasing compared with the

positive €10.7 million of the first half of 2011 due to the combined effects of cost and revenue. The

following is highlighted in particular:

- personnel expense decreased by €4.8 million (5.5%), mostly thanks to the reduction in

the average number of employees by 160 persons, also as a result of the organisational

downsizing plan;

- direct and operating costs increased by 5.0%, equalling €7.2 million, mainly due to the

increase in distribution costs and in the price of raw materials;

- other operating costs rose by €1.3 million.

The operating loss (Ebit) of €13.7 million decreased by €10.8 million compared with the first half

of 2011.

Depreciation, amortisation and impairment totalled €10.5 million, in contrast with €14.0 million in

2011. Of interest is that the amortisation of the concession and broadcasting frequencies in the first

half of 2011 equalled €1.7 million. The useful life of concessions and radio frequencies was

reviewed and made indefinite at the end of last year. Therefore, these are no longer amortised.

The loss attributable to owners of the parent amounted to €8.4 million, compared with the €4.5

million loss in the first half of 2011.

The Group’s net financial position as at 30 June 2012 came to €41.1 million, compared with €42.1

million at the start of the year.

24 ORE Group


9

Main income statement and statement of financial position figures of the 24 ORE Group

Income Statement

On 1 July 2011 the Group finalised the sale of the Real time financial reporting Business Unit.

From this date, the scope of consolidation no longer includes this business. In application of IFRS 5

– Non-current assets held for sale and discontinued operations, the balances of the income

statement of the first half of 2011 were adjusted compared with those originally published, to

reclassify the balances regarding the Real time financial reporting Business Unit under item Profit

(loss) from discontinued operations.

HIGHLIGHTS OF CONSOLIDATED INCOME STATEMENT (in thousands of euro)

1

st Half 2012 1

st Half 2011

Revenue from sales and services 229,589 243,482

Other operating income 3,995 3,834

Personnel expense (82,279) (87,083)

Change in inventories 361 584

Purchase of raw materials and consumables (15,322) (13,700)

Services (115,002) (111,912)

Other operating costs (22,209) (19,916)

Provisions and allowances for impairment (3,335) (4,561)


Depreciation, amortisation and impairment losses (10,501) (13,983)

Gains/losses on disposal of intangible assets and property, plant and equipment 1,001 325


Financial income (expenses) (75) 730

Income (expenses) from investments (198) (127)


Income taxes 5,066 (2,273)



Profit (loss) attributable to non-controlling interests (489) 39


Revenues amount to €229.6 million, down by 5.7% relative to €243.5 million in 1H11.

Revenues from the sale of daily newspapers, books and magazines totalled €66.8 million, compared

with €72.5 million in 1H11, for a decrease of €5.7 million, or -7.9%. The newspaper’s circulation

revenue increased slightly (+1.0%), magazine revenue amounted to €23.1 million (-12.7%) and the

revenue from books to €5.3 million (-34.5%). Sales of add-on products totalled €3.9 million, up by

2.8%.

Total advertising revenue declined by €10.9 million (-11.6%). Other revenue totalled € 79.7

million, compared with €77.0 million of the same period of the previous year (+3.5%). Digital

revenue increased its percentage incidence over the Group’s total revenues from 22.5% to 23.9%

and the increase of €2.7 million is due to the sale of tickets for exhibitions.

24 ORE Group


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Other operating income totalled €4.0 million, compared with €3.8 million in 1H11. This item

includes the recovery of costs, rental income, contingent income, contributions and other residual

items.

Extraordinary personnel expenses reached €1.8 million in the first half of 2012. In any case

personnel expense decreased by €4.8 million (-5.5%) due to the lower average headcount as an

effect of the reorganisation plan. Employees as at 30 June 2012 were 1,874, compared with 1,995 in

the same period of the previous year.

Direct and operating costs increased by 5.0%, equalling €7.2 million, compared with the first half

of 2011, due to the following effects:

- costs for raw materials and consumables increased by €1.8 million due to the rising price

of paper and the higher number of copies produced;

- distribution costs rose by €2.0 million (+10.8%) due to higher distribution charges

calculated on the new cover price, greater volumes (add-on products and number of

pages) and the increasing postal rates (+17% basic tariff and +34% Saturday tariff);

- costs for exhibitions and fairs rose by €2.9 million in connection with the rise in revenues

from exhibitions;

- advertising and promotions grew by €0.4 million due to the higher advertising and

marketing investments on the daily newspaper and new products of the Group;

- commissions and other selling costs dropped by 14.5% consequently to the performance

of advertising revenue and the rationalisation of sales structures.

Provisions and provision for bad debt amount to €3.3 million versus €4.6 million of 1H11.

Depreciation, amortisation and impairment totalled €10.5 million, in contrast with €14.0 million

in 2011. Of interest is that the amortisation of the concession and broadcasting frequencies in the

first half of 2011 equalled €1.7 million. The useful life of concessions and radio frequencies was

reviewed and made indefinite at the end of last year. Therefore, these are no longer amortised.

Net financial income and expenses are negative for €0.1 million (€0.7 million in 1H11). The

decrease in financial income is mainly due to the lower interest rates and the decreased cash

resources of the period relative to the previous year.

Income taxes totalled €5.1 million versus € -2.3 million in 1H11. This result partly depends on the

recording of higher deferred tax assets on the losses for the year and €3.5 million for realignment

operations on mergers, which allowed tax pertinence to be given to the goodwill recorded in

previous mergers and the recording of income.

24 ORE Group


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Statement of financial position

HIGHLIGHTS OF THE STATEMENT OF FINANCIAL POSITION

(in thousands of euro) 30.06.2012 31.12.2011

Non-current assets 295,326 308,643

Current assets 254,648 246,894

Total assets 549,974 555,537

Equity attributable to owners of the parent 238,289 247,940

Equity attributable to non-controlling interests (324) 317

Total equity 237,965 248,257

Non-current liabilities 66,994 67,202

Current liabilities 245,015 240,078

Total liabilities 312,009 307,280

Total equity and liabilities 549,974 555,537

Non-current assets amounted to €295.3 million compared with €308.6 million as at 31 December

2011, for a decrease of €13.3 million, mainly due to the early extinction of the insurance company

stipulated with Monte Paschi Vita, equal to €19.7 million.

The decrease in property, plant and equipment equalled €2.7 million, intangible assets decreased by

€2.4 million due to the negative balance between depreciation and amortisation and new

investments.

Compared with the last financial statements, deferred tax assets increased by €10.1 million, of

which 5.7 million due to the corresponding income from the alignment operation to give tax

pertinence to the goodwill recorded for previous mergers.

Current assets amounted to €254.6 million as compared with €246.9 million at the beginning of

the year, for an increase of €7.8 million, primarily due to the €17.8 million increase in cash and

cash equivalents deriving from the early extinction of the insurance policy stipulated with Monte

Paschi Vita. Trade receivables decreased by €16.1 million in connection with the revenue

performance and the decrease in average collection days compared with the end of 2011.

Equity totalled €238.0 million, compared with €248.3 million at 31 December 2011. The equity

attributable to non-controlling interests was €0.3 million.

Non-current liabilities amounted to €67.0 million, compared with €67.2 million at the beginning

of the year, with a decrease of €0.2 million.

Current liabilities totalled €245.0 million, up €4.9 million from the €240.1 million reported at 31

December 2011. The change stemmed principally from the increase in deferred income, due to the

seasonal nature of subscriptions to magazines, the newspaper and electronic publishing products.

24 ORE Group


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Statement of cash flows

HIGHLIGHTS OF CASH FLOWS (in thousands of euro) 1

st Half 2012 1

st Half 2011


Adjustments 1,507 8,224

Changes in net working capital 13,921 (25,128)

Net cash used in operating activities 7,008 (21,439)

Investments (5,423) (4,234)

Divestments and other changes (522) 842

Net cash used in investing activities (5,945) (3,392)

Free cash flow 1,063 (24,832)

Net cash used in financing activities 16,434 (788)

Net decrease (increase) in cash & cash equivalents 17,497 (25,620)

At the start of the year 28,667 73,629

At the end of the year 46,164 48,009

Total cash flows were positive by €17.5 million, marking an improvement by €43.1 million from

1H11 cash flow (negative by €25.6 million).

Net cash used in operating activities was a positive by €7.0 million as opposed to negative cash

flow of €21.4 million the previous year. This reflected the positive change by €13.9 million in net

working capital, mainly due to the decreased in trade receivables.

Net cash used in investing activities was a negative at €5.9 million, consisting mainly of operating

investments. In 1H11, this amount was a negative €3.4 million.

Cash flows from financing activities were positive at €16,4 million. The most significant changes

refer to the extinction of the life insurance police taken out by MPS for €19.7 million and the

repayment of medium to long-term loans for €1.2 million.

24 ORE Group


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Net financial position

NET FINANCIAL POSITION (in thousands of euro) 30.06.2012 31.12.2011

Cash and cash equivalents 49,259 31,431

Bank overdrafts and loans - due within one year (3,096) (2,764)

Short-term net financial position 46,164 28,667

Non-current financial liabilities (4,718) (5,916)

Non-current financial assets - 19,657

Fair value changes in financial hedging instruments (305) (317)

Medium-long term net financial position (5,023) 13,424

Net financial position 41,141 42,091

The net financial position decreased from €42.1 million at 31 December 2011 to €41.1 million at

30 June 2012. Cash and cash equivalents increased in connection with the liquidity deriving from

the extinction of the MPS life insurance policy and the trend of cash flows already mentioned in the

Statement of cash flows. Medium-long term indebtedness decreased, upon repayment of the amount

due during the period for subsidised loans.

Significant events in the first half

On 24 February 2012 the Board of Directors of Il Sole 24 ORE S.p.A. approved the updated 2011-

2013 Business Plan unanimously.

Given a market still facing a slowdown particularly in terms of advertising revenue, the Plan’s

strategic lines are confirmed through the strengthening of the leadership of the 24 ORE Group by

means of innovative actions and a balanced approach to favour the start of a series of new initiatives

aimed at company development while lowering costs.

Despite lower advertising revenue and the uncertain economic situation, the Group expects to

reabsorb the effects of the economic crisis and reach the objective of the 2011-2013 Plan during

2014.

Fabbrica 24 S.r.l. was set up on 20 January 2012. This company is wholly owned by Innovare24

S.p.A. and is operational in the e-commerce segment starting from April 2012.

The new organisation of the advertising sales agency has been active since January 2012. It enables

a better cost rationalisation than in 2011 and an improved integration of the sales network. The

agency is approaching the market with a unique sales network able to offer communication

opportunities on both off and on line media.

On 14 February 2012 the Board of Directors of Il Sole 24 ORE S.p.A. appointed by co-option the

director Carlo Ticozzi Valerio to replace Piero Gnudi. The director Carlo Ticozzi Valerio was also

appointed as the Chairman of the Internal Control & Audit Committee.

On 23 April 2012, the Shareholders’ Meeting of Il Sole 24 ORE S.p.A. approved the financial

statements for the year 2011, resolving not to distribute dividends and fully to cover the loss for the

year of € 10,085,291, by using a matching amount of “Retained earnings”.

The same meeting appointed Mr. Claudio Costamagna, who had been co-opted by the Board of

Directors of Il Sole 24 ORE S.p.A. on 10 May 2011 and also appointed Mr. Carlo Ticozzi Valerio

24 ORE Group


14

as director, who had been co-opted by the Board of Directors of Il Sole 24 ORE S.p.A. on 14

February 2012.

Since April 2012, the ADS moving average for the twelve months is no longer communicated, but

only the monthly data (the only data available refers to the months of April and May) and,

therefore, the comparison with the previous period is no longer homogenous. In this new context,

the ADS average of the eight main paid dailies (source: ADS) grew by 0.9% between May and

April.

Business media Web S.r.l. was put into liquidation on 26 April 2012 due to the decline of SAIE, the

main trade show in Bologna, from which Business Media Web obtained most of its revenues.

On 4 June 2012, in the absence of an official research activity, the GFK Eurisko institute carried out

a radio audience survey called Radio Monitor, which was purchased by the main national stations,

advertising sales agencies and media centres, and presented its results. In the radio audience data

survey, Radio 24 ranked among the top ten most listened to national radio stations with 1,903,000

listeners and a loyalty of 41% (amongst the highest recorded).

On 13 June 2012 the company Signet S.r.l. was acquired by agreeing to the capital increase. The

investment was equal to €147 thousand. 70% of the company is owned by Fabbrica 24 S.r.l. and it

manages the www.innerdesign.com portal.

In June Il Sole 24 ORE launched an initiative to establish an initial fund for the requalification of

technical colleges in the Emilia region that were mostly hit by the earthquake. The initiative was

successful, also thanks to the contribution of its advertisers, which participated in it by subscribing

advertising in the newspaper for the days of 2 and 3 June.

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Group performance by operating segments

Organisational and offer rationalisation actions were taken in the second half of 2011, as

summarised below:

- The Tax & legal, Software solutions and Training and events business unit of the former

Professional area were made independent and separate in terms of responsibilities;

- The business unit related to real time financial reporting was sold in July 2011. This

disposal was treated in the 2011 comparison data as a discontinued operation and the

results are highlighted in a specific line of the income statement.

In order to render the amounts for the two years comparable, the results for 2011 have been

reclassified on the basis of the new organisational structure.

The data is reported net of internal relations.

Publishing Area – Generalist and sector-specific publishing

Publishing is the division that heads up the daily newspaper Il Sole 24 ORE, its bundled add-on

products, theme magazines such as English24 and I Viaggi del Sole, and the monthly IL – Il

maschile de Il Sole 24 ORE, plus a number of primary processes (printing and distribution) also

managed for other Group segments. The area also comprises the Radiocor news agency and the

B2B integrated communication activity targeting SMEs in specific sectors, including agrifood,

retail distribution, construction and welfare, directly managing dedicated advertising sales forces.

PUBLISHING AREA REVENUE BY PRODUCT

(in thousands of euro) 1st Half 2012 1

st Half 2011 % Change

Newspaper 73,693 79,165 -6.9%

Add-ons 4,547 4,546 0.0%

Sector-Specific Publishing 17,149 19,513 -12.1%

Agency and P.A. 3,981 4,010 -0.7%

Other 1,585 2,298 -31.0%

Total 100,955 109,532 -7.8%

The editorial offices of Il Sole 24 ORE are organised according to theme sections and are located at

the Milan and Rome offices and at four other Italian offices (Florence, Genoa, Bologna, Turin,

Padua and Palermo). The daily newspaper, in particular, has international coverage provided by

correspondents seconded to six foreign locations (Brussels, London, Frankfurt, Shanghai, New

York and Paris). The overall editorial organisation of the Publishing Area draws on the services of

299 journalist employees, who also contribute to the contents of the portal www.ilsole24ore.com.

The newspaper is printed at the two owned printing centres in Milan and Carsoli (province of

L’Aquila) and at the following six third-party production sites: Verona, Mechelen (Belgium),

Benevento, Catania, Cagliari and Medicina (Bologna). Out of a total of 61.5 million copies printed

in the first half of 2012, 61% were printed at the owned sites and 39% at third-party sites.

Market figures for the first half of 2012 show an even more negative trend than that already seen

throughout 2011, with a contraction in terms of both advertising of 9.5% (-13.5% for daily

newspapers, -13.8% for magazines - source Nielsen Media Research – January-February 2012) and

circulation.

24 ORE Group


16

In terms of circulation, due to the changed ADS certification method, since April 2012, the moving

average for the twelve months is no longer communicated, but only the monthly data (the only data

available refers to the months of April and May) and, therefore, the comparison with the previous

period is no longer homogenous. In this new context, the ADS average of the eight main paid

dailies (source: ADS) grew by 0.9% between May and April. In the same period, Il Sole 24ORE

recorded a 1.6% drop.

According to the Audipress data regarding the comparison between the first cycle of 2012 (9

January-25 March 2012) and the third cycle of 2011 (19 September-18 December 2011), the

average daily number of newspapers’ readers in Italy, equal 24.66 million, dropped by 260

thousand (-1%).

Il Sole 24ORE gained 5.4% readers, with a total of 1,243,000 people who leaf through the

newspaper on an average a day, against just less than one million and two hundred thousand in the

period September-December 2011.

Aggregate revenue generated by the Publishing Area was €101.0 million (-7.8% compared with the

first half of 2011) due to the performance of advertising revenues (-16.4%), partially offset by the

increase in circulation revenues and other revenues (+2.1%).

Revenue for the daily newspaper dropped by 6.9% compared with the same period of the previous

year. The increased circulation revenue and other revenue (+6.1%) partly offset the drop in

advertising for the daily newspaper and its add-on products.

Circulation revenues for the daily newspaper was positive (+2.1%) thanks to the growing sales

volumes (+12.4%) driven mainly by subscriptions and digital copies.

Of interest is the growth in the number of Pdf and iPad subscribers. The more than 35,000

subscribers to electronic formats in June 2012 (+93% over December 2011) are the result of the

constant growth in the phenomenon and of the Group’s focus on developing an offer oriented to the

use of all platforms for the distribution of its contents.

Circulation of our newspaper (average for the first half of 2012) reached 263,100 average copies, up

by 0.7% compared with the first half of 2011.

In February 2012 the daily newspaper reviewed its publishing range through three moves:

- launch of the third new insert Impresa & Territori from Tuesday 14 February;

- inauguration of the new supplement on Fridays Moda24 dedicated to the fashion

industry, objects and cosmetics;

- closing of the regional editions and launch of Rapporti24: development of sectorial

reports on Tuesdays and territorial reports on Wednesdays.

On the Tuesday and Friday editions, Il Sole 24ORE is configured as follows:

- first insert dedicated to topical subjects, economic policy and the historical Norme e

Tributi (Laws and Tax) section;

- second insert dedicated to finance, the markets and news on listed companies;

- third insert Impresa & Territori focusing on the real economy. The daily newspaper’s

range is complemented every day by the weekly supplements.

In addition to providing complementing detailed page inserts illustrating the principal changes in

the national budget act, the Group also published the edition of Telefisco: the conference where the

newspaper’s experts and Italian Treasury officials illustrate the changes and reply to readers’

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questions. The 2012 edition was very well received by professionals: in the 150 venues linked by

videoconference and on the Internet, over 100,000 participants followed the conference. In

February 2012, the instant book with CD-rom containing videos of the reports and regulatory

insights was proposed at newsstands.

The publication of Guide Pratiche (Practical Guides) of Il Sole 24 ORE continued in 2012: these

are detailed studies the newspaper provides on the occasion of major regulatory changes. These are

connected with an online forum and a dedicated show on Radio24. Among the main titles there are:

Lavori in casa, Società di comodo, Irap, Gli studi di settore, Imprese e gare pubbliche,

Professionisti e antiriciclaggio, La scelta dell’università.

At the end of June, the summer initiative L’estate rovente con il tuo amico Sole was started,

launched to describe the year that changed the life of Italians and to provide the instruments needed

to face the new phase this major crisis is about to enter. A publication twice a week: on Fridays

with the books “LA GRANDE CRISI - I temi dell’economia raccontati dalle firme del Sole” to

understand the economic and financial scenarios, and on Thursdays with the books “LA TUA

ECONOMIA - Come affrontare e superare la grande crisi” with tips from experts on the best

choices in terms of houses, saving, pensions, universities, etc.

The collection became available at newsstands at €0.5 more on Fridays and Tuesdays and started on

29 June with the book “FATE PRESTO” by Roberto Napoletano.

Other initiatives taken in the first half of 2012 include:

- the instant book Le nuove pensioni was proposed at newsstands, containing also an online

version, analysing the main changes to the pension reform;

- on 3 March, a collection of 20 guides was launched at newsstands, providing guidance on

investments and finance: I tuoi soldi – le guide di Plus24;

- the Racconti d’autore initiative (books added on Sundays) continued;

- on 6 March “L’anno che ha cambiato la vita degli italiani” was launched in combined

sale: a survey by Il Sole 24 ORE on all the regulatory changes that have transformed the

life of citizens, consumers and tax-payers;

- the conference Tuttopensioni 2012 was held on 19 March. It was promoted in

collaboration with INPS and dedicated to the changes in pensions as part of the reform.

The project involved all the group’s areas concerned (Annual and events, Online, Tax &

Legal, Radio24);

- the 14th

edition of Premio alto rendimento was held on 20 March: recognition of Il Sole

24 ORE to Italian and foreign holding companies and open-end investment companies

that recorded the best performance in the last three years.

- on 17 April, in view of the important publication about tax returns, the newspaper

proposed two paid bundled add-on products: Guida 730 with an accompanying code that

allows readers to access an online software programme enabling them to fill out and print

their own Form 730 Italian tax return; and Guida Unico 2011 published on 18 May with

CD ROM, sold together with a demo version of the VIA LIBERA operating software by

Il Sole 24 ORE, forms, documentation and a selection of answers by experts.

