Revenues for the first half of 2017 came to 7,494 million euros and were up by 247 million euros (+3.4%) compared to the first half of 2016,
continuing the improvement seen in the previous year. Indeed, the second quarter saw growth of +4.0% on the same period of 2016, representing a rise on the previous quarters (first quarter 2017 +2.8%, fourth quarter 2016 +2.5%, third quarter +1.0%,
second quarter
-1.2%,
and first quarter
-2.3%).
Revenues from services also showed a similar trend, at 6,842 million euros (+21 million euros on the first half
of 2016), with a turnaround into positive territory, at +0.3% in the half year (+0.9% in the second quarter 2017,
-0.3%
in the first quarter 2017 and
-1.3%
in the fourth
quarter 2016). This improvement was driven by the growth in both the Mobile and Fixed Broadband customer base, the increase in ARPU levels (thanks to the higher adoption of Fiber and LTE ultrabroadband connectivity services, and digital and ICT
services), also accompanied by higher sales volumes for connected devices (Smartphones, SmartTVs, SmartHomes, Modems, etc.).
Revenues from product sales, including the change in work in progress, amounted to 652 million euros in the first half of 2017 (+226 million euros
compared to the first half of 2016) and reflected the steady increase in sales of smartphones and connected devices (smart TVs, Smart Home products, modems,
set-top
boxes, etc.).
EBITDA for the Domestic Business Unit totaled
3,361 million euros for the first half of 2017, up by 177 million euros compared to the first half of 2016 (+5.6%), with an EBITDA margin of 44.8% (+0.9 percentage points compared to the same period of the previous year). In organic terms,
the increase was +5.5%. The first half of 2017 reflected the negative impact of
non-recurring
expenses totaling 95 million euros (83 million euros for the same period of the previous year) for
settlements, disputes and redundancy costs.
Without these expenses the organic change in EBITDA would have been +5.7%, with an EBITDA margin of 46.1%, up
1 percentage point on the first half of 2016.
The EBITDA performance, in addition to the improvement in sales earnings and the revenue performance, also
reflected the positive impacts achieved by the program of cost transformation and simplification of business processes, which started to have an effect from the second quarter of 2016. As already reported in the first quarter of 2017, resources
continued to be focused on marketing, to support sales initiatives and customer management, while reducing industrial and general operating costs.
Other income amounted to 199 million euros, up 101 million euros on the first half of 2016. This item includes
contribution fees resulting from partnership agreements already discussed in relation to the consolidated operating performance.
EBIT of the Domestic Business Unit for the first half of 2017 came to 1,685 million euros (1,581 million euros in the same period of 2016), up
104 million euros (+6.6%), with an EBIT margin of 22.5% (21.8% in the first half of 2016). The EBIT performance mainly reflected the improvement in EBITDA reported above, partially offset by the increase in depreciation and amortization, of
+78 million euros. In organic terms the increase was 6.5%.
EBIT for the first half of 2017 was pulled down by a total of 95 million euros in
non-recurring
expenses (83 million euros for the same period of the previous year), without which the organic change in EBIT would have been 6.9%, with an EBIT margin of 23.8%.
The main financial and operating highlights of the
Domestic Business Unit are reported according to two Cash Generating units (CGU):
Key results for the first half of 2017 for the Domestic Business Unit are presented in the following tables,
broken down by market/business segment and compared to the first half of 2016.
Revenues
for the Telecom Italia Sparkle group International Wholesale in the first half of 2017 totaled 646 million euros, substantially in line with the figure for the first half of 2016
(-3 million
euros,
-0.5%).
This result was due to the decline in revenues from IP/Data services
(-11 million
euros,
-7.5%),
mainly
attributable to the fall in revenues from the Mediterranean area as a result of the expiry of old long-term contracts, partially offset by the growth in revenues from Voice services (+8 million euros, +1.8%).
BRAZIL
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
(millions of reais)
|
|
|
|
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
amount
|
|
|
%
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(c)
|
|
|
(d)
|
|
|
(c-d)
|
|
|
(c-d)/d
|
|
Revenues
|
|
|
2,293
|
|
|
|
1,858
|
|
|
|
7,894
|
|
|
|
7,674
|
|
|
|
220
|
|
|
|
2.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
762
|
|
|
|
556
|
|
|
|
2,624
|
|
|
|
2,296
|
|
|
|
328
|
|
|
|
14.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA Margin
|
|
|
33.2
|
|
|
|
29.9
|
|
|
|
33.2
|
|
|
|
29.9
|
|
|
|
|
|
|
|
3.3
|
pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
|
|
|
194
|
|
|
|
121
|
|
|
|
669
|
|
|
|
498
|
|
|
|
171
|
|
|
|
34.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT Margin
|
|
|
8.5
|
|
|
|
6.5
|
|
|
|
8.5
|
|
|
|
6.5
|
|
|
|
|
|
|
|
2.0
|
pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Headcount at period end (number)
|
|
|
|
|
|
|
|
|
|
|
9,471
|
|
|
|
(1)
9,849
|
|
|
|
(378
|
)
|
|
|
(3.8
|
)
|
(1)
|
Headcount at December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
Lines at period end (thousands)
|
|
|
60,831
|
|
|
|
(1)
63,418
|
|
|
|
|
|
|
|
|
|
|
MOU (minutes/month)
(*)
|
|
|
106.7
|
|
|
|
118.4
|
|
|
|
|
|
|
|
|
|
|
ARPU (reais)
|
|
|
19.2
|
|
|
|
17.2
|
|
(1)
|
Number at December 31, 2016, including corporate lines
|
Revenues
Revenues for the first half of 2017 amounted to
7,894 million reais and were up 220 million reais (+2.9%)
year-on-year.
Service revenues totaled 7,494 million reais, an increase of 305 million
reais compared to 7,189 million reais for the first half of 2016 (+4.2%). These results confirm the continued improvement in the trend, with positive growth in the second quarter of 2017 both in total revenues (+3.2% compared to +2.5% for the
first quarter of 2017 and
-1.7%
for the fourth quarter of 2016) and in revenues from services (+5.0% compared to +3.5% for the first quarter 2017 and
-0.7%
for the
fourth quarter of 2016).
Mobile Average Revenue Per User (ARPU) for the first half of 2017 was 19.2 reais, up on the figure of 17.2 reais for the first
half of 2016 (+11.6%), due to the general repositioning towards the postpaid segment and new commercial initiatives aimed at increasing data usage and the average spend per customer.
The total number of lines at June 30, 2017 was 60,831 thousand, representing a decrease of 2,587 thousand on December 31, 2016 (63,418
thousand), with a market share of 25.1% in June 2017 (26.0% at December 31, 2016). This reduction was entirely attributable to the prepaid segment
(-3,540
thousand) and was only partially offset by the
growth in the postpaid segment (+953 thousand), also as a result of the consolidation underway in the market for second SIM cards. Postpaid customers represented 26.0% of the customer base at June 30, 2017, up 2.5 percentage points on December
2016 (23.5%).
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Financial and Operating Highlights of the Business Units of the TIM Group
Brazil Business Unit
|
|
21
|
Revenues from product sales came to 400 million reais (485 million reais in the first half of 2016
(-17.5%).
The reduction reflects the change in the commercial policy, which is now more focused on value rather than sales volume growth. The main goals of this strategy are to increase the purchasing of new
handsets giving TIM customers access to broadband services on 3G/4G networks and to support the new loyalty offerings for higher-value postpaid customers. This new strategy is reflected in an increase in the average handset price of +7.7% compared
with the first half of 2016 and an increase in smartphone penetration within the Companys total customer base, which reached 77% in May 2017 (70% in June 2016).
EBITDA
EBITDA amounted to 2,624 million reais, up 328 million reais on the first half of 2016 (+14.3%). The growth in EBITDA was attributable to both the
positive performance of revenues and the benefits from the projects to enhance the efficiency of the operating expenses structure, launched in the second half of 2016, with an improvement in the second quarter (+15.8% compared to +12.6% in the first
quarter of 2017 and +5.8% in the fourth quarter of 2016).
The EBITDA margin stood at 33.2%, 3.3 percentage points higher than in the first half of 2016.
You are also reminded that the employee benefits expenses for the first half of 2016 included
non-recurring
expenses for termination benefits of 34 million reais.
Even without the impact of these
non-recurring
expenses, EBITDA for the first half of 2017 showed an increase (+12.6%) compared to the first half of 2016, continuing the trend of steady improvement in the second quarter (+15.7% compared to +9.4% for the first quarter of 2017 and +2.1% for the
fourth quarter of 2016).
The changes in the main cost items are shown below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
(millions of reais)
|
|
|
|
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
Change
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(c)
|
|
|
(d)
|
|
|
(c-d)
|
|
Acquisition of goods and services
|
|
|
1,169
|
|
|
|
978
|
|
|
|
4,025
|
|
|
|
4,041
|
|
|
|
(16
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses
|
|
|
178
|
|
|
|
161
|
|
|
|
613
|
|
|
|
663
|
|
|
|
(50
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses
|
|
|
262
|
|
|
|
224
|
|
|
|
901
|
|
|
|
925
|
|
|
|
(24
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
(5
|
)
|
|
|
(8
|
)
|
|
|
(18
|
)
|
|
|
(31
|
)
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
EBIT amounted to 669 million reais, up 171 million reais (+34.3%) on the first half of 2016 (498 million reais). This result benefited from the
greater contribution from the EBITDA (+328 million reais), which was offset by higher depreciation (+119 million reais) related to the development of industrial infrastructure, and a lower impact of net gains on disposals of assets
(-38 million
reais), mainly attributable to the telecommunication towers. In this regard, we note that the last partial sale of telecommunication towers to American Tower do Brasil took place in the second
quarter of 2017. This transaction resulted in proceeds and an income effect of an immaterial amount.
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Financial and Operating Highlights of the Business Units of the TIM Group
Brazil Business Unit
|
|
22
|
CONSOLIDATED FINANCIAL POSITION AND CASH FLOWS PERFORMANCE
NON-CURRENT
ASSETS
|
|
Goodwill: this decreased by 101 million euros, from 29,612 million euros at the end of 2016 to 29,511 million euros at June 30, 2017 due to the negative variation in exchange rates for the Brazilian
companies
(1)
. Further details are provided in the Note Goodwill in the Half-year Condensed Consolidated Financial Statements at June 30, 2017 of the TIM Group.
|
|
|
Other intangible assets: were down 357 million euros, from 6,951 million euros at the end of 2016 to 6,594 million euros at June 30, 2017, representing the balance of the following items:
|
|
|
|
capex (+673 million euros);
|
|
|
|
amortization charge for the period
(-907 million
euros);
|
|
|
|
disposals, exchange differences, reclassifications and other changes (for a net negative balance of 123 million euros).
|
|
|
Tangible assets: were down 318 million euros, from 16,360 million euros at the end of 2016 to 16,042 million euros at June 30, 2017, representing the balance of the following items:
|
|
|
|
capex (+1,383 million euros);
|
|
|
|
changes in financial leasing contracts (+30 million euros);
|
|
|
|
depreciation charge for the period
(-1,342 million
euros);
|
|
|
|
disposals, exchange differences, reclassifications and other changes (for a net negative balance of 389 million euros).
|
CONSOLIDATED EQUITY
Consolidated equity amounted to 23,619 million euros (23,553 million euros at December 31, 2016), of which 21,404 million euros
attributable to Owners of the Parent (21,207 million euros at December 31, 2016) and 2,215 million euros attributable to
non-controlling
interests (2,346 million euros at December 31,
2016). In greater detail, the changes in equity were the following:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
At the beginning of the period
|
|
|
23,553
|
|
|
|
21,333
|
|
|
|
|
|
|
|
|
|
|
Correction due to errors
|
|
|
|
|
|
|
(84
|
)
|
|
|
|
|
|
|
|
|
|
At the beginning of the period revised
|
|
|
23,553
|
|
|
|
21,249
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
269
|
|
|
|
2,801
|
|
|
|
|
|
|
|
|
|
|
Dividends approved by:
|
|
|
(205
|
)
|
|
|
(204
|
)
|
|
|
|
|
|
|
|
|
|
TIM S.p.A.
|
|
|
(166
|
)
|
|
|
(166
|
)
|
|
|
|
|
|
|
|
|
|
Other Group companies
|
|
|
(39
|
)
|
|
|
(38
|
)
|
|
|
|
|
|
|
|
|
|
Issue of equity instruments
|
|
|
4
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
Conversion of the Guaranteed Subordinated Mandatory Convertible Bonds due 2016
|
|
|
|
|
|
|
1,300
|
|
|
|
|
|
|
|
|
|
|
Disposal of the Sofora Telecom Argentina group
|
|
|
|
|
|
|
(1,582
|
)
|
|
|
|
|
|
|
|
|
|
Other changes
|
|
|
(2
|
)
|
|
|
(12
|
)
|
|
|
|
|
|
|
|
|
|
At the end of the period
|
|
|
23,619
|
|
|
|
23,553
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The spot exchange rate used for the translation into euro of the Brazilian real (expressed in terms of units of local currency per 1 euro) was 3.77532 at June 30, 2017 and 3.43542 at December 31, 2016.
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
23
|
CASH
FLOWS
Adjusted net financial debt stood at 25,104 million euros, down 15 million euros compared to December 31, 2016 (25,119 million
euros).
The table below summarizes the main transactions that had an impact on the change in adjusted net financial debt during the first half of 2017:
Change in adjusted net financial debt
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
Change
|
|
EBITDA
|
|
|
4,114
|
|
|
|
3,726
|
|
|
|
388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures on an accrual basis
|
|
|
(2,056
|
)
|
|
|
(1,983
|
)
|
|
|
(73
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in net operating working capital:
|
|
|
(1,130
|
)
|
|
|
(1,078
|
)
|
|
|
(52
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
(44
|
)
|
|
|
(40
|
)
|
|
|
(4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in trade receivables and net amounts due from customers on construction
contracts
|
|
|
(52
|
)
|
|
|
(130
|
)
|
|
|
78
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in trade payables
(*)
|
|
|
(692
|
)
|
|
|
(635
|
)
|
|
|
(57
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other changes in operating receivables/payables
|
|
|
(342
|
)
|
|
|
(273
|
)
|
|
|
(69
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in employee benefits
|
|
|
(7
|
)
|
|
|
40
|
|
|
|
(47
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in operating provisions and Other changes
|
|
|
37
|
|
|
|
(34
|
)
|
|
|
71
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating free cash flow
|
|
|
958
|
|
|
|
671
|
|
|
|
287
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Revenues
|
|
|
9.8
|
|
|
|
7.4
|
|
|
|
2.4
|
pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of investments and other disposals flow
|
|
|
9
|
|
|
|
732
|
|
|
|
(723
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital increases/reimbursements, including incidental costs
|
|
|
6
|
|
|
|
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial investments flow
|
|
|
(1
|
)
|
|
|
(9
|
)
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends payment
|
|
|
(218
|
)
|
|
|
(227
|
)
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in financial leasing contracts
|
|
|
(30
|
)
|
|
|
(123
|
)
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses, income taxes and other net
non-operating
requirements flow
|
|
|
(709
|
)
|
|
|
(1,242
|
)
|
|
|
533
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction/(Increase) in adjusted net financial debt from continuing operations
|
|
|
15
|
|
|
|
(198
|
)
|
|
|
213
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction/(Increase) in net financial debt from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
(38
|
)
|
|
|
38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction/(Increase) in adjusted net financial debt
|
|
|
15
|
|
|
|
(236
|
)
|
|
|
251
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Includes the change in trade payables for amounts due to fixed asset suppliers.
|
In addition to what has
already been described with reference to EBITDA, net financial debt during the first half of 2017 has been particularly impacted by the following items:
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
24
|
Capital expenditures on an accrual basis
The breakdown of capital expenditures by operating
segment is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
Change
|
|
|
|
|
|
|
% of total
|
|
|
|
|
|
% of total
|
|
|
Domestic
|
|
|
1,626
|
|
|
|
79.1
|
|
|
|
1,575
|
|
|
|
79.4
|
|
|
|
51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brazil
|
|
|
430
|
|
|
|
20.9
|
|
|
|
408
|
|
|
|
20.6
|
|
|
|
22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments and eliminations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Total
|
|
|
2,056
|
|
|
|
100.0
|
|
|
|
1,983
|
|
|
|
100.0
|
|
|
|
73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Revenues
|
|
|
21.0
|
|
|
|
|
|
|
|
21.8
|
|
|
|
|
|
|
|
(0.8
|
)pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures in the first half of 2017 totaled 2,056 million euros, up 73 million euros on the first half of
2016. In particular:
|
|
the Domestic Business Unit posted capital expenditures of 1,626 million euros, an increase of 51 million euros compared to the first half of 2016. This increase was mainly attributable to the innovative
component (+266 million euros on the first half of 2016) and, in particular, it reflected the increase in capital expenditure for the development of next-generation networks and services and the reduction in other types of expenditure. It also
confirms the selectivity and attention given to the capital allocation choices based on strategic priorities and profit optimization.
|
|
|
The Brazil Business Unit recorded an increase in capital expenditure of 22 million euros for the first half of 2017 (including a positive currency effect of 82 million euros) compared to the first half of
2016; capital expenditures for the half-year were mainly aimed at the development of industrial infrastructure.
|
Change in net operating
working capital
The change in net operating
working capital for the first half of 2017 was a decrease of 1,130 million euros (decrease of 1,078 million euros in the first half of 2016). In particular:
|
|
the change in inventories and the management of trade receivables generated negative impacts of 44 million euros and 52 million euros, respectively;
|
|
|
the change in trade payables
(-692 million
euros) included the payment of around 257 million euros made by the Brazil Business Unit to the consortium that is carrying
out the
clean-up
of the 700 MHz spectrum, which the Business Unit purchased the user rights to in 2014. The level of trade payables was also influenced by the seasonal peak in payments for bills payable;
|
|
|
the other changes in operating receivables/payables
(-342 million
euros) include a negative amount of 134 million euros, for levies on telecommunications operations paid
by the Brazil Business Unit the taxes are normally paid every year by the end of March. There was also an increase in the VAT payable, which was settled in July.
|
Sale of investments and other disposals flow
This item showed a positive figure of 9 million euros for the first half of 2017 and related to disposals of assets within the normal operating cycle.
In the first half of 2016 it was a positive figure of 732 million euros and essentially related to the sale of the Sofora Telecom Argentina
group that took place on March 8, 2016.
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
25
|
Financial investments flow
In the first half of 2017 this item amounted to
1 million euros.
In the first half of 2016 this item amounted to 9 million euros and included around 6 million euros for the payment made
by INWIT S.p.A., net of the cash acquired, for the acquisition of the investments in Revi Immobili S.r.l., Gestione Immobili S.r.l. and Gestione Due S.r.l., and around 3 million euros for the subscription of the capital increase in the company
Northgate held as a
non-controlling
interest.
Change in leasing contracts
In the first half of 2017, this item amounted to
30 million euros.
In the first half of 2016 the change was 123 million and related to TIM S.p.A..
Further details are provided in the Note Tangible assets (owned and under finance leases) of the Half-year Condensed Consolidated Financial
Statements at June 30, 2017 of the TIM Group.
Finance expenses, income taxes and other net
non-operating
requirements flow
The item amounted to
709 million euros and mainly included the payment, during the first half of 2017, of net finance expenses and income taxes, as well as the change in
non-operating
receivables and payables.
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
26
|
Net financial debt
Net financial debt is composed as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
(a)
|
|
|
12/31/2016
(b)
|
|
|
Change
(a-b)
|
|
Non-current
financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds
|
|
|
19,587
|
|
|
|
20,369
|
|
|
|
(782
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts due to banks, other financial payables and liabilities
|
|
|
6,944
|
|
|
|
7,656
|
|
|
|
(712
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease liabilities
|
|
|
2,356
|
|
|
|
2,444
|
|
|
|
(88
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,887
|
|
|
|
30,469
|
|
|
|
(1,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities (*)
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds
|
|
|
3,022
|
|
|
|
2,595
|
|
|
|
427
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts due to banks, other financial payables and liabilities
|
|
|
1,625
|
|
|
|
1,269
|
|
|
|
356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease liabilities
|
|
|
197
|
|
|
|
192
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,844
|
|
|
|
4,056
|
|
|
|
788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities directly associated with Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross financial debt
|
|
|
33,731
|
|
|
|
34,525
|
|
|
|
(794
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments
|
|
|
|
|
|
|
(1
|
)
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other
non-current
financial
assets
|
|
|
(2,185
|
)
|
|
|
(2,697
|
)
|
|
|
512
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,185
|
)
|
|
|
(2,698
|
)
|
|
|
513
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments
|
|
|
(1,102
|
)
|
|
|
(1,519
|
)
|
|
|
417
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other current financial assets
|
|
|
(630
|
)
|
|
|
(389
|
)
|
|
|
(241
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
(4,086
|
)
|
|
|
(3,964
|
)
|
|
|
(122
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,818
|
)
|
|
|
(5,872
|
)
|
|
|
54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial assets relating to Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total financial assets
|
|
|
(8,003
|
)
|
|
|
(8,570
|
)
|
|
|
567
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financial debt carrying amount
|
|
|
25,728
|
|
|
|
25,955
|
|
|
|
(227
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reversal of fair value measurement of derivatives and related financial
assets/liabilities
|
|
|
(624
|
)
|
|
|
(836
|
)
|
|
|
212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net financial debt
|
|
|
25,104
|
|
|
|
25,119
|
|
|
|
(15
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Breakdown as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Total adjusted gross financial debt
|
|
|
32,002
|
|
|
|
32,574
|
|
|
|
(572
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total adjusted financial assets
|
|
|
(6,898
|
)
|
|
|
(7,455
|
)
|
|
|
557
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) of which current portion of medium/long-term debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds
|
|
|
3,022
|
|
|
|
2,595
|
|
|
|
427
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts due to banks, other financial payables and liabilities
|
|
|
853
|
|
|
|
670
|
|
|
|
183
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease liabilities
|
|
|
197
|
|
|
|
192
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The financial risk management policies of the TIM Group are aimed at minimizing market risks, fully hedging exchange rate
risk, and optimizing interest rate exposure through appropriate diversification of the portfolio, which is also achieved by using carefully selected derivative financial instruments. Such instruments, it should be stressed, are not used for
speculative purposes and all have an underlying, which is hedged.
In addition, to determine its exposure to interest rates, the Group sets an optimum
composition for the fixed-rate and variable-rate debt structure and uses derivative financial instruments to achieve that composition. Taking into account the Groups operating activities, the optimum mix of medium/long-term
non-current
financial liabilities has been established, on the basis of the nominal amount, at a range of 65% - 75% for the fixed-rate component and 25% - 35% for the variable-rate component.
In managing market risks, the Group has adopted Guidelines for the Management and control of financial risk and mainly uses IRS and CCIRS
derivative financial instruments.
To provide a better representation of the true performance of Net Financial Debt, from 2009, in addition to the usual
indicator (renamed Net financial debt carrying amount), a measure called Adjusted net
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
27
|
financial debt has also been shown, which neutralizes the effects caused by the volatility of financial markets. Given that some components of the fair value measurement of derivatives
(contracts for setting the exchange and interest rate for contractual flows) and derivatives embedded in other financial instruments do not result in actual monetary settlement, the Adjusted net financial debt excludes these purely
accounting and
non-monetary
effects (including the effects resulting from the introduction of IFRS 13 Fair Value Measurement from January 1, 2013) from the measurement of derivatives and related
financial assets/liabilities.
Sales of receivables to factoring companies
Sales of trade receivables to factoring companies completed during the first half of 2017 resulted in a positive effect on net financial debt at June 30,
2017 of 969 million euros (1,091 million euros at December 31, 2016).
Gross financial debt
Bonds
Bonds at June 30, 2017 were recorded for a
total of 22,609 million euros (22,964 million euros at December 31, 2016). Their nominal repayment amount was 22,310 million euros, down 107 million euros compared to December 31, 2016 (22,417 million euros).
Changes in bonds over the first half of 2017 are shown below:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of original currency)
|
|
Currency
|
|
|
Amount
|
|
|
Issue date
|
|
New issues
|
|
|
|
|
|
|
|
|
|
|
|
|
Telecom Italia S.p.A. 1,000 million euros 2.500% maturing 7/19/2023
|
|
|
Euro
|
|
|
|
1,000
|
|
|
|
1/19/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of original currency)
|
|
Currency
|
|
|
Amount
|
|
|
Repayment
date
|
|
Repayments
|
|
|
|
|
|
|
|
|
|
|
|
|
Telecom Italia S.p.A. 545 million euros 7.000%
(1)
|
|
|
Euro
|
|
|
|
545
|
|
|
|
1/20/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net of buybacks by the Company of 455 million euros during 2015.
|
With reference to the Telecom Italia
S.p.A. 2002-2022 bonds, reserved for subscription by employees of the Group, the nominal amount at June 30, 2017 was 200 million euros, down 1 million euros compared to December 31, 2016 (201 million euros).
Revolving Credit Facility and Term Loan
The following
table shows the composition and the drawdown of the committed credit lines available at June 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(billions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
Agreed
|
|
|
Drawn down
|
|
|
Agreed
|
|
|
Drawn down
|
|
Revolving Credit Facility expiring May 2019
|
|
|
4.0
|
|
|
|
|
|
|
|
4.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revolving Credit Facility expiring March 2020
|
|
|
3.0
|
|
|
|
|
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
7.0
|
|
|
|
|
|
|
|
7.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM has two syndicated Revolving Credit Facilities for amounts of 4 billion euros and 3 billion euros expiring
May 24, 2019 and March 25, 2020 respectively, both not yet drawn down.
TIM also has:
|
|
a bilateral Term Loan from Banca Regionale Europea expiring July 2019 for 200 million euros, drawn down for the full amount;
|
|
|
two bilateral Term Loans from Mediobanca respectively for 200 million euros expiring in November 2019 and 150 million euros expiring in July 2020, drawn down for the full amount;
|
|
|
a bilateral Term Loan from ICBC expiring July 2020 for 120 million euros, drawn down for the full amount;
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
28
|
|
|
a bilateral Term Loan from Intesa Sanpaolo expiring August 2021 for 200 million euros, drawn down for the full amount;
|
|
|
an Hot Money loan with Banca Popolare dellEmilia Romagna expiring July 2017 for 200 million euros, drawn down for the full amount.
|
On March 6, 2017, TIM S.p.A. signed a supplementary agreement with Mediobanca under which an early repayment was made on July 3, 2017 for
75 million euros for the bilateral term loan of an original amount of 150 million euros maturing in July 2020, which has been fully drawn down.
Maturities of financial liabilities and average cost of debt
The average maturity of
non-current
financial liabilities (including the current portion of medium/long-term financial
liabilities due within 12 months) is 7.71 years.
The average cost of the Groups debt, considered as the cost for the year calculated on an annual
basis and resulting from the ratio of debt-related expenses to average exposure, is about 5.0%.
For details on the maturities of financial liabilities in
terms of expected nominal repayment amounts, as contractually agreed, see the Notes Financial liabilities
(non-current
and current) in the Half-year Condensed Consolidated Financial Statements at
June 30, 2017 of the TIM Group.
Current financial assets and liquidity margin
The TIM Groups available liquidity margin amounted to 12,188 million euros at June 30, 2017, corresponding to the sum of Cash and
cash equivalents and Current securities other than investments, totaling 5,188 million euros (5,483 million euros at December 31, 2016), and the committed credit lines, mentioned above, of which a total of
7,000 million euros has not been drawn down. This margin is sufficient to cover Group financial liabilities due at least for the next 24 months.
