Analysis of changes

The most significant changes were recorded by (i) Arse (- 10.8 million euros) which began marketing photovoltaic panels during the year, reducing acquisitions of assets, (ii) ACEA Distribuzione (- 14.6 million euros), (iii) Eall (- 33.4 million euros) due to the impending entry into operation of the second and third lines, (iv) Kyklos (- 7.1 million euros) for the completion of the Aprila composting plant in the previous year, (v) AceaElectrabel Produzione (+ 7.3 million euros) for investments in wind plants.

  • investments amounted to 35.8 million euros, marking an increase of 1.4 million euros, due mainly to the valuation at equity of companies consolidated using said method (up 3.1 million euros overall) and the sale, at par value, of the investment in Centro Agroalimentare Romano (1.1 million euros).
  • the balance of other non-current assets (299.9 million euros) is composed principally of deferred tax assets (273.6 million euros), long-term receivables deriving from the Public Lighting service contract for 17.9 million euros, which represents the unconditional right to receive a cash flow in line with the methods and timeframes set out in said contract from 1 June 2005 – 30 May 2015, prepaid expenses (6.5 million euros) relating predominantly to the production of white certificates. The balance of non-current assets increased by 27.9 million euros (+ 10.3%) compared to the previous year, essentially as a result of the recording of higher deferred tax assets set aside on the basis of earnings forecasts in the company’s plans which confirm the likelihood that sufficient future taxable income will be generated against which all prepaid taxes can be recovered.
  • defined Benefit plans amounted to 110.8 million euros, recording a decrease in receivables of 12.5 million euros compared to the end of the previous year, of which
    • 6.8 million euros relating to staff termination benefits
    • 3.9 million euros relating to tariff subsidies
    • and, lastly, 1.9 million relating to the medium/long term Incentive Scheme

The performance of the first two items was affected by exits in 2010, in particular as a result of the implementation of ACEA Ato2 and ACEA Distribuzione voluntary mobility schemes; the medium/long term Incentive Scheme felt the effects of the release (3.1 million euros) of the amount set aside for the first cycle (2007-2009 three-year period) given the plan’s objectives were not achieved,

  • the provision for liabilities and charges contributed 200.8 million euros to net invested capital, falling by 42.1 million euros compared to the previous year, mainly due to uses (totalling 89.2 million euros) of sums set aside in 2009 to cover mobility and tax risks. In particular, this relates to the definition of tax settlement proposals regarding the tax inspections of ACEA and AceaElectrabel Elettricità (totalling 48.5 million euros). The provision increased during the year due to allocations of 47.2 million euros. For a breakdown please refer to note no. 4 of the Consolidated Income Statement.
    Therefore, at 31.12.10, the provision for liabilities and charges essentially included: (i) 57.1 million euros for the valuation of legal risks (disputes, litigation, etc.), (ii) 40.4 thousand relating to potential liabilities and charges relating to staff including therein disputes over contributions, (iii) 10.9 million euros for the potential disputes with suppliers or losses on contracts, (iv) 2.6 million euros relating to the estimate of risks related to the management of investees and/or ex-investees, (v) 41.5 million euros for the allocation of recovery costs essentially relating to water services provided under a concession arrangement, (vi) 15.4 million euros mainly referring to the valuation of post-operating charges connected with the management of the SAO (Orvieto) landfill, (vii) 10.6 million euros relating to the recording of loans which Gori is required to repay to the Municipalities, as set out in the Area Plan, (viii) 6.5 million euros relating to expenses allocated for possible losses on receivables recorded against works performed, (ix) 4.4 million euros relating to generation company dismantling costs, (x) 3.5 million euros relating to costs of the mobility and redundancy schemes, (xi) 2.3 million euros tied to expenses allocated for the dispute that arose between GORI and the Campania Region.
    ACEA maintains that the settlement of ongoing disputes and other potential disputes should not create any additional charges for Group companies, with respect to the amounts set aside. These provisions reflect the best possible estimate based on the information available.
    For more information, please refer to the Notes to the 2010 Consolidated Financial Statements, and in particular, the section entitled “Update on major disputes and litigation",
  • other non-current liabilities contribute 333.3 million euros to the reduction in net invested capital and, compared to 31 December 2009, increased by 38.1 million euros (up 12.9%). This item consists of:
    • provision for deferred taxes of 105.6 million euros (+ 13.6 million euros)
    • advances totalling 96 million euros (up 26.3 million euros): this item includes the amount of guarantee deposits and consumption
    • advance subject to adjustment by water service companies,
    • grants related to assets of 108.2 million (- 3.4 million euros),
    • long-term deferred income of 23.4 million euros (+ 1.6 million euros).