- a new initiative was taken starting from 17 May by Il Sole 24 ORE to service citizens:

"SPORTELLO SOLE 24 ORE". On Thursdays the "Sportello" of Il Sole 24 ORE tries to

give the answers of a Minister or the Manager of an administration or market institution

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on the main topics proposed by citizens, together with a report containing detailed

information and practical indications from the editorial office.

- The 7th

edition of the Forum Lavoro, organised in collaboration with the Il Consiglio

Nazionale dei Consulenti del Lavoro (National Labour Consultants Board), was held on

30 May: a chance for professionals and experts from the Ministry of Labour and Il Sole

24 ORE to discuss on the main changes related to the Labour market reform. The 2012

edition recorded about 13,000 participants from the 103 offices connected by provincial

boards, employment consultants and users streaming on the Sole website.

The add-on products market confirmed its progressive downturn. A markedly negative

performance was recorded in the first few months of the year, characterised by a drop in the average

copies sold per initiative. The market performance was affected by regulatory changes regarding

circulation, which give discretional margins to newsagents for returns and products to be sold. All

publishers experienced increased early returns and contracted average sales.

The Group’s performance in this reference framework was in line with the trend of the same period

of the previous year.

In the magazine sector, the negative trend for circulation and advertising revenue continued: -

13.8% for the total magazines market and -19.0% for men’s magazines.

The non-positive performance of the monthlies in this Area (-31.0% compared with the first half of

2011) is affected by the closure of Ventiquattro.

The first half of 2012 saw a change in management involving all magazines. IL confirms its status

as one of the most innovative and appreciated papers in terms of graphics, as proven by the great

recognition received also in the first few months of the year.

Sector-specific publications were hit by the negative economic situation, which is reflected on the

B2B sector-specific publishing market.

The first few months showed a 12.1% contraction of revenue compared with the first half of 2011.

The difficult moment experienced by the merchandise segments in which the business unit operates,

further reduced the advertising drive associated with trade shows.

In the first half of 2012, the Agency and Public Administration Services B.U. recorded revenues

that are in line (-0.7%) with the same period of the previous year, due to a market situation in which

the main national and international press agencies operating in Italy and competitors of Radiocor

are heavily affected by the market crisis. The agreements being developed with international

operators are allowing the trend of the traditional services offered to the Radiocor agency to be

maintained and the effect of the persisting slowdown of the demand from the Public Administration

market to be mitigated.

PUBLISHING AREA RESULTS (in thousands of euro) 1

st Half 2012 1


Circulation/other revenue 51,859 50,789 2.1%

Revenue from advertising 49,095 58,744 -16.4%

Revenue 100,955 109,532 -7.8%

Gross operating profit (loss) (14,661) (7,362) -99.1%

GOL margin % -14.5% -6.7% -116.1%

Operating profit (loss) (17,353) (10,611) -63.5%

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System area – Advertising sales

System is the division acting as the advertising sales agency for the Group’s main media – except

for sector-specific publishing, which has its own network, and for some third-party media.

SYSTEM AREA REVENUE



Captive revenue 65,980 75,083 -12.1%

Non-captive revenue 6,479 6,700 -3.3%

Total 72,459 81,784 -11.4%

In Italy the advertising sales agency has a matrix organisation based on district and

product/type/means. The various sales territories are managed by seven different local offices that

are either branches or sales agencies.

As at 30 June 2012 the sales organisation in Italy consisted of 43 employees and 93 agents.

Outside Italy, advertising sales are handled by the International Division, which maintains a

presence in all major countries through a network of representatives. The subsidiary Il Sole 24 ORE

UK Ltd. handles the sale of advertising space in the United Kingdom.

The System Area’s active customer base (i.e. customers for which at least one advertisement was

published during the year) consists of 3,500 customers. They mostly consist of major Italian and

foreign companies operating in the finance, automotive, professional services, public

administration, and manufacturing sectors.

Compared with the first quarter 2012, the negative trend of the advertising market continued and

worsened, closing the first five months with -9.5%. The press confirmed a strong contraction, with

newspapers down by 13.5% and magazines by -13.8%. TV also recorded a double-digit loss (-

10.0%) while radio, though worsening its performance, experienced a contained drop (-5.5%). Once

again Internet bucked the trend (+10.6%). (source: Nielsen Media Research January–May 2012).

In this context the System Area obtained revenue for a total of €72.5 million, down by 11.4%

compared with the first half of 2011. The change in revenues is also affected by the discontinuation

during 2011 of Italianews and other minor sites and the closing of Ventiquattro, net of which

advertising revenue decreased by 9.8%, substantially in line with the market trend. It should also be

considered that types such as financial advertising, legal and funds (in which Il Sole 24 ORE leads

the market with a 42% compared with the main competitors) face objective difficulties due to the

persisting financial market crisis and record an overall loss in the six-month period of 16%.

In particular, the newspaper as a whole closed the first half of 2012 with a decrease of 13.9%, due

to different trends for the various advertising forms.

The commercial type, which accounts for 58.8% of the revenues from the newspapers, decreased by

11.8%, compared with -11.2% of the market (including national newspapers, sports newspapers and

regional/local newspapers). Il Sole 24 ORE recorded a worse trend than the market in sectors that

do not represent its core business. In its main segments (Finance/Insurance, Professional services,

Automotive, Telecommunications), it shows a trend that is slightly lower than the market in terms

of spaces, also due to the commercial policy in terms of prices.

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Magazines recorded an 18.8% drop. The termination of Ventiquattro starting from June 2011 had

an effect, net of which the performance equalled -4.3% compared with the market, which recorded

-13.8%.

Radio24 confirmed a growth trend (+1.7%) in a decreasing market (-5.5%). A good performance

was recorded also in terms of space, with Radio24 increasing its share in seconds compared with

the total radio market (8.9% first half of 2012; 8.3% in the first half of 2011). The leading sectors

for Radio 24 are confirmed to be: Automobile rose by 3%, Finance and Insurance by 40% and

Professional Services by 26%. The marked concentration of these sectors on Radio24 is confirmed

since, on their own, they account for 47% of the total seconds sold in the first half of 2012.

Advertising revenue from Internet, net of funds, rose by 12.2%. The site www.ilsole24ore.com

recorded a 22.8% increase in a display market that grew by 16.3%.

SYSTEM AREA RESULTS (in thousands of euro) 1

st Half 2012 1


Circulation/other revenue 234 189 23,6%

Revenue from advertising 72.226 81.595 -11,5%

Revenue 72.459 81.784 -11,4%

Gross operating profit (loss) (788) (1,747) 54.9%

GOL margin % -1.1% -2.1% 49.1%

Operating profit (loss) (790) (1,748) 54.8%

Tax & Legal Area – Professional publishing

The Tax & Legal Area develops integrated product systems of technical and regulatory content

targeting mainly professionals, companies and the public administration. The specific market

segments are controlled by three Business Units (Taxes/Labour/Economy, Law, Construction and

Public Administration), which satisfy all the information, training and operative requirements of

the reference targets through specialist information tools closely integrated one with the other.

TAX & LEGAL AREA REVENUE (in thousands of euro) 1

st Half 2012 1


Books 3,946 6,335 -37.7%

Magazines 16,590 20,234 -18.0%

Electronic publishing 16,009 15,527 3.1%

IT services 3,452 2,111 63.5%

Other revenue 1,201 1,054 13.9%

Tax & Legal Total 41,198 45,260 -9.0%

The Tax & Legal Area makes products designed to satisfy all professional needs in terms of

publishing, training, management and communication of specific targets (professionals, businesses

and public administrations) using multimedia product systems. As at 30 June 2012 the Tax & Legal

Area’s line included a predominantly business to business product portfolio comprising books

(about 1,000 catalogue titles), magazines - periodicals (about 25 specialised paper or online

publications), databases (18, all accessible online).

The Tax & Legal BU operates in a market characterised by a markedly shrinking demand in a very

negative economic environment.

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The negative trend is confirmed also for 2012, which is seriously affected by the heavy economic

crisis in progress, causing growing difficulties for the final demand of companies, public entities

and households, which professionals interface with, who represent the main target for the Area. In

turn, professional firms are considerably cutting expenditure.

The consumption model evolved in favour of electronic media, online service, products and

databases. This phenomenon led to a downturn in expenditure, due to the difficulty for the

professional market to sell online information at a price that is suitable for the paper version.

The use of traditional paper media, books and magazines continues to decrease, confirming also in

2012 the negative trend of 2011 (-3.4% for books and -9.9% for magazines – source Databank

2011).

The revenue of the Tax & Legal BU in the first half of 2012 equalled €41.2 million, decreasing in

comparison with the €45.3 million of the same period of 2011 (-9.0%).

This negative trend was caused by the heavy crisis affecting paper, which led to the decision to

close in 2012 six paper publications showing low or negative margins, some of which are now only

available in their online version.

The digital component grew by 10.3% (E-publishing and online services), accounting for 47% of

total revenues from the Tax & Legal business unit in the first half of 2012, compared with 39% in

the first half of 2011, due to a reduction in the paper component, whose influence decreased from

59% in 2011 to 50% in 2012.

Actions were taken to encourage a switch from paper to online versions and in particular:

- digitalisation of the paper version of both online magazines sold individually and digital

books sold as single shot and on a subscription basis;

- upgrade of the sales network through the introduction of new agents and the creation of a

task force dedicated to the sale of online products.

Therefore, the initiatives and new projects were focused on expanding the online range and

digitalizing all of the paper versions. The iPad version of all databases of the Area, Guida Pratica

Fiscale +, L@voro, Sistema Società, 24OreNet, Sistema Pratico Diritto, Guida agli Enti Locali were

released. Furthermore, the range of entry level products was expanded, web marketing actions were

intensified and bundle offers with newspapers and software were created.

In this market transition phase, the area keeps good margins as confirmed by the growing GOP

(30% of revenues), compared with 29.2% of the same period of the previous year.

TAX & LEGAL AREA RESULTS (in thousands of euro) 1

st Half 2012 1


Circulation/other revenue 40,881 44,918 -9.0%

Revenue from advertising 317 343 -7.5%

Revenue 41,198 45,260 -9.0%

Gross operating profit (loss) 12,341 13,201 -6.5%

GOL margin % 30,0% 29,2% 2.7%

Operating profit (loss) 12,293 13,192 -6.8%

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Software Solutions Area

The Software Solutions area includes all the software activities of the 24 ORE Group, through a

functional organisation that covers various activities and addresses the markets through the brands

that make it up. The range specifically comprises software products with the “Software 24Ore”

brand, mainly addressed to professionals, such as the Innovare 24 brand products (former STR,

former Data Ufficio and former Softlab), which are specific for the public administration, the

construction industry and the lawyer market, and finally the Esa Software brand products targeting

SMEs.

SOFTWARE SOLUTIONS AREA REVENUE BY SEGMENT



Legal products 206 204 1.0%

Tax & Labour products 9,952 9,848 1.1%

STR products 5,175 6,015 -14.0%

Data Ufficio products 3,907 5,821 -32.9%

ESA products 12,633 13,090 -3.5%

Softlab products 410 - insig.

Total 32,284 34,978 -7.7%

The reference market the Software Solutions area of the 24 ORE Group works in addresses

professional such as chartered accountants, employment consultants, lawyers, engineers, architects,

surveyors and small and medium enterprises. The area is also engaged in the Public Administration

sector and associations such as the tax assistance centres (CAF).

In 2011 the market (excluding PA and CAF) decreased by about 1.8% (source Assinform), given the

country's general macroeconomic situation, which is reflected on the already mentioned contracted

expenditure for professional firms and businesses.

The latest figures available for ICT expenditure in Italy regarding the management software record

a drop in the first quarter 2012 compared with 3.2% of the same period of 2011 (source:

Assintel/Next Value).

A global reduction in ICT expenditure is expected for 2012, compared with 4.2% of 2011, equal to

5.1% for software, with a homogenous drop being recorded in all corporate segments from micro to

medium-sized businesses (source: Assintel/Next Value).

Worthy of mention is the crisis in the construction market, which our offer of products with the

STR brand is addressed to. Surveys conducted by Ance through its Osservatorio delle Costruzioni

predict a 6% drop for the sector in 2012, higher than the -5.3% of 2011, with investments

decreasing by €43 billion and more than three hundred thousand jobs lost.

The bankruptcy petitions filed in the first half of 2012 were 6,312, which, though slightly lower

than in the same period of 2011 (6.399), are by 30% higher than in 2009 (4,593 cases) as the pre-

crisis period. Of the more than 6,300 petitions of the first half of 2012, 20% concern the

construction industry (1,345 cases) as the sector most badly hit (source: Il Sole24Ore).

During 1H12, the Software Solutions business unit recorded a 7.7% downturn in revenues,

particularly due to the termination in 2011 of two important contracts with social security

institutions (Inps and Inpdap), which in the reference period are worth €2.1 million.

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The campaign for the Form 730 tax returns supplied by the tax assistance centres (CAF) through the

applications of Innovare 24 recorded a positive result in the first half of 2012. 4 million returns

were released, against 3.6 million of the same period of the previous year, up by 10%.

In terms of product evolution, the activities continue for the three strategic projects of the Software

Area, i.e. the “Piattaforma Fiscale Unica” (new line of online tax products), Vision (the new STR

software written in Microsoft.Net technology, which is progressively replacing the previous

version) and the E.Net project, which will become the management solution for the company

market in the Software Solutions Area, supplementing the versions of Esa and Innovare24, all

written using the Microsoft.Net technology.

Tax & Labour products recorded revenue increasing by 1.1% compared with the first half of 2011,

mainly thanks to the positive performance of the renewed assistance contracts, which increased by

3.6%. Revenues from Legal products increased slightly by 1.0%. These two types of products are

sold with the Sole 24ORE brand.

Revenue from STR products decreased by 14.0% compared with the first half of 2011, due to the

considerable slowdown in the closure of commercial negotiations consequently to the crisis of the

construction market mentioned above.

Revenues from Data Ufficio products declined by 32.9% relative to the same period of the previous

year, due to the termination of the two important contracts with social security institutions, Inpdap

and Inps.

Revenues from Esa Software products dropped by 3.5% compared with the same period of 2011

due to both the persisting crisis of small and medium enterprises our range is addressed to and to a

shot Com3000 product of 2011 that cannot be repeated this year.

RESULTS OF THE SOFTWARE SOLUTIONS AREA (in thousands of euro) 1

st Half 2012 1



Revenue from advertising - 1 -100.0%

Revenue 32,284 34,978 -7.7%


GOL margin % 7,9% 14,2% -44.4%

Operating profit (loss) (249) 1,013 -124.6%

Training and Events Area

The Training and Events area provides specialist training to young university graduates, managers

and professionals and organises annual conferences and events on a contract basis for large

customers all over Italy. Included in the areas are the operations of the subsidiaries Newton

Management Innovation: a management consulting and training company, and Newton Lab: an

event organising and multimedia content management agency.

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TRAINING AREA REVENUE BY BUSINESS UNIT (in thousands of euro) 1

st Half 2012 1


Business school 5,488 5,809 -5.5%

Annual Training and Events 1,438 979 46.9%

Newton Man. Innov. and Newton Lab products 4,445 5,233 -15.0%

Training for Professionals and SMEs 1,050 790 33.0%

Total 12,422 12,811 -3.0%

Revenues from the Training BU, including the revenues of 24 ORE Training, Events and Newton

line, dropped by 3.0% over the first half of the previous year.

Worthy of mention for the Business school is the performance of Part Time Masters (+ 19.7%) in

the first half of 2012, with 60 specialisation Masters, 3 Executive24 masters in blended formula for

middle management. 2,444 managers in total were trained in the first half of 2012.

The Master Full Time line recorded revenues dropping by 8.7%, late when compared with the same

period of the previous year, due to different publishing plans.

Training for Professionals and SME in the first half of 2012 recorded revenues growing by 33.0%

compared with the same period of the previous year.

Revenue from the Annual Training and Events BU targeting top management grew by 46.9%

compared with the same period of the previous year, for a total of 9,630 participants in the six-

month period.

As regards innovative e-learning projects, 749 online courses and 70 online masters were sold in the

period, started and developed during the previous year.

Revenue from Newton Management Innovation and Newton Lab products decreased by 15.0%

compared with the first half of 2011 due to a lower volume deriving from the organisation of some

events and fewer tenders awarded. The “UniExpo” was held this year, and consultancy, artistic

supervision and production services were provided for the “Giornata Internazionale della famiglia a

Milano il 30 giugno 2012”.

TRAINING AREA RESULTS (in thousands of euro) 1

st Half 2012 1



Revenue 12,422 12,811 -3.0%


GOL margin % 12.4% 17.1% -27.1%

Operating profit (loss) 1,443 2,126 -32.1%

Radio

The Radio Area manages the national radio station Radio24, a news and talk radio with an

editorial format alternating news and entertainment programmes based almost exclusively on

speech. Every week, over 40 different programmes cover all the key areas of public interest,

ranging from national and international news to business and finance; from topics concerning the

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home, work and the environment to sport, culture and leisure; and from healthcare to wellbeing.

Every day 19 editions of the radio news, 15 programmes and 12 reports on the financial markets

are held. Daily live hours are 18.

After the liquidation of Audiradio, the company that used to conduct the official survey regarding

audience data, the latest official audience data available is that of the last two months of 2010, when

total radio audience reached 39,981,000 million listeners.

At the start of 2012 AGCOM began technical discussions with national and local publishers and

organisations that represent the market. The aim is to identify a single innovative research

methodology for the radio sector and establish a consortium with all the subjects concerned to

monitor the findings.

In the absence of an official research activity, the GFK Eurisko institute carried out a survey on

listening called Radio Monitor, which was purchased by the main national stations, advertising

sales agencies and media centres.

In June 2012 Radio Monitor published the data concerning the January-April period. It should be

noted that this survey cannot be compared with the Audiradio findings for two reasons:

- the Radio Monitor survey is based on a sample of population aged 14 and up, unlike

Audiradio, which considers the population from the age of 11.

- the sample was weighted on the basis of the ISTAT data related to the Italian population;

the changed parameters led to shrinking brackets with higher education.

According to the Radio Monitor survey, the total radio audience in the first four months of 2012

equalled 34,263,000 listeners during an average day, down by almost six million listeners compared

with Audiradio 2009; this drop is likely to depend on the methodological differences between the

surveys.

The radio advertising market recorded a downturn in the first five months of 2012 (-5.5% compared

with the same period of the previous year - source: Osservatorio FCP Assoradio).

The latest official Audiradio audience data for nationwide radio networks date back to 2009, when

Radio 24 was tenth in the nationwide radio standings with 1,885,000 daily listeners.

The first finding of the Eurisko Radio Monitor survey places Radio 24 tenth in the nationwide radio

standings with 1,903,000 listeners on an average day. An audience peak is recorded between 7 am

and 9 am with 327,000 unique listeners in the average quarter of an hour and a maximum of

365,000 from 7.45 am to 8 am. The share per average quarter of an hour from Monday to Friday

equals 2.8%, with a maximum of 5.7% between 7 pm and 8 pm.

Radio 24 revenue in the first half of 2012 grew by 3.0% compared with the same period of 2011.

Completely against the market trend, the advertising revenue from Radio 24 increased by 1.7%

compared with the same period of 2011, thus confirming the positive trend of the last few years.

Advertising revenue from the Radio 24 area equalled €8.0 million, up by 1.1%.

In terms of spaces, the trend of seconds sold as at 30 June 2012 grew by 6.4% (source Nielsen –

analysis per second), with a performance that is against the market trend (-0.4%), increasing its

share in seconds, passing from 8.3% in the first half of 2011 to 8.9% in the period in question.

The leading sectors for Radio 24 are confirmed to be: Automotive (+3%), Finance and Insurance

(+40%) and Professional Services (+26%), which by themselves account for 47% of total seconds

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in the first half of 2012, showing a trend that is considerably growing compared with the same

period of the previous year.

The good results of Radio 24 are the direct consequence of the mix of high information quality of

the radio news and programmes, as is also clear from the high number of “shots” that the news and

original interviews broadcast by the radio have on national media.

Effectiveness and the results of the two years were improved due to the operating integration

between the journalist structures of Radio 24 and the Radiocor agency.

The Radio 24 site continued to grow in the first half of 2012, with 5,916,600 downloaded files

(+70% compared with the same period of 2011). The site unique users also increased by 25% with

about 283,400 average visitors per month (source: Nielsen Site Census). The average pages viewed

in the day were 5,389,500, up by 14% compared with the same period of 2011.

The Radio Area ends the year with a gross operating profit. Profitability improved consequently to

the good revenue trend, combined with the cost cutting actions implemented already in past years.

The useful life of concessions and radio frequencies was redefined at the end of 2011. Based on a

careful study of the context related to the passage to the digital radio system and with the aid of an

independent external assessor, these were attributed an indefinite useful life. In the first half of 2011

the amortisation of frequencies accounted for €1.7 million.