In
particular:
Cash and cash equivalents amounted to 4,086 million euros (3,964 million euros at December 31, 2016). The different technical
forms used for the investment of liquidity as of June 30, 2017 can be analyzed as follows:
|
|
Maturities: investments have a maximum maturity of three months;
|
|
|
Counterparty risk: investments by the European companies are made with leading banking, financial and industrial institutions with high credit quality. Investments by the companies in South America are made with leading
local counterparties;
|
|
|
Country risk: deposits have been made mainly in major European financial markets.
|
Current securities other
than investments amounted to 1,102 million euros (1,519 million euros at December 31, 2016): these forms of investment represent alternatives to the investment of liquidity with the aim of improving returns. They include
613 million euros of Italian treasury bonds purchased respectively by TIM S.p.A. (256 million euros) and Telecom Italia Finance S.A. (357 million euros) and 488 million euros of bonds purchased by Telecom Italia Finance S.A. with
different maturities, all with an active market and consequently readily convertible into cash. The purchases of the above government bonds, which, pursuant to Consob Communication no. DEM/11070007 of August 5, 2011, represent investments in
Sovereign debt securities, have been made in accordance with the Guidelines for the Management and control of financial risk adopted by the TIM Group since August 2012.
In the second quarter of 2017, the adjusted net financial debt fell by 131 million euros compared to March 31, 2017 (25,235 million euros) due
to the positive business and operational performance which, in particular, provided coverage for the requirements resulting in particular from the already mentioned payment of dividends of 218 million euros.
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
3/31/2017
|
|
|
Change
|
|
|
(a)
|
|
|
(b)
|
|
|
(a-b)
|
|
Net financial debt carrying amount
|
|
|
25,728
|
|
|
|
25,923
|
|
|
|
(195
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reversal of fair value measurement of derivatives and related financial
assets/liabilities
|
|
|
(624
|
)
|
|
|
(688
|
)
|
|
|
64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net financial debt
|
|
|
25,104
|
|
|
|
25,235
|
|
|
|
(131
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Breakdown as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Total adjusted gross financial debt
|
|
|
32,002
|
|
|
|
32,796
|
|
|
|
(794
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total adjusted financial assets
|
|
|
(6,898
|
)
|
|
|
(7,561
|
)
|
|
|
663
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Position and Cash Flows Performance
|
|
30
|
CONSOLIDATED FINANCIAL STATEMENTS TIM GROUP
The Half-Year Financial Report at June 30, 2017 of the TIM Group has been prepared in compliance with Article
154-ter
(Financial Reports) of Italian Legislative Decree no. 58/1998 (Consolidated Law on Finance - TUF) and subsequent amendments and supplements and presented in accordance with the international accounting
standards issued by the International Accounting Standards Board and endorsed by the European Union (designated as IFRS) as well as with the regulations issued to implement Article 9 of Italian Legislative Decree no. 38/2005.
The Half-year Financial Report includes:
|
|
the Interim Management Report;
|
|
|
the Half-Year Condensed Consolidated Financial Statements;
|
|
|
the certification of the Half-Year Condensed Consolidated Financial Statements pursuant to Article
81-ter
of the Consob Regulation 11971 dated May
14, 1999,
with Amendments and Additions.
|
The accounting policies and consolidation principles adopted in the preparation of the half-year
condensed consolidated financial statements at June 30, 2017 are the same as those adopted in the annual consolidated financial statements at December 31, 2016, to which reference can be made. No new standards and interpretations were
endorsed by the EU and in force from January 1, 2017.
The TIM Group, in addition to the conventional financial performance measures
established by IFRS, uses certain alternative performance measures in order to present a better understanding of the trend of operations and financial condition. Specifically, these alternative performance measures refer to: EBITDA; EBIT; the
organic change in revenues, EBITDA and EBIT; EBITDA margin and EBIT margin; and net financial debt carrying amount and adjusted net financial debt.
Moreover, the part entitled Business Outlook for 2017 contains forward-looking statements in relation to the Groups intentions, beliefs
or current expectations regarding financial performance and other aspects of the Groups operations and strategies. Readers of the Half-year financial Report are reminded not to place undue reliance on forward-looking statements; actual results
may differ significantly from forecasts owing to numerous factors, the majority of which are beyond the scope of the Groups control.
MAIN CHANGES IN THE SCOPE OF CONSOLIDATION
There were no significant changes in the scope of consolidation during the first half of 2017.
The following changes in the scope of consolidation occurred during 2016:
|
|
TIMVISION S.r.l. (Domestic Business Unit):
established on December 28, 2016;
|
|
|
Noverca S.r.l. (Domestic Business Unit):
on October 28, 2016 TIM S.p.A. acquired 100% of the company;
|
|
|
Flash Fiber S.r.l. (Domestic Business Unit):
established on July 28, 2016;
|
|
|
Sofora - Telecom Argentina group:
classified as Discontinued Operations (Discontinued
operations/Non-current
assets held for sale) was sold on March 8, 2016;
|
|
|
Revi Immobili S.r.l., Gestione Due S.r.l. and Gestione Immobili S.r.l. (Domestic Business Unit):
on January 11, 2016, INWIT S.p.A. purchased 100% of these companies, which were subsequently merged by
absorption.
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
31
|
Separate Consolidated Income Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
(a)
|
|
|
1st Half
2016
(b)
|
|
|
Change
(a-b)
|
|
|
|
|
|
amount
|
|
|
%
|
|
Revenues
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
676
|
|
|
|
7.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
217
|
|
|
|
107
|
|
|
|
110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating revenues and other income
|
|
|
9,989
|
|
|
|
9,203
|
|
|
|
786
|
|
|
|
8.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of goods and services
|
|
|
(4,136
|
)
|
|
|
(3,783
|
)
|
|
|
(353
|
)
|
|
|
(9.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses
|
|
|
(1,530
|
)
|
|
|
(1,551
|
)
|
|
|
21
|
|
|
|
1.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses
|
|
|
(576
|
)
|
|
|
(501
|
)
|
|
|
(75
|
)
|
|
|
(15.0
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
50
|
|
|
|
33
|
|
|
|
17
|
|
|
|
51.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Internally generated assets
|
|
|
317
|
|
|
|
325
|
|
|
|
(8
|
)
|
|
|
(2.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit before depreciation and amortization, capital gains (losses) and impairment
reversals (losses) on
non-current
assets (EBITDA)
|
|
|
4,114
|
|
|
|
3,726
|
|
|
|
388
|
|
|
|
10.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
(2,249
|
)
|
|
|
(2,047
|
)
|
|
|
(202
|
)
|
|
|
(9.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on disposals of
non-current
assets
|
|
|
6
|
|
|
|
13
|
|
|
|
(7
|
)
|
|
|
(53.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment reversals (losses) on
non-current
assets
|
|
|
|
|
|
|
(5
|
)
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit (loss) (EBIT)
|
|
|
1,871
|
|
|
|
1,687
|
|
|
|
184
|
|
|
|
10.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profits (losses) of associates and joint ventures accounted for using the equity
method
|
|
|
(1
|
)
|
|
|
(2
|
)
|
|
|
1
|
|
|
|
50.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses) from investments
|
|
|
(19
|
)
|
|
|
7
|
|
|
|
(26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
|
1,110
|
|
|
|
2,012
|
|
|
|
(902
|
)
|
|
|
(44.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses
|
|
|
(1,850
|
)
|
|
|
(2,157
|
)
|
|
|
307
|
|
|
|
14.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) before tax from continuing operations
|
|
|
1,111
|
|
|
|
1,547
|
|
|
|
(436
|
)
|
|
|
(28.2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
(457
|
)
|
|
|
(489
|
)
|
|
|
32
|
|
|
|
6.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
654
|
|
|
|
1,058
|
|
|
|
(404
|
)
|
|
|
(38.2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
47
|
|
|
|
(47
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
654
|
|
|
|
1,105
|
|
|
|
(451
|
)
|
|
|
(40.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Parent
|
|
|
596
|
|
|
|
1,018
|
|
|
|
(422
|
)
|
|
|
(41.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
58
|
|
|
|
87
|
|
|
|
(29
|
)
|
|
|
(33.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
32
|
Consolidated Statements of Comprehensive Income
In accordance with IAS 1
(Presentation of Financial
Statements
), the following consolidated statements of comprehensive income include the Profit (loss) for the period as shown in the Separate Consolidated Income Statements and all
non-owner
changes in
equity.
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Profit (loss) for the period
|
|
|
(a
|
)
|
|
|
654
|
|
|
|
1,105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other components of the Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Other components that subsequently will not be reclassified in the Separate Consolidated Income
Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of employee defined benefit plans (IAS 19):
|
|
|
|
|
|
|
|
|
|
|
|
|
Actuarial gains (losses)
|
|
|
|
|
|
|
33
|
|
|
|
(118
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
(8
|
)
|
|
|
32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
25
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of other profits (losses) of associates and joint ventures accounted for using the equity
method:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other components that subsequently will not be reclassified in the Separate Consolidated
Income Statements
|
|
|
(d=b+c
|
)
|
|
|
25
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other components that subsequently will be reclassified in the Separate Consolidated Income
Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale
financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from fair value adjustments
|
|
|
|
|
|
|
34
|
|
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) transferred to the Separate Consolidated Income Statements
|
|
|
|
|
|
|
(37
|
)
|
|
|
(69
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
2
|
|
|
|
(4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(e
|
)
|
|
|
(1
|
)
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from fair value adjustments
|
|
|
|
|
|
|
(331
|
)
|
|
|
(327
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) transferred to the Separate Consolidated Income Statements
|
|
|
|
|
|
|
497
|
|
|
|
245
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
(43
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(f
|
)
|
|
|
123
|
|
|
|
(84
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange differences on translating foreign operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) on translating foreign operations
|
|
|
|
|
|
|
(551
|
)
|
|
|
618
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) on translating foreign operations transferred to the Separate Consolidated Income
Statements
|
|
|
|
|
|
|
19
|
|
|
|
304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(g
|
)
|
|
|
(532
|
)
|
|
|
922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of other profits (losses) of associates and joint ventures accounted for using the equity
method:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) transferred to the Separate Consolidated Income Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(h
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other components that subsequently will be reclassified to the Separate Consolidated Income
Statements
|
|
|
(i=e+f+g+h
|
)
|
|
|
(410
|
)
|
|
|
841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other components of the Consolidated Statements of Comprehensive Income
|
|
|
(k=d+i
|
)
|
|
|
(385
|
)
|
|
|
755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
(a+k
|
)
|
|
|
269
|
|
|
|
1,860
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Parent
|
|
|
|
|
|
|
367
|
|
|
|
1,726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
|
|
|
(98
|
)
|
|
|
134
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
33
|
Consolidated Statements of Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
Change
|
|
(millions of euros)
|
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(a-b)
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
|
|
|
|
29,511
|
|
|
|
29,612
|
|
|
|
(101
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets with a finite useful life
|
|
|
|
|
|
|
6,594
|
|
|
|
6,951
|
|
|
|
(357
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,105
|
|
|
|
36,563
|
|
|
|
(458
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment owned
|
|
|
|
|
|
|
13,671
|
|
|
|
13,947
|
|
|
|
(276
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets held under finance leases
|
|
|
|
|
|
|
2,371
|
|
|
|
2,413
|
|
|
|
(42
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,042
|
|
|
|
16,360
|
|
|
|
(318
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in associates and joint ventures accounted for using the equity method
|
|
|
|
|
|
|
17
|
|
|
|
18
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other investments
|
|
|
|
|
|
|
48
|
|
|
|
46
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
|
|
|
|
2,185
|
|
|
|
2,698
|
|
|
|
(513
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous receivables and other
non-current
assets
|
|
|
|
|
|
|
2,324
|
|
|
|
2,222
|
|
|
|
102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax assets
|
|
|
|
|
|
|
525
|
|
|
|
877
|
|
|
|
(352
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,099
|
|
|
|
5,861
|
|
|
|
(762
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Non-current
assets
|
|
|
(a
|
)
|
|
|
57,246
|
|
|
|
58,784
|
|
|
|
(1,538
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inventories
|
|
|
|
|
|
|
314
|
|
|
|
270
|
|
|
|
44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous receivables and other current assets
|
|
|
|
|
|
|
5,617
|
|
|
|
5,426
|
|
|
|
191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current income tax receivables
|
|
|
|
|
|
|
45
|
|
|
|
94
|
|
|
|
(49
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments, financial receivables and other current financial
assets
|
|
|
|
|
|
|
1,732
|
|
|
|
1,908
|
|
|
|
(176
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
4,086
|
|
|
|
3,964
|
|
|
|
122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,818
|
|
|
|
5,872
|
|
|
|
(54
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
sub-total
|
|
|
|
|
|
|
11,794
|
|
|
|
11,662
|
|
|
|
132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations/Non-current
assets held for
sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Current assets
|
|
|
(b
|
)
|
|
|
11,794
|
|
|
|
11,662
|
|
|
|
132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
|
(a+b
|
)
|
|
|
69,040
|
|
|
|
70,446
|
|
|
|
(1,406
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
Change
|
|
(millions of euros)
|
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(a-b)
|
|
Equity and Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to Owners of the Parent
|
|
|
|
|
|
|
21,404
|
|
|
|
21,207
|
|
|
|
197
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
|
|
|
2,215
|
|
|
|
2,346
|
|
|
|
(131
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity
|
|
|
(c
|
)
|
|
|
23,619
|
|
|
|
23,553
|
|
|
|
66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial liabilities
|
|
|
|
|
|
|
28,887
|
|
|
|
30,469
|
|
|
|
(1,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits
|
|
|
|
|
|
|
1,336
|
|
|
|
1,355
|
|
|
|
(19
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax liabilities
|
|
|
|
|
|
|
323
|
|
|
|
293
|
|
|
|
30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions
|
|
|
|
|
|
|
813
|
|
|
|
830
|
|
|
|
(17
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous payables and other
non-current
liabilities
|
|
|
|
|
|
|
1,594
|
|
|
|
1,607
|
|
|
|
(13
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Non-current
liabilities
|
|
|
(d
|
)
|
|
|
32,953
|
|
|
|
34,554
|
|
|
|
(1,601
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities
|
|
|
|
|
|
|
4,844
|
|
|
|
4,056
|
|
|
|
788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
|
|
|
|
7,056
|
|
|
|
7,646
|
|
|
|
(590
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current income tax payables
|
|
|
|
|
|
|
568
|
|
|
|
637
|
|
|
|
(69
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
sub-total
|
|
|
|
|
|
|
12,468
|
|
|
|
12,339
|
|
|
|
129
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities directly associated with Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Current Liabilities
|
|
|
(e
|
)
|
|
|
12,468
|
|
|
|
12,339
|
|
|
|
129
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
(f=d+e
|
)
|
|
|
45,421
|
|
|
|
46,893
|
|
|
|
(1,472
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity and Liabilities
|
|
|
(c+f
|
)
|
|
|
69,040
|
|
|
|
70,446
|
|
|
|
(1,406
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
35
|
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
|
|
|
|
654
|
|
|
|
1,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
2,249
|
|
|
|
2,047
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment losses (reversals) on
non-current
assets
(including investments)
|
|
|
|
|
|
|
10
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in deferred tax assets and liabilities
|
|
|
|
|
|
|
336
|
|
|
|
257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Losses (gains) realized on disposals of
non-current
assets
(including investments)
|
|
|
|
|
|
|
(6
|
)
|
|
|
(13
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profits (losses) of associates and joint ventures accounted for using the equity
method
|
|
|
|
|
|
|
1
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in employee benefits
|
|
|
|
|
|
|
(7
|
)
|
|
|
40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
|
|
|
|
(44
|
)
|
|
|
(40
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in trade receivables and net amounts due from customers on construction contracts
|
|
|
|
|
|
|
(52
|
)
|
|
|
(130
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in trade payables
|
|
|
|
|
|
|
44
|
|
|
|
(141
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in current income tax receivables/payables
|
|
|
|
|
|
|
72
|
|
|
|
95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in miscellaneous receivables/payables and other assets/liabilities
|
|
|
|
|
|
|
(119
|
)
|
|
|
(687
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) operating activities
|
|
|
(a
|
)
|
|
|
3,138
|
|
|
|
2,493
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of intangible assets
|
|
|
|
|
|
|
(673
|
)
|
|
|
(709
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of tangible assets
|
|
|
|
|
|
|
(1,413
|
)
|
|
|
(1,397
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets on an accrual basis
|
|
|
|
|
|
|
(2,086
|
)
|
|
|
(2,106
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in amounts due for purchases of intangible and tangible assets
|
|
|
|
|
|
|
(707
|
)
|
|
|
(371
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets on a cash basis
|
|
|
|
|
|
|
(2,793
|
)
|
|
|
(2,477
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of control in subsidiaries or other businesses, net of cash acquired
|
|
|
|
|
|
|
|
|
|
|
(6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions/disposals of other investments
|
|
|
|
|
|
|
(1
|
)
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in financial receivables and other financial assets
|
|
|
|
|
|
|
695
|
|
|
|
364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale that result in a loss of control of subsidiaries or other businesses, net of
cash disposed of
|
|
|
|
|
|
|
|
|
|
|
492
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale/repayment of intangible, tangible and other
non-current
assets
|
|
|
|
|
|
|
9
|
|
|
|
29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) investing activities
|
|
|
(b
|
)
|
|
|
(2,090
|
)
|
|
|
(1,601
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in current financial liabilities and other
|
|
|
|
|
|
|
(663
|
)
|
|
|
(262
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
non-current
financial liabilities (including
current portion)
|
|
|
|
|
|
|
1,256
|
|
|
|
2,061
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repayments of
non-current
financial liabilities (including
current portion)
|
|
|
|
|
|
|
(1,200
|
)
|
|
|
(3,094
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital proceeds/reimbursements (including subsidiaries)
|
|
|
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid
|
|
|
|
|
|
|
(218
|
)
|
|
|
(227
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) financing activities
|
|
|
(c
|
)
|
|
|
(819
|
)
|
|
|
(1,522
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) Discontinued
operations/Non-current
assets held for sale
|
|
|
(d
|
)
|
|
|
|
|
|
|
(45
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate cash flows
|
|
|
(e=a+b+c+d
|
)
|
|
|
229
|
|
|
|
(675
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash and cash equivalents at beginning of the period
|
|
|
(f
|
)
|
|
|
3,952
|
|
|
|
3,216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net foreign exchange differences on net cash and cash equivalents
|
|
|
(g
|
)
|
|
|
(95
|
)
|
|
|
159
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash and cash equivalents at end of the period
|
|
|
(h=e+f+g
|
)
|
|
|
4,086
|
|
|
|
2,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
36
|
Additional Cash Flow Information
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Income taxes (paid) received
|
|
|
(27
|
)
|
|
|
(104
|
)
|
|
|
|
|
|
|
|
|
|
Interest expense paid
|
|
|
(1,198
|
)
|
|
|
(1,327
|
)
|
|
|
|
|
|
|
|
|
|
Interest income received
|
|
|
432
|
|
|
|
516
|
|
|
|
|
|
|
|
|
|
|
Dividends received
|
|
|
|
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
Analysis of Net Cash and Cash Equivalents
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Net cash and cash equivalents at beginning of the period
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from continuing operations
|
|
|
3,964
|
|
|
|
3,559
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand - from continuing operations
|
|
|
(12
|
)
|
|
|
(441
|
)
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
98
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand - from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,952
|
|
|
|
3,216
|
|
|
|
|
|
|
|
|
|
|
Net cash and cash equivalents at end of the period
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from continuing operations
|
|
|
4,086
|
|
|
|
2,707
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand - from continuing operations
|
|
|
|
|
|
|
(7
|
)
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand - from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,086
|
|
|
|
2,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
37
|
OTHER
INFORMATION
Average salaried workforce
|
|
|
|
|
|
|
|
|
|
|
|
|
(equivalent number)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
Change
|
|
Average salaried workforce Italy
|
|
|
45,907
|
|
|
|
47,448
|
|
|
|
(1,541
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average salaried workforce Outside Italy
|
|
|
9,392
|
|
|
|
11,688
|
|
|
|
(2,296
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average salaried workforce
(1)
|
|
|
55,299
|
|
|
|
59,136
|
|
|
|
(3,837
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations/Non-current
assets held for sale -
Sofora - Telecom Argentina group
|
|
|
|
|
|
|
5,161
|
|
|
|
(5,161
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average salaried workforce - including Discontinued
operations/Non-current
assets held for sale
|
|
|
55,299
|
|
|
|
64,297
|
|
|
|
(8,998
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1)
|
Includes employees with temp work contracts: the average headcount was 3 in the first half of 2017 (2 in Italy and 1 outside Italy). In the first half of 2016, the average headcount was 4 (2 in Italy and 2 outside
Italy).
|
Headcount at period end
|
|
|
|
|
|
|
|
|
|
|
|
|
(number)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
Change
|
|
Headcount Italy
|
|
|
50,926
|
|
|
|
51,125
|
|
|
|
(199
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Headcount Outside Italy
|
|
|
9,726
|
|
|
|
10,104
|
|
|
|
(378
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total headcount at period end
(1)
|
|
|
60,652
|
|
|
|
61,229
|
|
|
|
(577
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1)
|
Includes employees with temp work contracts: 1 at 6/30/2017 and 4 at 12/31/2016.
|
Headcount at period end
Breakdown by Business Unit
|
|
|
|
|
|
|
|
|
|
|
|
|
(number)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
Change
|
|
Domestic
|
|
|
51,095
|
|
|
|
51,280
|
|
|
|
(185
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brazil
|
|
|
9,471
|
|
|
|
9,849
|
|
|
|
(378
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Operations
|
|
|
86
|
|
|
|
100
|
|
|
|
(14
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
60,652
|
|
|
|
61,229
|
|
|
|
(577
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Consolidated Financial Statements TIM Group
|
|
38
|
EVENTS SUBSEQUENT TO JUNE 30, 2017
For details of subsequent events see the Note Events Subsequent to June 30, 2017 in the TIM Group half-year condensed consolidated financial
statements.
BUSINESS OUTLOOK FOR THE YEAR 2017
As envisaged in the 20172019 Plan, TIM will continue the process of profound transformation of the Company. This process consists of firm financial
discipline in support of development, aimed at creating more room for investments for new networks and platforms (Fiber and mobile UltraBroadband and Cloud-based services) and eliminating less strategic cash costs, in addition to maximizing return
on investment. The objective is to ensure structural growth in revenue and EBITDA and consolidate TIMs position as the market leader in terms of technology, network quality and service excellence in the Fixed-line and Mobile segments. The key
elements of this approach are innovation, convergence, exclusive content and closeness to the Customer.
In the Domestic Fixed segment, TIM expects to
reduce the decrease in the number of clients and that all loss lines will be brought to zero by 2018 through the faster spread and subsequent adoption of fiber optic networks. A crucial role will also be played by our commercial
strategy that aims to retain and increase the number of customers by offering, inter alia, devices and appliances for the Smart Home connected to the home network and directly charged in the phone bill.
Within the Domestic Mobile segment, in an increasingly polarized and segmented competitive scenario, TIM particularly in the
high-end
market with ever-increasing data usage will leverage the reach of its 4G network (expected population coverage of over 99% in 2019) and the diffusion of convergent services and quality content. Kena,
the second
no-frills
brand (launched in April), will allow the company to compete in the more price-sensitive segments.
Operations will be characterized by greater selectivity and priority in investment choices and efficiency recovery actions through structural cost
optimization programs. At the same time, the transformation and simplification of organization and processes combined with the commercial development and the expected growth in revenue will provide the Group with EBITDA growth (low
single digit) and the cash generation needed to reduce the Adjusted net financial debt to reported EBITDA ratio, which is expected to be below 2.7x in 2018.
In Brazil, the Plan provides for the continued turnaround of Tim Brasil through its
re-positioning
based on network
and product quality, thereby enabling the company to maintain its leadership in the prepaid segment and successfully compete in the postpaid segment. The Cost Containment Plan launched in 2016 has also been continued and strengthened and will enable
the achievement of solid profit and cash flow generation. More specifically, further impetus will be given to the construction of the UBB Mobile infrastructure at completion of the Plan, the 4G network will reach 95% of the population with
coverage of about 3,600 cities and the development of convergent offers, also thanks to agreements with major premium content providers.
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Business outlook
for 2017
|
|
39
|
MAIN RISKS AND UNCERTAINTIES
Risk governance is a strategic tool for value creation. The TIM Group has adopted an Enterprise Risk Management Model based on the methodology of the Committee
of Sponsoring Organizations of the Treadway Commission (ERM CoSO Report), which enables the identification and management of risk in a uniform manner across the Group companies, highlighting potential synergies among the actors involved in the
assessment of the Internal Control and Risk Management System. The ERM process is designed to identify potential events that may affect the business, to manage risk within acceptable limits and to provide reasonable assurance regarding the
achievement of corporate objectives.
The business outlook for 2017 could be affected in the second half of the year by risks and uncertainties caused by
a multitude of factors, the majority of which are beyond the Groups control.
In particular, several major alterations need to be noted, such as the
changes in several senior executive positions and the modification of the market environment, with the initiation of proceedings by the Anti-Trust Authority on the projects for development of the ultrabroadband and fiber optic networks, in addition
to a possible revision of the business strategies for the content component. These risk factors may have repercussions which are currently unforeseeable in terms of the strategic choices adopted by the company and could have an impact,
for example, on the ultrabroadband development plans and on the evolution model adopted in the multimedia market.
In view of the above risks, in addition
to the expected performance of the domestic market and the impacts from the new tariff model for roaming services, as well as several
non-recurring
business trends in the third quarter of 2016 (resulting in a
not fully
like-for-like
comparison in the second half of the year), management has confirmed the guidance announced for the full year 2017 and for the period of the Plan
(e.g.
low-single
digit growth in Domestic EBITDA), despite the strong performance in the second quarter of 2017.
The main risks affecting the business activities of the TIM Group, which may impact, even significantly, the ability to achieve the objectives of the Group
are detailed below.
STRATEGIC RISKS
Risks related to macro economic factors
The TIM Groups economic and financial situation
is subject to the influence of numerous macroeconomic factors such as economic growth, political stability, consumer confidence, and changes in interest rates and exchange rates in the markets in which it operates. The expected results may be
affected, in the domestic market, by the strengthening of the economic recovery: the year 2016 ended with growth of around 1% (a low figure when compared to the average of the EMU countries) and the forecast for 2017 is for higher growth, albeit
only slightly. Consumption is starting to pick up again, after a slowdown in the second half of 2016, despite the erosion of purchasing power due to rising inflation. Confidence has also improved among consumers and businesses. Unemployment is still
high, despite the significant fall from the second quarter of 2016, with consequent possible effects on income available for consumption.
On the
Brazilian market, the expected results may be significantly affected by the macroeconomic and political situation. After 8 quarters of GDP decline, marking the deepest and most profound crisis in its history, Brazil returned to growth in the first
quarter of 2017 (+1%). 2017 should close with a growth rate just above zero. Apart from this positive result, there is an ongoing situation of high political instability, as well as a very problematic employment situation (with a total of more than
14 million unemployed and an unemployment rate of 14% in the first quarter of 2017) which are significantly slowing down the recovery in domestic demand.
|
|
|
|
|
Interim Management Report
at June 30, 2017
|
|
Main risks and uncertainties
|
|
40
|
Risks related to competition
The telecommunications market is characterized by
strong competition that may reduce market share in the geographical areas where the TIM Group is engaged as well as erode prices and margins. Competition is focused, on one hand, on innovative products and services and, on the other hand, on the
price of traditional services. In addition, in the area of infrastructure competition, the growth of alternative operators could represent a threat for TIM, particularly in the years of the Plan after 2017 and also beyond the Plan period.
In the mobile market, Iliad S.A. is about to launch a new mobile operator in Italy with the aim of acquiring
10-15%
of
the market, as per its own announcements, by adopting the strategies it has already used for the French market. For its part, TIM has launched a new operator with its own independent systems and features.
In addition, Open Fiber and Infratel have announced their plans for the development of an ultrabroadband telecommunications network as an alternative to the
TIM network, respectively in the major Italian cities and the market failure areas.
In Brazil, the deterioration of the macroeconomic
environment continues to negatively impact on the telecommunications market. Competitive risk is given both by a deterioration of the business model tied to traditional services, which have not been replaced by innovative services, and by the
rationalization of consumption by customers as a result of a contraction of their purchasing power. In this scenario, the Tim Brasil group may be further impacted in the short term to a greater extent than its main competitors, due to the higher
proportion of customers with prepaid services, which are more affected by the current macroeconomic situation, and by a slowdown in their replacement with postpaid customers.
OPERATIONAL RISKS
Operational risks inherent in our business relate to possible inadequacies in internal processes, external factors, frauds, employee errors, errors in properly
documenting transactions, loss of critical or commercially sensitive data and failures in systems and/or network platforms.
Risks related to business
continuity
The TIM Groups success depends
heavily on the ability to ensure continuous and uninterrupted delivery of the products and services we provide through the availability of processes and the relating supporting assets. In particular, the Network Infrastructure and the Information
Systems are sensitive to various internal and external threats: power outage, floods, storms, human errors, system failures, hardware and software failures, software bugs, cyber attacks, earthquakes, facility failures, strikes, fraud, vandalism,
terrorism, etc.. Each of these events could lead to an interruption in the supply of services/products and potentially affect our business both directly and indirectly: reduction in revenues and/or increased costs for recovery and for penalties and
fines, decrease in customer satisfaction, and negative impact on reputation.
Risks related to the development of fixed and mobile networks
To maintain and expand our customer portfolio in each
of the markets in which we operate, it is necessary to maintain, update and improve existing networks in a timely manner. A reliable and high quality network is necessary to maintain the customer base and minimize the terminations to protect the
Companys revenues from erosion. The maintenance and improvement of existing installations depend on our ability to:
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upgrade the capabilities of the networks to provide customers with services that are closer to their needs; in this regard, the TIM Group may participate in tenders for broadcasting frequencies;
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increase the geographical coverage of innovative services;
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upgrade the structure of the systems and the networks to adapt it to new technologies;
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Interim Management Report
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Main risks and uncertainties
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41
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sustaining the necessary level of capital expenditure in the long term.
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Risks of internal/external fraud
The TIM Group has adopted an organizational model to
prevent fraud. However, the implementation of this model cannot ensure the total mitigation of the risk. Dishonest activities and illegal acts committed by people inside and outside the organization could adversely affect the Companys
operating results, financial position and image.
Risks related to disputes and litigation
The TIM Group has to deal with disputes and litigation
with tax authorities, regulators, competition authorities, other telecommunications operators and other entities. The possible impacts of such proceedings are generally uncertain. In the event of settlement unfavorable to the Group, these issues
may, individually or as whole, have an adverse effect, which may even be significant, on its operating results, financial position and cash flows.
FINANCIAL RISKS
The TIM Group may be exposed to financial risks, such as risks arising from fluctuations in interest rates and exchange rates, credit risk, liquidity risk and
risks related to the performance of the equity markets in general, and more specifically risks related to the performance of the share price of the TIM Group companies. These risks may adversely impact the earnings and the financial
structure of the Group. Accordingly, to manage those risks, the TIM Group has established guidelines, at central level, which must be followed for operational management, identification of the most suitable financial instruments to meet set goals,
and monitoring the results achieved. In particular, in order to mitigate the liquidity risk, the TIM Group aims to maintain an adequate level of financial flexibility, in terms of cash and syndicated committed credit lines, enabling it
to cover refinancing requirements at least for the next 12
-18
months.
On June 23, 2016, a referendum was
held in the United Kingdom, commonly referred to as Brexit, in which voters approved the UKs exit from the European Union. The potential impact of Brexit will depend, in part, on the outcome of the negotiations on tariffs, trade,
regulations and other matters, which started in the second half of June 2017. The result of the referendum had an adverse effect on the global markets and also produced a sharp decline in the pound against the dollar and the euro. Brexit and the
possible changes during the exit negotiations could create further instability in the global financial markets and uncertainty about the laws and regulations of the European Union that the United Kingdom may decide to replace with national laws and
regulations. The potential effects of Brexit could adversely affect our financial conditions, our business and the related earnings and cash flows.
REGULATORY AND COMPLIANCE RISKS
Regulatory risks
The telecommunications industry is highly regulated. In this context, new decisions by the Communications Authority (AGCom) may lead to changes in the
regulatory framework that may affect the expected results of the Group. More specifically, the main elements that introduce uncertainty are:
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lack of predictability in
start-up
timing and consequent new process decisions;
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decisions with retroactive effect (for example, price revisions for previous years as a result of judgments issued by the Administrative Courts);
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Main risks and uncertainties
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42
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decisions that can influence the technological choices made and to be made, with potential impact on the timing of return on infrastructure investment.
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Implementation has been completed of the New Equivalence Model (NEM), launched by TIM in 2015, aimed at further improving the effectiveness of guarantees for
equal treatment between own business divisions and competitors that buy wholesale services. The NEM and the related implementation roadmap were approved by the Board of Directors of TIM on November 5, 2015. The Italian Antitrust Authority
(AGCM) and the AGCom positively evaluated the effectiveness of the NEM and decided, respectively, to close the
non-compliance
proceedings A428C, acknowledging that TIM has complied with the earlier A428
decision, and to discontinue the ongoing penalty proceedings.
Compliance risks
The TIM Group may be exposed to risks of
non-compliance
due to
non-observance/breach
of internal (self-regulation, such as, for example, bylaws, code of ethics) and external rules (laws and regulations), with
consequent judicial or administrative penalties, financial losses or reputational damage.
The TIM Group aims to ensure that processes, and, therefore,
the procedures and systems governing them, and corporate conduct comply with legal requirements. The risk is associated with potential time lags in making the processes compliant with regulatory changes or whenever
non-conformities
are identified.
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Interim Management Report
at June 30, 2017
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MAIN CHANGES IN THE REGULATORY FRAMEWORK
DOMESTIC
Wholesale fixed-line markets
Wholesale access services
Following the Resolution 623/15/CONS, in which AGCom requested TIM to submit a proposal for improving the effectiveness of its equivalence model in the
processes for the supply of wholesale services to competitors and to its own commercial divisions, TIM completed the implementation of the New Equivalents Model (NEM) on April 30, 2017.
Within the above-mentioned Resolution, AGCom also requested TIM to submit a proposal containing the operating procedures for the introduction of a model for
the unbundling of incidental services associated to the delivery and assurance of wholesale access lines for local loop unbundling and
sub-loop
unbundling services. The proposal submitted by TIM is based on
the extension of the Unique System (i.e., use of outside companies at the request of the competitors) to the above-mentioned delivery and assurance activities. The procedure is still ongoing and AGCom final decision, after notification of the draft
measure to the European Commission, is expected by the third quarter of 2017.
Infratel Tenders for the subsidizing of the Ultra Broadband networks
On March 7, 2017, Infratel Italia awarded the company Open Fiber (OF) all five lots of the tender for the construction and operation of networks
enabling the offering of Ultra Broadband services (from 30 to 100 Mbit/s) in the
so-called
White Areas (in which the private operators had not envisaged the independent construction of Ultra
Broadband infrastructure in the next three years) of the municipalities of six Italian regions (Abruzzo, Molise, Emilia Romagna, Lombardy, Tuscany and Veneto).
On March 20, 2017, a ruling with an unfavorable outcome for TIM was issued in the main proceedings for the appeal filed by TIM concerning the tender and
on June 20, 2017 TIM lodged an appeal with the
Consiglio di Stato
.
Retail fixed-line markets
Universal Service
Through Resolution 46/17/CONS of January 26, 2017, AGCom introduced new measures regarding the subsidized financial conditions for access to fixed and
mobile services for particular categories of disabled customers. The provisions of the measure, which apply to the deaf and the totally and partially blind, broaden the current subsidies, both in terms of discounted services (e.g. flat voice and
data offers) and categories of disabled people covered (e.g. the partially blind).
In February 2017, TIM submitted an appeal to the Lazio Regional
Administrative Court against Resolution 456/16/CONS of October 2016, through which AGCom rejected TIMs proposal for a price adjustment on the Voice offering (the basic voice telephony offering), and introduced a strict procedure
for future changes of Universal Service prices, by providing, for example, a minimum time interval of a year between two successive tariff changes and the possibility to only change prices with reference to: (i) increase in
wholesale
costs; (ii) offsetting inflation; (iii) socio-economic conditions. The first hearing has been set for November 22, 2017.
Through
resolution 163/17/CONS of April 18, 2017, AGCom imposed a fine of 232,000 euros on TIM for the failure to achieve 4 quality objectives of 2015.
For
information on the pending disputes relating to the remuneration of the net costs of the Universal Service incurred by TIM in the years 1999-2003, excluding 2002, see the Note Contingent liabilities, other information, commitments and
guarantees of the Consolidated financial statements of the TIM Group at December 31, 2016.
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Wholesale mobile network markets
International roaming
On June 15, 2017, the provision of European Regulation 2015/2120 of November 25, 2015 (Telecom Single Market - TSM Regulation) entered
into force, which requires for the application of the national tariff for
intra-EU
voice, SMS and roaming data traffic.
On April 25, 2017, the European Parliament and the Council adopted a regulation establishing new wholesale caps for roaming traffic valid from
June 15, 2017 to June 30, 2022 (Voice: 3.2 euro cents per minute; SMS 1 euro cents per SMS, data: 7.7 euro/GByte in 2017; 6 euro/GByte in 2018; 4.5 euro/GByte in 2019; 3.5 euro/GByte in 2020; 3 euro/GByte in 2021; and 2.5 euro/GByte in
2022).
AGCom contribution fee
On March 31,
2017, TIM paid an amount of 19.3 million euros, with reservation, for the 2017 AGCom contribution fee. The value was calculated by applying the rate of 0.0014 to the revenues recorded in the Companys 2015 Financial Statements. The
guidelines for the calculation of the contribution fee, set out in the AGCom Resolutions 463/16/CONS and 62/17/CONS, have not changed with respect to those established for the calculation of the 2016 contribution fee.
Antitrust
For information on the pending legal disputes, relating to proceedings already completed by the AGCM A428 and I761 see the Note Contingent
liabilities, other information, commitments and guarantees of the Half-year condensed consolidated financial statements of the TIM Group at June 30, 2017.
Case A500B
In April 2017, the AGCM extended to Telecom
Italia Sparkle the case A500B, opened against TIM and regarding the possible improper conduct in the market consisting in bulk SMS messaging services.
Case I799
In February 2017, AGCM initiated
investigation proceedings for possible violation of Article 101 TFEU (ban on competition-restricting agreements) against TIM S.p.A. and Fastweb S.p.A., following the signing of an agreement aimed at establishing a joint cooperative enterprise Flash
Fiber S.r.l.. The end of the proceedings has been set at December 31, 2017.
Case A514
On June 28, 2017, AGCM initiated proceedings against TIM for possible breaches of Article 102 TFEU following complaints made by Infratel, Enel, Open
Fiber, Vodafone and
Wind-Tre.
For more details see the description provided in the Note Contingent liabilities, other information, commitments and guarantees of the Half-year condensed consolidated
financial statements of the TIM Group at June 30, 2017.
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Interim Management Report
at June 30, 2017
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Main changes in the regulatory framework
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BRAZIL
700 MHz and Analog TV switch off
In September 2014, TIM won the tender for the award of the 700MHz (4G/LTE) band frequencies, for a price of 1.7 billion reais, and with additional
commitments of 1.2 billion reais (in four annual installments, adjusted for inflation) as a contribution to the consortium established by the tender (EAD) for all the operators (TIM, Algar, Claro and Vivo) awarded the contract for
managing the freeing up of the 700MHz band through the switch off of analog TV, the redistribution of channels and the reduction of interference. To that end, the first payment (370 million reais) was made in April 2015 and the subsequent two
payments (for a total of 860 million reais) were both made in January 2017.
In April 2017, the first towns to complete the implementation of the
4G/LTE network were Brasilia, Campo Grande and Teresina. Subsequently, seven other towns have installed the new network and
start-up
is scheduled in another nine towns within the year in the country.
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Interim Management Report
at June 30, 2017
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Main changes in the regulatory framework
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CORPORATE BOARDS AT JUNE 30, 2017
BOARD OF DIRECTORS
The ordinary shareholders meeting of
the Company, held on May 4, 2017, appointed the new Board of Directors, setting its number of members at 15 and its term of office at three years (up to the approval of the financial statements at December 31, 2019). The Board of
Directors meeting, held on May 5, 2017, appointed Giuseppe Recchi as Chairman of the Board, Arnaud Roy de Puyfontaine as Deputy Chairman and Flavio Cattaneo as Chief Executive Officer of the Company.
On June 1, 2017 the Board of Directors approved a change in the company officers, with the appointment of Arnaud Roy de Puyfontaine as Chairman of the
Board of Directors and Giuseppe Recchi as Deputy Chairman.
The Board of Directors of the Company at June 30, 2017 was composed as follows:
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Chairman
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Arnaud Roy de Puyfontaine
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Deputy Chairman
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Giuseppe Recchi
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Chief Executive Officer
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Flavio Cattaneo
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Directors
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Camilla Antonini (independent)
Franco
Bernabè (independent)
Ferruccio Borsani (independent)
Lucia Calvosa (independent)
Francesca Cornelli (independent)
Frédéric Crépin
Dario Frigerio
(independent)
Félicité Herzog (independent)
Anna Jones (independent)
Marella Moretti (independent)
Hervé Philippe
Danilo Vivarelli
(independent)
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Secretary to the Board
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Agostino Nuzzolo
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All the board members are domiciled for the positions they hold in TIM at the registered offices of the Company in Milan, Via
G. Negri 1.
The following board committees were in place at June 30, 2017:
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Control and Risk Committee: composed of the Directors: Lucia Calvosa (Chair appointed in the meeting of June 22, 2017), Francesca Cornelli, Frederic Crépin, Félicité Herzog and Marella Moretti;
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Nomination and Remuneration Committee: composed of the Directors: Anna Jones (Chair appointed in the meeting of June 15, 2017), Ferruccio Borsani, Frederic Crépin, Hervé Philippe and Danilo Vivarelli;
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Strategy Committee: made up
of the Chairman of the Board of Directors, Arnaud Roy de Puyfontaine, the Chief Executive Officer, Flavio Cattaneo, the Deputy Chairman, Giuseppe Recchi, and the Directors Franco
Bernabé and Dario Frigerio.
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BOARD OF STATUTORY AUDITORS
The ordinary shareholders
meeting of May 20, 2015 appointed the Companys Board of Statutory Auditors with a term up to the approval of the 2017 financial statements.
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Interim Management Report
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Corporate Boards at June 30, 2017
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The Board of Statutory Auditors of the Company is now composed as follows:
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Chairman
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Roberto Capone
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Acting Auditors
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Vincenzo Cariello
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Paola Maiorana
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Gianluca Ponzellini
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Ugo Rock
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Alternate Auditors
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Francesco Di Carlo
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Gabriella Chersicla
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Piera Vitali
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Riccardo Schioppo
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INDEPENDENT AUDITORS
The shareholders meeting held on
April 29, 2010 appointed the audit firm PricewaterhouseCoopers S.p.A. to audit TIM financial statements for the nine-year period 2010-2018.
MANAGER RESPONSIBLE FOR PREPARING THE CORPORATE
FINANCIAL REPORTS
At the meeting of May 5, 2017, the Board of Directors confirmed Piergiorgio Peluso (Head of the Group Administration, Finance and
Control Function) as the manager responsible for preparing TIMs financial reports.
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Interim Management Report
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Corporate Boards at June 30, 2017
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MACRO-ORGANIZATION CHART AT JUNE 30, 2017
On July 24, 2017, the Board of Directors of TIM S.p.A. approved a settlement agreement for the termination, with
effect from July 28, of Mr. Flavio Cattaneos term of office as Chief Executive Officer and as the General Manager (with effect from July 31).
On July 27, 2017, the Board of Directors, in line with the Companys succession plan, temporarily assigned the Chief Executive Officers
responsibilities to the Executive Chairman Mr. de Puyfontaine. The responsibilities related to the Security Function and the company Telecom Italia Sparkle were assigned on an interim basis to the Deputy Chairman, Giuseppe Recchi.
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Interim Management Report
at June 30, 2017
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Macro-Organization Chart at June 30, 2017
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INFORMATION FOR INVESTORS
TIM S.P.A. SHARE CAPITAL AT JUNE 30, 2017
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Share capital
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11,677,002,855.10 euros
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Number of ordinary shares (without nominal value)
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15,203,122,583
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Number of savings shares (without nominal value)
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6,027,791,699
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Number of TIM S.p.A. ordinary treasury shares
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37,672,014
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Number of TIM S.p.A. ordinary shares held by Telecom Italia Finance S.A.
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126,082,374
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Percentage of ordinary treasury shares held by the Group to total share capital
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0.77
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%
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Market capitalization (based on June 2017 average prices)
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16,577 million euros
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Regarding the trading of shares issued by Group companies on regulated markets, the ordinary and savings shares of TIM S.p.A.
are listed in Italy (FTSE index), as well as the ordinary shares of INWIT S.p.A., whereas the ordinary shares of Tim Participações S.A. are listed in Brazil (BOVESPA index). The ordinary and savings shares of TIM S.p.A., and the
ordinary shares of Tim Participações S.A. are also listed on the NYSE (New York Stock Exchange); trading occurs through ADS (American Depositary Shares) that respectively represent 10 ordinary shares and 10 savings shares of TIM S.p.A.
and 5 ordinary shares of Tim Participações S.A..
SHAREHOLDERS
Composition of Telecom Italia S.p.A. shareholders
at June 30, 2017 according to the Shareholders Book, supplemented by communications received and other available sources of information (ordinary shares):
There are no significant shareholders agreements for TIM pursuant to Article 122 of Italian Legislative Decree
58/1998.
MAJOR HOLDINGS IN SHARE CAPITAL
At June 30, 2017, taking
into account the entries in the Shareholders Book, communications sent to Consob and to the Company pursuant to Italian Legislative Decree 58 of February 24, 1998, Article 120, and other available sources of information, the relevant holdings
of TIM S.p.A.s ordinary share capital are as follows:
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Holder
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Type of ownership
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Percentage of ownership
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Vivendi S.A.
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Direct
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23.94%
(*)
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(*)
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Equity interest obtained following receipt of a notification by Vivendi S.A. pursuant to Article 152
octies
, paragraph 7, of the Consob Issuer Regulations.
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Information for Investors
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Blackrock Inc. also notified Consob that, on November 15, 2016, as an asset management company, it
indirectly held a quantity of ordinary shares equal to 3.10% of the total ordinary shares of TIM S.p.A. at June 30, 2017.
COMMON REPRESENTATIVES
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The special meeting of the savings shareholders held on June 16, 2016 renewed the appointment of Dario Trevisan as the common representative for three financial years, up to the approval of the financial statements
for the year ended December 31, 2018.
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By decree of June 9, 2017, the Milan Court confirmed the appointment of Enrico Cotta Ramusino (already appointed by the decrees of April 11, 2014 and March 7, 2011) as the common representative of the
bondholders for the Telecom Italia S.p.A. 2002-2022 bonds at variable rates, open special series, reserved for subscription by employees of the TIM Group, in service or retired, with a mandate for the three-year period 2017-2019.
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By decree of June 12, 2015, the Milan Court appointed Monica Iacoviello as the common representative of the bondholders for the Telecom Italia S.p.A. 1,250,000,000 euros 5.375 percent. Notes due
2019 up to the approval of the 2017 Annual Report.
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RATING AT JUNE 30, 2017
At June 30, 2017, the three rating agencies Standard & Poors, Moodys and Fitch Ratings rated TIM as follows:
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Rating
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Outlook
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STANDARD & POORS
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BB+
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Stable
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MOODYS
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Ba1
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Stable
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FITCH RATINGS
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BBB-
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Stable
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On July 12, 2017, the rating agency Standard & Poors upgraded TIM S.p.A.s outlook from
Stable to Positive.
WAIVER OF THE OBLIGATION TO PUBLISH DISCLOSURE DOCUMENTS FOR EXTRAORDINARY OPERATIONS
On January 17, 2013, the board of directors of TIM S.p.A. resolved to exercise the option, as per article 70 paragraph 8 and article 71 paragraph
1-bis
of the Consob Regulation 11971/99, to waive the obligations to publish disclosure documents in the event of significant operations such as mergers, demergers, capital increases by means of the transfer of
assets in kind, acquisitions and disposals.
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Information for Investors
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RELATED PARTY TRANSACTIONS
In accordance with Article 5, paragraph 8 of Consob Regulation 17221 of March 12, 2010 concerning related party transactions and the
subsequent Consob Resolution 17389 of June 23, 2010, no significant transactions were entered into in the first half of 2017 as defined by Article 4, paragraph 1, letter a) of the aforementioned regulation which had a major impact on the
financial position or on the results of the TIM Group for the first half of 2017.
Furthermore, there were no changes or developments regarding the
related party transactions described in the 2016 Report on operations which had a significant effect on the financial position or on the results of the TIM Group in the first half of 2017.
Related party transactions, when not dictated by specific laws, were conducted at arms length. In addition, the transactions were carried out in
accordance with an internal procedure that establishes the terms and timing for verification and monitoring.
Up to May 4, 2017, the companies of the
Generali group, Intesa Sanpaolo group, Mediobanca group and Telefonica group (shareholders of the company Telco) were also considered related parties, based on the provision of TIMs procedure for the management of related party transactions
according to which it applies also to the participants in significant shareholder agreements according to Article 122 of the Consolidated Law on Finance that govern the candidacy to the position of Director of the Company, where the majority
of the Directors nominated have been drawn from the list submitted. The members of the Board of Directors of TIM in office up to May 4, 2017 had in fact been drawn from the list originally submitted by the shareholder Telco. With the
reappointment of the Board of Directors this circumstance no longer applied and the scope of related parties through Directors was therefore amended.
On
May 3 and June 1, 2017, the Board of Directors of TIM approved several changes to the Procedure for the management of related party transactions, deciding, on a voluntary basis and therefore without any obligation, to treat Vivendi as if
it was the parent, in accordance with the Consob Regulation. The process of identifying new entities that entered the scope of related parties essentially led to the identification of all the entities with which the Group has significant
relationships. The full list is currently being completed.
The new Procedure for the management of related party transactions is available for
consultation at the website www.telecomitalia.com, About Us section Governance System channel.
The information on related
parties required by Consob Communication DEM/6064293 of July 28, 2006 is presented in the financial statements and in the Note Related party transactions in the Half-year condensed consolidated financial statements at
June 30, 2017 of the TIM Group.
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ALTERNATIVE PERFORMANCE MEASURES
In this Half-year Financial Report at June 30, 2017 of the TIM Group, in addition to the conventional financial performance measures established by IFRS,
certain
alternative performance measures
are presented for purposes of a better understanding of the trend of operations and financial condition. Such measures, which are also presented in other periodical financial reports (annual and
interim) should, however, not be construed as a substitute for those required by IFRS.
The alternative performance measures used are described below:
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EBITDA: this financial measure is used by TIM as the financial target in internal presentations (business plans) and in external presentations (to analysts and investors). It represents a useful unit of measurement for
the evaluation of the operating performance of the Group (as a whole and at the Business Unit level), in addition to EBIT. These measures are calculated as follows:
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Profit (loss) before tax from continuing operations
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+
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Finance expenses
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-
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Finance income
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+/-
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Other expenses (income) from investments
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+/-
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Share of profits (losses) of associates and joint ventures accounted for using the equity method
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EBIT - Operating profit (loss)
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+/-
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Impairment losses (reversals) on
non-current
assets
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+/-
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Losses (gains) on disposals of
non-current
assets
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+
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Depreciation and amortization
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EBITDA - Operating profit (loss) before depreciation and
amortization, Capital gains (losses) and Impairment reversals (losses) on
non-current
assets
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Organic change in Revenues, EBITDA and EBIT: these measures express changes (amount and/or percentage) in revenues, EBITDA and EBIT, excluding, where applicable, the effects of the change in the scope of consolidation
and exchange differences.
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TIM believes that the presentation of the organic change in revenues, EBITDA and EBIT allows for a more complete and effective understanding of the operating performance of the Group (as a whole and at the Business Unit
level). This method of presenting information is also used in presentations to analysts and investors. This Half-Year Financial Report provides a reconciliation between the reported figure and the organic figure.
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EBITDA margin and EBIT margin: TIM believes that these margins represent useful indicators of the Groups ability, as a whole and at Business Unit level, to generate profits from its revenues. In fact, EBITDA
margin and EBIT margin measure the operating performance of an entity by analyzing the percentage of revenues that are converted, respectively, into EBITDA and EBIT. Such indicators are used by TIM in internal presentations
(business plans)
and in external presentations (to analysts and investors) in order to illustrate the results from operations also through the comparison of the operating results of the reporting period with those of the previous periods.
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Net Financial Debt: TIM believes that Net Financial Debt represents an accurate indicator of the Groups ability to meet its financial obligations. It is represented by Gross Financial Debt less Cash and Cash
Equivalents and other Financial Assets. This Half-Year Financial Report includes tables showing the amounts taken from the statement of financial position and used to calculate the Net Financial Debt of the Group.
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To better represent the real performance of Net Financial Debt, in addition to the usual indicator (called Net financial debt carrying amount), Adjusted net financial debt is also shown, which
excludes effects that are purely accounting and
non-monetary
in nature deriving from the fair value measurement of derivatives and related financial assets and liabilities.
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Net financial debt is calculated as follows:
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+
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Non-current
financial liabilities
|
+
|
|
Current financial liabilities
|
+
|
|
Financial liabilities directly associated with Discontinued
operations/Non-current
assets held for sale
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A)
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|
Gross financial debt
|
+
|
|
Non-current
financial assets
|
+
|
|
Current financial assets
|
+
|
|
Financial assets relating to Discontinued
operations/Non-current
assets held for sale
|
B)
|
|
Financial assets
|
C=(A - B)
|
|
Net financial debt carrying amount
|
D)
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Reversal of fair value measurement of derivatives and related financial assets/liabilities
|
E=(C + D)
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Adjusted net financial debt
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SUSTAINABILITY
In the past, environmental, social and governance issues were of interest to a limited community of stakeholders; now, increasingly, they are an essential
condition for the prosperity of companies in the long term. Introducing and integrating social responsibility in business activities, in order to promote it as an opportunity to create value, is a strategic lever to strengthen the competitiveness of
the company.
To demonstrate the growing importance of sustainability issues, in January 2017 Legislative Decree n° 254 of December 30, 2016 came
into force, which transposed Directive 2014/95/EU of the European Parliament
1
. The Decree takes the disclosure of diversity and
non-financial
information by
businesses and large groups from being voluntary to mandatory as of the 2017 financial year.
The Decree lists the topics companies are required to
provide information about, in particular:
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environmental aspects, including the use of energy resources, water usage, CO
2
emissions;
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issues related to personnel management, including the actions taken to ensure gender equality and dialogue with social partners;
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respect for Human Rights and the actions taken to prevent violations and discriminatory conduct;
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the fight against active and passive corruption.
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The content of the Decree recognizes what is increasingly
felt by the financial and
non-financial
community, the need for the thorough representation of company activities; in fact it provides further tools that allow stakeholders, including shareholders, to perceive
the contribution that sustainability can make to both the financial results of the company and to the community in terms of social value.