RADIO AREA RESULTS (in thousands of euro) 1

st Half 2012 1


Circulation/other revenue 320 161 99.3%

Revenue from advertising 7,981 7,898 1.1%

Revenue 8,301 8,058 3.0%

Gross operating profit (loss) 862 909 -5.1%

GOL margin % 10.4% 11.3% -7.9%

Operating profit (loss) 532 (1.133) 147.0%

Digital Area

The Digital Area manages the Website www.ilsole24ore.com, its on-line paid contents, the

Shopping24 e-commerce channel and the Group’s presence with consumers on tablets and smart

phones, and co-ordinates all the online activities of the various business areas. The company

Fabbrica 24 S.r.l., which operates in the e-commerce segment, is included in the area.

The advertising market grew by 10.6% overall in the first five months of 2012, with the display

component – the only one where the Group is present – up by 16.3%. This figure becomes even

more worthwhile when compared with the current market trend of the other media (source:

Osservatorio FCP – Assointernet – May 2012).

In the first half of 2012, revenues from the Digital Area grew by 7.9%, compared with the same

half of the previous year. The main growth factors were the good performance of advertising

revenues (+7.0% compared with the first half of 2011), which equals 22.8% net of funds, coupled

with the good results of the sale of digital subscriptions.

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In the six months, unique site browsers grew by 54.9%, with a daily average of 549,685 and an

83.0% increase in average daily pages, which reached 4,503,508 (source: Nielsen Site Census).

Worthy of mention is the new record of pages viewed reached in May: 148,899,261.

In the first half of 2012, the mobile version of the website grew by 112.0% among average daily

unique browsers and +149.9% of average daily pages (source: Nielsen Site Census). Also

noteworthy is the growth in the presence on various social networks: the Facebook fan page of Il

Sole 24ORE had 140,000 fans, and this number is growing by about 6,000 fans each month. Twitter

followers reached 424,392 thousand at the end of June.

Fabbrica24 started operations in February. The first product proposed to the market is Sugarbox, a

subscription commerce service to intercept the cosmetic advertising market. An agreement of

collaboration between Fabbrica24 and Signet was signed in the middle of June for the InnerDesign

platform, through the purchase of 70% of the company.

The first phase of the new edition of Premio WWW was launched in June; a landmark in the Italian

web scene, which used to be organised by Il Sole 24ORE in the past and was resumed this year.

In the first half of 2012, a series of new online and device-based products were introduced:

- The 2012 edition of Telefisco recorded an excellent result in terms of online paid

subscriptions, up by 25%.

- The section Impresa&Territori is available online; it complements and supplements the

paper version dedicated to the real economy.

- The new Moda24 channel www.ilsole24ore.com/moda24 became available also online

on 17 February. The new site is constantly updated with news, comments, photo galleries

and videos on new fashion trends and national and international fashion shows, with

exclusive interviewers to the main players in the fashion world.

- The format of the video chat with the experts from Sole 24 ORE on current

economic/regulatory issued was inaugurated in February.

- On 1 March, the English version was re-launched: a new section of the site with the

articles on the first page translated into English and articles from Gli Economisti.

- The contents of Moda24, Motori24 and Casa24 were made available on Google Currents

in April.

- The correlation of the contents of the Banche Dati Professionisti in the .com articles was

released in May.

- The special publications dedicated to the Administrative Elections 2012, the Giro d’Italia

and the report on the combined municipal tax (IMU), were released in May, with an

extensive and in-depth coverage, answers from Experts and calculation tools.

- On 30 May a live streaming session of the Forum Lavoro 2012 was broadcast; this event

involves the Consiglio Nazionale dell'Ordine (National Labour Consultants Board), the

Fondazione Studi Consulenti del Lavoro (Foundation of Labour Consultants) and Il Sole

24ORE in connection with the Provincial Boards of the Ordine dei Consulenti del Lavoro

(Organisation of Labour Consultants).

- The new mobile showcase was released in May. It is available on www.applicazioni-

mobile.ilsole24ore.com and contains and illustrates the entire mobile range of the group

with better organised contents, optimised for the search engines and improved usability.

24 ORE Group


28

- The app Le basi della Cucina Italiana was launched; through straightforward and

comprehensive texts and images of a high visual impact it proposes more than 80 recipes

from traditional Italian cuisine.

- On 30 June the update of the application for Windows Phone 7 was released.

On 30 June the overall number of downloaded applications reached about 622,000.

A new digital newsstand platform of Il Sole 24 ORE became available on 18 January, initially

introduced as the reader application for the daily newspaper.

The digital newsstand uses a new platform called GIOVE (Gestione Integrata Online Vendita ed

Edizione) to integrate the production and distribution of digital products and is used by other Areas

of the Group to publish and distribute products such as add-on products and instant books and

products of the Tax & Legal area.

The reader application was downloaded 383,774 times, the Finanza & Mercati and the La Vita

Nòva applications recorded 51,838 and 46,302 downloads as at 30 June respectively.

The new e-commerce platform was released in February. The Online Shop was completely

revamped in its design and technology.

On 15 June, the free app for Nokia smartphones was released, which presents the contents of the

most distributed Italian economic newspaper in a rapid and comprehensive manner. It also contains

the best blogs of authors from Il Sole 24ORE and a rapid and intuitive search engine.

DIGITAL AREA RESULTS (in thousands of euro) 1

st Half 2012 1



Revenue from advertising 6,578 6,148 7.0%

Revenue 9,926 9,203 7.9%

Gross operating profit (loss) 1,933 1,534 26.0%

GOL margin % 19.5% 16.7% 16.9%

Operating profit (loss) 1,932 1,533 26.0%

Culture Area

This Area includes Group activities in the culture segment, through 24 ORE Cultura S.r.l. and

Alinari 24 ORE S.p.A. Its scope ranges from the planning and staging of art and photography

exhibitions to the intermediation of photographic reproduction rights, the sale of objects and

photographs, the publication of essays (Scheiwiller imprint), art and photographs sold on a

catalogue or contract basis, educational and digital products.

The exhibition and museum sector remained constant in terms of visitors, though faced with the

growing difficulty experienced by the players in the sector in obtaining funds from the Public

Administration. The market of photographic rights recorded a contraction compared with 2011.

In the first half of 2012, the Culture area recorded revenues for €7.4 million, increasing (+71.9%)

over the same period of 2011. Revenue from the exhibitions lines of 24 ORE Cultura grew. The

second exhibition dedicated to Pixar was launched at Palazzo Te', Mantua, in the first half of 2012

(delayed, in the final stage, by the earthquake emergency), together with the exhibitions dedicated

24 ORE Group


29

to Mirò (Rome), Marina Abramovic (Milan), Klimt (Venice, Museo Correr). An important

exhibition dedicated to Picasso is scheduled for September in Milan, Palazzo Reale, in

collaboration with the Picasso Museum of Paris, together with the second stage of the Mirò

exhibition in Genoa, Palazzo Ducale.

In publishing terms, 24 ORE Cultura continued to devise multi-channel projects and encourage

international development through, among others, the launch of mobile platforms for the Minimum

Design application, deriving from the collection of Maestri del Design books and the increasingly

intense synergies with the daily Newspaper on the front of add-on products.

The sale of photographic rights for Alinari 24 ORE dropped.

CULTURE AREA RESULTS (in thousands of euro) 1

st Half 2012 1



Revenue 7,365 4,284 71.9%

Gross operating profit (loss) (2.400) (330) -627.7%

GOL margin % -32.6% -7.7% -323.3%

Operating profit (loss) (2,479) (395) -527.6%

Related-party transactions

Related-party transactions are limited to those with subsidiaries and associates concerning

commercial, administrative and financial services. These transactions form part of normal business

operations and of the core business of each of the companies involved, and are regulated at market

conditions.

The company continues to implement the Related-Party Transactions procedure, prescribed by the

Board of Directors on 15 November 2010, in compliance with the CONSOB Regulation approved

with resolution No. 17221 of 12 March 2010, subsequently amended with resolution No. 17389 of

23 June 2010. Related-party transaction disclosure is provided in paragraph 10.2, related-party

transactions, of the notes to the condensed half-yearly consolidated financial statements.

Principal risks and uncertainties

In the extensive number of activities where it is present, the 24 ORE Group is exposed to a series of

risks. Their identification, assessment and management involve the Group’s Chief Executive

Officer – also in her capacity as an executive director as per the Corporate Governance Code of

Borsa Italiana S.p.A. – and the heads of business areas and central corporate functions.

As part of this process, the different types of risk (strategic, operating, legal and regulatory,

financial and reporting) are classified according to assessment of their impact on achievement of

objectives, the likelihood of their occurrence and the degree of effectiveness of protective actions

implemented. The weighted result of the application of these assessment criteria permits

prioritisation of action and monitoring and identification of those responsible for managing such

risks.

In addition, in order to assure a further appropriate and timely risk-management tool, the principal

risks and their indicators are constantly monitored as part of the Group’s normal internal reporting

process.

24 ORE Group


30

On occasion of the meeting of the Internal Control & Audit Committee and of the Board of

Directors of Il Sole 24 ORE S.p.A. on 14 March 2012, the Executive Director presented the report

identifying the Group’s principal risks, based on which the Board also approved the 2012 Internal

Auditing Plan.

Strategic risks

Risks connected with strategies in the traditional and multimedia publishing sectors

The publishing industry is affected by a process of transition from conventional forms of publishing

to electronic/online publishing, associated with the introduction of new technologies and

distribution channels. It is difficult to predict the impacts of this in terms of the market’s

competitive dynamics.

The Group is continuing to expand its business also to relatively new sectors and environments

(such as online publishing). It has in fact made investments targeting development of this sector

within all business segments, and further investments are envisaged.

An important part of future growth will depend to a significant extent on growth of

digital/electronic business. Given this, any failure of these new initiatives, and also any delays in

the transition process, might lead to adverse effects on the Group’s income statement, balance sheet

and financial position.

The business plan approved on 24 February 2012 by the Board of Directors includes online

development initiatives in all the areas of the Group.

Operating risks

Risks connected with acquisitions and with the Group’s integration process

The Group’s present configuration stems from an integration process that is still underway. Some of

the companies in the Group were acquired during the last few years. Acquisition deals, by nature,

feature significant elements of risk. These include, but are not limited to, loss of customers and key

staff by the acquired companies, legal risks, or possible integration difficulties due to different

corporate cultures.

Furthermore, this process features the risks typical of a corporate group’s integration operations, i.e.

difficulties relating to co-ordination of management, the integration of budgeting and reporting

procedures and product lines, as well as the use of resources to achieve operating efficiency

improvements. The integration between existing organisations, technologies and services and those

of the newly acquired companies is still on-going and is providing the expected results.

Risks connected with the advertising revenue trend

The Group generates a considerable part of its revenue through sale of advertising space in its own

media (the daily newspaper “Il Sole 24ORE,” magazines, sector-specific magazines, the free

newspaper, radio, and websites) and those of independent publishers.

In 1H12 advertising revenue totalled €83.1 million and accounted for 36.2% of Group revenue (vs.

38.6% of total revenue in 1H11).

A significant share of revenue and profit margins therefore depends on the quality of publishing

products created and on our ability to make them appealing to advertisers. Given this, the Group

24 ORE Group


31

might have to make investments to maintain and/or increase the competitiveness of its publishing

products to attract and/or maintain strong interest on the part of advertisers, with consequent effects

on the Group’s financial position and performance.

Moreover, domestic and international macroeconomic conditions heavily influence the level of

advertising sales, so the present situation of global economic weakness will continue to have a

negative impact on the Group’s financial position and performance in 2012 as well.

Risks connected with the newspaper’s circulation trend

Advertising revenue and revenue from newsstand and subscription sales substantially depend on

levels of circulation and readership. The entire paid daily press market has been riding a steadily

downward trend for several years now, which is also related to ever-increasing competition from

new media. The economic crisis currently underway has further exacerbated these circumstances.

Support of circulation could generate additional costs that might not be recovered through higher

advertising revenue.

Risks connected with maintenance of the high degree of reliability and reputation of our brand and products

We believe that our brands and products have an excellent reputation thanks to the quality of

contents and professionalism of our staff, in particular to that of journalistic staff in the publishing

field. Events eroding that reputation or reducing customers’ trust in products’ quality and reliability

would therefore have a negative impact on the Group’s business turnover and financial position and

performance.

Risks connected with the relationship with some Group worker categories

The Group’s business and financial position and performance could suffer significantly from the

effects of renewal of national and/or company-level collective agreements for some categories of

workers, as well as of any cases of conflict that may occur, particularly during negotiation of such

agreements.

Strikes, work slowdowns and interruptions of services and business activity, or contractual renewals

that cause significant cost increases, leading to consequent operating rigidity of the Group, could

therefore adversely affect its profitability and the possibility of maximising its operating efficiency.

Risks connected with the trade receivables trend

Based on the type of customers targeted by the products and services of the Group’s various

segments, it is not believed that there is a high risk in terms of trade receivables. It is nevertheless

deemed advisable to activate operating procedures that limit sales to customers considered not to be

solvent and to post a specific allowance for impairment to cover any losses caused by non-

collectability of receivables.

At the same time, however, the difficult contingent economic situation is leading to increased credit

risk exposure, in connection with customers’ extension of payment times and the potential increase

in insolvencies.

24 ORE Group


32

Legal and regulatory risks

Financial disclosure requirements

With the press release of 17 January 2012, CONSOB announced it had approved a series of

simplifying regulatory amendments aimed, among others, at implementing the new community

directive on prospectuses.

This directive must be transposed in the Italian national legislation by the next 1 July.

The subject is of interest to our Company in connection with the disclosure requirements for listed

companies and the methods in which these requirements are considered as fulfilled.

The issue is not new and had already emerged during the implementation of the first “Prospectus”

directive and “Transparency” directive.

The vision that transpires from the regulation adopted by CONSOB in recent years is one of a

community of savers largely and perennially on-line: the world wide web is actually becoming the

only recipient of the regulated disclosure requirements in the field of assets under management.

As a consequence of the above, with resolutions of 19 March 2009 and 1 April 2009, CONSOB – in

executing the provisions of EU “Prospectus” directive of 2003 and “Transparency” directive of

2004 – had already amended the Issuer Regulation significantly with regard to the publication of

regulated information.

This information concerns most of the accounting and function data to exercise of rights of security

holders, e.g. half-yearly financial report, interim management statement, information on non-

recurring transactions, offered options.

The new regulation adopted by CONSOB has implied the transfer of this information disclosure

from printed paper to the web.

The new system assumes, for its full operations:

a) the establishment of an electronic system to distribute regulated information (so-called SDIR);

b) a storage system, i.e. centralised archiving of the distributed information.

While waiting for the SDIR to be created and for the information to be entirely transferred, the

mentioned CONSOB resolutions established a transitional period during which this information is

distributed in a priority manner through an IT site (the NIS circuit of Borsa Italiana) and only in a

residual manner, with reference to a few types of information, also through newspapers.

This choice led to serious consequences for newspapers, which have experienced a compression of

their traditional function even in the presence of a transitional phase for the installation of the SDIR

system, but also an objective limitation to the ease and security of access to important news for the

investing public.

Also the recent proposals to amend the Issuer Regulation, as a consequence of implementing the

Ucits IV directive, risk going in this direction.

The Prospectus and KIID (Key Investor Information Document) disclosure regimes no longer set an

obligation, but just a simple option for the issuing company to use national or largely spread

newspapers.

Moreover, the choice of only one vehicle for the distribution of regulated news made by the Italian

legislation does not derive, in our opinion, from community directives but CONSOB resolutions.

24 ORE Group


33

The hope is that the obligation will be reintroduced to disclose the regulated news in newspapers

and, in general, on means of information on printed paper, in order to facilitate access to non-

professional investors and small savers to this information, thus facilitating their participation in the

affairs of the company and the exercise of their shareholder rights.

Alternatively, a “double information disclosure regime” (printed and web) should remain in force

for a transitional period of at least three years (2012-2015) to monitor, through the establishment of

a round table, the effective trend of the system for the distribution of financial information.

Other information

Ownership status and treasury shares

As at 30 June 2012, the share capital of Il Sole 24 ORE S.p.A., fully subscribed and paid in, totalled

€35,123,787.40, divided into 90,000,000 ordinary shares (67.5% of share capital) and 43,333,213

special shares (32.50% of share capital), of which 3,302,027 treasury shares, without any indication

of par value.

Pursuant to Article 93 of Italian Legislative Decree No. 58 of 24 February 1998, Confindustria (the

Confederation of Italian Industry), which owns all ordinary shares of Il Sole 24 ORE SpA,

accounting for 67.50% and with voting right.

All Il Sole 24 ORE S.p.A. shares currently owned by Confindustria, as well as any shares it may

acquire in future, are registered on a fiduciary basis in the name of Mr. Giorgio Squinzi, in his

capacity as Chairman of Confindustria.

Shareholders, with the exception of the Company, as treasury shares, may not hold more special

category shares than those representing one fiftieth of the share capital plus one share. The limit

applies both to equity investments directly held by the individual shareholder, and (i) to shares

owned by the shareholder’s close family, including the non-legally separated spouse, dependent

children and children living with the shareholder; (ii) to shares owned indirectly through subsidiary

companies, fiduciaries or intermediaries; (iii) to shares owned directly or indirectly by a secured

creditor or by a usufructuary, when corporate rights are assigned to them, and to repurchased

shares.

The limit also applies to shares owned by the shareholder’s group, i.e. the group formed by

subsidiary entities, parent entities or entities subject to joint control and the group formed by

persons connected with the shareholder, whatever their legal status.

Whoever holds more special category shares than the limit prescribed by the Company By-laws

shall notify the Company in writing immediately after the occurrence of the event that led to the

excess; the shares held in excess shall be sold within one year from the notice or, in the absence of

any notice, from the company’s notification that the prohibition was violated.

For the shares held above the possession limit prescribed by the company by-laws, the shareholder

is not entitled to recording on the Shareholder Register and to exercise corporate rights. The

dividends accrued on excess shares remain acquired by the company, which enters them in a

specific reserve.

Special category shares are attributed a preferential dividend of 5% in proportion to the implicit par

value of the share, which cannot be cumulated from one year to the next.

As at the date of the Board of Directors’ meeting, based on the entries in the Shareholder Register,

and taking into account the notifications received pursuant to Article 120 of the Italian Consolidated

24 ORE Group


34

Finance Act, the following parties directly or indirectly own Company shares accounting for 2% or

more of share capital:

PARTIES DIRECTLY OR DIRECTLY OWNING COMPANY SHARES ACCOUNTING FOR 2% OR MORE OF SHARE CAPITAL

Declarant Direct shareholders % of ordinary share capital

% of capital voting rights

Ordinary shares

Confindustria – Confederazione Generale dell’Industria Italiana

Confindustria – Confederazione Generale dell’Industria Italiana 67.500% 67.500%

Special-category shares

Il Sole 24 ORE S.p.A. Il Sole 24 ORE S.p.A. 2.477% 2.477%

Edizione S.r.l. Edizione S.r.l. 2.000% 2.000%

There are no shareholders exceeding the special-share ownership limit under Article 8 of the

Company By-Laws.

The Shareholders’ Meeting has not delegated any powers to the Board of Directors either to

increase share capital under Article 2443 of the Italian Civil Code or to issue participatory financial

instruments.

There are no Shareholder Meeting authorisations to buy back own shares pursuant to Articles 2357

et seq. of the Italian Civil Code.

Organisational, management and control model pursuant to Italian Legislative Decree 231 of 8 June 2001

With the application of Italian Legislative Decree 231 of 8 June 2001 as amended, which

introduced a specific regime of corporate liability for certain types of crime, the Company has

adopted specific in-house rules and regulations aimed at reducing the risk of illicit acts that could

benefit the Company.

In particular, the Company’s Board of Directors has approved a model of organisation, management

and control pursuant to Italian Legislative Decree 231/01 (hereinafter “the Model”) which meets the

requirements of said legislation and which has been prepared in accordance with the guidelines

issued by Confindustria.

The current Model, amended in November 2011, was drafted on the basis of a detailed analysis of

the Company's operations designed to identify potentially at-risk activities: on the basis of the

information collected and the observations formulated, the Company has drawn up rules of conduct,

principles and control methods for drafting internal procedures. Driven by the Supervisory

Committee, the Company updates, periodically and at least once a year, as well as in the case of

regulatory and internal organisational changes, the company analysis to identify potentially at-risk

activities, in order to ascertain the need to update the Model.

The Model includes specifications of the field of application and the target audience for the Model,

and also defines the functions and powers of the Supervisory Committee, which is appointed by the

Board of Directors, and establishes the information that must be provided to this committee.