The TIM Group
operates with the conviction that business activities must be conducted in a way that considers the expectations of stakeholders, in keeping with the principles established by internationally recognized standards. In defining and implementing its
sustainability strategy and program, TIM is inspired by the guidelines issued by the main global guidance and standardization organizations in the field of Corporate Responsibility. TIMs sustainability report, prepared using the triple bottom
line approach
2
, has been prepared for almost 20 years and integrated into the consolidated financial statements from 2003 onwards. The adherence of the sustainability report to the GRI G4
3
standard, comprehensive version, enables TIM to be already compliant with Legislative Decree 254.
1
|
Directive 2014/95/EU of the European Parliament and of the Council of October 22, 2014, containing an amendment to Directive 2013/34/EU. The Directive concerns the disclosure of
non-financial
information and information on diversity by certain enterprises and certain large groups.
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2
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This approach, defined for the first time by John Elkington in 1994, provides for the economic-financial data to be represented together with the environmental and social results.
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3
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GRI: Global Reporting Initiative, the standard setter for sustainability issues. The comprehensive version is the most complete reporting option in terms of the indicators used.
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RESEARCH & DEVELOPMENT AND INNOVATIVE SERVICES
As a result of the growing presence and importance of digitization in the lives of citizens, consumers and companies, technological and business innovation
have become strategic for the market positioning and competitiveness of companies, particularly in the telecommunications sector.
The Group, in
consideration of this, has adopted a strategy that aims to:
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promote the internal innovation lines, focusing research on key aspects of the development of the fixed and mobile network moving towards the future 5G standards and ultrabroadband, and issues concerning service
platforms and the new operations systems
1
.
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create initiatives such as Idea Sharing
2
, to promote innovation and creativity among employees;
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continue with Open Innovation projects and activities which permit osmosis between innovation within the Company and external sources of innovative ideas.
|
This context also encompasses the development of laboratories specifically open to industrial collaboration, in particular in the context of the Internet of
Things (IoT), and the Joint Open Labs (JOL), set up through collaborations with Universities of excellence, and TIM #WCAP, TIMs Corporate Accelerator covering around 5 thousand square meters in Rome, Milan, Bologna and Catania, entirely
dedicated to entrepreneurial open innovation.
In terms of patents, 9 new ones were filed in the first half of 2017. In particular, 2 of these were
created in close collaboration with the University of Pisa and the University of Genoa on specific Digital Home topics. Another initiative aimed at enhancing the world of inventions was held in Turin in March 2017: Techshare Day 2017, a
day entirely dedicated to sharing technological knowledge with companies that want to introduce patent-protected forms of innovation resulting from research in their specific activities.
For the JOL 2017 activities, focused on infrastructural issues and application solutions, specific research contracts are being finalized (16 with the
Polytechnic University of Turin and 6 with the Polytechnic University of Milan) which commit around 660,000 euros, in addition to 30 of TIMs technical experts and 50 researchers from the Universities. With respect to the joint participation in
projects funded as part of the European Programme Horizon 2020
3
a benefit of around one million euros is estimated in 2017 in the form of proceeds deriving from the activities of the JOL.
Moreover, thanks to collaboration and exchange between TIM and the Polytechnic University of Turin, the latter has become one of the first 5G
campuses in Europe, a technology campus but also a Living Lab open to students, researchers and possible partners and vendors, thereby involving energies from all over Italy.
Finally, in 2017 TIM #WCap strengthened its role as an innovation tool, in line with TIMs business strategy, completing the evolution route
which led to the launch of the Call for Partners in May 2017 for the selection of
ready-to-market
start-ups
focused
on specific areas of particular interest to the Company: IOT Consumer; Payment & Digital Identity, Industry 4.0, Cyber Security for Business customers. The
start-ups
selected will gain access to the
Co-Creation
Programme aimed at the design and implementation of Proof of Concept (POC) of the digital solutions proposed, with the involvement of the Business Units. The aim, therefore, is primarily to speed up the
integration of innovative digital solutions in TIMs offer or technology.
With reference to technological innovation, the following are the projects
most worthy of note:
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support for the launch of numerous LTE Advanced services at 225 Mbps and 300 Mbps and the first
in-the-field
testing of LTE
Advanced services with speeds of up to 700 Mbps in download and up to 75 Mbps in upload, a new milestone following on from the European record achieved for the commercial launch of 4.5G technology of up to 500 Mbps. The service with speeds of up to
700 Mbps will be made available to TIM customers in the coming months, with the arrival of enabled smartphones and the upgrading of the 4.5G network currently underway in the principal cities;
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1
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Operations are defined as the set of processes that help to create and deliver value to customers, in general through a mixture of products and services.
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2
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Idea Sharing is an internal crowdsourcing project aimed at discovering the talent and creativity of TIMs employees to stimulate and promote innovation.
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Horizon 2020 (H2020) is the Framework Programme of the European Union (EU) for research and innovation relating to the period 2014-2020.
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support for the launch of 200M/20M offers on enhanced VDSL and the 1G/100M offer on FTTH;
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Smart Farm: this is Olivettis solution which enables agricultural enterprises to improve the quality of their harvest and encourage increased profits by exploiting the most innovative IoT technologies. Smart Farm
is based on an
in-cloud
platform that offers companies a complete system of tools and information to accurately monitor the factors that help to determine the health of plants, irrigation requirements and
climatic conditions. Through a network of
in-the-field
sensors, data is collected and transmitted to an application, which is easy to use and accessible through a web
interface which enables all the parameters of interest to be kept under control. This makes it possible to manage the activities as effectively as possible and to intervene in a prompt and targeted way where necessary;
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Smart Energy: is an added value service for customers who consume high amounts of electricity and are connected to low voltage which allows them to know their electricity consumption in real time, receive suggestions to
optimize their consumption, reduce their electricity bill and choose the best offer available. Moreover, if there is a photovoltaic plant, the service helps the customer to optimize the use and return, and to control its effectiveness over time. The
main characteristics of the service are simple DIY (do it yourself) installation and the ability to carry out an automatic energy audit through consumption behavior indicators and social comparisons with similar users.
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Energy Aggregation: enables management of an aggregate of the energy resources of industrial customers and their monetization by providing electricity services remunerated on the Dispatching Services Market
1
. It is based on an ICT platform equipped with the appropriate interfaces to receive dispatching orders from Terna and to execute them on an aggregate of energy resources, as well as to monitor the
progress of the orders and measure the electrical flexibility capacity at any given time;
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Smart Retail: in early 2017 TIM set up the first 50 Smart Retail solutions distributed throughout Italy, equipping retail outlets with BLE (Bluetooth Low Energy) beacon technology, small devices installed in theme-based
corners (e.g. TIM Vision area, Apple corner, etc.) which are detected by todays smartphones. Customers who have the MyTIM Mobile App are then guided during their visit to the shop, receiving welcome/goodbye messages (push notifications) and
information on their position within the retail outlet. The solution goes beyond the physical confines of the shop, extending the customers engagement to the geographic area in the immediate vicinity of the shop (geofence area) achieved by
using proximity marketing cases: customers with the MyTIM Mobile App, when they are in the vicinity of Smart Retail or a shop that has activated a geofencing campaign, receive a message on their smartphone inviting them to visit the nearest TIM
center to activate a promotional offer with particularly advantageous conditions. This idea is part of the companys New Concept Store project to renew retail outlets in terms of both their physical layout and technological equipment.
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INDUSTRY 4.0
The innovations brought by Industry 4.0 are often
represented as the fourth industrial revolution. The four key technological principles of Industry 4.0 for the Smart Factory, as defined by the promoters of this initiative (a working group of the German government set up during the Hannover Fair),
are:
|
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Interoperability, seen as the capacity to communicate between smart devices, sensors and people in a transparent and standard way through the Internet of Things and of People (also known as the Internet of Everything);
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Information transparency, seen as the capacity to create a cybernetic image of the Factory, virtual and updated in real time, also enriched with information obtained from smart devices, sensors, legacy databases and the
people who work in the factory;
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Technical Assistance, seen as the aggregation of information even using augmented reality techniques to support technicians who must resolve problems and make urgent interventions inside the Factory;
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Remote control and the decentralization of decisions which can also be taken automatically by the CPS at the premises, but with supervision from a control room not necessarily located in the same building or in the same
geographic area.
|
1
|
The quantity of energy required by the set of consumers (families and companies) must be produced in real time, and must be transmitted so that supply and demand are always balanced, thereby ensuring the continuity and
reliability of the supply of service. Management of these energy flows on the network is called dispatching.
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Case studies linked to Industry 4.0 under development are represented by the introduction of Internet
technologies and IoT within the production processes of the manufacturing industry. They are essentially based on CPS (Cyber-Physical Systems), that is smart devices used in production processes seen as the evolution of
present-day
and widely used PLC (Programmable Logic Controllers)
1
. The aim is to create a smart factory, modular and with islands, which can be remotely
controlled and represented through a virtual image. Through the IoT the CPS (evolution of the PLC) communicate and cooperate with each other and with human beings in real time and, again through the Internet (the Future Internet as defined for
example in the
FI-PPP
Program
2
of the European Commission), they present services both to departments within the manufacturing industry and to external
organizations.
Immersive Technologies
Immersive technologies, based on environments created around the user in which the latter is literally immersed, linked to virtual, augmented and
mixed reality, are becoming increasingly pervasive and in the near future may represent a new revolutionary computing platform, just as PCs and smartphones were in the past.
The panorama of immersive technologies is broken down into different areas. Virtual Reality (VR), the aim of which is to substitute some sense perceptions
(first and foremost sight and hearing) with digital content and simulations that are so realistic they convince the user at a subconscious level of the credibility of the virtual world in which they are immersed. Using appropriate VR headsets (HMD
Head Mounted Display) the users visual field is entirely replaced with digitally processed images which accurately follow the movements of the users head. The user has the sensation of truly finding themselves in a different
place, from a simulation of a space station cabin to a fantastic cartoon or a documentary on
far-flung
locations.
Instead, we are talking about Augmented and Mixed Reality (AR and MR) when the reality perceived by the user, instead of being completely replaced by a
virtual world, is integrated with information and digital content. Already available for some time through applications for smartphones and tablets, these technologies now allow the direct overlapping of content in the users visual field
through the use of particular eyeglasses.
Thanks to the widespread availability of processing power offered by
present-day
devices and the lower costs of some components, such as LCD displays, for example, these technologies, until now reserved for niche markets and industrial scopes, are now accessible to the consumer
market and will soon be part of our daily lives.
TIM is active in the research and development of solutions that use Virtual and Augmented Reality in
many areas:
|
|
Social VR, Interpersonal Communication, Collaboration: from an initial analysis VR might seem to be a technology that isolates people, but in fact it has the potential to be the most social platform ever tested. Thanks
to integration with the network, the virtual worlds are not solitary experiences but places in which to meet real people with whom to interact and chat in the same natural way (or almost) one would in real life. Any application, game or content, can
become an experience to share with friends. Applications relating to social networking, interpersonal communication, and company collaboration abound and they are all there to be explored.
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Digital entertainment: many of the main VR and AR applications will be linked, above all in the initial phase, to the entertainment area. Immersive technologies completely revolutionize
present-day
storytelling tools and will give rise to new and unexpected forms of artistic expression. The streaming of 360° immersive videos in 3D and high quality is a challenging matter from a
technological viewpoint, and the potential offered by TIMs 4G LTE networks and the future innovations of the mobile wireless network will play a key role in making this content available everywhere.
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1
|
The Programmable Logic Controller (PLC) is a controller for industry originally specialized in managing or controlling industrial processes.
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2
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Future Internet Public-Private Partnership Programme.
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Culture and eTourism: the potential of these technologies linked to the world of education, culture and tourism is vast. Think for example of the possibility of bringing and entire class of students to see the pyramids
in Egypt, the surface of Mars and the barrier reef, in just one day. The bHERE framework, which arose from the development of this application, will allow the creation of virtual museum experiences and narration of this type which, in the future,
will also be available in VR.
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VR eCommerce: immersive technologies will make it possible to offer the entire commodity of
present-day
electronic commerce solutions combined with the advantages of visiting a
real shop: the possibility of being able to view and touch the products (1:1 scale replicas) and interact with a real shop assistant in a virtual environment, even eliminating annoying queues.
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ENVIRONMENTAL PROTECTION
Energy
efficiency
Actions aimed at improving the
efficiency of technological systems and reducing electricity consumption, consequently reducing greenhouse gas emissions, are always an integral part of TIMs environmental strategy.
2017 is marked by significant growth in technological developments in the Network context, leading to a substantial increase in energy consumption in both
fixed and mobile, estimated for this year at around 200 GWh. Therefore, over the course of the first half year, further new adaptation and efficiency-improvement measures for the structures of fixed network exchanges were assessed and prepared, to
be carried out in the second half of the year with the aim of offsetting the aforementioned demand and at the same time reducing the increase in consumption. All the sites not affected by the efficiency-improvement plans already launched (disposal
and decommissioning of industrial buildings) were taken into consideration. Actions to reduce consumption in other areas (data centre rooms and offices) were also analysed.
The main projects already underway or planned for the months ahead are described below.
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Reengineering of Exchanges: planned adaptation work on both the power supply and air conditioning of the infrastructure of the exchanges is in the deployment phase, aimed at increasing energy efficiency, reducing the
active electrical power and minimizing the reactive electrical power
1
. Plans have been conceived to carry out work, in the second half of 2017, on the 100 exchanges (SGUs
2
and POPs
3
) which consume the most energy (out of a total of 10,500 exchanges) which indicatively represent 11% of the total consumption of the
exchanges, amounting to around 159 GWh per year (105 GWh telecommunications equipment and 54 GWh infrastructure) with a savings target, when fully operational, of around 21 GWh.
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Revamping Equipment: a set of streamlining, compactness and optimization measures are in the deployment phase, aimed at reducing energy consumption in the SGU exchanges in Metropolitan areas with initial estimated
savings, when fully operational, of around 4 GWh.
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Summer Efficiency Trial: in order to handle situations of abnormal consumption, the launch of summer monitoring has been planned for 80 fixed network exchanges.
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Room cooling optimization: reducing consumption linked to the cooling of rooms is planned through the selective switching off of machines by installing a particular solution for the dynamic optimization of cooling
mechanisms already tested in previous years. In the initial phase work will be carried out at a data center with significant consumption in the Rome area, obtaining an estimated annual saving of over 1 GWh.
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Eco4Cloud solution: the plan is to expand the number of machines set up with real-time controlled and dynamic switching off of servers in farms in the
cloud
4
based on VMware virtualization
5
, with optimization of the use of physical resources (CPU and RAM) and the consequent energy
savings. The solution, the efficiency of which has already been tested, leads
|
1
|
The active or real power is that actually consumed by a load, while the reactive power provides no consumption values as it is an exchange energy between the power line and the inductive load
(motor, fluorescent lamps, etc.). Reducing the reactive power signifies, in practical terms, increasing the systems capacity to use energy to perform useful work by reducing the heating of the load and the cables, which cause energy losses due
to the Joule effect.
|
2
|
SGUs, or Urban Group Stages, are Area Exchanges that represent level 2 of TIMs switching hierarchy and are positioned between the Group Transit Stage (SGT, intercity network) and the Main Exchanges (MEs, which
include the users through the distribution network).
|
3
|
In telecommunications the POP, or Point of Presence, is a network access point (router) along the access network, provided by an Internet Service Provider (ISP), capable of routing traffic to the
end-users
connected to it.
|
4
|
A farm in the cloud is a farm or a series of servers positioned in a single area in order to centralize the management, maintenance and security thereof. The various farms are distributed in
the cloud.
|
5
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This involves a series of software packages developed by VMware Inc. which allow
several operating systems to run in a virtual environment. This makes it possible to implement, on a platform with a Windows or Linux operating system and the relevant hardware, a number
n of other virtual machines with different operating systems.
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to the better operation of IT farms in terms of performance and capacity planning, enabling optimization of the physical development of IT platforms following increases to the
processing load required.
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Energy efficiency at sites used as offices through the Building Energy Management System (BEMS), namely a building management system, with a dynamic approach, which aims to achieve lower energy consumption during
operation and for the entire life cycle of the building-plant system
1
; implementation is planned for 20 more energy-intensive offices which are not subject to divestment in the next 3 years.
|
As anticipated, decommissioning initiatives for obsolete technological platforms already launched in previous years also
continued in the first half of 2017, mainly with regard to the following projects:
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|
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PSTN
2
: the project involves the migration of traditional accesses (except for ISDN accesses) to VoIP platforms. This results in reduced energy consumption, occupation
of space and maintenance, and in general in the overcoming of the obsolescence of the traditional plants. The 2017 plan includes switching off 3.6 million ports with anticipated progress of over 50% by June with respect to the plan.
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SuperSGU: the initiative plans to make the fixed network equipment more compact, concentrating the functions of some SGUs on a reduced number of SuperSGUs with direct benefits in terms of reducing energy
consumption. The 2017 plan includes work on 25 SGUs with anticipated progress of over 50% by June with respect to the plan.
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ATM
3
: the project involves optimizing data accesses with the gradual disposal of ATM devices and a shift to IP technology devices. This results in reduced energy
consumption and in general the overcoming of the obsolescence of the traditional plants. The 2017 plan includes switching off 1.3 million ports with anticipated progress of over 30% by June with respect to the plan.
|
1
|
See also standard UNI EN 15232 - Energy Performance of Buildings - Impact of building automation, control and technical building management which defines the methods for assessing the energy savings that can
be achieved in buildings that use technologies for the management and automatic control of the technological systems and the electricity system.
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2
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PSTN is the acronym for Public Switched Telephone Network; it is also known as RTG (General Telephone Network) or switched public telephone network.
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3
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ATM, or Asynchronous Transfer Mode, identifies a series of network protocols developed from the 90s onwards capable of offering an integrated single telecommunications service which is able to combine voice
services with various types of data services.
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TIM PEOPLE
The evolution of the
TLC industry towards Digital Telco models, the technological evolution of infrastructure and market challenges linked to the development of new digital and innovative services are all parts of the framework of an employment market undergoing
profound transformation. The Digital Transformation, which TIM is working on, is pervasive and forces us to rethink processes and services and to develop new skills and professionals who are able to make the best use of the new opportunities.
At TIM in particular, the move towards a business model centered around Digital Innovation, the consequent need for a reshuffling of skills in line with the
expanding range of offers and market positioning, and the extension of working life are the challenges that have the most impact on the definition of the new HR strategy, launched last year and currently on course for full application with
particular emphasis on the following priority intervention areas:
Efficiency: in the first half of 2017 there was a continuation of actions aimed at
rationalizing costs, simplifying the organizational structure and processes and improving productivity indexes.
Welfare: the reference model has been
redesigned with a renewed proposal of services with particular attention to the work longevity phenomenon. The various actions planned include those to support the enhancement of professional characteristics functional for the increase
of Companys value irrespective of age and following a logic of equality, inclusion and sustainability.
Skills: a significant number of professional
re-training
programs are in progress (job center), with particular attention to the digitization of professions; individual professional and managerial development plans to ensure the alignment of skills
profiles with the new strategic direction.
Development Model
Compared to last years, TIMs development
model has been further refined in terms of individual components in order to support people in the various phases of their professional path within the company.
In particular, the first half saw the continuation of activities related to onboarding programs which involved new graduates and junior professionals already
working at the Company, in order, amongst other things, to further support them in their professional career in keeping with the evolution of the business.
With respect to the other evaluation processes - Performance, Motivation and Knowledge Review - which constitute the primary source for the construction of
development plans open to all directed at the entire Company population, the following activities were carried out:
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|
Performance: in February the choice of evaluators phase was carried out by the persons responsible for the evaluation according to multirater logic; in March there was an evaluation phase involving everyone
in the Group; the feedback phase was then initiated in April (starting with the MBO20 beneficiaries) which concluded for the entire Company population in the month of June.
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Motivation Review: a new evaluation process aimed at detecting the energy people express in their work activities. In February the testing phase was initiated for the scientific validation of the tool; four companies in
the Group are involved (TCC, Sparkle, HRS, INWIT).
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Knowledge Review: in May the planning of the critical knowledge assessment process was completed, the results of which will constitute the basis for defining development plans for Professional Leadership aimed at
recognizing Knowledge Holders as possessors of strategic
know-how
for the current and future business of the Company.
|
Finally, in the first half of the year, an overall review of the instrumentation for the Assessment of potential processes was carried out and the relative
evaluation activities were started, aiming to define the development plans for Managerial Leadership.
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Training
Continuing on the path of the enhancement and
development of
in-house
expertise, which started in July 2016, the skills development strategy is outlined through the following main pillars:
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Professional
re-training
and enhancement
|
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Development of the managerial profile
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Evolution and digitization of skills
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Individual development plans
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In keeping with these drivers, the consolidation of the TIM Academy and
Development Model continues, in order to ensure tools and methodologies that can support employees at this delicate time of transformation.
The training
activities are divided into four macro-categories, each of which entails several main activities carried out in the first half.
Management
Education
:
training aimed at managers is essential to accelerate company turnaround and ensure the implementation of the 2017-2019 strategic plan. A Management Education course for 2017/2018 has been established, which will involve a total of
700 managers, offering targeted programs differentiated on the basis of the complexity of the roles managed by the participants. In June the planning was completed and the first programs are in the launch phase. The plan, developed in blended mode,
includes: webinar sessions, online coaching sessions,
bite-size
training and video-talks, experimental laboratories, workshops and seminars on strategic topics with key speakers.
Development of role-based and specialized skills and new capabilities: training to develop role-based and specialized skills, as well as new capabilities,
occupies a central role in TIMs training investments plan. The main projects launched in the first half are:
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Open Access
on-the-field
technicians skills improvement: blended training for around 9,000
in-the-field
technicians aimed at bridging the gaps in the technical skills that emerged from the skill assessment.
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Maintenance and Development of Corporate Certifications: measures to enable participation in tenders and contracts in the private sector and in Central and Local Public Administration.
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Big Data Transformation: development path for Big Data skills to support the transformation underway at TIM.
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Field Management Training: management training for 52 Coordinator Managers for Integrated Access Network Assurance & Delivery (Field Force) in the Open Access area.
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Development and empowerment
The organizational changes and the
evolution of business-linked skills require new tools to support the change and the awareness of TIMs people.
The Skills Model
e-learning
course has been created, which aims to increase awareness and promote the culture needed to guide the behavior of the Groups personnel.
Institutional and corporate culture
Institutional and mandatory
training, involving the entire population of the Company, aims to raise awareness and disseminate knowledge of the content required by the legal formalities and support the transformation of the organizational culture. The main projects of the first
half year are:
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New Equivalence Model (NEM): dedicated to staff in the commercial departments to facilitate the transition towards the New Model.
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Safety: in relation to the obligations deriving from current regulations, around 100 senior managers are involved in the Sicuri Adesso (Safe Now) training project.
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Anti-corruption and whistleblowing: a digital learning module has been created, which involves the entire population of the company and the Group in order to encourage the adoption of transparency, correctness and
behaviors in good faith by the whole Company.
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Job Centre and the development of
in-house
expertise
In relation to the
re-training
paths in progress, professional
re-skilling
activities continued as part of the Job Centre Project, which pursues the following main objectives:
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|
re-allocating
the people currently assigned to support activities with a direct impact on the business and on customers;
|
|
|
provide a professional qualification for people to be
re-employed
in activities previously outsourced and now brought back
in-house;
|
|
|
represent a professional opportunity which allows the company to open up to the market more effectively and efficiently, with energy, skills and professionalism, while also allowing people to maintain an updated
professional profile.
|
At the end of June more than 2,700 people have been envolved in the Job Center.
HR Partnerships
In 2017 we implemented the new model of relations with the educational ecosystem (academic world, schools, business schools, institutional and social entities)
pro-actively
collaborating on the definition of training projects, the teaching of the topics specific to our business and the implementation of specific School-Work Alternation courses with technical
institutions and schools from across the country.
The aim of the new partnership model is to generate value in the short-medium term for the
organization, on the one hand, through the blending of different knowledge; and for young people, on the other, making our
know-how
available to them.
People Caring
TIM believes that being an inclusive company, one that is able to take care of its people and to create solutions that put everyone in a position to give the
best of themselves, is the basis for economic and social sustainability. In this context, 2017 also saw numerous initiatives launched in various and diverse areas, all connected by the common thread of placing people at the center, which are
encompassed in the following four macro areas:
|
|
Work-life balance and Family Care (including daycare centers, summer camps for employees children, commute management, free tickets and the testing of agile working);
|
|
|
Volunteering initiatives by employees (including blood donation days organized at Company offices, stands hosted at Company offices to sell charity products and participate in charitable activities);
|
|
|
Equity & Inclusion Management (which include disability management and longevity management initiatives);
|
|
|
Promotion and support for people and their well-being (for example the provision of financial assistance to support employees in particular financial difficulties; the provision of scholarships, for visits abroad and
the reimbursement of university taxes; and for enrolment in the first year of single-cycle university programs and selected masters degrees for worthy children of employees).
|
Health and Safety
During the first half, the main areas of action in the field of health and safety at work, related to the
re-modelling
of the process of identifying and assessing risks in keeping with TIMs shift to a multi-employer model, which resulted in the reviewing of the organizational and procedural framework linked to the management of prevention aspects.
Campaigns to monitor physical agents continued by means of tools specific to the measurement of vibrations, noise and electromagnetic fields. Training
activities for all company employees were planned and launched, in particular for operational technical staff increasingly affected by the application of new technologies and involved in new operating scenarios.
|
|
|
|
|
Interim Management Report
|
|
Environmental protection
|
|
64
|
at June 30, 2017
|
|
|
|
As part of the information and awareness-raising initiatives to strengthen the safety culture, planning started
for a video on how to handle emergencies in the event of earthquakes.
With reference to the monitoring of accidents, in the first half the careful
analysis of events and the potential identification of corrective actions continued; for greater synergy, there was stronger direct involvement of the staff affected.
A number of digital projects are also being developed in collaboration with technical personnel; these are also aimed at the application of new technologies
in the Safety area.
Industrial relations
In the first half, in keeping with the Industrial Relations model shaped by seeking dialogue and a constructive comparison of ideas, and in compliance with
contractual structures, information and discussion sessions with trade unions continued at both national and regional level.
At national level, on
several occasions TIM outlined the strategic positioning of the Company in relation to the main economic and production indicators and the consequent need to identify measures aimed at supporting the recovery of competitiveness and profitability as
well as improving the quality of services, in order to safeguard employment levels and the company scope.
In this context, in February the Company issued
a Company Regulation which innovates and modernizes some fundamental aspects of the employment relationship, including, inter alia, with respect to remuneration, specific individual incentive measures for technical staff. This Regulation was then
subsequently refined and improved, accepting the proposals and suggestions of the trade union organizations.
In June, the Company and the Trade Union
reached an understanding that defines the structure of the 2017/2019 Performance Bonus for companies of the TIM Group.
The Bonus takes a new approach: it
provides for equal incentive systems for all, from managers to technical personnel, and they are based on the results achieved with respect to the goals set.
The agreement, which positively concludes the negotiations started last month with the trade union, provides for the performance bonus to be comprised of:
|
|
a basic bonus, which uses the Group EBITDA as an indicator;
|
|
|
a production bonus, which uses the revenues from group services net of product revenues as an indicator;
|
|
|
an improvement bonus which uses the Customer Satisfaction Index as an indicator;
|
|
|
a department bonus linked to the departmental targets.
|
The objectives, changed by managerial
incentive systems, recognize the contribution of all workers to the achievement of the forecast economic and production results.
The average value of the
Bonus for TIM was also defined (1,300 euros per year), correlated and commensurate to the achievement of the goals set.
The payout will concern all
employees, including those with apprenticeship and fixed-term contracts, but the bonus will be awarded upon achievement, first of all, of the measure set for the Group EBITDA indicator.
The parties have also provided for the Welfare option, according to which people may choose whether to receive all or a part of the bonus in welfare services,
benefiting from full tax relief. The list of services includes, inter alia, daycare centers, taxes and schools books, elderly care, healthcare costs, pension funds, loans, shopping vouchers, sports and free time which are only a part of the welfare
capital, in which TIM invests a total of over 100 million euros each year.
A consultancy body has been set up to manage the agreement, which will be
notified of the goals each year, derived from the budget process, in keeping with the Business Plan.
|
|
|
|
|
Interim Management Report
|
|
Environmental protection
|
|
65
|
at June 30, 2017
|
|
|
|
With respect to the trend reversal of the Companys main economic and profit indicators, recorded in the
second half of 2016, TIM paid its employees a contribution made on the basis of overall efficiency recovery and improvement of the Companys economic performance. In this sense TIMs people were paid a
One-off
Bonus, diversified according to their grade. Appreciation was also shown to personnel of the Groups other companies - to whom the Telecommunications Collective Employment Agreement applies -
with the agreement on the Performance Bonus which expired in 2016.
|
|
|
|
|
Interim Management Report
|
|
Environmental protection
|
|
66
|
at June 30, 2017
|
|
|
|
C
ONTENTS
C
ONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
note
|
|
|
6/30/2017
|
|
|
of which
related
parties
|
|
|
12/31/2016
|
|
|
of which
related
parties
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
|
|
|
|
4
|
)
|
|
|
29,511
|
|
|
|
|
|
|
|
29,612
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets with a finite useful life
|
|
|
|
|
|
|
5
|
)
|
|
|
6,594
|
|
|
|
|
|
|
|
6,951
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,105
|
|
|
|
|
|
|
|
36,563
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible assets
|
|
|
|
|
|
|
6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment owned
|
|
|
|
|
|
|
|
|
|
|
13,671
|
|
|
|
|
|
|
|
13,947
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets held under finance leases
|
|
|
|
|
|
|
|
|
|
|
2,371
|
|
|
|
|
|
|
|
2,413
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,042
|
|
|
|
|
|
|
|
16,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in associates and joint ventures accounted for using the equity method
|
|
|
|
|
|
|
7
|
)
|
|
|
17
|
|
|
|
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other investments
|
|
|
|
|
|
|
7
|
)
|
|
|
48
|
|
|
|
|
|
|
|
46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
|
|
|
|
8
|
)
|
|
|
2,185
|
|
|
|
|
|
|
|
2,698
|
|
|
|
532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous receivables and other
non-current
assets
|
|
|
|
|
|
|
|
|
|
|
2,324
|
|
|
|
|
|
|
|
2,222
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax assets
|
|
|
|
|
|
|
|
|
|
|
525
|
|
|
|
|
|
|
|
877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,099
|
|
|
|
|
|
|
|
5,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Non-current
assets
|
|
|
(a
|
)
|
|
|
|
|
|
|
57,246
|
|
|
|
|
|
|
|
58,784
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inventories
|
|
|
|
|
|
|
|
|
|
|
314
|
|
|
|
|
|
|
|
270
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous receivables and other current assets
|
|
|
|
|
|
|
9
|
)
|
|
|
5,617
|
|
|
|
15
|
|
|
|
5,426
|
|
|
|
136
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current income tax receivables
|
|
|
|
|
|
|
|
|
|
|
45
|
|
|
|
|
|
|
|
94
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
|
|
|
|
8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments, financial receivables and other current financial
assets
|
|
|
|
|
|
|
|
|
|
|
1,732
|
|
|
|
5
|
|
|
|
1,908
|
|
|
|
132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
|
|
4,086
|
|
|
|
|
|
|
|
3,964
|
|
|
|
621
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,818
|
|
|
|
5
|
|
|
|
5,872
|
|
|
|
753
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
sub-total
|
|
|
|
|
|
|
|
|
|
|
11,794
|
|
|
|
|
|
|
|
11,662
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations/Non-current
assets held for
sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Current assets
|
|
|
(b
|
)
|
|
|
|
|
|
|
11,794
|
|
|
|
|
|
|
|
11,662
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
|
(a+b
|
)
|
|
|
|
|
|
|
69,040
|
|
|
|
|
|
|
|
70,446
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
|
|
|
|
|
at June 30, 2017
|
|
Consolidated Statements of Financial Position
|
|
|
69
|
|
Equity and Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
note
|
|
|
6/30/2017
|
|
|
of which
related
parties
|
|
|
12/31/2016
|
|
|
of which
related
parties
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital issued
|
|
|
|
|
|
|
|
|
|
|
11,677
|
|
|
|
|
|
|
|
11,677
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
less: Treasury shares
|
|
|
|
|
|
|
|
|
|
|
(90
|
)
|
|
|
|
|
|
|
(90
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
|
|
|
|
|
|
|
|
11,587
|
|
|
|
|
|
|
|
11,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
paid-in
capital
|
|
|
|
|
|
|
|
|
|
|
2,094
|
|
|
|
|
|
|
|
2,094
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other reserves and retained earnings (accumulated losses), including profit (loss) for the
period
|
|
|
|
|
|
|
|
|
|
|
7,723
|
|
|
|
|
|
|
|
7,526
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to Owners of the Parent
|
|
|
|
|
|
|
|
|
|
|
21,404
|
|
|
|
|
|
|
|
21,207
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
|
|
|
|
|
|
|
2,215
|
|
|
|
|
|
|
|
2,346
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity
|
|
|
(c
|
)
|
|
|
|
|
|
|
23,619
|
|
|
|
|
|
|
|
23,553
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial liabilities
|
|
|
|
|
|
|
11
|
)
|
|
|
28,887
|
|
|
|
|
|
|
|
30,469
|
|
|
|
912
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits
|
|
|
|
|
|
|
15
|
)
|
|
|
1,336
|
|
|
|
|
|
|
|
1,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax liabilities
|
|
|
|
|
|
|
|
|
|
|
323
|
|
|
|
|
|
|
|
293
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions
|
|
|
|
|
|
|
16
|
)
|
|
|
813
|
|
|
|
|
|
|
|
830
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous payables and other
non-current
liabilities
|
|
|
|
|
|
|
|
|
|
|
1,594
|
|
|
|
|
|
|
|
1,607
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Non-current
liabilities
|
|
|
(d
|
)
|
|
|
|
|
|
|
32,953
|
|
|
|
|
|
|
|
34,554
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities
|
|
|
|
|
|
|
11
|
)
|
|
|
4,844
|
|
|
|
|
|
|
|
4,056
|
|
|
|
133
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
|
|
|
|
17
|
)
|
|
|
7,056
|
|
|
|
76
|
|
|
|
7,646
|
|
|
|
263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current income tax payables
|
|
|
|
|
|
|
|
|
|
|
568
|
|
|
|
|
|
|
|
637
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
sub-total
|
|
|
|
|
|
|
|
|
|
|
12,468
|
|
|
|
|
|
|
|
12,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities directly associated with Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Current Liabilities
|
|
|
(e
|
)
|
|
|
|
|
|
|
12,468
|
|
|
|
|
|
|
|
12,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
(f=d+e
|
)
|
|
|
|
|
|
|
45,421
|
|
|
|
|
|
|
|
46,893
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity and Liabilities
|
|
|
(c+f
|
)
|
|
|
|
|
|
|
69,040
|
|
|
|
|
|
|
|
70,446
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
|
|
|
|
|
at June 30, 2017
|
|
Consolidated Statements of Financial Position
|
|
|
70
|
|
S
EPARATE CONSOLIDATED INCOME STATEMENTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
note
|
|
|
1st Half
2017
|
|
|
of which
related
parties
|
|
|
1st Half
2016
|
|
|
of which
related
parties
|
|
Revenues
|
|
|
|
|
|
|
9,772
|
|
|
|
118
|
|
|
|
9,096
|
|
|
|
164
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
|
|
|
|
217
|
|
|
|
7
|
|
|
|
107
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating revenues and other income
|
|
|
|
|
|
|
9,989
|
|
|
|
|
|
|
|
9,203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of goods and services
|
|
|
|
|
|
|
(4,136
|
)
|
|
|
(99
|
)
|
|
|
(3,783
|
)
|
|
|
(110
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses
|
|
|
|
|
|
|
(1,530
|
)
|
|
|
(54
|
)
|
|
|
(1,551
|
)
|
|
|
(66
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses
|
|
|
|
|
|
|
(576
|
)
|
|
|
|
|
|
|
(501
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
|
|
|
|
50
|
|
|
|
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Internally generated assets
|
|
|
|
|
|
|
317
|
|
|
|
|
|
|
|
325
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit before depreciation and amortization, capital gains (losses) and impairment
reversals (losses) on
non-current
assets (EBITDA)
|
|
|
|
|
|
|
4,114
|
|
|
|
|
|
|
|
3,726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: impact of
non-recurring
items
|
|
|
25
|
)
|
|
|
(95
|
)
|
|
|
|
|
|
|
(91
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
(2,249
|
)
|
|
|
|
|
|
|
(2,047
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on disposals of
non-current
assets
|
|
|
|
|
|
|
6
|
|
|
|
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment reversals (losses) on
non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit (loss) (EBIT)
|
|
|
|
|
|
|
1,871
|
|
|
|
|
|
|
|
1,687
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: impact of
non-recurring
items
|
|
|
25
|
)
|
|
|
(96
|
)
|
|
|
|
|
|
|
(82
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profits (losses) of associates and joint ventures accounted for using the equity
method
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses) from investments
|
|
|
|
|
|
|
(19
|
)
|
|
|
|
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
|
19
|
)
|
|
|
1,110
|
|
|
|
37
|
|
|
|
2,012
|
|
|
|
60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses
|
|
|
19
|
)
|
|
|
(1,850
|
)
|
|
|
(40
|
)
|
|
|
(2,157
|
)
|
|
|
(67
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) before tax from continuing operations
|
|
|
|
|
|
|
1,111
|
|
|
|
|
|
|
|
1,547
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: impact of
non-recurring
items
|
|
|
25
|
)
|
|
|
(110
|
)
|
|
|
|
|
|
|
(93
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
|
|
|
|
(457
|
)
|
|
|
|
|
|
|
(489
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
|
|
|
|
654
|
|
|
|
|
|
|
|
1,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47
|
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
20
|
)
|
|
|
654
|
|
|
|
|
|
|
|
1,105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: impact of
non-recurring
items
|
|
|
25
|
)
|
|
|
(173
|
)
|
|
|
|
|
|
|
(78
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Parent
|
|
|
|
|
|
|
596
|
|
|
|
|
|
|
|
1,018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
|
|
|
58
|
|
|
|
|
|
|
|
87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Earnings per share:
|
|
|
21
|
)
|
|
|
|
|
|
|
|
|
Earnings per share (Basic)
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary Share
|
|
|
|
|
|
|
0.03
|
|
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings Share
|
|
|
|
|
|
|
0.04
|
|
|
|
0.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which:
|
|
|
|
|
|
|
|
|
|
|
|
|
from Continuing operations attributable to Owners of the Parent
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary Share
|
|
|
|
|
|
|
0.03
|
|
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings Share
|
|
|
|
|
|
|
0.04
|
|
|
|
0.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share (Diluted)
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary Share
|
|
|
|
|
|
|
0.03
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings Share
|
|
|
|
|
|
|
0.04
|
|
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which:
|
|
|
|
|
|
|
|
|
|
|
|
|
from Continuing operations attributable to Owners of the Parent
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary Share
|
|
|
|
|
|
|
0.03
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings Share
|
|
|
|
|
|
|
0.04
|
|
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
|
|
|
|
|
at June 30, 2017
|
|
Separate Consolidated Income Statements
|
|
|
71
|
|
C
ONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Note 10
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Profit (loss) for the period
|
|
|
(a
|
)
|
|
|
654
|
|
|
|
1,105
|
|
Other components of the Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Other components that subsequently will not be reclassified in the Separate Consolidated Income
Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of employee defined benefit plans (IAS 19):
|
|
|
|
|
|
|
|
|
|
|
|
|
Actuarial gains (losses)
|
|
|
|
|
|
|
33
|
|
|
|
(118
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
(8
|
)
|
|
|
32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
25
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of other profits (losses) of associates and joint ventures accounted for using the equity
method:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other components that subsequently will not be reclassified in the Separate Consolidated
Income Statements
|
|
|
(d=b+c
|
)
|
|
|
25
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other components that subsequently will be reclassified in the Separate Consolidated Income
Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale
financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from fair value adjustments
|
|
|
|
|
|
|
34
|
|
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) transferred to the Separate Consolidated Income Statements
|
|
|
|
|
|
|
(37
|
)
|
|
|
(69
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
2
|
|
|
|
(4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(e
|
)
|
|
|
(1
|
)
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from fair value adjustments
|
|
|
|
|
|
|
(331
|
)
|
|
|
(327
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) transferred to the Separate Consolidated Income Statements
|
|
|
|
|
|
|
497
|
|
|
|
245
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
(43
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(f
|
)
|
|
|
123
|
|
|
|
(84
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange differences on translating foreign operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) on translating foreign operations
|
|
|
|
|
|
|
(551
|
)
|
|
|
618
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) on translating foreign operations transferred to the Separate Consolidated Income
Statements
|
|
|
|
|
|
|
19
|
|
|
|
304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(g
|
)
|
|
|
(532
|
)
|
|
|
922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of other profits (losses) of associates and joint ventures accounted for using the equity
method:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (profit) transferred to the Separate Consolidated Income Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax effect
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(h
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other components that subsequently will be reclassified to the Separate Consolidated Income
Statements
|
|
|
(i=e+f+g+h
|
)
|
|
|
(410
|
)
|
|
|
841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other components of the Consolidated Statements of Comprehensive Income
|
|
|
(k=d+i
|
)
|
|
|
(385
|
)
|
|
|
755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
(a+k
|
)
|
|
|
269
|
|
|
|
1,860
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Parent
|
|
|
|
|
|
|
367
|
|
|
|
1,726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
|
|
|
(98
|
)
|
|
|
134
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
|
|
|
|
|
at June 30, 2017
|
|
Consolidated Statements of Comprehensive Income
|
|
|
72
|
|
C
ONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Changes from January 1, 2016 to June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to Owners of the Parent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
Share
capital
|
|
|
Additional
paid-in
capital
|
|
|
Reserve for
available-for-
sale financial
assets
|
|
|
Reserve for
cash flow
hedges
|
|
|
Reserve for
exchange
differences
on
translating
foreign
operations
|
|
|
Reserve for
remeasurements of
employee
defined
benefit plans
(IAS 19)
|
|
|
Share of
other
profits
(losses) of
associates
and joint
ventures
accounted
for using
the equity
method
|
|
|
Other
reserves and
retained
earnings
(accumulated
losses),
including
profit (loss)
for the period
|
|
|
Total
|
|
|
Non-
controlling
interests
|
|
|
Total
equity
|
|
Balance at December 31, 2015
|
|
|
10,650
|
|
|
|
1,731
|
|
|
|
32
|
|
|
|
(249
|
)
|
|
|
(1,459
|
)
|
|
|
(87
|
)
|
|
|
|
|
|
|
6,992
|
|
|
|
17,610
|
|
|
|
3,723
|
|
|
|
21,333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Correction due to errors
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
46
|
|
|
|
|
|
|
|
|
|
|
|
(102
|
)
|
|
|
(56
|
)
|
|
|
(28
|
)
|
|
|
(84
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Balance at December 31, 2015
|
|
|
10,650
|
|
|
|
1,731
|
|
|
|
32
|
|
|
|
(249
|
)
|
|
|
(1,413
|
)
|
|
|
(87
|
)
|
|
|
|
|
|
|
6,890
|
|
|
|
17,554
|
|
|
|
3,695
|
|
|
|
21,249
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in equity during the period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends approved
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(166
|
)
|
|
|
(166
|
)
|
|
|
(26
|
)
|
|
|
(192
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
|
|
|
|
|
|
|
|
3
|
|
|
|
(84
|
)
|
|
|
875
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
1,018
|
|
|
|
1,726
|
|
|
|
134
|
|
|
|
1,860
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disposal of the Sofora - Telecom Argentina group
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,582
|
)
|
|
|
(1,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issue of equity instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3
|
|
|
|
3
|
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other changes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11
|
)
|
|
|
(11
|
)
|
|
|
|
|
|
|
(11
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2016
|
|
|
10,650
|
|
|
|
1,731
|
|
|
|
35
|
|
|
|
(333
|
)
|
|
|
(538
|
)
|
|
|
(173
|
)
|
|
|
|
|
|
|
7,734
|
|
|
|
19,106
|
|
|
|
2,221
|
|
|
|
21,327
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes from January 1, 2017 to June 30,
2017 Note 10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to Owners of the Parent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
Share
capital
|
|
|
Additional
paid-in
capital
|
|
|
Reserve for
available-for-
sale financial
assets
|
|
|
Reserve for
cash flow
hedges
|
|
|
Reserve for
exchange
differences
on
translating
foreign
operations
|
|
|
Reserve for
remeasurements
of employee
defined
benefit plans
(IAS 19)
|
|
|
Share of
other
profits
(losses) of
associates
and joint
ventures
accounted
for using
the
equity
method
|
|
|
Other
reserves and
retained
earnings
(accumulated
losses),
including
profit (loss)
for the period
|
|
|
Total
|
|
|
Non-
controlling
interests
|
|
|
Total
equity
|
|
Balance at December 31, 2016
|
|
|
11,587
|
|
|
|
2,094
|
|
|
|
39
|
|
|
|
(551
|
)
|
|
|
(366
|
)
|
|
|
(113
|
)
|
|
|
|
|
|
|
8,517
|
|
|
|
21,207
|
|
|
|
2,346
|
|
|
|
23,553
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in equity during the period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends approved
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(166
|
)
|
|
|
(166
|
)
|
|
|
(39
|
)
|
|
|
(205
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
123
|
|
|
|
(376
|
)
|
|
|
25
|
|
|
|
|
|
|
|
596
|
|
|
|
367
|
|
|
|
(98
|
)
|
|
|
269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issue of equity instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
4
|
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other changes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(8
|
)
|
|
|
(8
|
)
|
|
|
6
|
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2017
|
|
|
11,587
|
|
|
|
2,094
|
|
|
|
38
|
|
|
|
(428
|
)
|
|
|
(742
|
)
|
|
|
(88
|
)
|
|
|
|
|
|
|
8,943
|
|
|
|
21,404
|
|
|
|
2,215
|
|
|
|
23,619
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
|
|
|
|
|
at June 30, 2017
|
|
Consolidated Statements of Changes in Equity
|
|
|
73
|
|
C
ONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
note
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
|
654
|
|
|
|
1,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
|
|
|
2,249
|
|
|
|
2,047
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment losses (reversals) on
non-current
assets
(including investments)
|
|
|
|
|
|
|
|
|
|
|
10
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in deferred tax assets and liabilities
|
|
|
|
|
|
|
|
|
|
|
336
|
|
|
|
257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Losses (gains) realized on disposals of
non-current
assets
(including investments)
|
|
|
|
|
|
|
|
|
|
|
(6
|
)
|
|
|
(13
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profits (losses) of associates and joint ventures accounted for using the equity
method
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in employee benefits
|
|
|
|
|
|
|
|
|
|
|
(7
|
)
|
|
|
40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
|
|
|
|
|
|
|
|
(44
|
)
|
|
|
(40
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in trade receivables and net amounts due from customers on construction contracts
|
|
|
|
|
|
|
|
|
|
|
(52
|
)
|
|
|
(130
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in trade payables
|
|
|
|
|
|
|
|
|
|
|
44
|
|
|
|
(141
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in current income tax receivables/payables
|
|
|
|
|
|
|
|
|
|
|
72
|
|
|
|
95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in miscellaneous receivables/payables and other assets/liabilities
|
|
|
|
|
|
|
|
|
|
|
(119
|
)
|
|
|
(687
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) operating activities
|
|
|
(a
|
)
|
|
|
|
|
|
|
3,138
|
|
|
|
2,493
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of intangible assets
|
|
|
|
|
|
|
5
|
)
|
|
|
(673
|
)
|
|
|
(709
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of tangible assets
|
|
|
|
|
|
|
6
|
)
|
|
|
(1,413
|
)
|
|
|
(1,397
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets on an accrual basis
(*)
|
|
|
|
|
|
|
|
|
|
|
(2,086
|
)
|
|
|
(2,106
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in amounts due for purchases of intangible and tangible assets
|
|
|
|
|
|
|
|
|
|
|
(707
|
)
|
|
|
(371
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets on a cash basis
|
|
|
|
|
|
|
|
|
|
|
(2,793
|
)
|
|
|
(2,477
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of control in subsidiaries or other businesses, net of cash acquired
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions/disposals of other investments
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in financial receivables and other financial assets
|
|
|
|
|
|
|
|
|
|
|
695
|
|
|
|
364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale that result in a loss of control of subsidiaries or other businesses, net of
cash disposed of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
492
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale/repayment of intangible, tangible and other
non-current
assets
|
|
|
|
|
|
|
|
|
|
|
9
|
|
|
|
29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) investing activities
|
|
|
(b
|
)
|
|
|
|
|
|
|
(2,090
|
)
|
|
|
(1,601
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in current financial liabilities and other
|
|
|
|
|
|
|
|
|
|
|
(663
|
)
|
|
|
(262
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
non-current
financial liabilities (including
current portion)
|
|
|
|
|
|
|
|
|
|
|
1,256
|
|
|
|
2,061
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repayments of
non-current
financial liabilities (including
current portion)
|
|
|
|
|
|
|
|
|
|
|
(1,200
|
)
|
|
|
(3,094
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital proceeds/reimbursements (including subsidiaries)
|
|
|
|
|
|
|
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid
(*)
|
|
|
|
|
|
|
|
|
|
|
(218
|
)
|
|
|
(227
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) financing activities
|
|
|
(c
|
)
|
|
|
|
|
|
|
(819
|
)
|
|
|
(1,522
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from (used in) Discontinued
operations/Non-current
assets held for sale
|
|
|
(d
|
)
|
|
|
|
|
|
|
|
|
|
|
(45
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate cash flows
|
|
|
(e=a+b+c+d
|
)
|
|
|
|
|
|
|
229
|
|
|
|
(675
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash and cash equivalents at beginning of the period
|
|
|
(f
|
)
|
|
|
|
|
|
|
3,952
|
|
|
|
3,216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net foreign exchange differences on net cash and cash equivalents
|
|
|
(g
|
)
|
|
|
|
|
|
|
(95
|
)
|
|
|
159
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash and cash equivalents at end of the period
|
|
|
(h=e+f+g
|
)
|
|
|
|
|
|
|
4,086
|
|
|
|
2,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
of which related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets on an accrual basis
|
|
|
|
|
|
|
|
|
|
|
75
|
|
|
|
63
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated
Financial Statements
|
|
Consolidated Statements of Cash Flows
|
|
|
|
|
at June 30, 2017
|
|
|
|
74
|
|
|
|
|
|
|
|
|
|
|
Additional Cash Flow Information
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Income taxes (paid) received
|
|
|
(27
|
)
|
|
|
(104
|
)
|
|
|
|
|
|
|
|
|
|
Interest expense paid
|
|
|
(1,198
|
)
|
|
|
(1,327
|
)
|
|
|
|
|
|
|
|
|
|
Interest income received
|
|
|
432
|
|
|
|
516
|
|
|
|
|
|
|
|
|
|
|
Dividends received
|
|
|
|
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of Net Cash and Cash Equivalents
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Net cash and cash equivalents at beginning of the period
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from continuing operations
|
|
|
3,964
|
|
|
|
3,559
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand from continuing operations
|
|
|
(12
|
)
|
|
|
(441
|
)
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
98
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,952
|
|
|
|
3,216
|
|
|
|
|
|
|
|
|
|
|
Net cash and cash equivalents at end of the period
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from continuing operations
|
|
|
4,086
|
|
|
|
2,707
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand from continuing operations
|
|
|
|
|
|
|
(7
|
)
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank overdrafts repayable on demand from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,086
|
|
|
|
2,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
|
|
|
|
|
at June 30, 2017
|
|
Consolidated Statements of Cash Flows
|
|
|
75
|
|
N
OTE 1
FORM, CONTENT AND OTHER GENERAL INFORMATION
FORM AND CONTENT
Telecom Italia S.p.A. (the Parent), also known in short as TIM S.p.A., and its subsidiaries form the TIM Group or the
Group.
TIM is a joint-stock company (S.p.A.) organized under the laws of the Republic of Italy.
The registered offices of the Parent, TIM, are located in Milan, Italy at Via Gaetano Negri 1.
The duration of TIM S.p.A., as stated in the companys bylaws, extends until December 31, 2100.
The TIM Group operates mainly in Europe, the Mediterranean Basin and South America.
The Group is engaged principally in the communications sector and, particularly, the fixed and mobile national and international telecommunications sector.
The TIM Group half-year condensed consolidated financial statements at June 30, 2017 have been prepared on a going concern basis (further details
are provided in the Note Accounting policies) and in accordance with the International Financial Reporting Standards issued by the International Accounting Standards Board and endorsed by the European Union (designated as
IFRS), as well as the laws and regulations in force in Italy.
The TIM Group half-year condensed consolidated financial statements at
June 30, 2017 have been prepared in compliance with IAS 34 (
Interim Reports
) and, as permitted by this standard, do not include all the information required in the annual consolidated financial statements; accordingly, these financial
statements should be read together with the 2016 TIM Group consolidated financial statements.
For purposes of comparison, the consolidated statements of
financial position at December 31, 2016 and the separate consolidated income statements, the consolidated statements of comprehensive income, the consolidated statements of cash flows, as well as the consolidated statements of changes in equity
for the first half of 2016 are presented.
The TIM Group half-year condensed consolidated financial statements at June 30, 2017 are expressed in euro
(rounded to the nearest million unless otherwise indicated).
Publication of the TIM Group half-year condensed consolidated financial statements at
June 30, 2017 was approved by resolution of the Board of Directors meeting held on July 27, 2017.
FINANCIAL STATEMENT FORMATS
The financial statement formats adopted are consistent with those indicated in IAS 1. In particular:
|
|
the consolidated statements of financial position have been prepared by classifying assets and liabilities according to the current and
non-current
criterion;
|
|
|
the separate consolidated income statements have been prepared by classifying operating expenses by nature of expense as this form of presentation is considered more appropriate and representative of the specific
business of the Group, conforms to internal reporting and is in line with the TIM Groups industrial sector.
|
In addition to EBIT or
Operating profit (loss), the separate consolidated income statements include the alternative performance measure of EBITDA or Operating profit (loss) before depreciation and amortization, Capital gains (losses) and Impairment reversals (losses) on
non-current
assets.
In particular, besides EBIT, EBITDA is used by TIM as the financial target in internal
presentations (business plans) and in external presentations (to analysts and investors). It represents a useful unit of measurement for the evaluation of the operating performance of the Group (as a whole and at the Business Unit level). EBIT and
EBITDA are calculated as follows:
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 1
|
|
|
at June 30, 2017
|
|
Form, content and other general information
|
|
76
|
|
|
|
Profit (loss) before tax from continuing operations
|
|
|
+
|
|
Finance expenses
|
|
|
-
|
|
Finance income
|
|
|
+/-
|
|
Other expenses (income) from investments
|
|
|
+/-
|
|
Share of profits (losses) of associates and joint ventures accounted for using the equity method
|
|
EBIT - Operating profit (loss)
|
|
|
+/-
|
|
Impairment losses (reversals) on
non-current
assets
|
|
|
+/-
|
|
Losses (gains) on disposals of
non-current
assets
|
|
|
+
|
|
Depreciation and amortization
|
|
EBITDA - Operating profit (loss) before depreciation and amortization, Capital gains (losses) and Impairment reversals (losses) on
non-current
assets
|
|
|
the consolidated statements of comprehensive income include the profit or loss for the period as shown in the separate consolidated income statements and all other
non-owner
changes in equity;
|
|
|
the Consolidated statements of cash flows have been prepared by presenting cash flows from operating activities according to the indirect method, as permitted by IAS 7 (Statement of Cash Flows).
|
Furthermore, as required by Consob Resolution 15519 of July 27, 2006, in the separate consolidated income statements, income and
expenses relating to transactions which by nature do not occur during normal operation
(non-recurring
transactions) have been specifically identified and their impacts on the main intermediate levels have been
shown separately, when they are significant. Specifically,
non-recurring
income/(expenses) include, for instance: income/expenses arising from the sale of properties, plant and equipment, business segments and
investments; expenses stemming from company reorganization and streamlining processes and projects, also in connection with corporate transactions (mergers, spin-offs, etc.); expenses resulting from litigation and regulatory fines and related
liabilities; other provisions and related reversals; costs for the settlement of disputes; and impairment losses on goodwill and/or other intangible and tangible assets).