The Model comprises a special part, which in turn is divided into nine sections that establish

specific principles of control designed to prevent (i) crimes against the Public Administration, (ii)

24 ORE Group


35

white collar crimes, (iii) market abuse, (iv) culpable manslaughter and bodily harm committed in

breach of accident-prevention regulations and regulations for the protection of occupational hygiene

and health, (v) receipt of stolen goods, money laundering and reuse (use of money, assets or profits

having an illegal origin), (vi) computer crime, (vii) copyright infringement, (viii) environmental

violations committed by Company directors, executives, employees or outsourcers or (ix) other

offences contemplated by Italian Legislative Decree 231/2001, whose risk of perpetration has been

deemed remote, possible only in theory but not in practice.

Finally, the Model contains the Code of Conduct and set of principles and ethical and conduct

principles designed to prevent commission of the offences envisaged in Legislative Decree

231/2001. The Model has also defined the disciplinary system, broken down according to the

various types of recipients of the Model and designed to penalise violation of the provisions of the

Model.

So as to ensure the utmost efficacy of application of these rules, the Company has promoted

awareness of the Model and has arranged specific training and communication initiatives

illustrating its contents.

The Model is available for viewing in the section Governance of the Company’s website:

www.gruppo24ore.com.

Events after the end of the reporting period

On 24 July 2012 Giampaolo Galli resigned from the office of non-executive Director of Il Sole 24

ORE S.p.A. with immediate effect. Mr. Galli did not belong to any company committee and did not

qualify as Independent Director.

On 26 July 2012, control over Diamante S.p.A. was acquired following the purchase by Innovare24

S.p.A. of 45.015% of the capital. From that date, the Group owns 75.015%.

The disbursement equalled €1,200 thousand and is to be added to the 30% value recorded, equal to

€1,180 thousand. The framework agreement envisages the progressive purchase of the remaining

share, by the time the financial statements 2015 are approved, at a price that varies according to the

results of the 2013 – 2015 three-year period. The value of the assets and the acquired goodwill are

being determined.

The purchase was aimed at supplementing the range of the Software Solutions area to develop the

Group’s Cloud computing platform.

24 ORE Group


36

Outlook

The economic indicators for 2012 show signs of a structural crisis with very negative growth rates;

in this context, gross operating profit is expected to decreased compared with the one recorded in

2011.

Therefore the Group has started to review the Industrial Plan to make it compatible with a

continuously contracting reference market by leveraging on the notability of the Sole 24 Ore brand,

which is expressed in all of its information contents, and by creating a development model that is

suitable to face the challenge.

Milan, 31 July 2012

The Chairman of the Board of Directors

GIANCARLO CERUTTI

(original signed)

24 ORE Group


37

CONDENSED HALF-YEARLY CONSOLIDATED FINANCIAL STATEMENTS OF THE 24 ORE GROUP AS AT 30 JUNE 2012

Separate financial statements

Statement of financial position

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (in thousands of euro) Note 30.06.2012 31.12.2011

ASSETS

Non-current assets

Property, plant and equipment (1) 74,855 77,547

Goodwill (2) 74,993 73,474

Intangible assets (3) 83,308 85,673

Investments in associates and joint ventures (4) 2,102 2,291

Available-for-sale financial assets (5) 1,171 1,171

Other non-current financial assets (6) 753 20,411

Other non-current assets (7) 862 854

Deferred tax assets (8) 57,281 47,222

Total 295,326 308,643

Current assets

Inventories (9) 12,829 12,469

Trade receivables (10) 172,130 188,214

Other receivables (11) 10,694 8,503

Other current assets (12) 9,736 6,279

Cash and cash equivalents (13) 49,259 31,431

Total 254,648 246,894

Assets held for sale - -

TOTAL ASSETS 549,974 555,537

(*) Section 8 of the explanatory notes (notes to the financial statements)

As required by Consob (Italian securities & exchange commission) resolution no. 15519 of 27 July 2006, the

effects of related-party transactions and positions on the statement of financial position, income statement,

and statement of cash flows are reported in Section 10.3 and detailed in Section 10.2.

24 ORE Group


38

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (cont.) (in thousands of euro) Note 30.06.2012 31.12.2011

EQUITY AND LIABILITIES

Equity

Equity attributable to owners of the parent

Share capital (14) 35,124 35,124

Equity reserves (15) 180,316 180,316

Revaluation reserves (16) 20,561 20,561

Hedging and translation reserves (17) (220) (229)

Other reserves (18) 23,785 25,025

Retained earnings (Loss brought forward) (19) (12,857) (4,491)

Profit (loss) attributable to owners of the parent (20) (8,420) (8,366)

Total 238,289 247,940

Equity attributable to non-controlling interests

Capital and reserves attributable to non-controlling interests 165 342

Profit (loss) attributable to non-controlling interests (20) (489) (25)

Total (324) 317

Total equity 237,965 248,257

Non-current liabilities

Non-current financial liabilities (21) 4,718 5,916

Employee benefit obligations (22) 33,812 31,977

Deferred tax liabilities (8) 15,452 16,055

Provisions for risks and charges (23) 12,978 13,220

Other non-current liabilities (24) 34 34

Total 66,994 67,202

Current liabilities

Bank overdrafts and loans - due within one year (25) 3,096 2,764

Financial liabilities held for trading (26) 305 317

Trade payables (27) 171,029 161,711

Other current liabilities (28) 17,869 9,792

Other payables (29) 52,717 65,494

Total 245,015 240,078

Liabilities held for sale - -

Total liabilities 312,009 307,280

TOTAL EQUITY AND LIABILITIES 549,974 555,537





24 ORE Group


39

Separate income statement

SEPARATE INCOME STATEMENT (in thousands of euro) Note

(*) 1st Half 2012 1

st Half 2011

1) Continuing operations

Revenue from newspapers, books and magazines (30) 66,804 72,521

Revenue from advertising (31) 83,088 93,995

Other revenue (32) 79,697 76,966

Total revenue 229,589 243,482

Other operating income (33) 3,995 3,834

Personnel expense (34) (82,279) (87,083)

Change in inventories (9) 361 584

Purchase of raw materials and consumables (35) (15,322) (13,700)

Services (36) (115,002) (111,912)

Use of third party assets (37) (16,155) (15,168)

Other operating costs (38) (6,055) (4,749)

Provisions (23) (854) (774)

Allowance for impairment (10) (2,481) (3,787)


Amortisation of intangible assets (3) (5,297) (8,498)

Depreciation of property, plant and equipment (1) (5,204) (5,484)

Gains/losses on disposal of non-current assets (39) 1,001 325


Financial income (40) 259 876

Financial expenses (40) (334) (146)

Total financial income (expenses) (75) 730

Other income (expenses) from investment assets and liabilities (41) (9) (127)

Profits (losses) from equity-accounted investees (4) (189) -


Income taxes (42) 5,066 (2,273)


2) Discontinued operations


Profit (loss) for the year (20) (8,909) (4,496)

Profit (loss) attributable to non-controlling interests (20) (489) 39

Profit (loss) attributable to owners of the parent (20) (8,420) (4,535) Basic LPS (€) (0.13) (0.07)

Diluted LPS (€) (0.13) (0.07)





The income components resulting from non-recurring events or transactions, or from transactions or events

that do not recur frequently, are also reported in section 10.3.

24 ORE Group


40

Statement of comprehensive income

STATEMENT OF COMPREHENSIVE INCOME

(in thousands of euro) Note (*) 1

st Half 2012 1

st Half 2011

Profit (loss) for the year (8,909) (4,496)

Other comprehensive income

Effective portion of changes in fair value of cash flow hedges 13 175

Actuarial gains (losses) of defined-benefit plans (1,717) 120

Taxes on other comprehensive income 468 (80)

Other comprehensive income (expense) after tax (1,236) 215

Total comprehensive income (expense) for the year (10,145) (4,281)

Attributable to:

Non-controlling interests (494) 38

Owners of the parent (9,651) (4,319)

Total comprehensive income (expense) for the year (10,145) (4,281)


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41

Statement of cash flows

CONSOLIDATED STATEMENT OF CASH FLOWS (in thousands of euro) Note 1

st Half 2012 1

st Half 2011

A) CASH FLOWS FROM OPERATING ACTIVITIES

Profit (loss) attributable to owners of the parent (20) (8,420) (4,535)

Adjustments for:

Profit (loss) from discontinued operations - (104)

Depreciation of property, plant and equipment (1) 5,204 5,484

Amortisation of other intangible assets (3) 5,297 8,498

Impairment losses on non-current assets (4) 189 -

(Gain) loss on sale of property, plant and equipment (39) (1) (323)

(Gain) loss on sale of intangible assets - (2)

(Gain) loss on sale of business units (39) (1,000) -

(Gain) loss on sale of investments in associates (41) (1) 176

(Gain) loss on sale of available-for-sale financial assets - (50)

Increase (decrease) in provisions for risks and charges (23) (242) (1,403)

Increase (decrease) in employee benefits (22) 1,835 (3,369)

Increase (decrease) in deferred tax assets/liabilities (8)(43) (10,654) (444)

Annual instalment of substitute tax 781 136

Entry in the income statement of the effects of acquisitions (43) 14 -

Net financial income (expenses) (40)(41) 85 (730) Cash flows from (used in) discontinued operations prior to change in net working capital - 354

Cash flows used in operating activities prior to change in net working capital (6,913) 3,689

(Increase) decrease in inventories (9) (361) (584)

(Increase) decrease in trade receivables (10)(43) 16,089 (36,902)

Increase (decrease) in trade payables (27)(43) 9,311 14,623

Income taxes paid (2,672) (912)

(Increase) decrease in other assets/liabilities (8,446) (1,391)

Changes in discontinued operations - 37

Changes in net working capital 13,921 (25,128)

TOT. NET CASH FROM CONTINUING OPERATIONS

7,008 (21,830)

TOT. NET CASH FROM DISCONTINUED OPERATIONS - 391

TOT. NET CASH FROM OPERATING ACTIVITIES (A) 7,008 (21,439)

24 ORE Group


42

CONSOLIDATED STATEMENT OF CASH FLOWS (CONT.) (in thousands of euro) Note 1

st Half 2012 1

st Half 2011

B) CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds of sale of associates (41) 1 1

Proceeds on sale of property, plant and equipment (1)(39) 4 418

Proceeds on sale of intangible assets (0) 2

Proceeds on sale of business units (39) 1,000 -

Proceeds on sale of available-for-sale financial assets - 57

Investments in property, plant and equipment (1) (2,526) (2,039)

Investments in intangible assets (3) (2,893) (2,094)

Other changes in property, plant and equipment (1) 5 11

Other changes in intangible assets (3) (4) 20

Other increases in goodwill (2) (1,519) -

Purchase of investments in subsidiaries (43) (4) -

Other decreases (increases) in other non-current assets and liabilities (7)(24) (8) 334

Changes in discontinued operations - (101)

TOT. NET CASH USED IN INVESTING ACTIVITIES (B) (5,945) (3,392)

FREE CASH FLOW CONTINUING OPERATIONS 1,063 (25,122)

FREE CASH FLOW DISCONTINUED OPERATIONS - 290

FREE CASH FLOW (A + B) 1,063 (24,832)

24 ORE Group


43

CONSOLIDATED STATEMENT OF CASH FLOWS (CONT.) (in thousands of euro) Note

(*) 1st Half 2012 1

st Half 2011

C) CASH FLOWS FROM FINANCING ACTIVITIES

Dividends paid (204) (128)

Raising (repayment) of medium/long-term bank loans (21) (1,198) (1,187)

Change in other non-current financial assets (6) 19,657 (282)

Change in financial assets/liabilities held for trading (26) (13) (175)

Net financial interest received (40)(4

1) (85) 730

Change in equity attributable to non-controlling interests (493) 38

Other changes in reserves (1,232) 215

TOT. NET CASH USED IN FINANCING ACTIVITIES (C) 16,434 (788)

NET INCR. (DECR.) IN CASH AND CASH EQUIVALENTS (A+B+C) 17,497 (25,620)

OPENING CASH AND CASH EQUIVALENTS

28,667 73,629

CLOSING CASH AND CASH EQUIVALENTS (13)

46,164 48,009

INCREASE (DECREASE) FOR THE YEAR 17,497 (25,620)





24 ORE Group


44

Statement of changes in Equity STATEMENT OF CHANGES IN EQUITY

(in thousands of euro) Share capital

Equity reserves

Revaluation reserves

Hedging and

translation reserves

Other reserves

Retained earnings/Loss

brought forward

Profit (loss) for the year

Equity attributable

to owners of the

parent

Equity attributable

to non-controlling

interests

Total equity

Note (*) (14 ) (15 ) (16 ) (17 ) (18 ) (19 ) (20 ) Balance at 31 December 2010 35,124 180,316 20,561 (339) 25,995 35,609 (40,100) 257,166 296 257,462

Income/expenses recognised directly in equity Reserve for post-employment benefits for IFRS adjustment - - - - 121 - - 121 (1) 120

Fair value changes in hedging instruments - - - 175 - - - 175 - 175

Fair value of stock granting - - - - - - - - - -

Taxes on expenses and income recognised in equity - - - (48) (32) - - (80) - (80) Income/expenses recognised directly in equity - - - 127 89 - - 216 (1) 215

Profit (loss) for the year - - - - - - (4,535) (4,535) 39 (4,496)

Total income/expenses allocated in the year - - - 127 89 - (4,535) (4,319) 38 (4,281)

Change in the 2010 profit (loss) - - - - - (40,100) 40,100 - - -

Dividends - - - - - - - - (128) (128) Balance at 30 June 2011 35,124 180,316 20,561 (212) 26,084 (4,491) (4,535) 252,847 206 253,053

(in thousands of euro) Share capital

Equity reserves

Revaluation reserves

Hedging and

translation reserves

Other reserves

Retained earnings/Loss

brought forward

Profit (loss) for the year

Equity attributable

to owners of the

parent

Equity attributable

to non-controlling

interests

Total equity

Note (*)

Balance at 31 December 2011 35,124 180,316 20,561 (229) 25,025 (4,491) (8,366) 247,940 317 248,257

Income/expenses recognised directly in equity Reserve for post-employment benefits for IFRS adjustment - - - - (1,711) - - (1,711) (6) (1,717)

Fair value changes in hedging instruments - - - 13 - - - 13 - 13

Taxes on expenses and income recognised in equity - - - (4) 471 - - 467 1 468 Income/expenses recognised directly in equity - - - 9 (1,240) - - (1,231) (5) (1,236) Profit (loss) for the year - - - - - - (8,420) (8,420) (489) (8,909)

Total income/expenses allocated in the year - - - 9 (1,240) - (8,420) (9,651) (494) (10,145)

Change in the 2011 profit (loss) - - - - - (8,366) 8,366 - - - Dividends - - - - - - - - (204) (204)

Change in % held of investments - - - - - - - - 57 57 Balance at 30 June 2012 35,124 180,316 20,561 (220) 23,785 (12,857) (8,420) 238,289 (324) 237,965


Milan, 31 July 2012


GIANCARLO CERUTTI

(original signed)

24 ORE Group


45

Notes to the financial statements

1. General information

The 24 ORE Group (hereinafter also “Group”) operates in a leadership position in the business

news and information market. Its products and services are offered to the general public,

professionals, businesses and financial institutions.

The composition of the Group and the scope of its consolidation as at 30 June 2012, with the

changes that have taken place with respect to 31 December 2011, are reported in Section 7 – Scope

of consolidation. The effect of changes that occurred during the first half, including business

combinations and the acquisition or loss of controlling interests in subsidiaries, and illustration of

all material information are set out in that paragraph.

Disclosures on long-term investments, company restructuring and discontinued operations are

available in paragraph 8 of the notes to the financial statements.

The companies included in the scope of consolidation at 30 June 2012 were:

- Il Sole 24 ORE S.p.A., the Parent Company, which acts both as the holding company for

majority investments in Group companies, and as an operating company, by performing

core business activities (general, financial and professional news and information, press

agency, etc.).

- Innovare24 S.p.A., specialised in software solutions and IT services for public

administration and construction industry professionals;

- Nuova Radio S.p.A., the broadcaster of Radio24, a news & talk radio station.

- Il Sole 24 ORE UK Ltd., which mediates for the sale of advertising space in the United

Kingdom.

- 24 ORE Cultura S.r.l., specialised in products dedicated to art and photography and in

the organisation of shows and events.

- Alinari 24 ORE S.p.A., a company active in the photography and image sector.

- Shopping 24 S.r.l., which is an e-commerce and online marketing company.

- Newton Management Innovation S.p.A., a company active in training services.

- Business Media Web S.r.l. in liquidation.

- Newton Lab S.r.l., a company active in training services. The company is indirectly

controlled through Newton Management Innovation S.p.A.

- Esa Software S.p.A., a company active in management software for small and medium

enterprises and for professionals. The company is indirectly controlled through Innovare

24 S.p.A.

- Fabbrica 24 S.r.l., active in the e-commerce sector. The company is indirectly controlled

through Innovare 24 S.p.A.

- Signet S.r.l., specialised in the design, production, management and distribution of

multimedia products and contents. The company is indirectly controlled through Fabbrica

24 S.r.l.

24 ORE Group


46

On 1 July 2011 the Group finalised the sale of the Real time financial reporting Business Unit.

From this date, the scope of consolidation no longer includes this business. In application of IFRS 5

– Non-current assets held for sale and discontinued operations, the balances of the income

statement of the first half of 2011 were adjusted compared with those originally published, to

reclassify the balances regarding the Real time financial reporting Business Unit under item Profit

(loss) from discontinued operations.

On 1 January 2012 Innovare 24 S.p.A. merged with its wholly owned subsidiary Softlab S.r.l. The

merged company was already wholly owned and included in the scope of consolidation at 31

December 2011. This operation did not alter the Group’s scope of consolidation.

Compared with the latest financial statements approved, the following changes to the scope of

consolidation took place:

- Fabbrica 24 S.r.l. was set up on 20 January 2012. This company is wholly owned by

Innovare24 S.p.A. and is operational in the e-commerce segment starting from April.

- On 13 June 2012 Fabbrica 24 S.r.l. agreed on increasing the capital of the company

Signet S.r.l. for an amount equal to €147,000, thus holding 70% of the share capital of

Signet S.r.l. and acquiring control over it.

The registered offices of Il Sole 24 ORE S.p.A. are located at Via Monte Rosa 91, Milan, Italy.

Confindustria (the Confederation of Italian Industry) controls the parent.

The share capital of the parent totals €35,124 thousand, represented by 90,000,000 ordinary shares

and 43,333,213 special-category shares. Their breakdown is as follows:

- 90,000,000 ordinary shares owned by Confindustria, accounting for 67.5% of all shares;

- 40,031,186 special-category shares listed on the Milan Bourse screen-based equity

market (MTA – Mercato Telematico Azionario) of Borsa Italiana S.p.A. in the Standard

segment (Class 1), accounting for 30.0% of all shares.

- 3,302,027 special-category treasury shares, accounting for 2.5% of all shares.

The company by-laws contain provisions whereby the controlling shareholders of the company may

not be changed. In particular, in accordance with Article 8 of the by-laws, shareholders may not

hold more special-class shares than those that represent one fiftieth of the share capital plus one

share, with the exception of the company that owns them as treasury shares.

Il Sole 24 ORE S.p.A. special-category stock is currently listed in the Standard (Class 1) segment

on the MTA of Borsa Italiana S.p.A.

STOCK IDENTIFICATION CODES

Name Il Sole 24 ORE S.p.A.

ISIN IT0004269723

Alphanumerical code S24.MI

Reuters code S24.MI

Bloomberg code S24 IM

The half-yearly financial report, comprising the condensed half-yearly financial statements as at 30

June 2012, the interim report on operations and the certification prescribed by Article 154-bis,

Paragraph 5 of Italian Legislative Decree 58/1998 (Consolidated Finance Act), was approved by the

Board of Directors on 31 July 2012.

24 ORE Group


47

2. Format, content and accounting standards adopted

These condensed half-yearly consolidated financial statements as at and for the period ended 30

June 2012 were prepared on the assumption that the Company is operated on a going concern basis

and in accordance with the recognition and measurement criteria set out in international accounting

standards (International Accounting Standards – IAS and International Financial Reporting

Standards – IFRS), as amended by the applicable interpretations (issued by the Standing

Interpretations Committee – SIC and International Financial Reporting Interpretations Committee –

IFRIC), approved and published by the International Accounting Standards Board – IASB,

approved by EC Regulation 1126/2008 of the European Commission as subsequently amended.

EC Regulation no. 1126/2008 as amended adopts the International financial reporting standards set

by EC regulation 1606/2002 of the European Parliament and Council EC Regulation, expressly

recalled in article 154 ter, paragraph 3 of Italian Legislative Decree 58/1998 (Consolidated Finance

Act) to draw up the condensed half-yearly consolidated financial statements.