Also in reference to the above Consob resolution, the amounts of the balances or transactions with related parties have been shown separately in the
consolidated financial statements.
SEGMENT REPORTING
An operating segment is a component of an
entity:
|
|
that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity);
|
|
|
whose operating results are regularly reviewed by the entitys chief operating decision maker to make decisions about resources (for TIM, the Board of Directors) to be allocated to the segment and assess its
performance; and
|
|
|
for which discrete financial information is available.
|
In particular, the operating segments of the TIM Group
are organized according to geographic location (Domestic and Brazil) for the telecommunications business.
The Sofora - Telecom Argentina group, which was
sold on March 8, 2016, has been recognized under Discontinued operations.
The term operating segment is considered synonymous with
Business Unit.
The operating segments of the TIM Group are as follows:
|
|
Domestic: includes operations in Italy for voice and data services on fixed and mobile networks for end customers
(retail) and other operators (wholesale), the operations of the Telecom Italia Sparkle group (International wholesale), which, at international level (Europe, the Mediterranean and South America), develops fiber optic networks for wholesale
customers, the operations of Olivetti (products
|
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 1
|
|
|
at June 30, 2017
|
|
Form, content and other general information
|
|
77
|
|
and services for Information Technology), as well as INWIT S.p.A. (a company operating in the electronic communications infrastructure sector, and in particular the infrastructure for hosting
radio transmission equipment for mobile telephone networks, both for TIM and other operators) and the units supporting the Domestic sector.
|
|
See the section Financial and Operating Highlights of the Business Units of the TIM Group Domestic Business Unit of the Interim Management Report for more details;
|
|
|
Brazil: includes mobile (TIM Celular) and fixed (TIM Celular and Intelig) telecommunications operations in Brazil;
|
|
|
Other Operations: include finance companies and other minor companies not strictly related to the core business of the TIM Group.
|
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 1
|
|
|
at June 30, 2017
|
|
Form, content and other general information
|
|
78
|
NOTE 2
ACCOUNTING POLICIES
GOING CONCERN
The half-year condensed consolidated financial statements at June 30, 2017 have been prepared on a going concern basis as there is the reasonable
expectation that TIM will continue its operational activities in the foreseeable future (and in any event with a time horizon of at least twelve months).
In particular, the following factors have been taken into consideration:
|
|
the main risks and uncertainties (that are for the most part of an external nature) to which the Group and the various activities of the TIM Group are exposed:
|
|
(2)
|
changes in the general macroeconomic situation in the Italian, European and Brazilian markets, as well as the volatility of financial markets in the Eurozone also as a result of the Brexit referendum in the
United Kingdom;
|
|
(3)
|
variations in business conditions, also related to competition;
|
|
(4)
|
changes to laws and regulations (price and rate variations or decisions that may affect technological choices);
|
|
(5)
|
outcomes of legal disputes and proceedings with regulatory authorities, competitors and other parties;
|
|
(6)
|
financial risks (interest rate and/or exchange rate trends, changes in the Groups credit rating by rating agencies);
|
|
|
the mix between equity and debt capital considered optimal as well as the policy for the remuneration of equity, described in the 2016 consolidated financial statements in the paragraph devoted to the Share
capital information under the Note Equity;
|
|
|
the policy for financial risk management (market risk, credit risk and liquidity risk) as described in the Note Financial risk management in the annual consolidated financial statements at December 31,
2016.
|
Based on these factors, the Management believes that, at the present time, there are no elements of uncertainty regarding the
Groups ability to continue as a going concern.
ACCOUNTING POLICIES AND PRINCIPLES OF CONSOLIDATION
The
accounting policies and consolidation principles adopted in the preparation of the half-year condensed consolidated financial statements at June 30, 2017 are the same as those adopted in the annual consolidated financial statements at
December 31, 2016, to which reference can be made, except for the changes required because of the nature of interim financial reporting.
Furthermore, in the half-year condensed consolidated financial statements at June 30, 2017, income taxes for the period of the individual consolidated
companies are calculated according to the best possible estimate based on available information and on a reasonable forecast of performance up to the end of the tax period. Conventionally, the income tax liabilities (current and deferred) on the
profit for the interim period of the individual consolidated companies are recorded net of advances and tax receivables (excluding receivables for which refunds have been requested) as well as deferred tax assets, under Deferred tax
liabilities; if the balance between deferred tax assets and deferred tax liabilities is an asset it is conventionally recognized in Deferred tax assets.
USE OF ESTIMATES
The preparation of the half-year condensed consolidated financial statements at June 30, 2017 and related disclosure requires management to make estimates
and assumptions based also on subjective judgments, past experience and hypotheses considered reasonable and realistic in relation to the information known at the time of the estimate. Such estimates have an effect on the reported amount of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the financial
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 2
|
|
|
at June 30, 2017
|
|
Accounting policies
|
|
79
|
statements, as well as the amount of revenues and costs during the period. Actual results could differ, even significantly, from those estimates owing to possible changes in the factors
considered in the determination of such estimates. Estimates are reviewed periodically.
With regard to the most important accounting estimates, please
refer to those illustrated in the annual consolidated financial statements at December 31, 2016.
NEW STANDARDS AND INTERPRETATIONS ENDORSED BY THE EU
AND IN FORCE FROM JANUARY 1, 2017
There were no new Standards and Interpretations that had been endorsed by the EU and were in force from
January 1, 2017.
NEW STANDARDS AND INTERPRETATIONS ISSUED BY IASB BUT NOT YET APPLICABLE
At the date of preparation of these half-year condensed consolidated financial statements, the following new standards and interpretations, which have not yet
entered into force, had been issued by the IASB:
|
|
|
|
|
Mandatory
application
starting from
|
New Standards and Interpretations endorsed by the EU
|
|
|
|
|
IFRS 15 (Revenues from contracts with customers)
|
|
1/1/2018
|
|
|
IFRS 9 (Financial Instruments)
|
|
1/1/2018
|
|
|
New Standards and Interpretations not yet endorsed by the EU
|
|
|
|
|
IFRS 16 (Leases)
|
|
1/1/2019
|
|
|
Amendments to IFRS 10 (Consolidated Financial Statements) and to IAS 28 (Investments in Associates
and Joint Ventures): Sale or contribution of assets between an investor and its associate/joint venture
|
|
Application
deferred
indefinitely
|
|
|
Amendments to IAS 12 (Income taxes) Recognition of Deferred Tax Assets for Unrealized
Losses
|
|
1/1/2017
|
|
|
Amendments to IAS 7 (Cash flow statement - Disclosure initiative)
|
|
1/1/2017
|
|
|
Clarifications to IFRS 15 (Revenue from contracts with customers)
|
|
1/1/2018
|
|
|
Amendments to IFRS 2 (Classification and measurement of share-based payments)
|
|
1/1/2018
|
|
|
Improvements to the IFRS (2014-2016 cycle) Amendments to IFRS 12 and IAS 28
|
|
1/1/2017
for IFRS 12
1/1/2018
for IAS 28
|
|
|
IFRIC 22 (Foreign currency transactions and advance consideration)
|
|
1/1/2018
|
|
|
Amendments to IAS 40 (Investment property)
|
|
1/1/2018
|
|
|
IFRIC 23 Uncertainty over income tax treatments
|
|
1/1/2019
|
The potential impacts on the consolidated financial statements from application of these standards and interpretations are
currently being assessed. With regard to the adoption of IFRS 15, IFRS 16 and IFRS 9, specific projects have been initiated at Group level and therefore a reliable estimate of their quantitative effects will only be possible when each project has
been completed.
For more details of the specific projects see the information provided in the Note Accounting policies of the annual
consolidated financial statements at December 31, 2016.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 2
|
|
|
at June 30, 2017
|
|
Accounting policies
|
|
80
|
NOTE 3
SCOPE OF CONSOLIDATION
The changes in the scope of consolidation
at June 30, 2017 compared to December 31, 2016 are listed below.
Subsidiaries exiting the scope of consolidation:
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
|
|
|
|
|
Business Unit
|
|
|
Month
|
|
Exit:
|
|
|
|
|
|
|
|
|
|
|
|
|
TIERRA ARGENTEA S.A.
|
|
|
Liquidated
|
|
|
|
Other Operations
|
|
|
|
May 2017
|
|
In addition to that noted above, the changes in the scope of consolidation at June 30, 2017 compared to June 30,
2016 are listed below:
Subsidiaries entering/exiting/merged into the scope of consolidation
|
|
|
|
|
|
|
Company
|
|
|
|
Business Unit
|
|
Month
|
Entry:
|
|
|
|
|
|
|
FLASH FIBER S.r.l.
|
|
New company
|
|
Domestic
|
|
July 2016
|
TI SPARKLE RUSSIA LLC
|
|
New acquisition
|
|
Domestic
|
|
July 2016
|
NOVERCA S.r.l.
|
|
New acquisition
|
|
Domestic
|
|
October 2016
|
TIMVISION S.r.l.
|
|
New company
|
|
Domestic
|
|
December 2016
|
Exit:
|
PURPLE TULIP B.V.
|
|
Liquidated
|
|
Other Operations
|
|
July 2016
|
Merger:
|
TELECOM ITALIA INTERNATIONAL N.V.
|
|
Merged into Telecom Italia Finance S.A.
|
|
Other Operations
|
|
August 2016
|
TELECOM ITALIA DEUTSCHLAND HOLDING Gmbh
|
|
Merged into TIM S.p.A.
|
|
Other Operations
|
|
August 2016
|
GESTIONE DUE S.r.l.
|
|
Merged into INWIT S.p.A.
|
|
Domestic
|
|
September 2016
|
GESTIONE IMMOBILI S.r.l.
|
|
Merged into INWIT S.p.A.
|
|
Domestic
|
|
September 2016
|
REVI IMMOBILI S.r.l.
|
|
Merged into INWIT S.p.A.
|
|
Domestic
|
|
September 2016
|
TELECOM ITALIA INFORMATION TECHNOLOGY S.p.A.
|
|
Merged into TIM S.p.A.
|
|
Domestic
|
|
December 2016
|
The breakdown by number of subsidiaries and associates of the TIM Group is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6/30/2017
|
|
Companies:
|
|
Italy
|
|
|
Outside Italy
|
|
|
Total
|
|
subsidiaries consolidated
line-by-line
|
|
|
25
|
|
|
|
47
|
|
|
|
72
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
joint ventures accounted for using the equity method
|
|
|
1
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
associates accounted for using the equity method
|
|
|
20
|
|
|
|
|
|
|
|
20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total companies
|
|
|
46
|
|
|
|
47
|
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 3
|
|
|
at June 30, 2017
|
|
Scope of consolidation
|
|
81
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/31/2016
|
|
Companies:
|
|
Italy
|
|
|
Outside Italy
|
|
|
Total
|
|
subsidiaries consolidated
line-by-line
|
|
|
25
|
|
|
|
48
|
|
|
|
73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
joint ventures accounted for using the equity method
|
|
|
1
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
associates accounted for using the equity method
|
|
|
19
|
|
|
|
|
|
|
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total companies
|
|
|
45
|
|
|
|
48
|
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6/30/2016
|
|
Companies:
|
|
Italy
|
|
|
Outside Italy
|
|
|
Total
|
|
subsidiaries consolidated
line-by-line
|
|
|
26
|
|
|
|
50
|
|
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
joint ventures accounted for using the equity method
|
|
|
1
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
associates accounted for using the equity method
|
|
|
18
|
|
|
|
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total companies
|
|
|
45
|
|
|
|
50
|
|
|
|
95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Further details are provided in the Note List of companies of the TIM Group.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 3
|
|
|
at June 30, 2017
|
|
Scope of consolidation
|
|
82
|
NOTE 4
GOODWILL
The breakdown and the changes in Goodwill during the
first six months of 2017 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
12/31/2016
|
|
|
Reclassifications
|
|
|
Increase
|
|
|
Decrease
|
|
|
Impairments
|
|
|
Exchange
differences
|
|
|
6/30/2017
|
|
Domestic
|
|
|
28,489
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,489
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core Domestic
|
|
|
28,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Wholesale
|
|
|
412
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
412
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brazil
|
|
|
1,123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(101
|
)
|
|
|
1,022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
29,612
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(101
|
)
|
|
|
29,511
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In accordance with IAS 36, goodwill is not subject to amortization, but is tested for impairment annually or more frequently,
whenever specific events or circumstances occur that may indicate an impairment.
At June 30, 2017, TIMs market capitalization was less than
the value of its equity; however, in view of the positive performance of the first six months of the year, in line with the plan forecasts, the absence of new and additional external indicators and the results in terms of recoverable amount of the
impairment testing conducted for the 2016 Financial Statements, it was not considered necessary to redetermine the recoverable amount and consequently the goodwill allocated to the individual cash generating units in the 2016 Consolidated Financial
Statements was confirmed.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 4
|
|
|
at June 30, 2017
|
|
Goodwill
|
|
83
|
NOTE 5
INTANGIBLE ASSETS WITH A FINITE USEFUL LIFE
Intangible assets
with a finite useful life decreased by 357 million euros compared to December 31, 2016. The breakdown and movements are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
12/31/2016
|
|
|
Additions
|
|
|
Amortization
|
|
|
Impairment
(losses) /
reversals
|
|
|
Disposals
|
|
|
Exchange
differences
|
|
|
Capitalized
borrowing
costs
|
|
|
Other
changes
|
|
|
6/30/2017
|
|
Industrial patents and intellectual property rights
|
|
|
2,458
|
|
|
|
255
|
|
|
|
(645
|
)
|
|
|
|
|
|
|
|
|
|
|
(101
|
)
|
|
|
|
|
|
|
318
|
|
|
|
2,285
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Concessions, licenses, trademarks and similar rights
|
|
|
2,854
|
|
|
|
7
|
|
|
|
(198
|
)
|
|
|
|
|
|
|
|
|
|
|
(53
|
)
|
|
|
|
|
|
|
30
|
|
|
|
2,640
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other intangible assets
|
|
|
109
|
|
|
|
76
|
|
|
|
(64
|
)
|
|
|
|
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
1
|
|
|
|
119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Work in progress and advance payments
|
|
|
1,530
|
|
|
|
335
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(106
|
)
|
|
|
45
|
|
|
|
(254
|
)
|
|
|
1,550
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
6,951
|
|
|
|
673
|
|
|
|
(907
|
)
|
|
|
|
|
|
|
|
|
|
|
(263
|
)
|
|
|
45
|
|
|
|
95
|
|
|
|
6,594
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additions in the first six months of 2017 included 133 million euros of internally generated assets (147 million
euros in the first six months of 2016).
Industrial patents and intellectual property rights at June 30, 2017 essentially consisted of software
applications purchased outright and user license rights of unlimited duration, relating to TIM S.p.A. (1,240 million euros) and the Brazil Business Unit (1,021 million euros).
Concessions, licenses, trademarks and similar rights at June 30, 2017 mainly refer to:
(1)
|
the remaining cost of telephone licenses and similar rights (1,823 million euros for TIM S.p.A., 383 million euros for the Brazil Business Unit);
|
(2)
|
Indefeasible Rights of Use - IRU (319 million euros) mainly relating to companies of the Telecom Italia Sparkle group - International Wholesale (215 million euros) and the Parent (104 million euros);
|
(3)
|
TV frequencies of the company Persidera in the Core Domestic segment (115 million euros).
|
Other
intangible assets at June 30, 2017 essentially consist of capitalized subscriber acquisition costs (SAC) of 103 million euros (70 million euros for the Parent and 33 million euros for the Brazil Business Unit), mainly related to
commissions for the sales network, for a number of commercial deals that lock in customers for a set period.
Work in progress and advance payments
increased by 20 million euros. You are reminded that this item includes the user rights for the 700 MHz frequencies, acquired in 2014 by the Tim Brasil group for a total of 2.9 billion reais (equal to around 1 billion euros). Since
the assets require a period of more than 12 months to be ready for use, again in the first half of 2017, borrowing costs of 45 million euros were capitalized, as they were directly attributable to the acquisition. The yearly rate used for the
capitalization of borrowing costs in reais is 10.28%. Capitalized borrowing costs have been recorded as a direct reduction of the income statement item Finance expenses - Interest expenses to banks. In the second quarter of 2017, the
implementation was completed of the 4G/LTE network in the city of Brasilia and nine other cities; accordingly, the first part of the amount was reclassified to the item Concessions, licenses, trademarks and similar rights.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 5
|
|
|
at June 30, 2017
|
|
Intangible assets with a finite useful life
|
|
84
|
NOTE 6
TANGIBLE ASSETS (OWNED AND UNDER FINANCE LEASES)
PROPERTY, PLANT AND EQUIPMENT OWNED
Property, plant and equipment owned decreased by 276 million euros compared to December 31, 2016. The breakdown and movements are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
12/31/2016
|
|
|
Additions
|
|
|
Depreciation
|
|
|
Impairment
(losses) /
reversals
|
|
|
Disposals
|
|
|
Exchange
differences
|
|
|
Other
changes
|
|
|
6/30/2017
|
|
Land
|
|
|
203
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
3
|
|
|
|
206
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buildings (civil and industrial)
|
|
|
509
|
|
|
|
1
|
|
|
|
(23
|
)
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
3
|
|
|
|
488
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plant and equipment
|
|
|
11,709
|
|
|
|
824
|
|
|
|
(1,140
|
)
|
|
|
|
|
|
|
(3
|
)
|
|
|
(217
|
)
|
|
|
249
|
|
|
|
11,422
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Manufacturing and distribution equipment
|
|
|
38
|
|
|
|
4
|
|
|
|
(8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|
|
35
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
391
|
|
|
|
21
|
|
|
|
(82
|
)
|
|
|
|
|
|
|
(3
|
)
|
|
|
(12
|
)
|
|
|
64
|
|
|
|
379
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction in progress and advance payments
|
|
|
1,097
|
|
|
|
479
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19
|
)
|
|
|
(416
|
)
|
|
|
1,141
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
13,947
|
|
|
|
1,330
|
|
|
|
(1,253
|
)
|
|
|
|
|
|
|
(6
|
)
|
|
|
(251
|
)
|
|
|
(96
|
)
|
|
|
13,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additions in the first six months of 2017 included 184 million euros of internally generated assets (178 million
euros in the first six months of 2016).
Land comprises both
built-up
land and available land and is not subject
to depreciation. The figure at June 30, 2017 mainly related to TIM S.p.A. (119 million euros) and TIM Real Estate S.r.l. (55 million euros).
Buildings (civil and industrial) almost exclusively includes buildings for industrial use hosting telephone exchanges or for office use, and light
constructions. The figure at June 30, 2017 mainly related to TIM S.p.A. (228 million euros) and TIM Real Estate S.r.l. (212 million euros).
Plant and equipment includes the aggregate of all the structures used for the functioning of voice and data telephone services. The figure at June 30,
2017 was mainly attributable to TIM S.p.A. (8,671 million euros) and to companies of the Brazil Business Unit (2,101 million euros).
Manufacturing and distribution equipment consists of instruments and equipment used for the operations and maintenance of plants and equipment; the amount was
essentially in line with the end of the prior year and primarily related to TIM S.p.A..
The item Other mainly consists of hardware for the functioning of
the Data Center and for work stations, furniture and fixtures and, to a minimal extent, transport vehicles and office machines.
Construction in progress
and advance payments refer to the internal and external costs incurred for the acquisition or internal production of tangible assets, which are not yet in use.
|
|
|
|
|
TIM Group
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 6
|
|
|
at June 30, 2017
|
|
Tangible assets (owned and under finance leases)
|
|
85
|
ASSETS
HELD UNDER FINANCE LEASES
Assets held under finance leases decreased by 42 million euros compared to December 31, 2016. The breakdown and
movements are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
12/31/2016
|
|
|
Additions
|
|
|
Change in financial
leasing contracts
|
|
|
Depreciation
|
|
|
Exchange
differences
|
|
|
Other
changes
|
|
|
6/30/2017
|
|
Land under lease
|
|
|
16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buildings (civil and industrial)
|
|
|
1,835
|
|
|
|
6
|
|
|
|
2
|
|
|
|
(64
|
)
|
|
|
|
|
|
|
10
|
|
|
|
1,789
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plant and equipment
|
|
|
365
|
|
|
|
40
|
|
|
|
8
|
|
|
|
(10
|
)
|
|
|
(32
|
)
|
|
|
14
|
|
|
|
385
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
125
|
|
|
|
|
|
|
|
20
|
|
|
|
(15
|
)
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
128
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction in progress and advance payments
|
|
|
72
|
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(26
|
)
|
|
|
53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
2,413
|
|
|
|
53
|
|
|
|
30
|
|
|
|
(89
|
)
|
|
|
(33
|
)
|
|
|
(3
|
)
|
|
|
2,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The additions consisted of the acquisition of IRU transmission capacity, due to the full financial settlement at the beginning
of the contract, and improvements and incremental expenses incurred for movable and immovable third-party assets used on the basis of finance lease agreements.
The item Buildings (civil and industrial) includes buildings under long rent contracts and related building adaptations, almost exclusively attributable to
TIM S.p.A..
The item Plant and equipment mainly includes the recognition of the value of the telecommunications towers sold by the Tim Brasil group to
American Tower do Brasil and subsequently repurchased in the form of finance lease. The additions consisted of the acquisition of IRU transmission capacity by the Parent.
The item Other mainly comprises the finance leases on autovehicles.
Other changes included disposals for a total of 3 million euros, in addition to reclassifications between the items.
|
|
|
|
|
TIM Group
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 6
|
|
|
at June 30, 2017
|
|
Tangible assets (owned and under finance leases)
|
|
86
|
NOTE 7
INVESTMENTS
Investments in associates and joint ventures
accounted for using the equity method include:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Tiglio I
|
|
|
7
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
NordCom
|
|
|
5
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
W.A.Y.
|
|
|
3
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
2
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
Total Associates
|
|
|
17
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
Alfiere
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Joint Ventures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments accounted for using the equity method
|
|
|
17
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
The list of investments accounted for using the equity method is presented in the Note List of companies of the TIM
Group.
Other investments refer to the following:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Assicurazioni Generali
|
|
|
3
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
Fin.Priv.
|
|
|
18
|
|
|
|
17
|
|
|
|
|
|
|
|
|
|
|
Northgate Telecom Innovations Partners L.P.
|
|
|
14
|
|
|
|
14
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
13
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
48
|
|
|
|
46
|
|
|
|
|
|
|
|
|
|
|
The TIM Group does not hold investments in structured entities.
|
|
|
|
|
TIM Group
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 7
Investments
|
|
|
at June 30, 2017
|
|
|
87
|
NOTE 8
FINANCIAL ASSETS
(NON-CURRENT
AND CURRENT)
Financial assets
(non-current
and current) were broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Non-current
financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities, financial receivables and other
non-current
financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables for lease contracts
|
|
|
|
|
|
|
90
|
|
|
|
101
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging derivatives relating to hedged items classified as
non-current
assets/liabilities of a financial nature
|
|
|
|
|
|
|
1,886
|
|
|
|
2,497
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables from employees
|
|
|
|
|
|
|
46
|
|
|
|
48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-hedging
derivatives
|
|
|
|
|
|
|
13
|
|
|
|
39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial receivables
|
|
|
|
|
|
|
150
|
|
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
financial assets
|
|
|
(a
|
)
|
|
|
2,185
|
|
|
|
2,698
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments
|
|
|
|
|
|
|
|
|
|
|
|
|
Held for trading
|
|
|
|
|
|
|
1
|
|
|
|
140
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held-to-maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale
|
|
|
|
|
|
|
1,101
|
|
|
|
1,379
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,102
|
|
|
|
1,519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other current financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquid assets with banks, financial institutions and post offices (with maturity over 3
months)
|
|
|
|
|
|
|
250
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables from employees
|
|
|
|
|
|
|
15
|
|
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables for lease contracts
|
|
|
|
|
|
|
57
|
|
|
|
59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging derivatives relating to hedged items classified as current assets/liabilities of a
financial nature
|
|
|
|
|
|
|
287
|
|
|
|
185
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-hedging
derivatives
|
|
|
|
|
|
|
18
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other short-term financial receivables
|
|
|
|
|
|
|
3
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
630
|
|
|
|
389
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
4,086
|
|
|
|
3,964
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current financial assets
|
|
|
(b
|
)
|
|
|
5,818
|
|
|
|
5,872
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial assets relating to Discontinued
operations/Non-current
assets held for sale
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
and current financial assets
|
|
|
(a+b+c
|
)
|
|
|
8,003
|
|
|
|
8,570
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables for lease contracts refer to:
|
|
Teleleasing lease contracts entered into directly with customers in previous years and for which TIM is the guarantor;
|
|
|
the portion of rental contracts, with the rendering of accessory services;
|
|
|
finance leases on user rights and equipment.
|
Hedging derivatives relating to hedged items classified as
non-current
assets/liabilities of a financial nature mainly refer to the
mark-to-market
spot valuation component of the hedging
derivatives, whereas Hedging derivatives relating to hedged items classified as current assets/liabilities of a financial nature mainly consist of accrued income on derivative contracts.
The
Non-hedging
derivatives consist of the
spot
mark-to-market
component of the
non-hedging
derivatives of the Brazil Business Unit.
Further details are provided in the Note Derivatives.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 8
|
|
|
at June 30, 2017
|
|
Financial assets (non-current and current)
|
|
88
|
Securities other than investments included in current assets relate to:
|
|
listed securities (1,101 million euros), classified as
available-for-sale
due beyond three months. They consist of 613 million
euros of treasury bonds purchased respectively by TIM S.p.A. (256 million euros) and Telecom Italia Finance S.A. (357 million euros) and 488 million euros of bonds purchased by Telecom Italia Finance S.A. with different maturities,
all with an active market and consequently readily convertible into cash. The purchases of the above government bonds, which, pursuant to Consob Communication no. DEM/11070007 of August 5, 2011, represent investments in Sovereign debt
securities, have been made in accordance with the Guidelines for the Management and control of financial risk adopted by the TIM Group since August 2012, in replacement of the previous policies in force;
|
|
|
securities (1 million euros), classified as
held-for-trading,
relating to the investment made by the Brazil Business Unit in a
monetary fund that invests almost entirely in instruments in US dollars.
|
Cash and cash equivalents increased by 122 million euros
compared to December 31, 2016 and were broken down as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Liquid assets with banks, financial institutions and post offices
|
|
|
3,123
|
|
|
|
2,491
|
|
|
|
|
|
|
|
|
|
|
Checks, cash and other receivables and deposits for cash flexibility
|
|
|
1
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments (due within 3 months)
|
|
|
962
|
|
|
|
1,472
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
4,086
|
|
|
|
3,964
|
|
|
|
|
|
|
|
|
|
|
The different technical forms of investing available cash at June 30, 2017 had the following characteristics:
(2)
|
maturities: all deposits have a maximum maturity date of three months;
|
(3)
|
counterparty risk: deposits have been made with leading high-credit-quality banks and financial institutions with a rating of at least
BBB-
according to Standard &
Poors with regard to Europe, and with leading local counterparts with regard to investments in South America;
|
(4)
|
Country risk: deposits have been made mainly in major European financial markets.
|
Securities other than
investments (due within 3 months) consisted of 893 million euros (1,471 million euros at December 31, 2016) of Brazilian bank certificates of deposit (Certificado de Depósito Bancário) held by companies of the Brazil
Business Unit with premier local banking and financial institutions, and 68 million euros of Euro Commercial Papers held by Telecom Italia Finance S.A. (with an issuer rating of
BBB-
from S&Ps).
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 8
Financial assets (non-current and current)
|
|
|
at June 30, 2017
|
|
|
89
|
NOTE 9
TRADE AND MISCELLANEOUS RECEIVABLES AND OTHER CURRENT ASSETS
Trade and miscellaneous receivables and other current assets increased by 191 million euros compared to December 31, 2016 and were broken down as
follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Amounts due on construction contracts
|
|
|
29
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
Trade receivables:
|
|
|
|
|
|
|
|
|
Receivables from customers
|
|
|
3,083
|
|
|
|
3,110
|
|
|
|
|
|
|
|
|
|
|
Receivables from other telecommunications operators
|
|
|
888
|
|
|
|
815
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,971
|
|
|
|
3,925
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous receivables and other current assets:
|
|
|
|
|
|
|
|
|
Other receivables
|
|
|
703
|
|
|
|
784
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous prepaid expenses
|
|
|
914
|
|
|
|
684
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,617
|
|
|
|
1,468
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
5,617
|
|
|
|
5,426
|
|
|
|
|
|
|
|
|
|
|
Trade receivables amounted to 3,971 million euros (3,925 million euros at December 31, 2016) and were net of
the provision for bad debts of 592 million euros (648 million euros at December 31, 2016).
Trade receivables mainly related to TIM S.p.A.
(2,817 million euros) and the Brazil Business Unit (712 million euros). They also included 64 million euros (82 million euros at December 31, 2016) of medium/long-term receivables, principally in respect of agreements for
the sale of Indefeasible Rights of Use (IRU).
Other receivables amounted to 703 million euros (784 million euros at December 31, 2016) and
were net of a provision for bad debts of 73 million euros (72 million euros at December 31, 2016). Details are as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Advances to suppliers
|
|
|
64
|
|
|
|
41
|
|
|
|
|
|
|
|
|
|
|
Receivables from employees
|
|
|
32
|
|
|
|
26
|
|
|
|
|
|
|
|
|
|
|
Tax receivables
|
|
|
189
|
|
|
|
228
|
|
|
|
|
|
|
|
|
|
|
Receivables for grants from the government and public entities
|
|
|
202
|
|
|
|
242
|
|
|
|
|
|
|
|
|
|
|
Sundry receivables
|
|
|
216
|
|
|
|
247
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
703
|
|
|
|
784
|
|
|
|
|
|
|
|
|
|
|
Tax receivables included, among others, 156 million euros relating to the Brazil Business Unit, largely with reference to
local indirect taxes, and 34 million euros relating to the Domestic Business Unit, partly represented by credits resulting from tax returns, other taxes and also the VAT receivable on the purchase of cars and related accessories for which
refunds were requested under Italian Decree Law 258/2006, converted with amendments by Italian Law 278/2006.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 9
|
|
|
at June 30, 2017
|
|
Trade and miscellaneous receivables and other current assets
|
|
90
|
Receivables for grants from the government and public entities (202 million euros) mainly relate to
Ultra-Broadband-UBB
and
Broadband-BB
projects. The grants are recognized to the income statement when the related plants become ready for use upon satisfaction of specific
requirements for each tender notice.
Sundry receivables mainly included:
(4)
|
receivables from factoring companies, totaling 50 million euros;
|
(5)
|
receivables from social security and assistance agencies due to TIM S.p.A. of 27 million euros;
|
(6)
|
miscellaneous receivables due to TIM S.p.A. from other licensed TLC operators of 43 million euros.
|
Trade
and miscellaneous prepaid expenses mainly relate to the deferrals of costs referring to the activation of new contracts with customers (467 million euros), building leases (34 million euros), rent and maintenance (78 million euros)
and insurance premiums (16 million euros).
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 9
|
|
|
at June 30, 2017
|
|
Trade and miscellaneous receivables and other current assets
|
|
91
|
NOTE 10
EQUITY
Equity consisted of:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Equity attributable to owners of the Parent
|
|
|
21,404
|
|
|
|
21,207
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
2,215
|
|
|
|
2,346
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
23,619
|
|
|
|
23,553
|
|
|
|
|
|
|
|
|
|
|
The breakdown of Equity attributable to Owners of the Parent is provided below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
6/30/2017
|
|
|
|
|
|
12/31/2016
|
|
Share capital
|
|
|
|
|
|
|
11,587
|
|
|
|
|
|
|
|
11,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
paid-in
capital
|
|
|
|
|
|
|
2,094
|
|
|
|
|
|
|
|
2,094
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other reserves and retained earnings (accumulated losses), including profit (loss) for the
period
|
|
|
|
|
|
|
7,723
|
|
|
|
|
|
|
|
7,526
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reserve for
available-for-sale
financial assets
|
|
|
38
|
|
|
|
|
|
|
|
39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reserve for cash flow hedges
|
|
|
(428
|
)
|
|
|
|
|
|
|
(551
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reserve for exchange differences on translating foreign operations
|
|
|
(742
|
)
|
|
|
|
|
|
|
(366
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reserve for remeasurements of employee defined benefit plans (IAS 19)
|
|
|
(88
|
)
|
|
|
|
|
|
|
(113
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of other profits (losses) of associates and joint ventures accounted for using the equity
method
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sundry reserves and retained earnings (accumulated losses), including profit (loss) for the
period
|
|
|
8,943
|
|
|
|
|
|
|
|
8,517
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
21,404
|
|
|
|
|
|
|
|
21,207
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On the basis of the resolution passed by the Shareholders Meeting held on May 4, 2017, the profit for the year 2016
reported in the financial statements of the Parent TIM S.p.A. has been allocated as follows:
(5)
|
166 million euros, for the distribution of a preferred dividend to Savings Shareholders of 0.0275 euros for each savings share, gross of withholdings required by law;
|
(6)
|
95 million euros to the legal reserve;
|
(7)
|
1,636 million euros to retained earnings.
|
Movements in Share Capital during the first half of 2017,
amounting to 11,587 million euros, and already net of treasury shares of 90 million euros, are shown in the tables below:
Reconciliation
between the number of shares outstanding at December 31, 2016 and June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(number of shares)
|
|
|
|
|
at 12/31/2016
|
|
|
Share issues
|
|
|
at 6/30/2017
|
|
|
% of share
capital
|
|
Ordinary shares issued
|
|
|
(a
|
)
|
|
|
15,203,122,583
|
|
|
|
|
|
|
|
15,203,122,583
|
|
|
|
71.61
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
less: treasury shares
|
|
|
(b
|
)
|
|
|
(163,754,388
|
)
|
|
|
|
|
|
|
(163,754,388
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary shares outstanding
|
|
|
(c
|
)
|
|
|
15,039,368,195
|
|
|
|
|
|
|
|
15,039,368,195
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings shares issued and outstanding
|
|
|
(d
|
)
|
|
|
6,027,791,699
|
|
|
|
|
|
|
|
6,027,791,699
|
|
|
|
28.39
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total TIM S.p.A. shares issued
|
|
|
(a+d
|
)
|
|
|
21,230,914,282
|
|
|
|
|
|
|
|
21,230,914,282
|
|
|
|
100.00
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total TIM S.p.A. shares outstanding
|
|
|
(c+d
|
)
|
|
|
21,067,159,894
|
|
|
|
|
|
|
|
21,067,159,894
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 10
|
|
|
at June 30, 2017
|
|
Equity
|
|
92
|
Reconciliation between the value of shares outstanding at December 31, 2016 and June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
Share capital at
12/31/2016
|
|
|
Change in
share capital
|
|
|
Share capital at
6/30/2017
|
|
Ordinary shares issued
|
|
|
(a
|
)
|
|
|
8,362
|
|
|
|
|
|
|
|
8,362
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
less: treasury shares
|
|
|
(b
|
)
|
|
|
(90
|
)
|
|
|
|
|
|
|
(90
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary shares outstanding
|
|
|
(c
|
)
|
|
|
8,272
|
|
|
|
|
|
|
|
8,272
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings shares issued and outstanding
|
|
|
(d
|
)
|
|
|
3,315
|
|
|
|
|
|
|
|
3,315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total TIM S.p.A. share capital issued
|
|
|
(a+d
|
)
|
|
|
11,677
|
|
|
|
|
|
|
|
11,677
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total TIM S.p.A. share capital outstanding
|
|
|
(c+d
|
)
|
|
|
11,587
|
|
|
|
|
|
|
|
11,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
POTENTIAL FUTURE CHANGES IN SHARE CAPITAL
Details of
Future potential changes in share capital are presented in the Note Earnings per share.
|
|
|
|
|
TIM Group
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 10
|
|
|
at June 30, 2017
|
|
Equity
|
|
93
|
NOTE 11
FINANCIAL LIABILITIES
(NON-CURRENT
AND CURRENT)
Non-current
and current financial liabilities (gross financial debt) were broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Financial payables (medium/long-term):
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds
|
|
|
|
|
|
|
17,740
|
|
|
|
18,537
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible bonds
|
|
|
|
|
|
|
1,847
|
|
|
|
1,832
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts due to banks
|
|
|
|
|
|
|
4,916
|
|
|
|
5,461
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial payables
|
|
|
|
|
|
|
173
|
|
|
|
306
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,676
|
|
|
|
26,136
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease liabilities (medium/long-term)
|
|
|
|
|
|
|
2,356
|
|
|
|
2,444
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial liabilities (medium/long-term):
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging derivatives relating to hedged items classified as
non-current
assets/liabilities of a financial nature
|
|
|
|
|
|
|
1,849
|
|
|
|
1,876
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-hedging
derivatives
|
|
|
|
|
|
|
6
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,855
|
|
|
|
1,889
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
financial liabilities
|
|
|
(a
|
)
|
|
|
28,887
|
|
|
|
30,469
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial payables (short-term):
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds
|
|
|
|
|
|
|
3,016
|
|
|
|
2,589
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible bonds
|
|
|
|
|
|
|
6
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts due to banks
|
|
|
|
|
|
|
1,438
|
|
|
|
1,072
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial payables
|
|
|
|
|
|
|
107
|
|
|
|
117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,567
|
|
|
|
3,784
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease liabilities (short-term)
|
|
|
|
|
|
|
197
|
|
|
|
192
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial liabilities (short-term):
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging derivatives relating to hedged items classified as current assets/liabilities of a
financial nature
|
|
|
|
|
|
|
77
|
|
|
|
69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-hedging
derivatives
|
|
|
|
|
|
|
3
|
|
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
80
|
|
|
|
80
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current financial liabilities
|
|
|
(b
|
)
|
|
|
4,844
|
|
|
|
4,056
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities directly associated with Discontinued
operations/Non-current
assets held for sale
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Financial liabilities (Gross financial debt)
|
|
|
(a+b+c
|
)
|
|
|
33,731
|
|
|
|
34,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
94
|
|
Gross financial debt according to the original currency of the transaction is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
|
(millions of foreign
currency)
|
|
|
(millions of euros)
|
|
|
(millions of foreign
currency)
|
|
|
(millions of euros)
|
|
USD
|
|
|
7,209
|
|
|
|
6,317
|
|
|
|
7,504
|
|
|
|
7,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP
|
|
|
2,007
|
|
|
|
2,282
|
|
|
|
2,017
|
|
|
|
2,356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BRL
|
|
|
7,449
|
|
|
|
1,973
|
|
|
|
7,128
|
|
|
|
2,075
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
JPY
|
|
|
20,031
|
|
|
|
157
|
|
|
|
20,032
|
|
|
|
162
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EURO
|
|
|
|
|
|
|
23,002
|
|
|
|
|
|
|
|
22,813
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
33,731
|
|
|
|
|
|
|
|
34,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The breakdown of gross financial debt by effective interest rate bracket, excluding the effect of any hedging instruments, is
provided below:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Up to 2.5%
|
|
|
4,846
|
|
|
|
5,041
|
|
|
|
|
|
|
|
|
|
|
From 2.5% to 5%
|
|
|
10,313
|
|
|
|
9,368
|
|
|
|
|
|
|
|
|
|
|
From 5% to 7.5%
|
|
|
11,555
|
|
|
|
12,629
|
|
|
|
|
|
|
|
|
|
|
From 7.5% to 10%
|
|
|
3,772
|
|
|
|
3,918
|
|
|
|
|
|
|
|
|
|
|
Over 10%
|
|
|
641
|
|
|
|
673
|
|
|
|
|
|
|
|
|
|
|
Accruals/deferrals, MTM and derivatives
|
|
|
2,604
|
|
|
|
2,896
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
33,731
|
|
|
|
34,525
|
|
|
|
|
|
|
|
|
|
|
Following the use of derivative hedging instruments, on the other hand, the gross financial debt by nominal interest rate
bracket is:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Up to 2.5%
|
|
|
11,767
|
|
|
|
9,410
|
|
|
|
|
|
|
|
|
|
|
From 2.5% to 5%
|
|
|
6,181
|
|
|
|
7,775
|
|
|
|
|
|
|
|
|
|
|
From 5% to 7.5%
|
|
|
9,652
|
|
|
|
10,586
|
|
|
|
|
|
|
|
|
|
|
From 7.5% to 10%
|
|
|
2,018
|
|
|
|
1,430
|
|
|
|
|
|
|
|
|
|
|
Over 10%
|
|
|
1,509
|
|
|
|
2,428
|
|
|
|
|
|
|
|
|
|
|
Accruals/deferrals, MTM and derivatives
|
|
|
2,604
|
|
|
|
2,896
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
33,731
|
|
|
|
34,525
|
|
|
|
|
|
|
|
|
|
|
The maturities of financial liabilities according to the expected nominal repayment amount, as defined by contract, are the
following:
Details of the maturities of financial liabilities at nominal repayment amount:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
maturing by 6/30 of the year:
|
|
(millions of euros)
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
|
2022
|
|
|
After
2022
|
|
|
Total
|
|
Convertible bonds
|
|
|
2,667
|
|
|
|
3,047
|
|
|
|
720
|
|
|
|
1,111
|
|
|
|
3,084
|
|
|
|
11,681
|
|
|
|
22,310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and other financial liabilities
|
|
|
721
|
|
|
|
1,837
|
|
|
|
1,267
|
|
|
|
622
|
|
|
|
590
|
|
|
|
474
|
|
|
|
5,511
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease liabilities
|
|
|
144
|
|
|
|
115
|
|
|
|
110
|
|
|
|
110
|
|
|
|
93
|
|
|
|
1,919
|
|
|
|
2,491
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
3,532
|
|
|
|
4,999
|
|
|
|
2,097
|
|
|
|
1,843
|
|
|
|
3,767
|
|
|
|
14,074
|
|
|
|
30,312
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities
|
|
|
769
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
769
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
4,301
|
|
|
|
4,999
|
|
|
|
2,097
|
|
|
|
1,843
|
|
|
|
3,767
|
|
|
|
14,074
|
|
|
|
31,081
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The main components of financial liabilities are commented below.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
95
|
|
Bonds are broken down as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Non-current
portion
|
|
|
17,740
|
|
|
|
18,537
|
|
|
|
|
|
|
|
|
|
|
Current portion
|
|
|
3,016
|
|
|
|
2,589
|
|
|
|
|
|
|
|
|
|
|
Total carrying amount
|
|
|
20,756
|
|
|
|
21,126
|
|
|
|
|
|
|
|
|
|
|
Fair value adjustment and measurements at amortized cost
|
|
|
(446
|
)
|
|
|
(709
|
)
|
|
|
|
|
|
|
|
|
|
Total nominal repayment amount
|
|
|
20,310
|
|
|
|
20,417
|
|
|
|
|
|
|
|
|
|
|
The convertible bonds consist of the unsecured equity-linked bond for 2,000 million euros, with a coupon of 1.125%,
issued by TIM S.p.A., convertible into newly-issued ordinary shares, maturing in 2022.
|
|
This item was broken down as follows:
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Non-current
portion
|
|
|
1,847
|
|
|
|
1,832
|
|
|
|
|
|
|
|
|
|
|
Current portion
|
|
|
6
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
Total carrying amount
|
|
|
1,853
|
|
|
|
1,838
|
|
|
|
|
|
|
|
|
|
|
Fair value adjustment and measurements at amortized cost
|
|
|
147
|
|
|
|
162
|
|
|
|
|
|
|
|
|
|
|
Total nominal repayment amount
|
|
|
2,000
|
|
|
|
2,000
|
|
|
|
|
|
|
|
|
|
|
The nominal repayment amount of the bonds and convertible bonds totaled 22,310 million euros and was down
107 million euros compared to December 31, 2016 (22,417 million euros), as a result of the new issues and repayments in the first half of 2017.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
96
|
|
The following table lists the bonds issued by companies of the TIM Group, by issuing company, expressed at the
nominal repayment amount, net of bond repurchases, and also at market value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency
|
|
Amount
(millions)
|
|
|
Nominal
repayment
amount
(millions
of euros)
|
|
|
Coupon
|
|
|
Issue date
|
|
|
Maturity
date
|
|
|
Issue price
(%)
|
|
|
Market
price at
6/30/17
(%)
|
|
|
Market value
at
6/30/17
(millions of
euros)
|
|
Bonds issued by TIM S.p.A.
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
628.2
|
|
|
|
628.2
|
|
|
|
4.500
|
%
|
|
|
9/20/12
|
|
|
|
9/20/17
|
|
|
|
99.693
|
|
|
|
100.969
|
|
|
|
634
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP
|
|
|
750
|
|
|
|
852.9
|
|
|
|
7.375
|
%
|
|
|
5/26/09
|
|
|
|
12/15/17
|
|
|
|
99.608
|
|
|
|
102.862
|
|
|
|
877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
592.9
|
|
|
|
592.9
|
|
|
|
4.750
|
%
|
|
|
5/25/11
|
|
|
|
5/25/18
|
|
|
|
99.889
|
|
|
|
104.243
|
|
|
|
618
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
581.9
|
|
|
|
581.9
|
|
|
|
6.125
|
%
|
|
|
6/15/12
|
|
|
|
12/14/18
|
|
|
|
99.737
|
|
|
|
108.894
|
|
|
|
634
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
832.4
|
|
|
|
832.4
|
|
|
|
5.375
|
%
|
|
|
1/29/04
|
|
|
|
1/29/19
|
|
|
|
99.070
|
|
|
|
108.361
|
|
|
|
902
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP
|
|
|
850
|
|
|
|
966.6
|
|
|
|
6.375
|
%
|
|
|
6/24/04
|
|
|
|
6/24/19
|
|
|
|
98.850
|
|
|
|
109.320
|
|
|
|
1,057
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
719.5
|
|
|
|
719.5
|
|
|
|
4.000
|
%
|
|
|
12/21/12
|
|
|
|
1/21/20
|
|
|
|
99.184
|
|
|
|
109.243
|
|
|
|
786
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
547.5
|
|
|
|
547.5
|
|
|
|
4.875
|
%
|
|
|
9/25/13
|
|
|
|
9/25/20
|
|
|
|
98.966
|
|
|
|
114.211
|
|
|
|
625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
563.6
|
|
|
|
563.6
|
|
|
|
4.500
|
%
|
|
|
1/23/14
|
|
|
|
1/25/21
|
|
|
|
99.447
|
|
|
|
114.230
|
|
|
|
644
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
(b)
200.5
|
|
|
|
200.5
|
|
|
|
6 month Euribor (base 365
|
)
|
|
|
1/1/02
|
|
|
|
1/1/22
|
|
|
|
100
|
|
|
|
100
|
|
|
|
200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
883.9
|
|
|
|
883.9
|
|
|
|
5.250
|
%
|
|
|
2/10/10
|
|
|
|
2/10/22
|
|
|
|
99.295
|
|
|
|
119.865
|
|
|
|
1,059
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
(c)
2,000
|
|
|
|
2,000
|
|
|
|
1.125
|
%
|
|
|
3/26/15
|
|
|
|
3/26/22
|
|
|
|
100
|
|
|
|
99.237
|
|
|
|
1,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
3.250
|
%
|
|
|
1/16/15
|
|
|
|
1/16/23
|
|
|
|
99.446
|
|
|
|
110.480
|
|
|
|
1,105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP
|
|
|
375
|
|
|
|
426.5
|
|
|
|
5.875
|
%
|
|
|
5/19/06
|
|
|
|
5/19/23
|
|
|
|
99.622
|
|
|
|
115.482
|
|
|
|
492
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
2.500
|
%
|
|
|
1/19/17
|
|
|
|
7/19/23
|
|
|
|
99.288
|
|
|
|
105.373
|
|
|
|
1,054
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
750
|
|
|
|
750
|
|
|
|
3.625
|
%
|
|
|
1/20/16
|
|
|
|
1/19/24
|
|
|
|
99.632
|
|
|
|
111.427
|
|
|
|
836
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
1,500
|
|
|
|
1,314.4
|
|
|
|
5.303
|
%
|
|
|
5/30/14
|
|
|
|
5/30/24
|
|
|
|
100
|
|
|
|
107.716
|
|
|
|
1,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
3.000
|
%
|
|
|
9/30/16
|
|
|
|
9/30/25
|
|
|
|
99.806
|
|
|
|
106.289
|
|
|
|
1,063
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
3.625
|
%
|
|
|
5/25/16
|
|
|
|
5/25/26
|
|
|
|
100
|
|
|
|
111.489
|
|
|
|
1,115
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
670
|
|
|
|
670
|
|
|
|
5.250
|
%
|
|
|
3/17/05
|
|
|
|
3/17/55
|
|
|
|
99.667
|
|
|
|
108.387
|
|
|
|
726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
|
|
16,530.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,828
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds issued by Telecom Italia Finance S.A. and guaranteed by TIM S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Euro
|
|
|
1,015
|
|
|
|
1,015
|
|
|
|
7.750
|
%
|
|
|
1/24/03
|
|
|
|
1/24/33
|
|
|
|
(a)
109.646
|
|
|
|
138.906
|
|
|
|
1,410
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
|
|
|
|
|
1,015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,410
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds issued by Telecom Italia Capital S.A. and guaranteed by TIM S.p.A.
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
(d)
676.6
|
|
|
|
592.9
|
|
|
|
6.999
|
%
|
|
|
6/4/08
|
|
|
|
6/4/18
|
|
|
|
100
|
|
|
|
104.560
|
|
|
|
620
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
(d)
759.7
|
|
|
|
665.6
|
|
|
|
7.175
|
%
|
|
|
6/18/09
|
|
|
|
6/18/19
|
|
|
|
100
|
|
|
|
109.292
|
|
|
|
728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
1,000
|
|
|
|
876.3
|
|
|
|
6.375
|
%
|
|
|
10/29/03
|
|
|
|
11/15/33
|
|
|
|
99.558
|
|
|
|
107.946
|
|
|
|
946
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
1,000
|
|
|
|
876.3
|
|
|
|
6.000
|
%
|
|
|
10/6/04
|
|
|
|
9/30/34
|
|
|
|
99.081
|
|
|
|
105.714
|
|
|
|
926
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
1,000
|
|
|
|
876.3
|
|
|
|
7.200
|
%
|
|
|
7/18/06
|
|
|
|
7/18/36
|
|
|
|
99.440
|
|
|
|
116.327
|
|
|
|
1,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
1,000
|
|
|
|
876.3
|
|
|
|
7.721
|
%
|
|
|
6/4/08
|
|
|
|
6/4/38
|
|
|
|
100
|
|
|
|
121.229
|
|
|
|
1,062
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
|
|
|
|
|
4,763.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,301
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
22,309.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,539
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Weighted average issue price for bonds issued with more than one tranche.
|
(b)
|
Reserved for employees.
|
(c)
|
Bond convertible into newly-issued TIM S.p.A. ordinary treasury shares.
|
(d)
|
Net of the securities bought back by TIM S.p.A. on July 20, 2015.
|
The regulations and the Offering
Circulars relating to the bonds of the TIM Group are available on the corporate website www.telecomitalia.com.
The following table lists the changes in
bonds during the first half of 2017:
New issues
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of original currency)
|
|
Currency
|
|
|
Amount
|
|
|
Issue date
|
|
Telecom Italia S.p.A. 1,000 million euros 2.500% maturing 7/19/2023
|
|
|
Euro
|
|
|
|
1,000
|
|
|
|
1/19/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repayments
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of original currency)
|
|
Currency
|
|
|
Amount
|
|
|
Repayment date
|
|
Telecom Italia S.p.A. 545 million euros 7.000%
(1)
|
|
|
Euro
|
|
|
|
545
|
|
|
|
1/20/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net of buybacks by the Company of 455 million euros during 2015.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
97
|
|
Medium/long-term amounts due to banks of 4,916 million euros (5,461 million euros at December 31,
2016) decreased by 545 million euros. Short-term amounts due to banks totaled 1,438 million euros (1,072 million euros at December 31, 2016) and included 758 million euros of the current portion of medium/long-term amounts
due to banks. In addition, Telecom Italia Finance S.A. had investments in repurchase agreements (Repos) on government bonds for a total value of 250 million euros maturing in July 2017.
Medium/long-term other financial payables, amounting to 173 million euros (306 million euros at December 31, 2016), decreased by
133 million euros (following the early repayment on April 10, 2017 of the bilateral term loan with Cassa Depositi e Prestiti of the amount of 100 million euros maturing April 2019) and included 152 million euros of the Telecom
Italia Finance S.A. loan for 20,000 million Japanese yen maturing in 2029. Short-term other financial payables amounting 107 million euros (117 million euros at December 31, 2016) decreased by 10 million euros and included
15 million euros of the current portion of the medium/long-term other financial payables.
Medium/long-term finance lease liabilities totaled
2,356 million euros (2,444 million euros at December 31, 2016) and mainly related to property leases accounted for using the financial method established by IAS 17. Short-term finance lease liabilities amounted to 197 million
euros (192 million euros at December 31, 2016).
Hedging derivatives relating to items classified as
non-current
liabilities of a financial nature amounted to 1,849 million euros (1,876 million euros at December 31, 2016). Hedging derivatives relating to items classified as current liabilities
of a financial nature totaled 77 million euros (69 million euros at December 31, 2016).
Non-hedging
derivatives classified as
non-current
financial liabilities
totaled 6 million euros (13 million euros at December 31, 2016).
Non-hedging
derivatives classified as
non-current
financial liabilities totaled
3 million euros (11 million euros at December 31, 2016). These also include the measurement of derivatives which, although put into place for hedging purposes, do not possess the formal requisites to be considered as such under IFRS.
COVENANTS AND NEGATIVE PLEDGES EXISTING AT JUNE 30, 2017
The bonds issued by the TIM Group do not contain financial covenants (e.g. ratios such as Debt/EBITDA, EBITDA/Interest, etc.) or clauses that would force the
early redemption of the bonds in relation to events other than the insolvency of the TIM Group. Furthermore, the repayment of the bonds and the payment of interest are not covered by specific guarantees nor are there commitments provided relative to
the assumption of future guarantees, except for the full and unconditional guarantees provided by TIM S.p.A. for the bonds issued by Telecom Italia Finance S.A. and Telecom Italia Capital S.A..
Since these bonds have been placed principally with institutional investors in major world capital markets (Euromarket and the U.S.A.), the terms which
regulate the bonds are in line with market practice for similar transactions effected on these same markets. Consequently, for example, there are commitments not to use the companys assets as collateral for loans (negative
pledges).