The format and content of this set of condensed half-yearly consolidated financial statements

comply with the disclosure prescribed by IAS 34 – Interim Financial Reporting. Therefore, these

condensed half-yearly consolidated financial statements do not include all the information required

for the annual report, and they must be read in conjunction with the consolidated financial

statements as at and for the year ended 31 December 2011. Their purpose is to provide an update in

reference to the last annual consolidated report, while concentrating on the new activities, events

and circumstances that occurred during the period between 31 December 2011 and 30 June 2012

and providing an explanation of the relevant transactions and events for the comprehension of

changes in the balance sheet and income statement that took place during that period.

Note must be made that the interim management statement for the first quarter of 2012 was not

prepared applying IAS 34 Interim Financial Reporting and was drawn up pursuant to Article 154-

ter Financial Reports, paragraph 5 of Italian Legislative Decree 58/1998 (Consolidated Finance

Act).

The accounting standards and measurement and recognition policies used to draw up the condensed

half-yearly consolidated financial statements are the same accounting standards and methods used

to prepare the last set of annual consolidated financial statements, to which reference is made,

except for what is indicated in Paragraph 4 - Changes in accounting policies, errors, and changes of

estimates.

The currency used to present this set of condensed half-yearly consolidated financial statements is

the euro and amounts are expressed in thousands of euro unless otherwise stated.

3. Separate financial statements

The Group has prepared the statement of financial position by classifying current and non-current

assets and liabilities separately.

For each asset and liability item that includes amounts falling due both within and beyond 12

months from the reporting date, the amount that is expected to be recovered or paid beyond 12

months has been indicated.

The statement of financial position was prepared at the end of the reference six-month period and

the comparable figures refer to the annual consolidated financial statements as at 31 December

2011.

24 ORE Group


48

All revenue and cost items are recognised on two statements:

- the Separate income statement, which shows the components of profit (loss) for the

period, and its final line item is defined Profit (Loss) for the period. The separate income

statement shows all income and cost items, excluding those components that are

recognised separately from the profit (loss) for the current period pursuant to specific

provisions Ifrs, and attribution of the portion of profit (loss) for the period attributable to

the owners of the parent and the portion attributable to non-controlling interests;

- a second statement named the Statement of comprehensive income, which begins with

the profit (loss) for the period illustrated in the Separate income statement and shows the

items of the statement of Other components of comprehensive income plus the portion of

the items of the statement of Other components of comprehensive income of associates

and joint ventures measured using the equity method. The final line on the Statement of

comprehensive income is defined as the Total comprehensive income.

The portion of the Total comprehensive income attributable to the owners of the parent and the

portion attributable to the non-controlling interests are indicated in the Statement of comprehensive

income.

The components that are recognised separately from the profit (loss) for the current year pursuant to

specific provisions Ifrs are presented in the statement of Other components of comprehensive

income. These components reflect the change in:

- the translation reserve for translation of financial statements denominated in a foreign

currency;

- the reserve for post-employment benefits (TFR) for the actuarial gains and losses

resulting from defined benefit plans;

- the reserve for gains and losses resulting from restatement of available-for-sale financial

assets;

- the reserve for the effective potion of gains and losses on cash flow hedging instruments.

The items of other Comprehensive income are presented gross of the related tax effects, with a

single amount for total taxes attributable to these items.

Items are classified in the Separate income statement according to their nature.

The Separate income statement and Statement of comprehensive income were prepared for the half-

year reporting period of the current year and are compared with the statements for the same half-

year period of the previous year.

Unless stated otherwise, when the term “income statement” is used in these consolidated financial

statements, it means the separate income statement.

Disclosure of cash flow is provided in the consolidated statement of cash flows, which is an integral

part of these condensed half-yearly consolidated financial statements.

The indirect method has been used for presenting cash flows, according to which the period’s profit

(loss) has been adjusted for the effects of:

- changes in inventories, receivables and payables generated by operating activities;

- non-cash operations;

- all other elements whose cash effects are cash flows involved in investing or financing

activities.

24 ORE Group


49

The statement of cash flows was drawn up as at the end date of the first half of this year and is

compared with the figures of the statement of cash flows of the corresponding six-month period of

the previous year.

Reconciliation between the amounts relating to the components of cash and cash equivalents in the

Statement of cash flows and the equivalent items reported on the statement of financial position was

predisposed in compliance with the reference provisions.

The table illustrating net financial position has been prepared on the basis of the guidance provided

by the Committee of European Securities Regulators (CESR) on 10 February 2005 –

“Recommendations for consistent implementation of the EU Commission’s Regulation on

Prospectuses.” The table details the main components of net financial position and indicates

payable/receivable positions vis-à-vis related parties.

The statement of changes in equity shows:

- the total comprehensive income for the year, with separate indication of the total amounts

attributable to the owners of the parent and those attributable to non-controlling interests;

- for each Equity item, any effects of retroactive application or retroactive restatement

recognised pursuant to IAS 8 Accounting policies, changes in estimates and errors;

- for each equity item, reconciliation of the carrying amount at the beginning and at the end of

the financial year, with separate indication of the changes resulting from:

- profit or loss;

- other components of the Comprehensive income statement and

- possible transactions with shareholders, with separate indication of capital injections by

shareholders, distribution of Equity to shareholders, and changes in equity interest in the

subsidiaries without loss of control.

-

For each Equity component, an analysis is presented in the statement of changes in Equity of the

Other Comprehensive income by item.

The statement of changes in equity has been prepared based on the half year end date compared

with the figures for same period of the previous year.

At the foot of the Statement of financial position, Separate income statement, Statement of

comprehensive income and Statement of cash flows, reference is made to a specific section where a

statement illustrates the sub-items for the amounts of positions or transactions with related parties,

with indication of the effects on the statement of financial position, profit or loss for the year and

statement of cash flows of the Group.

The sub-items regarding any income component (if they are of a material amount), deriving from

non-recurring events or operations are recorded separately from the reference accounts, with

indication of the effects on the statement of financial position, profit or loss for the year and

statement of cash flows of the Group.

A specific table, which is an integral part of this set of condensed half-yearly consolidated financial

statements, lists the Group’s companies indicating their name, registered office, share capital,

equity interests directly or indirectly owned by the parent and each subsidiary, and consolidation

method, as well as listing equity-accounted investments.

24 ORE Group


50

4. Changes in accounting policies, errors, and changes in estimates

The accounting policies adopted in these condensed half-yearly consolidated financial statements

have been changed with respect to those used in the previous consolidated annual financial

statements only if this change – which will be reflected in the next set of consolidated annual

financial statements – is required by an official accounting standard, or helps to provide more

pertinent and reliable information on the effects of transactions on the entity’s financial position,

results of operations, and cash flows.

The changes in accounting policies are recognised:

- in accordance with the provisions of specific transitory measures (if any) of that policy;

- retroactively, if the accounting policy does not contain transitory provisions, or if the

policy is changed voluntarily, recording the effect to opening equity for the earliest of the

financial years being presented. Other comparative figures for each prior year are also

adjusted as if the new policy had always been applied.

The prospective approach is used only when it is impracticable to determine the specific effects on

the year or the cumulative effect of the change for all previous years.

In case of material errors, the same policy is applied as for changes in the accounting standards

illustrated above. In the case of non-material errors, accounting adjustments are made to the income

statement in the year when the error is found.

Changes in accounting estimates made in previous interim periods or financial years are recognised

prospectively in the income statement in the interim period when the change occurs if it affects only

that period, or at year-end and in future financial years if the change also affects those years.

The changes regarding the transfers of financial assets made by IFRS 7 Financial Instruments:

Disclosures, endorsed with (EU) regulation 1205/2011, come into force with prospective

application to the financial years starting from 1 July 2011 are applied for the first time starting on 1

January 2012.

Moreover, the changes to IAS 12 Income taxes regarding the calculation of deferred tax assets and

liabilities on investment property measured at fair value are applicable from 1 January 2012; these

cases are not present within the Group as at the date of these condensed half-yearly consolidated

report, but may have accounting effects on future transactions or agreements. Although these

changes were retroactively enforced, they have not been endorsed by any (EU) regulation yet.

5. Risk management

In order to provide disclosures that improve the reader’s understanding of the impact of financial

instruments on the Group’s financial position, results of operations and cash flows, supplementary

information is provided to facilitate evaluation of the magnitude of the related risks.

The risks related to the financial instruments used are:

- market risk, i.e. the risk of a financial instrument’s fair value or cash flows fluctuating

following changes in market prices. This risk can be further broken down into:

- foreign exchange risk, i.e. the risk that the value of a financial instrument might fluctuate

as a result of movements in exchange rates;

24 ORE Group


51

- interest rate risk on fair value, i.e. the risk that the value or future cash flows of a

financial instrument might fluctuate as a result of changes in market interest rates;

- price risk, i.e. the risk that the fair value of a financial instrument or its future cash flows

might fluctuate as a result of changes in market prices;

- credit risk, i.e. the risk that one of the parties of a financial instrument does not fulfil an

obligation and causes a financial loss to the other;

- liquidity risk, i.e. the risk of having problems in fulfilling the obligations associated with

financial liabilities settled via cash or other financial assets.

Financial risk management is performed following a principle of prudence and of minimisation of

the risks connected with financial assets and liabilities. The investment of surplus cash or the

raising of necessary resources is carried out with the priority objective of neutralising the risk of

loss of capital, avoiding speculation, and interest rate fluctuations, avoiding exposure of the

operating profit (loss) to any unexpected increases in financial expenses.

The Group constantly monitors the financial risks to which it is exposed, in order to assess any

negative impact and initiate appropriate mitigation action. The Board of Directors has the overall

responsibility for creating and supervising over the Group’s risk management system, as well as for

the development and control of risk management policies.

The Group’s risk management policies are intended to identify and analyse the risks to which the

Group is exposed, defining appropriate limits and the monitoring systems for such risks. Policies

and related systems are periodically reviewed in consideration of changes in market conditions and

in Group activities.

Financial management of subsidiaries takes place through specific intercompany current accounts

on which any cash surpluses are deposited or on which the parent provides the financial resources

needed for the subsidiaries to conduct their business operations. The aim is also to optimise the

impact on the income statement of the financial income and expenses accruing on these current

accounts.

Centralised management of the Group’s finances also makes it possible to control and co-ordinate

the operations of each subsidiary efficiently, also via more effective financial planning and control.

This also provides useful input to ensure the best possible handling of the Group’s relationships

with its main banks and credit institutions and to help monitor the Group’s financial risk and

treasury movements in a systematic way.

Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument fluctuate

following changes in market prices, due to changes in interest rates, exchange rates or in the market

prices of equity instruments. The objective of market-risk management is to manage and control the

Group’s exposure to the risk and keep it within appropriate limits, whilst also optimising the return

of the investments to which such risk relates.

The Group uses derivative instruments during the normal course of its financial activity and also

takes on financial liabilities to manage market risk. It performs these activities in accordance with

the guidelines established by the Board of Directors. The Group performs hedging transactions to

manage the volatility of results relating to financial instruments.

24 ORE Group


52

Foreign exchange risk

The Group is marginally exposed to foreign exchange risk on purchases denominated in currencies

other than the functional currency of the various Group entities.

These transactions mainly refer to the following exchange rates: EUR/USD, EUR/GBP, and

EUR/CHF.

The Group in any case has the policy of hedging foreign exchange risk for specific purchases of

investment assets denominated in currencies other than the functional currency in order to preserve

the forecast return on such investments. It is the Group’s policy to undertake full hedging, where

possible, of significant exposures arising from receivables and payables denominated in currencies

other than the euro.

Interest risk

The Group’s financial performance is exposed to fluctuations in market interest rates, with special

reference to net financial expenses relating to facilitated medium-long term variable-rate loans.

The return of financial investments, consisting of short-term cash investments with a maturity of not

more than three months, is not affected by changes in interest rates.

To manage interest risk, the Group uses interest-rate derivatives – mainly Interest Rate Swaps

(IRSs) – to eliminate or mitigate, at acceptable economic conditions, the impact of interest rate

fluctuations on profit performance.

At 30 June 2012, 100% of exposure calculated for this risk in connection with medium-long term

liabilities was hedged.

The main way of raising financial resources from third parties the Group currently uses is medium-

long term facilitated loans, also because of the interest subsidies they envisage, which substantially

reduce the cost of financial resources.

In 2005, the parent agreed three facilitated loans under Italian Law 62/2001 (Contributions to the

Publishing Industry), with maturity date at 30 June 2015:

- a loan of €6,976 thousand from Credito Emiliano (100% used);

- two loans from Intesa San Paolo in the amounts of €3,595 thousand (100% used) and

€8,199 thousand (a loan issued according to project completion status and partly used out

of a total authorised amount of €10,530 thousand).

These loans are to be repaid in fixed amounts of principal every six months and were agreed at a

floating rate of interest linked to 6-month Euribor.

As part of the Group's Risk management policy, hedge contracts are in place to mitigate the risk of

fluctuations in the interest rates on these loans.

On 17 January 2006, three Payer Interest Rate Swaps – Forward Start (i.e. the hedge takes effect

after the date the IRS contract is signed) were entered into for which the company pays a fixed rate

that transforms the interest rate on the underlying loan from floating to fixed, with an exchange of

interest flows as from 30 June 2008 to 30 June 2015.

The value of the IRS hedging the loan for which the amount is defined on the basis of project

completion status – and that had initially been signed for an amount equal to the maximum

authorised loan amount – was also aligned during the year with the amount actually paid out,

proceeding with a partial unwinding.

24 ORE Group


53

A delayed start to the IRSs was decided so as to benefit during the first 18 months of the loans from

the expected positive differential between the expected trend of the 6-month Euribor and the fixed

rate quoted in the IRS.

The IRSs made it possible to convert the floating rate of the loans into a fixed rate of approximately

3.20%.

The Group has evaluated the effectiveness of the hedges, using the Hedge Accounting methodology

based on the Cash flow hedge model. This refers to hedging of exposure to the variability of cash

flows, attributable to the particular risk associated with the underlying liability.

Based on this methodology, after determining the fair value of the derivative, the value of the

effective part of the hedge is recognised in a special equity reserve, whereas the value of the

ineffective part of the hedge is recognised in the income statement.

The effectiveness of the hedging relationship is measured by comparing the change in the clean fair

value of the derivative with that of a Hypothetical Swap representing a synthetic fixed-rate bond at

the market conditions existing when the hedge was agreed.

The ex ante effectiveness of the hedge of the instrument has been assessed by analysing Critical

Items and by measuring the fair value of the hedging derivative and of the hypothetical derivative.

The retrospective effectiveness of the hedge (ex post effectiveness test) is assessed regularly by

calculating the change in the fair value of the hedging derivative compared with that of the

hypothetical derivative, determined by the fluctuation that has occurred between the current interest

rate curve compared with the rate curve at the date when the swap was agreed (Cumulative Based

Test).

The hedge is considered retrospectively effective if the ratio between the two variances, in absolute

terms, lies within a range of 80-125%. This test is performed on a cumulative basis, performing

calculations as at the date of the test and as at the start date.

Price risk

The main raw material used by the Group that could be exposed to significant price risk is paper.

Paper is handled centrally for all of the Group’s business units by means of careful procurement

planning and inventory management. In line with best market practice, supply contracts are agreed

with leading Italian and foreign paper companies for fixed quantities at fixed prices for the

maximum period that the market currently permits, i.e. about one year.

The Group does not use hedges such as paper swaps, as they offer limited liquidity in terms both of

counter-parties and of maturities.

Credit risk

Credit risk is the risk of a customer or one of the counterparties of a financial instrument causing a

financial loss by not honouring an obligation.

Within the Group, credit risk mainly relates to trade receivables from sales of products and services

by the various business units, as well as to financial receivables in connection with the investment

of surplus cash.

Considering the type of customers that the Company has for its products and services, management

does not believe there is a high level of trade credit risk. As there is no high concentration of this

24 ORE Group


54

risk, the policy is to limit sales to any customers that are considered insolvent or are unable to

provide adequate guarantees.

Customer credit risk is controlled by grouping customers by type and business area, considering

whether customers are advertising agencies, financial companies and institutions, public entities,

professionals and natural persons, distributors and bookstores, or other customers. Other factors

examined are geographical location, business sector, credit age, the due dates of invoices issued,

and previous payment behaviour.

In the face of this risk, a specific allowance for impairment is made to cover any losses caused by

non-collectability.

As regards financial receivables, it is believed that the Group is not exposed to significant risk as it

invests surplus cash only with banks of premier standing, mainly using short-term investment

instruments with maturities of not more than 3 months (on demand or term deposits).

Liquidity risk

Liquidity risk is the risk of the Group having difficulty in meeting obligations associated with

financial liabilities and therefore of having difficulty in accessing, at economic conditions, the

financial resources necessary for its operations.

In managing the liquidity risk, the Group’s approach is to ensure, as far as possible, that there are

always sufficient financial reserves to meet its obligations at maturity.

Besides the trend in market interest rates, the main factors determining Group liquidity are the cash

flows generated or absorbed by operating and investing activities and the flows relating to

repayment of financial liabilities and collection of income relating to financial investments.

The Company has taken a series of actions designed to optimise management of financial resources

and mitigate the liquidity risk. More specifically:

- centralised management of Group liquidity through constant withdrawal of cash

surpluses from subsidiaries and through coverage of the latter’s requirements with

resources provided by the parent;

- maintenance of an adequate reserve of available liquidity;

- availability of adequate short-term lines of credit;

- planning of the future financial position, also as regards the impact of medium-long term

debt on the overall net financial position;

- utilisation of an appropriate internal control system to assess available liquidity in

relation to operational planning.

For coverage of any short-term financial requirements, at 30 June 2012 the Group had the following

credit facilities:

- €40.4 million relating to current-account overdrafts, subject to collection and unsecured,

paid at an average interest rate of 4.19%;

- €32.9 million relating to revocable lines of credit that can be used for short-term

temporary financial requirements, at an average cost equal to Euribor + 3.12%.

Management believes that the present financial resources and the credit lines available as mentioned

above are sufficient to cover requirements relating to investing activities, management of working

capital, and to repayment of medium-long term loans.

24 ORE Group


55

6. Principal reasons for uncertainties in estimates

Estimates are used mainly to recognise impairment losses on assets, to calculate probable future

returns of publications that have been distributed, to determine the extent to which receivables and

inventories should be written down, and to quantify the amounts to be provisioned for probable

risks.

Estimates are also used in the actuarial calculation of post-employment benefits, for quantification

of income taxes, and for calculation of the fair value, the useful life of assets, and the recoverability

of advance taxes.

In accordance with Ias 34 Interim financial reporting, the interim measurements of figures shown

in the condensed half-yearly financial statements can be based on estimates to a greater extent than

measurements of annual consolidated year-end figures. The valuation procedures used for this

purpose are designed to ensure that the information provided is reliable and that all significant

financial information relevant for comprehension of the Group’s statement of financial position or

income is illustrated.

These estimates and assumptions are reviewed at least once a year and the effects of each change

are immediately reflected in the Income statement.

In particular, publication returns are estimated using statistical techniques and updated monthly on

the basis of actual figures received.

The estimate of legal risks takes the nature of the litigation and the adverse outcome probability into

account.

Furthermore, the estimates pertaining to the measurement of the recoverable amount of goodwill

and other intangible assets with indefinite useful life are made on the basis of the fair value, in case

of signs of impairment, net of costs to sell or value in use, using the discounted cash flow method.

24 ORE Group


56

7. Scope of consolidation

SUBSIDIARIES CONSOLIDATED ON A LINE-BY-LINE BASIS

Company name Business

Headquarters

Curren

cy Share capital paid

in % of consolidation Held by

Nuova Radio S.p.A. Radio station Milan EUR 16,120,000 100.0% Il Sole 24 ORE

S.p.A.

Innovare24 S.p.A. Software solutions Milan EUR 5,672,000 100.0%


24 ORE Cultura S.r.l. Art products Milan EUR 1,049,920 100.0% Il Sole 24 ORE

S.p.A.

Il Sole 24 ORE UK Ltd Sale of

advertising space

London EUR 50,000 100.0% Il Sole 24 ORE

S.p.A.

Alinari 24 ORE S.p.A. Photographs

and exhibitions

Florence EUR 120,000 55.0%


Newton Management Innovation S.p.A.

Training services Milan EUR 160,000 60.0%


Shopping 24 S.r.l. E-commerce Milan EUR 10,000 100.0% Il Sole 24 ORE

S.p.A.

Business Media Web S.r.l. in liquidation Internet Bologna EU

R 100,000 60.0% Il Sole 24 ORE

S.p.A.

Esa Software S.p.A. Software solutions Rimini EUR 1,560,000 100.0%

Innovare24 S.p.A. (1)

Newton Lab S.r.l

Training services Turin EUR 100,000 30.6%

Newton Management Innovation S.p.A.

Fabbrica24 S.r.l. E-commerce Milan EUR 10,000 100.0% Innovare 24 S.p.A.

Signet S.r.l E-commerce Turin EUR 210,000 70.0% Fabbrica24 S.r.l.

(1) Innovare24 S.p.A. 70.04% and Il Sole 24 ORE S.p.A. 29.96%

ASSOCIATES CONSOLIDATED AT EQUITY

Company name Business Headquarters

Currency

Share capital paid in % of consolidation Held by

Diamante S.p.A. Software solutions Verona EUR 680,000 30.0%


Mondoesa Emilia S.r.l. Software solutions Parma EUR 20,800 40.0%

Esa Software S.p.A.

Mondoesa Lazio S.r.l. Software solutions Frosinone EUR 20,800 35.0%

Esa Software S.p.A.

Mondoesa Laghi S.r.l. Software solutions

Venegono inferiore (VA) EUR 107,500 33.70%

Esa Software S.p.A.

Mondoesa Milano Nordovest S.r.l.

Software solutions Milan EUR 107,100 49.0%

Esa Software S.p.A.

Cesaco S.r.l. Software solutions Vicenza EUR 90,000 48.0%

Esa Software S.p.A.

Aldebra S.p.A. Software solutions Trent EUR 1,272,908 19.39%

Esa Software S.p.A.

Italia news S.r.l. in liquidation

Multimedia publishing Bologna EUR 100,000 20.0%


24 ORE Group


57

Investments in subsidiaries

The changes in the scope of consolidation, compared with financial statements as at 31 December

2011 relate to:

- The establishment of Fabbrica 24 S.r.l. on 20 January 2012;

- Fabbrica 24 S.r.l. subscribing the share capital increase of the company Signet S.r.l. on

13 June 2012. The company is 70% owned. During the first half of the year the company

managed the site www.innerdesign.it and in the same period did not obtain or generate a

significant level of revenues or costs.

Investments in associates and joint ventures

The changes compared with 31 December 2011 are attributable to the disposal by the subsidiary

ESA Software S.p.A. of the investment in E.Veneto S.r.l. in liquidation occurred on 2 April 2012.

24 ORE Group


58

8. Notes to the separate financial statements

(1) Property, plant and equipment

As at 30 June 2012 the carrying amount of property, plant and equipment was €74,855 thousand.

The following changes took place:

PROPERTY, PLANT AND EQUIPMENT

(in thousands of euro) Opening balance Purchases Disposals Amortisation

Reclassifications and other

changes

Closing balance

Historical cost:

Land 2,870 - - - - 2,870

Buildings 31,077 47 - - - 31,124

Plant and equipment 123,351 1,070 (21) - 296 124,696

Industrial and commercial equipment 43,059 1,236 (107) - 376 44,565

Other assets 769 173 - - (692) 250

Total historical cost 201,125 2,526 (128) - (20) 203,503

Accumulated amortisation:

Buildings (16,557) - - (552) - (17,109)

Plant and equipment (71,992) - 21 (3,294) 2 (75,264)

Industrial and commercial equipment (34,985) - 104 (1,358) 8 (36,231)

Other assets (45) - - - - (45)

Total accumulated depreciation (123,579) - 125 (5,204) 10 (128,648)

Property, plant and equipment:

Land 2,870 - - - - 2,870

Buildings 14,520 47 - (552) - 14,015

Plant and equipment 51,358 1,070 0 (3,294) 298 49,432

Industrial and commercial equipment 8,074 1,236 (3) (1,358) 384 8,334

Other assets 724 173 - - (692) 205

Total 77,547 2,526 (3) (5,204) (10) 74,855 During 1H12 investments totalling €2,526 thousand were made relating to:

- €47 thousand for buildings, such as temporary buildings for the Carsoli plant;

- €1,070 thousand in plant and machinery, mainly referring to leasehold improvement for

€425 thousand, including upgrades to the Pero offices (€364 thousand) and the via Monte

Rosa 91 offices in Milan (€54 thousand). Other investments concern machinery for the

printing production in Milan and Carsoli (€478 thousand) and radio equipment (€143

thousand);

- €1,236 thousand for industrial and commercial equipment, and particularly for hardware

(€550 thousand) and terminals for the sales network (€528 thousand);

- Other assets for €173 thousand, mainly relating to hardware for €105 thousand still not

operational.

The disposals were largely represented by hardware disposals.

24 ORE Group


59

Depreciation of property, plant and equipment equalling €5,204 thousand and the determination

criteria did not change compared with the previous year.

(2) Goodwill

The goodwill recognised on the statement of financial position amounted to €74,993 thousand,

featuring the following movements compared with 31 December 2011:

GOODWILL

(in thousands of euro) Opening

balance Increases Decreases Closing balance

Publishing 513 - - 513

Tax, legal & PA 15,469 - - 15,469

Sector-Specific Publishing 2,371 - - 2,371

Software solutions 52,956 1,519 - 54,475

Training 2,165 - - 2,165

Total 73,474 1,519 - 74,993

The increase of €1,519 thousand is due to the adjustment of the purchase price of Data Ufficio,

acquired in 2007 and merged into Innovare24 S.p.A. in 2010.

The cash generating units (CGU) the goodwill is allocated to generated, in the first half of 2012,

results that are mostly in line with expectations; the changes in the main financial and economic

indicators (weighted average cost of capital and post plan growth rate) are not significant and do not

exceed the limits of the parameters used to carry out the sensitivity analyses made during the

impairment test to prepare the financial statements as at 31 December 2011. With reference to the

Sector-specific publishing CGU, which is the only one that in the first half of the year did not

perform as expected, the projections of the expected results, including the rationalisation actions

started, allow the recoverability of the recognised values.

(3) Intangible assets

Intangible assets amounted to €83,308 thousand. The following changes took place during the six

months:

24 ORE Group


60

INTANGIBLE ASSETS

(in thousands of euro) Opening balance Purchases Disposals Amortisation

Reclassifications and other

changes

Increases in the scope of consolidation

Closing balance

Historical cost:

Publications 37,163 - - - - - 37,163

Trademarks 3,190 - - - - - 3,190

Radio broadcasting frequencies 105,179 - - - - - 105,179 Licences and software 155,927 2,269 - - 911 29 159,137

Intangible assets in progress & down payments 6,754 624 - - (882) - 6,496

Total historical cost intangible assets 308,213 2,893 - - 29 29 311,164 Accumulated amortisation: Publications (25,410) - - (387) - - (25,797)

Trademarks (1,298) - - (78) - - (1,376)

Radio broadcasting frequencies (77,356) - - - - - (77,356) Licences and software (118,476) - - (4,832) (20) - (123,328)

Total accumulated amortisation (222,540) - - (5,297) (20) - (227,856)

Intangible assets:

Publications 11,753 - - (387) - - 11,367

Trademarks 1,892 - - (78) - - 1,814

Radio broadcasting frequencies 27,823 - - - - - 27,823 Licences and software 37,451 2,269 - (4,832) 892 29 35,809

Intangible assets in progress & down payments 6,754 624 - - (882) - 6,496

Total 85,673 2,893 - (5,297) 10 29 83,308 Investments in intangible assets amount to €2,893 thousand. The value of licences and software

equals €2,269 thousand and refers mainly to software development for management and

administrative systems (€1,275 thousand); software development by the subsidiaries Innovare 24

S.p.A. (€684 thousand), Esa Software S.p.A. (€105 thousand) and Alinari 24 ORE S.p.A. (€43

thousand). Investments in intangible assets in progress amounted to €624 thousand, mainly

pertaining to on-going software projects that will be become operational next year.

The amortisation of intangible assets, based on their estimated useful life, totalled €5,297 thousand.

Assets purchased during the year are depreciated as from the start of use.

The changes in the scope of consolidations for €29 thousand derive from the acquisition of the

subsidiary Signet S.r.l.

The value of intangible assets with indefinite useful life attributable to the value of radio

broadcasting frequencies did not undergo an impairment test as no elements emerged to require a

review of the valuation compared with the one made when preparing the financial statements as at

31 December 2011.

24 ORE Group


61

(4) Investments in associates

Investments in associates amounted to €2,102 thousand as compared with €2,291 thousand at the

beginning of the year due to the following changes:

INVESTMENTS IN ASSOCIATES

(in thousands of euro) Opening balance Disposals

Profit (losses)

from equity-accounted investees

Other changes

Changes in scope of

consolidation

Closing balance

Diamante S.p.A. 1,283 - - - - 1,283

Aldebra S.P.A. 393 - (152) - - 241

Mondoesa Lazio S.r.l. 189 - 3 - - 192

Mondoesa Laghi S.r.l. 147 - 2 - - 149

Mondoesa Milano Nordovest S.r.l. 137 - (52) - - 85

Cesaco S.r.l. 98 - 35 - - 133

Mondoesa Emilia S.r.l. 29 - (25) - - 4

Italia news S.r.l. in liquidation 15 - - - - 15

Total 2,291 - (189) - - 2,102

(5) Available-for-sale financial assets

This item relates to non-controlling investments and amounted to €1,171 thousand, unchanged

compared with 31 December 2011.

(6) Other non-current assets

Other non-current financial assets are shown in the statement of financial position at an amount of

€753 thousand, with a decrease of €19,657 thousand from the previous financial year, which is

attributable to the early extinction of an insurance policy taken out with Monte Paschi Vita.

(7) Other non-current assets

They amount to € 862 thousand and they mostly refer to security deposits (€802 thousand).

(8) Deferred tax assets and liabilities

These items show the impact of deferred tax assets and liabilities. These are respectively calculated

on the deductible and taxable differences that temporarily emerge between financially reported

amounts and their tax value.

The amounts of deferred tax assets and liabilities as at 30 June 2012 and 31 December 2011 are

shown below:

DEFERRED TAX ASSETS (in thousands of euro) 30.06.2012 31.12.2011 Change

Deferred tax assets 57,281 47,222 10,059

Deferred tax liabilities 15,452 16,055 (603)

24 ORE Group


62

The increase in deferred tax assets and liabilities mainly refers to the realignment of goodwill

recorded at the time of previous mergers for €6,118 thousand.

(9) Inventories

INVENTORIES (in thousands of euro) 30.06.2012 31.12.2011 Change

Paper 6,249 5,297 952

Ink 134 148 (14)

Photographic material 268 195 73

Raw and ancillary materials and consumables 6,650 5,640 1,010

Work in progress and semi-finished products 17 68 (51)

Books 5,537 6,070 (533)

Software 25 24 1

CDs 106 119 (13)

Other products 2,029 2,054 (25)

Allowance for inventory write-down (2,073) (2,093) 20

Finished products 5,625 6,173 (548)

Software purchased 25 18 7

Hardware purchased 5 7 (2)

Third-party books 124 131 (7)

Other merchandise bought 499 544 (45)

Allowance for inventory write-down (114) (114) -

Merchandise 538 587 (49)

Total 12,829 12,469 361

Inventories are shown net of provision for obsolete and slow-moving goods, which featured the

following movements:

ALLOWANCE FOR INVENTORY WRITE-DOWN

(in thousands of euro) Opening balance Provisions Use of

provisions Closing balance

Finished products (2,093) (322) 342 (2,073)

Merchandise (114) - - (114)

Total (2,207) (322) 342 (2,187)

(10) Trade receivables

Trade receivables stem from the normal course of continuing operations and featured the following

breakdown:

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63

TRADE RECEIVABLES (in thousands of euro) 30.06.2012 31.12.2011 Change

Trade receivables 189.131 201.608 (12.477)

Provision for returns to be received (2,273) (3,127) 854

Allowance for impairment (23,297) (23,780) 484

Net trade receivables 163,562 174,701 (11,139)

Ordinary advances to suppliers 8,431 10,090 (1,659)

Agents and agencies 59 3,355 (3,296)

Receivables from associates and non-controlling interests 79 67 11

Total 172,130 188,214 (16,084)

The amount of trade receivables is shown net of provision for returns to be received and for bad

debts. Changes in these provisions and allowances for impairment were as follows:

PROVISION FOR RETURNS TO BE RECEIVED AND ALLOWANCE FOR IMPAIRMENT

(in thousands of euro) Opening balance Provisions Use of

provisions Reclassifications

and other changes

Closing balance

Provision for returns to be received (3,127) (936) 1,790 - (2,273)

Allowance for impairment (23,780) (2,481) 2,959 5 (23,297)

Total (26,907) (3,417) 4,749 5 (25,569)

(11) Other receivables

OTHER RECEIVABLES (in thousands of euro) 30.06.2012 31.12.2011 Change

Current income tax 3,721 3,054 667

Tax receivables 1,366 691 675

Employee-related receivables 693 625 67

Other receivables 4,915 4,133 782

Total 10,694 8,503 2,191

Current income tax refers mainly to Irap prepayments of €2,612 thousand and tax withholding of

€870 thousand.

The detail of tax receivables is shown below:

Tax receivables (in thousands of euro) 30.06.2012 31.12.2011 Change

VAT receivables 769 62 707

VAT awaiting reimbursement 533 533 -

VAT on invoices to be received 64 96 (33)

Total 1,366 691 675

Receivables from employees, in the amount of €693 thousand, relate to expense allowances and

loans to employees.

24 ORE Group


64

Other receivables, in the amount of €4,915 thousand as at 30 June 2012, mainly refer to the

following:

OTHER RECEIVABLES (in thousands of euro) 30.06.2012 31.12.2011 Change

Receivables from Italian Post Office 1,405 1,848 (443)

Receivable for sale of equity interest in Faenza Industrie Grafiche S.r.l. 170 181 (11)

Receivables for European projects 357 357 -

Advances to agents 467 239 228

Other 2,516 1,508 1,008

Total 4,915 4,133 782

(12) Other current assets

The other current assets amount to €9,736 thousand, with the following breakdown:

OTHER CURRENT ASSETS (in thousands of euro) 30.06.2012 31.12.2011 Change

Accrued liabilities 4 - 4

Prepaid expenses 9,732 6,279 3,453

Total 9,736 6,279 3,457

The breakdown of prepaid expenses is as follows:

PREPAID EXPENSES (in thousands of euro) 30.06.2012 31.12.2011 Change

Agents' commissions 5,168 2,667 2,501

Hardware and software maintenance fees 845 268 577

Sundry taxes 416 449 (33)

IT services 400 235 165

Royalty and copyright costs 352 278 74

Rental costs 664 897 (233)

License fees 343 300 43

Administrative and commercial services 328 352 (24)

Employee insurance premiums 273 - 273

Information and data expenses 233 52 181

Other production services 211 69 142

Insurance premiums 451 164 287

Conference organisation expenses - 150 (150)

MPS life insurance policy - 108 (108)

Miscellaneous 47 290 (243)

Total 9,732 6,279 3,453

24 ORE Group


65

(13) Cash and cash equivalents

Cash and cash equivalents amounted to €49,259 thousand, increasing by €17,828 thousand from the

start of the year. They consist of cash in hand, cash equivalents, and on demand or short-term bank

deposits that are effectively available and immediately convertible into cash.

Cash and cash equivalents totalling €46,164 thousand are reported on the statement of cash flows at

30 June 2012 (€48,009 thousand at 30 June 2011), net of current account overdrafts and instalments

due within the year on bank borrowings of €3,096 (€2,585 thousand at 30 June 2011).

(14) Share capital

Share capital, fully subscribed and paid in, amounts to €35,123,787, divided into 133,333,213

shares, of which 90,000,000 ordinary shares (67.50% of share capital) and 43,333,213 special

shares (32.50% of share capital), of which 3,302,027 treasury shares.

Share capital and the number of treasury shares did not feature any changes from the last annual

statement of financial position at 31 December 2011.

(15) Equity reserves

Equity reserves, which amounted to €180,316, remained the same as those in the last financial

statements at 31 December 2011.

(16) Revaluation reserves

REVALUATION RESERVES (in thousands of euro) 30.06.2012 31.12.2011 Change

Revaluation reserve – Law 342/2000 18,786 18,786 -

Revaluation reserve – Law 350/2003 1,776 1,776 -

Total 20,561 20,561 -

(17) Hedging and translation reserves

The hedging and translation reserve came to a negative €220 thousand and covers the fair value of

interest rate swaps, which were set up to hedge the risk of fluctuations in interest rates on three

facilitated loans, net of related deferred tax assets. More specifically, the portion of fair value

forming the reserve in question concerns the IRS contracts classified as cash flow hedges, the value

of which amounts to a €305 thousand (pre-tax) and which are considered effective for the purposes

of IAS 39.

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66

(18) Other reserves

OTHER RESERVES

migliaia di euro 30.06.2012 31.12.2011 Change

Negative goodwill 11,272 11,272 -

Legal reserve 7,025 7,025 -

Stock Granting reserve (Fair value) 7,619 7,619 -

Post-employment benefit reserve (IFRS adjustment) (2,519) (1,279) (1,240)

Other 388 388 -

Total 23.785 25.025 (1.240)

The “Other reserves” item decreased from €25,025 thousand to €23,785 thousand due to accounting

treatment of the post-employment benefit reserve, which decreased by €1,240 thousand.

(19) Retained earnings (Loss brought forward)

Retained earnings (loss brought forward) decreased from -€4,491 thousand to -€12,857 thousand.

The change of -€8,366 thousand is due to the loss of the previous year, entirely brought forward.

(20) Loss for the year

The first half ended with a loss of €8,909 thousand. The loss attributable to owners of the parent

was €8,420 thousand.

(21) Non-current financial liabilities

Non-current financial liabilities amounted to €4,718 thousand (€5,916 thousand for the prior year)

and principally relate to the long-term portion of the facilitated loans received by the parent under

Italian publishing industry law, by the subsidiary Esa Software S.p.A. under the technological

innovation law and the subsidiary Newton Lab S.r.l., as summarised in the following table:

MEDIUM-LONG TERM LOANS

Bank Facilitation Amount paid out Interest rate Date of

maturity Current portion

M/L-term portion

Residual value at 30.06.2012

Loan with

clause

Credito Emiliano S.p.A.

Law 62/2001 Publishing Industry

6,976 6-mo. Euribor + 0.875% 30/06/2015 734 1,469 2,203 2,203

Intesa Sanpaolo S.p.A.


3,595 6-mo. Euribor + 0.85% 30/06/2015 378 757 1,135 1,135



8,199 6-mo. Euribor + 0.85% 30/06/2015 1,025 2,050 3,075 3,075

Minis. Ind. Att. Comm. (MICA)

Law 46/82 Tech. innovation 739 3,00% 23/02/2015 79 166 245 -

Minis. Prod. Activ. (MAP)

Law 46/82 Tech. innovation 423 2,25% 20/05/2018 42 223 265 -


78 7,25% 28/09/2016 16 54 70 -

Total 20,010 2,274 4,718 6,992 6,413

For the fixed-rate loans, no guarantees have been given, nor have covenants been requested.

24 ORE Group


67

Conversely, the floating-rate loans (6-month Euribor + spread) have been hedged against interest

rate fluctuations by using specific derivatives, as already described in Section 5 - Risk management.

These loans are not backed by collateral, but include specific covenants, which to date have always

been met.

The decrease of €1,198 thousand compared with the figure as at 31 December 2011 was due to

repayment of semi-annual instalments on the loans.

(22) Employee benefit obligations

EMPLOYEE BENEFIT OBLIGATIONS

(in thousands of euro) Opening balance

Cost of labour

Financial income/(expe

nses)

Actuarial gains

(losses)

Uses and other

changes Closing balance

Post-employment benefits 31,977 68 649 1,717 (599) 33,812

Total 31,977 68 649 1,717 (599) 33,812

The main actuarial assumptions used to estimate the benefits to be awarded on termination of

employment are the same as those used for the financial statements as at 31 December 2011.

(23) Provisions for risks and charges

PROVISIONS FOR RISKS AND CHARGES

(in thousands of euro) Opening balance Provisions Use of provisions

Reclassifica

tions and other

changes

Closing balance

Provision for legal disputes 3,901 170 (596) - 3,474

Provision for sundry risks 3,082 84 (218) - 2,948

Provision for agent indemnities 6,178 600 (222) - 6,556

Provision for part. loss in assoc. 60 - (60) - -

Total 13,220 854 (1,096) - 12,978

Provisions for legal disputes (€3,474 thousand) cover litigation risks known at the reporting date.

These risks relate in particular to personnel lawsuits (€1,282 thousand), disputes with social security

institutions (€1,048 thousand), lawsuits against the newspaper (€774 thousand), forecast legal

expenses (€284 thousand), and other litigation (€87 thousand).

Provision for sundry risks (€2,948 thousand) is to cover the residual risks relating to the contractual

obligations connected with construction of the building in Via Monte Rosa, Milan (€1,796

thousand) and other risks of a contractual nature (€1,152 thousand).

Agents’ indemnities are provisions to cover the risks deriving from early termination of the contract

and those relating to discontinuation of the agency relationship as per Article 1751 of the Italian

Civil Code.

(24) Other non-current liabilities

This item totals €34 thousand and is comprised by security deposits.

(25) Bank overdrafts and loans - due within one year

These amounted to €3,096 thousand (€2,764 thousand at the beginning of the year) and mainly

related to the short-term portion (€ 2,274 thousand) of medium-long term loans.

24 ORE Group


68

(26) Financial liabilities held for trading

Financial liabilities held for trading totalled €305 thousand (€317 thousand at 31 December 2011)

and refer to the fair value of derivative hedging instruments.

(27) Trade payables

TRADE PAYABLES (in thousands of euro) 30.06.2012 31.12.2011 Change

Suppliers 106,770 101,175 5,595

Deferred income 59,418 47,429 11,989

Trade payables to associates and non-controlling interests 456 712 (256)

Other trade payables 4,385 12,396 (8,011)

Total 171,029 161,711 9,318

The breakdown of deferred income is shown below:

DEFERRED INCOME (in thousands of euro) 30.06.2012 31.12.2011 Change

Sale of magazines 15,250 16,520 (1,270)

Online publications by subscription 15,675 13,848 1,827

Il Sole 24 ORE newspaper subscriptions 14,798 12,136 2,662

IT services 5,461 3,462 1,999

Software by subscription 8,235 1,463 6,772

Total 59,418 47,429 11,989

Other trade payables totalled €4,385 thousand (€12,396 thousand at 31 December 2011), including

€2,496 thousand for payables to agents (€6,591 thousand at 31 December 2011).

(28) Other current liabilities

OTHER CURRENT LIABILITIES (in thousands of euro) 30.06.2012 31.12.2011 Change

Deferred income 13,101 8,805 4,296

Accrued liabilities 18 15 3

Current tax liabilities 4,750 972 3,778

Total 17,869 9,792 8,077

The breakdown of deferred income is shown below:

DEFERRED INCOME (in thousands of euro) 30.06.2012 31.12.2011 Change

Annual service contracts 6,646 3,558 3,088

Conferences 2,476 3,165 (689)

Sales of software licenses 1,622 539 1,083

Annual portion of grants related to assets 646 405 241

Interest expense on M/L fin. payable to third parties 68 323 (255)

Rent income 1 1 0

Other deferred income 1,642 814 828

Total 13,101 8,805 4,296

24 ORE Group


69

(29) Other payables

OTHER PAYABLES (in thousands of euro) 30.06.2012 31.12.2011 Change

Payables to employees for restructuring 5,583 11,792 (6,209)

Social security institutions 8,114 11,219 (3,105)

Tax payables 6,391 10,504 (4,113)

Holidays 12,902 9,595 3,307

Other employee payables 4,118 5,624 (1,506)

13th and 14th-month salaries accrued and not yet paid 4,993 3,094 1,899

Miscellaneous payables 10,617 13,666 (3,049)

Total 52,717 65,494 (12,777)

Tax payables mainly refer to withholding tax on payroll and on freelancers’ invoices.

The breakdown of miscellaneous payables is shown below:

MISCELLANEOUS PAYABLES

(in thousands of euro) 30.06.2012 31.12.2011 Change Payable for ESA Software S.p.A. acquisition 6,761 6,761 -

Payable for Data Ufficio S.p.A. acquisition - 3,000 (3,000)

Payable to Ifitalia 1,420 1,533 (113)

Other payables 2,436 2,372 64

Total 10,617 13,666 (3,049)

The payable for the acquisition of ESA Software S.p.A. is related to the amounts retained as

guarantee towards the selling counterparty by the Group of the last 30% tranche made on 18

October 2011.

The payable for the acquisition of Data Ufficio S.p.A. was extinguished after finalising the purchase

by Innovare 24 S.p.A. and defining the amount of the last date to be paid to the selling counterparty.

(30) Revenue from newspapers, books and magazines

REVENUE FROM NEWSPAPERS, BOOKS AND MAGAZINES (in thousands of euro) 1

st Half 2012 1

st Half 2011 Change Change %

Newspaper 34,538 34,213 325 0.9%

Magazines 23,086 26,454 (3,368) -12.7%

Books 5,287 8,067 (2,780) -34.5%

Add-ons 3,893 3,788 105 2.8%

Total 66,804 72,521 (5,718) -7.9%

Revenues at 30 June 2012 pertaining to newsstand subscriptions were recognised inclusive of the

distribution premium, similarly to postal subscriptions.

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(31) Revenue from advertising

Revenue from advertising amounted to €83,088 thousand, with a decrease of €10,907 thousand, or

11.6% YoY.

(32) Other revenue

OTHER REVENUE (in thousands of euro) 1

st Half 2012 1


Software 30,060 32,588 (2,528) -7.8%

Electronic publishing 17,838 17,097 741 4.3%

Revenue from conferences and training 12,248 13,081 (833) -6.4%

IT products 6,923 5,048 1,875 37.1%

Revenue from other products and services 12,628 9,151 3,477 38.0%

Total 79,697 76,966 2,732 3.5%

(33) Other operating income

OTHER OPERATING INCOME (in thousands of euro) 1

st Half 2012 1


Prior year income 380 2,013 (1,633) -81.1%

Sundry expense recoveries 1,746 390 1,356 348.1%

Grants 654 434 220 50.6%

Rent income 386 336 50 14.9%

Other 828 661 168 25.4%

Total 3,995 3,834 161 4.2%

(34) Personnel expense

PERSONNEL EXPENSE (in thousands of euro) 1

st Half 2012 1


Wages & salaries 54,193 58,618 (4,425) -7.5%

Social security charges & pension contributions 18,007 19,683 (1,676) -8.5%

Post-employment benefits 4,200 4,039 161 4.0%

Overtime 1,136 1,345 (209) -15.5%

Holidays 3,715 3,270 445 13.6%

Other personnel expense 1,027 126 901 712.5%

Total 82,279 87,083 (4,803) -5.5%

Personnel expense decreased by €4,803 thousand, due to staff cutbacks that were made as part of

restructuring plans implemented at the end of 2009 and the disposal of certain business units.

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(35) Purchases of raw materials and consumables

PURCHASES OF RAW MATERIALS AND CONSUMABLES



Paper 11,593 10,267 1,326 12.9%

Goods for resale 1,627 1,471 156 10.6%

Photographic material and ink 802 765 37 4.8%

Plant maintenance materials 436 507 (71) -14.0%

Fuel 235 238 (3) -1.3%

Stationery & printed materials 145 117 28 24.0%

Spare parts 220 115 105 91.5%

Packaging materials 76 38 38 100.8%

Other sundry costs 188 182 6 3.3%

Total 15,322 13,700 1,622 11.8%

(36) Services

SERVICES (in thousands of euro) 1

st Half 2012 1


Distribution 20,422 18,431 1,991 10.8%

Commissions & other selling expenses 14,757 17,261 (2,504) -14.5%

Advisory services-freelancers 11,758 11,362 396 3.5%

Printing 11,879 11,974 (95) -0.8%

Advertising & promotion 9,388 8,961 427 4.8%

Editorial costs 8,384 8,402 (18) -0.2%

Miscellaneous production costs 6,121 6,486 (365) -5.6%

Conferences 7,436 4,361 3,075 70.5%

Advertising costs for publishers 4,731 5,020 (289) -5.8%

Set-up costs 3,220 3,535 (315) -8.9%

Utilities (telephone, electricity, water, etc.) 3,232 3,171 61 1.9%

Maintenance & repairs 2,521 2,307 214 9.3%

General facility services 2,039 2,266 (227) -10.0%

Personnel expense refunds 1,692 1,840 (148) -8.0%

Employee services 1,949 1,863 86 4.6%

Press agencies 1,235 1,224 11 0.9%

Software development 1,091 1,135 (44) -3.9%

Product warehousing costs 899 786 113 14.4%

Packing costs 772 964 (192) -19.9%

Insurance 665 567 98 17.3%

Bank expenses 580 292 288 98.8%

News purchase 232 (306) 538 175.9%

Transmission - 8 (8) -100.0%

Total 115,002 111,912 3,093 2.8%

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(37) Use of third party assets

USE OF THIRD PARTY ASSETS (in thousands of euro) 1

st Half 2012 1


Rental costs 8,241 8,167 74 0.9%

Royalties 2,966 1,856 1,110 59.8%

Car rental for company/private use 2,262 2,167 95 4.4%

Copyright royalties 968 1,392 (424) -30.5%

Rental of radio transmission equipment 690 668 22 3.3%

Other fees 811 603 208 34.5%

Hardware lease/rental costs 8 23 (15) -65.8%

Other sundry costs 208 292 (84) -28.8%

Total 16,155 15,168 986 6.5%

(38) Other operating costs

OTHER OPERATING COSTS (in thousands of euro) 1

st Half 2012 1


Prior year costs 1,061 1,218 (157) -12.9%

VAT borne by publisher 1,161 1,197 (36) -3.0%

Miscellaneous taxes 1,309 1,017 292 28.7%

Entertainment expenses 257 262 (5) -1.9%

Purchase of newspapers and magazines 352 408 (56) -13.7%

Association membership dues 375 322 53 16.4%

Purchase of books and magazines for promotional purposes 8 67 (59) -87.5%

Other miscellaneous expenses 1,533 258 1,275 494.5%

Total 6,055 4,749 1,307 27.5%

(39) Gains/losses on disposal of non-current assets

The gains from the disposal of non-current assets totalled €1,001 thousand as at 30 June 2012.

On 25 May 2012, the agreement of 1 July 2011 was finalised, which concerns the sale of the

business unit relating to real time financial information services to WVD Group Italia S.r.l. At the

time, the achievement of economic results was verified, which led to supplementing the price linked

to the sale of the above-mentioned business by €1 million.

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(40) Financial income (expenses)

FINANCIAL INCOME (EXPENSES) (in thousands of euro) 1

st Half 2012 1


Financial income from investment of surplus cash 186 722 (536) -74.2%

Other financial income 70 131 (61) -46.7%

Foreign exchange gains 3 23 (20) -86.6%

Total income 259 876 (617) -70.5%

Foreign exchange losses (20) (22) 2 9.2%

Financial expenses on short-term borrowings (68) (81) 13 16.1%

Financial expenses on medium-/long-term borrowings (39) 25 (64) -252.4%

Other financial expenses (206) (69) (137) -198.8%

Total expenses (334) (146) (186) -127.3%

Total (75) 730 (803) -110.1%

Net financial income was negative for €75 thousand and is broken down as follows:

- financial income of €259 thousand on cash resources and on short-term cash investment.

It was €617 thousand lower than in the same period of the previous year because of the

decline in interest rates and the lower average liquidity in the period;

- financial expenses in the amount of €334 thousand related to medium and long-term

facilitated loans and other financial expenses.

(41) Other income (expenses) from investment assets and liabilities

The other expenses and income from investment assets and liabilities are - €9 thousand and mostly

refer to the liquidation of the companies Mondoesa Campania S.r.l. and E.Veneto S.r.l.

(42) Income taxes

The main income-tax components for the periods ended on 30 June 2012 and 30 June 2011 were as

follows:

INCOME TAXES


st Half 2011 Change

Total current taxes (2,029) (2,936) 907

Deferred tax assets/liabilities 3,749 672 3,077

Prior year’s taxes (168) (10) (158)

Deferred tax assets/liabilities from realignment 6,118 - 6,118

Substitute income taxes (2,604) - (2,604)

Fiscal effect of realignment 3,514 - 3,514

Total 5,066 (2,274) 7,340

Income taxes are calculated using the rate expected to be applied at the end of the year.

The taxes for the half year totalled €5,066 thousand compared with a cost of €2,274 thousand in the

first half of 2011. Compared with the same period of the previous year, the lower tax burden of

24 ORE Group


74

€7,340 thousand is mainly due to the income from the alignment operation to give tax pertinence to

the goodwill recorded for previous mergers.

There is no material difference in the tax rates applied to the various companies of the Group. No

foreign company benefits from preferential tax treatment. For the foreign shareholdings, Italian

taxes have been allocated and are to be paid upon the distribution of dividends.

No company has calculated taxes on reserves taxable on distribution as there are no plans for their

distribution.

(43) Purchase of investments in subsidiaries

The investment in subsidiaries in the first half of 2012 concerns the purchase by Fabbrica 24 S.r.l.

of 70% of the capital of Signet S.r.l. by subscribing the capital increase resolved on 13 June 2012.

The investment equalled €147 thousand; the value of the assets and liabilities acquired is reported in

the table below:

PURCHASE OF INVESTMENTS IN SUBSIDIARIES Item

Signet S.r.l

Intangible assets 29

Trade receivables 5

Trade payables (6)

Other current assets/liabilities 11

Deferred tax assets/liabilities 8

Change in equity attributable to non-controlling interests (57)

Impact on the income statement of the effects of acquisitions 14

Sub total 4

Change in cash 144

Bank overdrafts and loans (1)

Total disbursement 147

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9. Segment reporting

Segment reporting has been prepared in such a way as to provide the information necessary to

evaluate the nature and financial effects of operating activities and of the economic environments

concerned.

The operating segments have been identified based on business operating activities (a) generating

revenue and costs, (b) whose results are regularly reviewed at the highest operating decision-

making level to decide on resource allocation and assess results, and (c) for which separate financial

information is available.

An operating segment identified in compliance with the qualitative requirements illustrated above is

subject to separate reporting when the following quantitative limits were exceeded:

- the segment’s reported revenue, from both external customers and inter-segment sales,

accounts for at least 10% of the combined total revenue of all operating segments;

- its reported profit or loss accounts for at least 10% of the greater, in absolute amount, of

(i) the combined reported profit of all operating segments that reported a profit and (ii)

the combined reported loss of all operating segments that reported a loss;

- its assets account for at least 10% of the combined assets of all operating segments.

If the above quantitative thresholds have not been exceeded, but corporate management has deemed

it useful to provide separate disclosure to aid evaluation of the nature and financial effects of the

related operating activities, the operating segments identified to this end have been subjected to

detailed disclosure.

In the second half of 2011, certain organisational changes modified the Group’s business areas and

reassigned certain activities and responsibilities amongst them. The main changes can be

summarised as follows:

- The Tax & legal, Software solutions and Training and events business unit of the former

Professional area were made independent and separate in terms of responsibilities;

- The business unit related to real time financial reporting was sold in July 2011. This

disposal was treated in the 2011 comparison data as a discontinued operation and the

results are highlighted in a specific line of the income statement.

In order to render the amounts for the two years comparable, the results for 1H11 have been

reclassified to reflect the organisational structure in effect in 2012.

Based on the above criteria, the operating segments for which the Group provides separate reporting

are as follows:

- Publishing is the division that heads up the daily newspaper Il Sole 24 ORE, its bundled

add-on products, theme magazines such as English24, I Viaggi del Sole, the monthly IL –

il maschile de Il Sole 24 ORE, plus a number of primary processes (printing and

distribution) also managed for other Group segments. The area also comprises the

Radiocor news agency and the B2B integrated communication activity targeting SMEs in

specific sectors, including agrifood, retail distribution, construction and welfare, directly

managing dedicated advertising sales forces.

- System, which acts as the advertising sales agency for the Group’s main media – except

for sector-specific publishing, which has its own network – and for some third-party

media;

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76

- Tax & Legal, which develops integrated product systems of technical and regulatory

content targeting mainly professionals, companies and the public administration. The

specific market segments are controlled by three Business Units

(Taxes/Labour/Economy, Law, Construction and Public Administration), which satisfy

all the information, training and operative requirements of the reference targets through

specialist information tools closely integrated one with the other.

- Software Solutions, which includes all the software activities of the 24 ORE Group,

through a functional organisation that covers various activities and addresses the markets

through the brands that make it up. The range specifically comprises software products

with the “Software 24Ore” brand, mainly addressed to professionals such as the Innovare

24 brand products (former STR, former Data Ufficio and former Softlab) that are specific

for the public administration, the construction industry and the lawyer market, and finally

the Esa Software brand products targeting SMEs;

- Training and Events, which organises both specialist training courses for young

university graduates, managers and professionals and annual conferences and events on a

contract basis for large customers all over Italy. Included in the areas are the operations

of the subsidiaries Newton Management Innovation: a management consulting and

training company, and Newton Lab: an event organising and multimedia content

management agency;

- Radio manages the national radio station Radio24, a News & Talk radio with an editorial

format alternating news and entertainment programmes based exclusively on speech.

Every week, over 40 different programmes cover all the key areas of public interest,

ranging from national and international news to business and finance; from topics

concerning the home, work and the environment to sport, culture and leisure; and from

healthcare to wellbeing;

- Culture, which includes the Group activities in the culture segment, through 24 ORE

Cultura S.r.l. and Alinari 24 ORE S.p.A. Its scope ranges from the planning and staging

of art and photography exhibitions to the intermediation of photographic reproduction

rights, the sale of objects and photographs, the publication of essays (Scheiwiller

imprint), art and photographs sold on a catalogue or contract basis, educational and

digital products;

- Digital, which manages the Website www.ilsole24ore.com, its on-line paid contents, the

Shopping24 e-commerce channel and the Group’s presence with consumers on tablets

and smart phones, and co-ordinates all the online activities of the various business areas.

In compliance with the provisions of IAS 34- Interim Financial Reporting, the following

information is provided in relation to the identified sectors:

- revenue from external customers, as regularly presented to the highest operating

decision-making level, for measuring segment profit or loss;

- inter-segment revenue, as regularly presented to the highest operating decision-making

level, for measuring segment profit or loss

- measurement of segment profits and losses, consisting of gross operating profit/loss and

Operating Profit/Loss;

- the total assets for each segment are not shown as the amount shown in the last annual

financial statements has not changed significantly;

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- a description of any difference compared with the latest financial statements concerning

the basis for the sectorial subdivision;

- reconciliation of the total measurements of profit or loss subject to disclosure with

respect to the profit or loss deriving from the separate consolidated half-yearly Income

Statement, before tax costs and gains or losses from discontinued operations.

Information broken down by geographical area is not provided, insofar as the Group’s activities are

concentrated primarily in Italy, with its activities in other countries being immaterial. In regard to

disclosures about company customers, there are no external customers who individually represent

more than 10% of the Group’s total revenue.

INCOME STATEMENTS AND ASSETS BY SEGMENT

SEGMENT Revenue from third parties

Revenue between segments

Tot. Revenue GOP/GOL Gains/losses Operating profit (loss)

PUBLISHING 1st Half 2012 62,180 38,775 100,955 (14,661) - (17,353)

1st Half 2011 62,464 47,068 109,532 (7,362) 6 (10,611)

SYSTEM 1st Half 2012 72,455 4 72,459 (788) - (790)

1st Half 2011 81,784 0 81,784 (1,747) - (1,748)

TAX & LEGAL 1st Half 2012 40,787 412 41,198 12,341 - 12,293

1st Half 2011 45,122 139 45,260 13,201 - 13,192

SOFTWARE SOLUTIONS 1st Half 2012 32,170 114 32,284 2,557 1 (249)

1st Half 2011 34,848 130 34,978 4,983 1 1,013

TRAINING AND EVENTS 1st Half 2012 11,705 717 12,422 1,545 - 1,443

1st Half 2011 12,273 538 12,811 2,186 - 2,126

RADIO - - - - - -

1st Half 2012 311 7,990 8,301 862 - 532

1st Half 2011 137 7,921 8,058 909 - (1,133)

CULTURE 1st Half 2012 6,930 435 7,365 (2,400) - (2,479)

1st Half 2011 4,041 243 4,284 (330) - (395)

DIGITAL 1st Half 2012 2,823 7,103 9,926 1,933 - 1,932

1st Half 2011 2,592 6,611 9,203 1,534 - 1,533

CORPORATE AND CENTRALISED SERVICES 1st Half 2012 229 121 349 (5,590) 1,000 (9,031)

1st Half 2011 220 107 332 (2,647) 319 (6,908)

CONSOLIDATED 1st Half 2012 229,589 - 229,589 (4,201) 1,001 (13,702)

1st Half 2011 243,482 - 243,482 10,727 325 (2,930)

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10. Other information

10.1 Subsequent events

On 24 July 2012 Giampaolo Galli resigned from the office of non-executive Director of Il Sole 24

ORE S.p.A. with immediate effect. Mr. Galli did not belong to any company committee and did not

qualify as Independent Director.

On 26 July 2012, control over Diamante S.p.A. was acquired following the purchase by Innovare24

S.p.A. of 45.015% of the capital. From that date, the Group owns 75.015%.

The disbursement equalled €1,200 thousand and is to be added to the 30% value recorded, equal to

€1,180 thousand. The framework agreement envisages the progressive purchase of the remaining

share, by the time the financial statements 2015 are approved, at a price that varies according to the

results of the 2013 – 2015 three-year period. The value of the assets and the acquired goodwill are

being determined.

The purchase was aimed at supplementing the range of the Software Solutions area to develop the

Group’s Cloud computing platform.

10.2 Related-party transactions

A related party is a person or entity related to the parent, indicated in compliance with the

provisions of Ias 24 Related party disclosures. The definition of related party always includes

subsidiaries owned by the associates and joint ventures of the parent.

According to IAS 34 Interim Financial Reporting, if significant related-party transactions have been

carried out as at the reference date of these condensed half-yearly consolidated financial statements,

with reference to the transactions performed, the nature of the relation with the related party is

stated, together with the amount of the transactions, the amount of the existing balances, including

commitments, contractual terms and conditions, any guarantee received or provided as well as any

allowances for doubtful receivables or impairment losses on receivables.

The relations between the parent company and the subsidiaries are always stated, regardless of any

transactions carried out between them.

Information regarding related parties and the relationships with them is summarised in the table in a

summarising table, with specific indication of the transactions, positions or balances that have an

impact on the Group’s statement of financial position, results of operations or cash flows. The

transactions and the balances regarding intercompany related parties are eliminated when preparing

these condensed half-yearly consolidated financial statements.

Related-party transactions are limited to those with subsidiaries and associates concerning

commercial, administrative and financial services. These transactions form part of normal business

operations and of the core business of each of the companies involved, and are regulated at market

conditions.

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RELATED-PARTY TRANSACTIONS

Company Receivables and

other assets

Financial receivabl

es

Payables and other liabilities

Financial

liabilities

Revenue and

operating income

Costs Financi

al income

Financial

expenses

Confederazione Generale dell'Industria Italiana (Confederation of Italian Industry) 58 - - - 81 - - -

Total ultimate parent entity 58 - - - 81 - - -

Innovare24 S.p.A. 213 13,091 (1,582) - 232 (548) 50 -

Nuova Radio S.p.A. 1,238 - (378) (2,845) 1,250 (7,961) - (4)

Il Sole 24 ORE Uk Ltd - - (173) - - (273) - -

24 ORE Cultura S.r.l. 251 6,024 (442) - 436 (434) 26 -

Newton Managment Innovation S.p.A. 203 160 (15) - - (12) 240 -

Newton Lab S.r.l. 56 - - - - - - -

Alinari 24 ORE S.p.A. 23 4,021 (52) - 23 (110) 21 -

Esa Software S.p.A. 84 898 (14) - 106 (82) - -

Business Media Web S.r.l. in liquidation 99 - (72) - 17 (152) - -

Shopping 24 S.r.l. 15 178 - - 15 - 1 -

Fabbrica 24 S.r.l. - 350 - - - - - -

Signet S.r.l. - - - - - - - -

Total subsidiaries 2,182 24,721 (2,729) (2,845) 2,079 (9,572) 338 (4)

Diamante S.p.A. - - (43) - 1 (160) - -

Italia news S.r.l. in liquidation - - - - - - - -

Total associates - - (43) - 1 (160) - -

Sipi S.r.l. 91 - (109) - 79 (175) - -

Key executives - - (220) - - (1,911) - -

Other executives - - (1,589) - - (4,915) - -

Board of Directors - - (188) - - (300) - -

Board of Statutory Auditors - - (127) - - (127) - -

Other related-party persons 193 - (367) - 152 (717) - -

Total other related parties 284 - (2,601) - 230 (8,146) - -

Total related parties 2,524 24,721 (5,372) (2,845) 2,392 (17,877) 338 (4)

Financial receivables and payables relate to:

- current account relationships with the subsidiaries Innovare 24 S.p.A., Nuova Radio

S.p.A., 24 ORE Cultura S.r.l., Alinari 24 Ore S.p.A., ESA Software S.p.A., Shopping 24

S.r.l. and Fabbrica 24 S.r.l. to maximise the earnings on Group cash deposits. To its

receivable balances, the parent applies an interest rate of 1-month Euribor/365 basis plus

½ of a percentage point. To its payable balances, the parent applies an interest rate of 1-

month Euribor/365 basis;

- receivables from Newton Management Innovation S.p.A. for resolved dividends not yet

distributed.

- Trade receivables and other assets mainly relate to:

- amounts receivable from the parent, Confederazione Generale dell'Industria Italiana, for

the sale of advertising spaces, subscriptions and online products;

- receivables from the subsidiaries Innovare 24 S.p.A., Nuova Radio S.p.A., 24 ORE

Cultura S.r.l. and ESA Software S.p.A. for charge-backs of centralised service costs;

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80

- receivables from the subsidiaries Newton Management Innovation S.p.A. and Newton

Lab S.r.l. for the transfer of tax credits;

- amounts receivable from the related companies Sipi S.r.l. and Gabetti Property Solutions

S.p.A., including among other related-party persons, for the sale of advertising spaces.

- Payables and other liabilities mainly relate to:

- indemnity letter issued to Innovare 24 S.p.A. to hedge the liabilities attributable to the

counterparty selling the shares of Esa Software S.p.A.

- payables to subsidiaries: Innovare 24 S.p.A. for the customisation of software products

and operations services; Nuova Radio S.p.A. for return of the publisher’s percentage on

sale of radio advertising time; Il Sole 24 ORE UK Ltd. for intermediation activity

relating to the sale of advertising space in the UK; 24 ORE Cultura S.r.l. for organising

events and providing promotional services;

- payables to the associate Diamante S.p.A. for software development and related royalties;

- payables to related companies: Sipi S.r.l. for advertising fees and sponsorships; Agenzia

Ansa Scarl for the purchase of news and consultation of archives.

Operating revenue and income mainly relate to:

- the lease to Nuova Radio S.p.A. of premises at Via Monte Rosa 91 in Milan;

- charge-back of centralised services to Group companies;

- sale of advertising space in Group-owned publications;

Costs mainly refer to:

- the publisher’s percentage of advertising revenue for Nuova Radio S.p.A., Business

Media S.r.l. in liquidation and Sipi S.r.l.;

- commission expenses arising from the intermediation for the sale of advertising space in

the United Kingdom by Il Sole 24 Ore UK Ltd.;

- charge-backs of support services for centralised, production, marketing and sponsoring

activities by Group companies;

- charge-backs of development costs and software royalties.

Financial income and expenses refer to interest income and expenses on the correspondence bank

accounts with the subsidiaries and the distributed dividends of Newton Management Innovation

S.p.A.

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10.3 Disclosures pursuant to CONSOB resolution No. 15519 of 27 July 2006

Statement of financial position pursuant to CONSOB resolution No. 15519 of 27 July 2006

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(in thousands of euro) Note (*) 30.06.2012

of which related parties

31.12.2011 of which

related parties

ASSETS

Non-current assets

Property, plant and equipment (1) 74,855 - 77,547 -

Goodwill (2) 74,993 - 73,474 -

Intangible assets (3) 83,308 - 85,673 -

Investments in associates and joint ventures (4) 2,102 2,102 2,291 2,291

Available-for-sale financial assets (5) 1,171 - 1,171 -

Other non-current financial assets (6) 753 - 20,411 -

Other non-current assets (7) 862 - 854 -

Deferred tax assets (8) 57,281 - 47,222 -

Total 295,326 2,102 308,643 2,291

Current assets

Inventories (9) 12,829 - 12,469 -

Trade receivables (10) 172,130 342 188,214 202

Other receivables (11) 10,694 - 8,503 -

Other current assets (12) 9,736 - 6,279 -

Cash and cash equivalents (13) 49,259 - 31,431 -

Total 254,648 342 246,894 202

Assets held for sale - - - -

TOTAL ASSETS 549,974 2,444 555,537 2,493


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CONSOLIDATED STATEMENT OF FINANCIAL POSITION (cont.)

(in thousands of euro) Note (*) 30.06.2012


31.12.2011 of which related parties

EQUITY AND LIABILITIES

Equity

Equity attributable to owners of the parent

Share capital (14) 35,124 - 35,124 -

Equity reserves (15) 180,316 - 180,316 -

Revaluation reserves (16) 20,561 - 20,561 -

Hedging and translation reserves (17) (220) - (229) -

Other reserves (18) 23,785 - 25,025 -

Retained earnings (Loss brought forward) (19) (12,857) - (4,491) -

Profit (loss) attributable to owners of the parent (20) (8,420) - (8,366) -

Total 238,289 - 247,940 -

Equity attributable to non-controlling interests

Capital and reserves attributable to non-controlling interests 165 - 342 -

Profit (loss) attributable to non-controlling interests (20) (489) - (25) -

Total (324) - 317 -

Total equity 237,965 - 248,257 -

Non-current liabilities

Non-current financial liabilities (21) 4,718 - 5,916 -

Employee benefit obligations (22) 33,812 879 31,977 913

Deferred tax liabilities (8) 15,452 - 16,055 -

Provisions for risks and charges (23) 12,978 - 13,220 -

Other non-current liabilities (24) 34 - 34 -

Total 66,994 879 67,202 913

Current liabilities Bank overdrafts and loans - due within one year (25) 3,096 - 2,764 -

Financial liabilities held for trading (26) 305 - 317 -

Trade payables (27) 171,029 834 161,711 845

Other current liabilities (28) 17,869 - 9,792 -

Other payables (29) 52,717 930 65,494 830

Total 245,015 1,764 240,078 1,675

Liabilities held for sale - - - -

Total liabilities 312,009 2,643 307,280 2,588

TOTAL EQUITY AND LIABILITIES 549,974 2,643 555,537 2,588


24 ORE Group


83

Income Statement pursuant to CONSOB Resolution No. 15519 of 27 July 2006

SEPARATE INCOME STATEMENT

(in thousands of euro) Note (*) 1

st Half 2012


of which non-

recurring transactions

1st Half 2011


of which non-

recurring transactions

1) Continuing operations

Revenue from newspapers, books and magazines (30) 66,804 20 - 72,521 21 -

Revenue from advertising (31) 83,088 244 - 93,995 145 -

Other revenue (32) 79,697 48 - 76,966 70 -

Total revenue 229,589 312 - 243,482 236 -

Other operating income (33) 3,995 - - 3,834 - -

Personnel expense (34) (82,279) (6,641) - (87,083) (6,270) -

Change in inventories (9) 361 - - 584 - -

Purchase of raw materials and consumables (35) (15,322) - - (13,700) - -

Services (36) (115,002) (1,634) - (111,912) (1,601) -

Use of third party assets (37) (16,155) (27) - (15,168) (31) -

Other operating costs (38) (6,055) (3) - (4,749) - -

Provisions (23) (854) - - (774) - -

Allowance for impairment (10) (2,481) - - (3,787) - -

Gross operating profit (loss) (4,201) (7,993) - 10,727 (7,666) -

Amortisation of intangible assets (3) (5,297) - - (8,498) - -

Depreciation of property, plant and equipment (1) (5,204) - - (5,484) - -

Gains/losses on disposal of non-current assets (39) 1,001 - 1,000 325 - -

Operating profit (loss) (13,702) (7,993) 1,000 (2,930) (7,666) -

Financial income (40) 259 - - 876 - -

Financial expenses (40) (334) - - (146) - -

Total financial income (expenses) (75) - - 730 - -

Other income (expenses) from investment assets and liabilities (41) (9) - - (127) - -

Profits (losses) from equity-accounted investees (4) (189) - - - - -

Profit (loss) before tax (13,974) (7,993) 1,000 (2,327) (7,666) -

Income taxes (42) 5,066 - - (2,273) - -

Profit (loss) from continuing operations (8,909) (7,993) 1,000 (4,601) (7,666) -

2) Discontinued operations -

Profit (loss) from discontinued operations - - - 104 - -

Profit (loss) for the year (20) (8,909) (7,993) 1,000 (4,496) (7,666) -

Profit (loss) attributable to non-controlling interests (20) (489) - - 39 - -

Profit (loss) attributable to owners of the parent (20) (8,420) (7,993) 1,000 (4,535) (7,666) -


24 ORE Group


84

Statement of Cash Flows pursuant to CONSOB Resolution No. 15519 of 27 July 2006

CONSOLIDATED STATEMENT OF CASH FLOWS

(in thousands of euro) Note (*) 1st Half 2012


1st Half 2011


A) CASH FLOWS FROM OPERATING ACTIVITIES

Profit (loss) attributable to owners of the parent (20) (8,420) - (4,535) -

Adjustments for: Profit (loss) from discontinued operations - (104) Depreciation of property, plant and equipment (1) 5,204 - 5,484 -

Amortisation of other intangible assets (3) 5,297 - 8,498 -

Impairment losses on non-current assets (4) 189 - - -

(Gain) loss on sale of property, plant and equipment (39) (1) - (323) -

(Gain) loss on sale of intangible assets - - (2) -

(Gain) loss on sale of business units (39) (1,000) - - -

(Gain) loss on sale of investments in associates (41) (1) - 176 -

(Gain) loss on sale of available-for-sale financial assets - - (50) -

Increase (decrease) in provisions for risks and charges (23) (242) - (1,403) -

Increase (decrease) in employee benefits (22) 1,835 (34) (3,369) 2,151

Increase (decrease) in deferred tax assets/liabilities (8)(43) (10,654) - (444) -

Annual instalment of substitute tax 781 - 136 -

Entry in the income statement of the effects of acquisitions (43) 14 - - -

Net financial income (expenses) (40)(41) 85 - (730) -

Cash flows from (used in) discontinued operations prior to change in net working capital - 354

Cash flows used in operating activities prior to change in net working capital (6,913) (34) 3,689 2,151

(Increase) decrease in inventories (9) (361) - (584) -

(Increase) decrease in trade receivables (10)(43) 16,089 (140) (36,902) (127)

Increase (decrease) in trade payables (27)(43) 9,311 (11) 14,623 (192)

Income taxes paid (2,672) - (912) -

(Increase) decrease in other assets/liabilities (8,446) - (1,391) -

Changes in discontinued operations - 37

Changes in net working capital 13,921 (185) (25,128) 1,832

TOT. NET CASH FROM CONTINUING OPERATIONS 7,008 (21,830)

TOT. NET CASH FROM DISCONTINUED OPERATIONS - 391

TOT. NET CASH FROM OPERATING ACTIVITIES (A) 7,008 (185) (21,439) 1,832

24 ORE Group


85

CONSOLIDATED STATEMENT OF CASH FLOWS (CONT.)

(in thousands of euro) Note (*) 1st Half 2012


1st Half 2011


B) CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds of sale of associates (41) 1 - 1 -

Proceeds on sale of property, plant and equipment (1)(39) 4 - 418 -

Proceeds on sale of intangible assets (0) - 2 -

Proceeds on sale of business units (39) 1,000 - - -

Proceeds on sale of available-for-sale financial assets - - 57 -

Investments in property, plant and equipment (1) (2,526) - (2,039) -

Investments in intangible assets (3) (2,893) - (2,094) -

Other changes in property, plant and equipment (1) 5 - 11 -

Other changes in intangible assets (3) (4) - 20 -

Other increases in goodwill (2) (1,519) - - -

Purchase of investments in subsidiaries (43) (4) - - -

Other decreases (increases) in other non-current assets and liabilities (7)(24) (8) - 334 -

Changes in discontinued operations - (101)

TOT. NET CASH USED IN INVESTING ACTIVITIES (B) (5,945) - (3,392) -

FREE CASH FLOW CONTINUING OPERATIONS 1,063 (25,122)

FREE CASH FLOW DISCONTINUED OPERATIONS - 290

FREE CASH FLOW (A + B) 1,063 (185) (24,832) 1,832

C) CASH FLOWS FROM FINANCING ACTIVITIES

Dividends paid (204) - (128) -

Raising (repayment) of medium/long-term bank loans (21) (1,198) - (1,187) -

Change in other non-current financial assets (6) 19,657 - (282) -

Change in financial assets/liabilities held for trading (26) (13) - (175) -

Net financial interest received (40)(41) (85) - 730 -

Change in equity attributable to non-controlling interests (493) - 38 -

Other changes in reserves (1,232) - 215 -

TOT. NET CASH USED IN FINANCING ACTIVITIES (C) 16,434 - (788) -

NET INCR. (DECR.) IN CASH AND. CASH EQUIVALENTS 17,497 (185) (25,620) 1,832

OPENING CASH AND CASH EQUIVALENTS 28,667 - 73,629 -

CLOSING CASH AND CASH EQUIVALENTS (13) 46,164 - 48,009 -

INCREASE (DECREASE) FOR THE YEAR 17,497 - (25,620) -


24 ORE Group


86

No atypical and/or unusual transactions were carried out with third parties, related parties or Group

companies.

10.4 Seasonality of Group business

The Group’s business is subject to seasonality, consisting of a slowdown in revenues – both from

circulation and, above all, advertising – in the summertime. Given this, first-half performance

cannot be considered representative of the Group’s full-year operating performance.

RESULTS OF RECENT HALF-YEAR PERIODS (in thousands of euro) 1

st Half 2011 2

st Half 2011 1

st Half 2012

Revenue

243,482

224,163 229,589

Gross operating profit (loss)

10,727

824 (4,201)

Operating profit (loss)

(2,930)

(8,559) (13,702)

The figures illustrated above are merely provided for reference purposes and may not be used in

forecasting future results.

Financial performance is affected by seasonality relating not only to the operating trend indicated

above, but also to the dynamics of the taking out and renewal of subscriptions for the newspaper

and magazines, which are concentrated in the first part of the year.

10.5 Net financial position

The following table details the components of the net financial position:

NET FINANCIAL POSITION (in thousands of euro) 30.06.2012 31.12.2011

Cash and cash equivalents 49,259 31,431

Bank overdrafts and loans - due within one year (3,096) (2,764)

Short-term net financial position 46,164 28,667

Non-current financial liabilities (4,718) (5,916)

Non-current financial assets - 19,657

Fair value changes in financial hedging instruments (305) (317)

Medium-long term net financial position (5,023) 13,424

Net financial position 41,141 42,091

24 ORE Group


87

10.6 Employees

The average number of employees in the six months by contractual category was as follows:

AVERAGE HEADCOUNT OF 24 ORE GROUP

1st Half 2012 1

st Half 2011 Change

AVERAGE HEADCOUNT Number % Number % Number %

Managers

81.1 4.4%

92.7 4.6%

(11.7) -12.6%

Journalists

400.6 21.6%

418.5 20.8%

(18.0) -4.3%

White Collars

1,264.3 68.1%

1,375.9 68.2%

(111.7) -8.1%

Blue-collars

110.7 6.0%

129.8 6.4%

(19.2) -14.8%

Total

1,856.6 100.0%

2,017.0 100.0%

(160.5) -8.0%

The exact number of employees as at the reference date by contractual category was as follows:

EXACT NUMBER OF EMPLOYEES

1st Half 2012 Year 2011

EXACT HEADCOUNT Number % Number %

Managers

83 4%

87 5%

Journalists

405 22%

408 21%

White Collars

1,276 68%

1,301 68%

Blue-collars

110 6%

115 6%

Total

1,874 100%

1,911 100%

Milan, 31 July 2012


GIANCARLO CERUTTI

(original signed)

24 ORE Group


88

Certification of condensed half-yearly financial statements pursuant to Article 81-ter of CONSOB Regulation No. 11971 of 14 May 1999 as amended

1. The undersigned Donatella Treu, in her capacity as Chief Executive Officer, and Massimo

Luca ARIOLI, in his capacity as Corporate Financial Reporting Manager of Il Sole 24 ORE S.p.A.,

hereby certify, pursuant to, inter alia, the provisions of Article 154-bis, paragraphs 3 and 4, of

Italian Legislative Decree No. 58 of 24 February 1998 [the Italian Consolidated Law on Finance]:

- - the adequacy in relation to the entity’s characteristics; and

- - the effective application of administrative and accounting procedures for preparation of

the condensed half-yearly financial statements during the first half of 2012.

2. The adequacy of the administrative and accounting procedures used to prepare the

condensed half-yearly financial statements as at and for the period ended 30 June 2012 has been

assessed based on the methodological rules defined by Il Sole 24 Ore S.p.A. and consistent with the

“Internal Control – Integrated Framework” model issued by the Committee of Sponsoring

Organizations of the Treadway Commission, which is a benchmark framework for the internal

control system generally accepted internationally.

3. They separate further certify that:

3.1. the condensed half-yearly financial statements:

- - have been drafted in compliance with the applicable International Financial Reporting

Standards recognised in the European Union pursuant to EC Regulation 1606/2002 of the

European Parliament and Council of 19 July 2002;

- - are consistent with the corporate books and accounting records;

- - give a fair and true view of the financial position and results of operations of the issuer

and of the companies included in the scope of consolidation.

3.2. The interim management report includes a reliable analysis of references to the important

events occurring in the first six months of the financial year and their impact on the condensed half-

yearly financial statements, as well as a description of the principal risks and uncertainties for the

remaining six months of the financial year. The interim management report also comprises a

reliable analysis of information concerning significant related-party transactions.

Milan, 31 July 2012

Chief Executive Officer Corporate financial reporting manager

Donatella TREU Massimo Luca ARIOLI

(original signed) (original signed)

half-yearly financial report as at 30 june 2012 · 2012 half-yearly financial report 2 ......

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