With regard to the loans taken out by TIM S.p.A. with the European Investment Bank (EIB), at June 30, 2017, the nominal
amount of outstanding loans amounted to 1,950 million euros, of which 800 million euros at direct risk and 1,150 million euros secured.
EIB loans not secured by bank guarantees for a nominal amount equal to 800 million euros need to apply the following covenants:
|
|
in the event the company becomes the target of a merger, demerger or contribution of a business segment outside the Group, or sells, disposes or transfers assets or business segments (except in certain cases, expressly
provided for), it shall immediately inform the EIB which shall have the right to ask for guarantees to be provided or changes to be made to the loan contract, or, only for certain loan contracts, the EIB shall have the option to demand the immediate
repayment of the loan (should the merger, demerger or contribution of a business segment outside the Group compromise the Project execution or cause a prejudice to EIB in its capacity as creditor);
|
|
|
with the 500 million euros loan, signed on December 14, 2015, TIM undertook to ensure that, for the entire duration of the loan, the total financial debt of the Group companies other than TIM S.p.A.
except for the cases when that debt is fully and irrevocably secured by TIM S.p.A. is lower than 35% (thirty-five percent) of the Groups total financial debt.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
98
|
|
EIB loans secured by banks or entities approved by the EIB for a total nominal amount of 1,150 million
euros, and direct risk loans, respectively for 300 million euros, signed on July 30, 2014 and 500 million euros, signed on December 14, 2015, must apply the following covenants:
|
|
Inclusion clause, covering a total of 1,650 million euros of loans, under which, in the event TIM commits to uphold financial covenants in other loan contracts (and even more restrictive clauses for
2014 and 2015 direct risk loans, including, for instance, cross default clauses and commitments restricting the sale of goods) that are not present in or are stricter than those granted to the EIB, the EIB will have the right if, in its
reasonable opinion, it considers that such changes may have a negative impact on TIMs financial capacity to request the provision of guarantees or the modification of the loan contract in order to establish an equivalent provision in
favor of the EIB;
|
|
|
Network Event, covering a total of 1,350 million euros of loans, under which, in the event of the disposal of the entire fixed network or of a substantial part of it (in any case more than half in
quantitative terms) to third parties or in the event of disposal of the controlling interest in the company in which the network or a substantial part of it has previously been transferred, TIM must immediately inform the EIB, which shall have the
option of requiring the establishment of guarantees or amendment of the loan contract or an alternative solution.
|
The loan agreements of
TIM S.p.A. do not contain financial covenants (e.g. ratios such as Debt/EBITDA, EBITDA/Interests, etc.) which would oblige the Company to repay the outstanding loan if the covenants are not observed.
The loan agreements contain the usual other types of covenants, including the commitment not to use the Companys assets as collateral for loans
(negative pledges), the commitment not to change the business purpose or sell the assets of the Company unless specific conditions exist (e.g. the sale takes place at fair market value). Covenants with basically the same content are also found in
the export credit loan agreement.
In the Loan Agreements and the Bonds, TIM is required to provide notification of change of control. Identification of
the occurrence of a change of control and the applicable consequences including the establishment of guarantees or the early repayment of the amount paid and the cancellation of the commitment in the absence of agreements to the contrary
are specifically covered in the individual agreements.
In addition, the outstanding loans generally contain a commitment by TIM, whose breach is
an Event of Default, not to implement mergers, demergers or transfer of business, involving entities outside the Group. Such Event of Default may entail, upon request of the Lender, the early redemption of the drawn amounts and/or the annulment of
the undrawn commitment amounts.
In the documentation of the loans granted to certain companies of the Tim Brasil group, the companies must generally
respect certain financial ratios (e.g. capitalization ratios, ratios for servicing debt and debt ratios) as well as the usual other covenants, under pain of a request for the early repayment of the loan.
Finally, as of June 30, 2017, no covenant, negative pledge clause or other clause relating to the above-described debt position, has in any way been
breached or violated.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
99
|
|
REVOLVING CREDIT FACILITY
The following table shows the
composition and the drawdown of the committed credit lines available at June 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
(billions of euros)
|
|
Agreed
|
|
|
Agreed
|
|
|
Agreed
|
|
|
Drawn down
|
|
Revolving Credit Facility expiring May 2019
|
|
|
4.0
|
|
|
|
|
|
|
|
4.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revolving Credit Facility expiring March 2020
|
|
|
3.0
|
|
|
|
|
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
7.0
|
|
|
|
|
|
|
|
7.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM has two syndicated Revolving Credit Facilities for amounts of 4 billion euros and 3 billion euros expiring
May 24, 2019 and March 25, 2020 respectively, both not yet drawn down.
TIM also has:
|
|
a bilateral Term Loan from Banca Regionale Europea expiring July 2019 for 200 million euros, drawn down for the full amount;
|
|
|
two bilateral Term Loans from Mediobanca respectively for 200 million euros expiring in November 2019 and 150 million euros expiring in July 2020, drawn down for the full amount;
|
|
|
a bilateral Term Loan from ICBC expiring July 2020 for 120 million euros, drawn down for the full amount;
|
|
|
a bilateral Term Loan from Intesa Sanpaolo expiring August 2021 for 200 million euros, drawn down for the full amount;
|
|
|
an Hot Money loan with Banca Popolare dellEmilia Romagna expiring July 2017 for 200 million euros, drawn down for the full amount.
|
On March 6, 2017, TIM S.p.A. signed a supplementary agreement with Mediobanca under which an early repayment was made on July 3, 2017 for
75 million euros for the bilateral term loan of an original amount of 150 million euros expiring in July 2020, which had been fully drawn down.
TIMS RATING AT JUNE 30, 2017
At June 30, 2017, the three rating agencies Standard & Poors, Moodys and Fitch Ratings rated TIM as follows:
|
|
|
|
|
|
|
|
|
|
|
Rating
|
|
|
Outlook
|
|
STANDARD & POORS
|
|
|
BB+
|
|
|
|
Stable
|
|
MOODYS
|
|
|
Ba1
|
|
|
|
Stable
|
|
FITCH RATINGS
|
|
|
BBB-
|
|
|
|
Stable
|
|
On July 12, 2017, the rating agency Standard & Poors upgraded TIM S.p.A.s outlook from
Stable to Positive.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Condensed Consolidated Financial Statements
|
|
Note 11
|
|
|
|
|
at June 30, 2017
|
|
Financial liabilities (non-current and current)
|
|
|
100
|
|
NOTE 12
NET FINANCIAL DEBT
The following table shows the net financial
debt at June 30, 2017 and December 31, 2016, calculated in accordance with the criteria indicated in the Recommendations for the Consistent Implementation of the European Commission Regulation on Prospectuses, issued on
February 10, 2005 by the European Securities & Markets Authority (ESMA), and adopted by Consob.
For the purpose of determining such figure,
the amount of financial liabilities has been adjusted by the effect of the relative hedging derivatives recorded in assets and the receivables arising from financial subleasing.
This table also shows the reconciliation of the net financial debt determined according to the criteria indicated by the ESMA and net financial debt
calculated according to the criteria of the TIM Group.
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Non-current
financial liabilities
|
|
|
|
|
|
|
28,887
|
|
|
|
30,469
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities
|
|
|
|
|
|
|
4,844
|
|
|
|
4,056
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities directly associated with Discontinued
operations/Non-
current assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross financial debt
|
|
|
(a
|
)
|
|
|
33,731
|
|
|
|
34,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets (°)
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial receivables for lease
contract
|
|
|
|
|
|
|
(90
|
)
|
|
|
(101
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
hedging derivatives
|
|
|
|
|
|
|
(1,886
|
)
|
|
|
(2,497
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
(1,976
|
)
|
|
|
(2,598
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments
|
|
|
|
|
|
|
(1,102
|
)
|
|
|
(1,519
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other current financial assets
|
|
|
|
|
|
|
(630
|
)
|
|
|
(389
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
(4,086
|
)
|
|
|
(3,964
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial assets relating to Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c
|
)
|
|
|
(5,818
|
)
|
|
|
(5,872
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financial debt as per Consob communication DEM/6064293/2006 (ESMA)
|
|
|
(d=a+b+c
|
)
|
|
|
25,937
|
|
|
|
26,055
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets (°)
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial receivables and other
non-current
financial assets
|
|
|
|
|
|
|
(209
|
)
|
|
|
(99
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(e
|
)
|
|
|
(209
|
)
|
|
|
(100
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financial debt
(*)
|
|
|
(f=d+e
|
)
|
|
|
25,728
|
|
|
|
25,955
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reversal of fair value measurement of derivatives and related financial
assets/liabilities
|
|
|
(g
|
)
|
|
|
(624
|
)
|
|
|
(836
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net financial debt
|
|
|
(f+g
|
)
|
|
|
25,104
|
|
|
|
25,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(°)
|
At June 30, 2017 and at December 31, 2016,
Non-current
financial assets (b+e) amounted to 2,185 million euros and 2,698 million euros,
respectively.
|
(*)
|
For details of the effects of related party transactions on net financial debt, see the specific table in the Note Related party transactions.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 12
|
|
|
|
|
at June 30, 2017
|
|
Net financial debt
|
|
|
101
|
|
NOTE 13
DERIVATIVES
Derivative financial instruments are used by the TIM
Group to hedge its exposure to foreign exchange rate risk, to manage interest rate risk and to diversify the parameters of debt so that costs and volatility can be reduced to within predetermined operational limits.
Derivative financial instruments in place at June 30, 2017 are principally used to manage debt positions. They include interest rate swaps (IRSs) to
reduce interest rate exposure on fixed-rate and variable-rate bank loans and bonds, as well as cross currency and interest rate swaps (CCIRSs), currency forwards and foreign exchange options to convert the loans/receivables secured in currencies
different from the functional currencies of the various Group companies.
IRS transactions, provide for or may entail, at specified maturity dates, the
exchange of flows of interest, calculated on the notional amount, at the agreed fixed or variable rates.
The same also applies to CCIRS transactions
which, in addition to the settlement of periodic interest flows, may provide for the exchange of principal, in the respective currencies of denomination, at maturity and possibly spot.
The following table shows the derivative financial instruments of the TIM Group at June 30, 2017 and at December 31, 2016, by type (for cross
currency and interest rate swaps the notional amount refers to the synthetic coverage):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Type
(millions of euros)
|
|
Hedged risk
|
|
Notional
amount at
6/30/2017
|
|
|
Notional amount
at 12/31/2016
|
|
|
Spot
(*)
Mark-to-
Market (Clean
Price) at
6/30/2017
|
|
|
Spot
*
Mark-to-
Market (Clean
Price) at
12/31/2016
|
|
Interest rate swaps
|
|
Interest rate risk
|
|
|
3,734
|
|
|
|
3,334
|
|
|
|
(7
|
)
|
|
|
42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross Currency and Interest Rate Swaps
|
|
Interest rate risk and currency exchange rate risk
|
|
|
851
|
|
|
|
851
|
|
|
|
12
|
|
|
|
46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fair Value Hedge Derivatives
**
|
|
|
4,585
|
|
|
|
4,185
|
|
|
|
5
|
|
|
|
88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swaps
|
|
Interest rate risk
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross Currency and Interest Rate Swaps
|
|
Interest rate risk and currency exchange rate risk
|
|
|
7,952
|
|
|
|
7,952
|
|
|
|
170
|
|
|
|
551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Cash Flow Hedge Derivatives
**
|
|
|
7,952
|
|
|
|
7,952
|
|
|
|
170
|
|
|
|
551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Non-Hedge
Accounting
Derivatives
|
|
|
184
|
|
|
|
484
|
|
|
|
23
|
|
|
|
51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total TIM Group derivatives
|
|
|
12,721
|
|
|
|
12,621
|
|
|
|
198
|
|
|
|
690
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Spot
Mark-to-market
above represents the market measurement of the derivative net of the accrued portion of the flow in progress.
|
**
|
On the 2009 issue in GBP there are two hedges, in FVH and CFH; accordingly, although it is a single issue, the notional amount of the hedge is included in both the FVH and CFH groupings.
|
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated
Financial Statements
|
|
Note 13
|
|
|
|
|
at June 30, 2017
|
|
Derivatives
|
|
|
102
|
|
NOTE 14
SUPPLEMENTARY DISCLOSURES ON FINANCIAL INSTRUMENTS
MEASUREMENT AT FAIR VALUE
The fair value measurement of the financial instruments of the Group is classified according to the three levels set out in IFRS 7. In particular, the fair
value hierarchy introduces three levels of input:
|
|
Level 1: quoted prices in active market;
|
|
|
Level 2: prices calculated using observable market inputs;
|
|
|
Level 3: prices calculated using inputs that are not based on observable market data.
|
The tables below
provide additional information on the financial instruments, including the table relating to the hierarchy level for each class of financial asset/liability measured at fair value at June 30, 2017.
Key for IAS 39 categories
|
|
|
|
|
|
|
|
|
|
|
Acronym
|
|
Loans and Receivables
|
|
Loans and Receivables
|
|
|
LaR
|
|
Financial assets
Held-to-Maturity
|
|
Financial assets
Held-to-Maturity
|
|
|
HtM
|
|
Available-for-Sale
financial assets
|
|
Financial assets
Available-for-Sale
|
|
|
AfS
|
|
Financial Assets/Liabilities Held for Trading
|
|
Financial Assets/Liabilities Held for Trading
|
|
|
FAHfT/FLHfT
|
|
Financial Liabilities at Amortized Cost
|
|
Financial Liabilities at Amortized Cost
|
|
|
FLAC
|
|
Hedging Derivatives
|
|
Hedge Derivatives
|
|
|
HD
|
|
Not applicable
|
|
Not applicable
|
|
|
n.a.
|
|
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated
Financial Statements
|
|
Note 14
|
|
|
|
|
at June 30, 2017
|
|
Supplementary disclosures on financial instruments
|
|
|
103
|
|
Fair value hierarchy level for each class of financial asset/liability at 6/30/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hierarchy Levels
|
|
(millions of euros)
|
|
|
|
|
IAS 39
Categories
|
|
|
Note
|
|
|
Carrying
amount in
financial
statements
at
6/30/2017
|
|
|
Level 1 (*)
|
|
|
Level 2 (*)
|
|
|
Level 3 (*)
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other investments
|
|
|
|
|
|
|
AfS
|
|
|
|
7
|
)
|
|
|
48
|
|
|
|
3
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities, financial receivables and other
non-current
financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which securities
|
|
|
|
|
|
|
AfS
|
|
|
|
8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which hedging derivatives
|
|
|
|
|
|
|
HD
|
|
|
|
8
|
)
|
|
|
1,886
|
|
|
|
|
|
|
|
1,886
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which
non-hedging
derivatives
|
|
|
|
|
|
|
FAHfT
|
|
|
|
8
|
)
|
|
|
13
|
|
|
|
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a
|
)
|
|
|
|
|
|
|
|
|
|
|
1,947
|
|
|
|
3
|
|
|
|
1,917
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which
available-for-sale
financial assets
|
|
|
|
|
|
|
AfS
|
|
|
|
8
|
)
|
|
|
1,101
|
|
|
|
1,101
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which
held-for-trading
financial assets
|
|
|
|
|
|
|
FAHfT
|
|
|
|
8
|
)
|
|
|
1
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other current financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which hedging derivatives
|
|
|
|
|
|
|
HD
|
|
|
|
8
|
)
|
|
|
287
|
|
|
|
|
|
|
|
287
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which
non-hedging
derivatives
|
|
|
|
|
|
|
FAHfT
|
|
|
|
8
|
)
|
|
|
18
|
|
|
|
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
|
|
|
|
|
|
|
|
1,407
|
|
|
|
1,102
|
|
|
|
305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(a+b
|
)
|
|
|
|
|
|
|
|
|
|
|
3,354
|
|
|
|
1,105
|
|
|
|
2,222
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which hedging derivatives
|
|
|
|
|
|
|
HD
|
|
|
|
11
|
)
|
|
|
1,849
|
|
|
|
|
|
|
|
1,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which
non-hedging
derivatives
|
|
|
|
|
|
|
FLHfT
|
|
|
|
11
|
)
|
|
|
6
|
|
|
|
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
1,855
|
|
|
|
|
|
|
|
1,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which hedging derivatives
|
|
|
|
|
|
|
HD
|
|
|
|
11
|
)
|
|
|
77
|
|
|
|
|
|
|
|
77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which
non-hedging
derivatives
|
|
|
|
|
|
|
FLHfT
|
|
|
|
11
|
)
|
|
|
3
|
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(d
|
)
|
|
|
|
|
|
|
|
|
|
|
80
|
|
|
|
|
|
|
|
80
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(c+d
|
)
|
|
|
|
|
|
|
|
|
|
|
1,935
|
|
|
|
|
|
|
|
1,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Level 1: quoted prices in active markets.
|
|
Level 2: prices calculated using observable market inputs.
|
|
Level 3: prices calculated using inputs that are not based on observable market data.
|
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated
Financial Statements
|
|
Note 14
|
|
|
|
|
at June 30, 2017
|
|
Supplementary disclosures on financial instruments
|
|
|
104
|
|
NOTE 15
EMPLOYEE BENEFITS
Employee benefits decreased by 26 million
euros compared to December 31, 2016 and were broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
12/31/2016
|
|
|
Increases/
Present value
|
|
|
Decrease
|
|
|
Exchange
differences
and other
changes
|
|
|
6/30/2017
|
|
Provision for employee severance indemnities
|
|
|
(a
|
)
|
|
|
1,009
|
|
|
|
(26
|
)
|
|
|
(8
|
)
|
|
|
|
|
|
|
975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for pension and other plans
|
|
|
|
|
|
|
28
|
|
|
|
7
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for termination benefit incentives
|
|
|
|
|
|
|
348
|
|
|
|
10
|
|
|
|
(8
|
)
|
|
|
|
|
|
|
350
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other provisions for employee benefits
|
|
|
(b
|
)
|
|
|
376
|
|
|
|
17
|
|
|
|
(9
|
)
|
|
|
|
|
|
|
384
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(a+b
|
)
|
|
|
1,385
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,359
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
non-current
portion
|
|
|
|
|
|
|
1,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
current portion
(*)
|
|
|
|
|
|
|
30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
The current portion refers only to Other provisions for employee benefits.
|
The Provision for employee
severance indemnities only refers to Italian companies and decreased overall by 34 million euros. The Decreases of 8 million euros refer to indemnities paid during the period to employees who terminated employment or for
advances. The decrease of 26 million euros in the column Increases/Present value consists of the following:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st half
2017
|
|
|
1st half
2016
|
|
Current service cost
(*)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses
|
|
|
7
|
|
|
|
10
|
|
|
|
|
|
|
|
|
|
|
Net actuarial (gains) losses for the period
|
|
|
(33
|
)
|
|
|
118
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(26
|
)
|
|
|
128
|
|
|
|
|
|
|
|
|
|
|
Effective return on plan assets
|
|
|
there are no assets servicing the plan
|
|
(*)
|
Following the social security reform in 2007, the portions intended for the INPS Treasury Fund or for the supplementary pension funds have been recorded under Employee benefits expenses, in Social
security expenses, and not as Employee severance indemnities expenses. The latter account will continue to be used only for the severance indemnity expenses of companies with less than 50 employees.
|
The net actuarial gains recognized at June 30, 2017, totaling 33 million euros (net actuarial losses of 118 million euros for the first half of
2016), essentially related to the change in the discount rate to 1.67% from the 1.31% used at December 31, 2016, while the inflation rate was considered to be 1.5% for the entire time (curve at December 2016: 1.1% for 2017; 1.3% for 2018; and
1.5% from 2019 onwards).
The Provision for pension and other plans amounted to 34 million euros at June 30, 2017 (28 million euros at
December 31, 2016) and mainly represented pension plans in place at foreign companies of the Group.
The Provision for termination benefit incentives
increased by a total of 2 million euros and included the recognition of the net impacts resulting from the various agreements with the trade unions signed during 2015 and 2016 by TIM S.p.A. and TI Information Technology (later merged into TIM
S.p.A.) and by other companies of the Domestic Business Unit. These agreements are part of the process of dialog between the parties, aimed at managing redundancies resulting from the streamlining processes affecting all the companies operating in
the TLC sector.
The figure consists of 326 million euros for the Parent, 10 million euros for Telecom Italia Sparkle S.p.A., 9 million
euros for Olivetti S.p.A and a total of 5 million euros for the other companies of the Domestic Business Unit.
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated
Financial Statements
|
|
Note 15
|
|
|
|
|
at June 30, 2017
|
|
Employee benefits
|
|
|
105
|
|
NOTE 16
PROVISIONS
Provisions increased by 160 million euros
compared to December 31, 2016 and were broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
12/31/2016
|
|
|
Increase
|
|
|
Taken to
income
|
|
|
Used directly
|
|
|
Exchange
differences
and other
changes
|
|
|
6/30/2017
|
|
Provision for taxation and tax risks
|
|
|
119
|
|
|
|
104
|
|
|
|
|
|
|
|
(11
|
)
|
|
|
(4
|
)
|
|
|
208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for restoration costs
|
|
|
326
|
|
|
|
4
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for legal disputes
|
|
|
457
|
|
|
|
127
|
|
|
|
(1
|
)
|
|
|
(62
|
)
|
|
|
4
|
|
|
|
525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for commercial risks
|
|
|
46
|
|
|
|
1
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
(6
|
)
|
|
|
40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for risks and charges on investments and corporate-related transactions
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6
|
|
|
|
34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other provisions
|
|
|
8
|
|
|
|
4
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
984
|
|
|
|
240
|
|
|
|
(1
|
)
|
|
|
(77
|
)
|
|
|
(2
|
)
|
|
|
1,144
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
non-current
portion
|
|
|
830
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
813
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
current portion
|
|
|
154
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The provision for taxation and tax risks increased by 89 million euros compared to December 31, 2016. The increase
was mainly due to the provision of 93 million euros by Telecom Italia Sparkle S.p.A. as described in the Note Contingent Liabilities. The figure at June 30, 2017 was mainly attributable to the Domestic Business Unit (144 million
euros) and the Brazil Business Unit (61 million euros).
The provision for restoration costs related to the provision for the estimated cost of
dismantling tangible assets (in particular: batteries, wooden poles and equipment) and for the restoration of the sites used for mobile telephony by the companies, with 322 million euros attributable to the Domestic Business Unit.
The provision for legal disputes included the provision for litigation with employees, social security entities, customers, regulatory authorities and other
counterparties.
The figure at June 30, 2017 includes 443 million euros for the Domestic Business Unit and 82 million euros for the Brazil
Business Unit.
The provision for commercial risks is attributable to the Domestic Business Unit.
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated
Financial Statements
|
|
Note 16
|
|
|
|
|
at June 30, 2017
|
|
Provisions
|
|
|
106
|
|
NOTE 17
TRADE AND MISCELLANEOUS PAYABLES AND OTHER CURRENT LIABILITIES
Trade and miscellaneous payables and other current liabilities decreased by 590 million euros compared to December 31, 2016 and were broken down as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Payables on construction work
|
|
|
(a
|
)
|
|
|
26
|
|
|
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade payables
|
|
|
|
|
|
|
|
|
|
|
|
|
Payables to suppliers
|
|
|
|
|
|
|
3,820
|
|
|
|
4,532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payables to other telecommunication operators
|
|
|
|
|
|
|
349
|
|
|
|
323
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
4,169
|
|
|
|
4,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax payables
|
|
|
(c
|
)
|
|
|
503
|
|
|
|
292
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous payables and other current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Payables for employee compensation
|
|
|
|
|
|
|
377
|
|
|
|
319
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payables to social security agencies
|
|
|
|
|
|
|
146
|
|
|
|
215
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous deferred income
|
|
|
|
|
|
|
537
|
|
|
|
488
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances received
|
|
|
|
|
|
|
25
|
|
|
|
53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer-related items
|
|
|
|
|
|
|
713
|
|
|
|
847
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payables for TLC operating fee
|
|
|
|
|
|
|
16
|
|
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends approved, but not yet paid to shareholders
|
|
|
|
|
|
|
17
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other current liabilities
|
|
|
|
|
|
|
173
|
|
|
|
320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits (except for employee severance indemnities) for the current portion expected to
be settled within 1 year
|
|
|
|
|
|
|
23
|
|
|
|
30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions for risks and charges for the current portion expected to be settled within 1
year
|
|
|
|
|
|
|
331
|
|
|
|
154
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(d
|
)
|
|
|
2,358
|
|
|
|
2,474
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(a+b+c+d
|
)
|
|
|
7,056
|
|
|
|
7,646
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade payables amounting to 4,169 million euros (4,855 million euros at December 31, 2016), mainly refer to TIM
S.p.A. (3,007 million euros) and to the companies of the Brazil Business Unit (797 million euros).
Tax payables refer in particular to TIM
S.p.A. and relate to the VAT payable (311 million euros), the payable for the government concession tax (25 million euros) and the withholding tax payables to the tax authorities as withholding agent (39 million euros). They also
included other tax payables of the Brazil Business Unit of 113 million euros.
Within miscellaneous payables and other current liabilities it is
noted in particular that:
|
|
trade and miscellaneous deferred income mainly consists of 268 million euros for interconnection charges, 175 million euros for the deferral of revenues from the activation of telephone service,
17 million euros for traffic and charges, and 78 million euros for rent and maintenance payments;
|
(2)
|
customer-related items largely consisted of the advance payments received by the Parent TIM S.p.A. from its fixed-line telephony customers for deposits made for telephone calls and subscription charges debited in
advance;
|
|
|
other current liabilities mainly relate to debt positions of the Parent TIM S.p.A..
|
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated Financial Statements
|
|
Note 17
|
|
|
|
|
at June 30, 2017
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
107
|
|
NOTE 18
CONTINGENT LIABILITIES, OTHER INFORMATION, COMMITMENTS AND GUARANTEES
A description is provided below of the most significant judicial, arbitration and tax disputes in which TIM Group companies are involved as of June 30,
2017, as well as those that came to an end during the period.
The TIM Group has posted liabilities totalling 520 million euros for those disputes
described below where the risk of losing the case has been considered probable.
A) SIGNIFICANT DISPUTES AND PENDING LEGAL ACTIONS
For the following disputes and pending legal actions no significant facts have emerged with respect to what was published in the 2016 Annual Report:
(5)
|
international tax and regulatory disputes;
|
(6)
|
administrative offence charge pursuant to Legislative Decree 231/2011 for the
so-called
TIM Security Affair;
|
(7)
|
irregularities concerning transactions for the leasing/rental of assets.
|
Telecom Italia Sparkle
Relations with
I-Globe,
Planetarium, Acumen, Accrue Telemedia and Diadem: investigation by the Public Prosecutors Office of Rome
The Rome Public Prosecutors Office has
challenged the judgement of the Court of Rome of October 2013 with which the three former managers of Telecom Italia Sparkle were fully acquitted of the charges of transnational conspiracy for the purpose of tax evasion and false declarations
through the use of invoices or other documents for
non-existent
transactions (carousel fraud), also in relation to the position of the Telecom Italia Sparkle employees; currently, judgement is
pending in the Court of Appeal in Rome. Telecom Italia Sparkle is still being investigated for the administrative offence pursuant to Legislative Decree 231/2001, with the predicate offence of conspiracy and translational money laundering.
Following the outcome of the immediate trial, the Company fully released the provisions for risk in the profit and loss account during 2014 and obtained from
the Judicial Authority the release and return of all the sums issued to guarantee any obligations deriving from the application of Legislative Decree 231/2001; the sum of 1,549,000 euros, which corresponds to the maximum fine applicable for the
administrative offence, still remains under seizure.
As for risks of a fiscal nature, it should be noted that in February 2014 the Revenues Agency (Lazio
Regional Office) served three formal notifications of fines for the years 2005, 2006 and 2007, based on the assumption that the telephone traffic in the carousel fraud did not exist. The amount of the fines 25% of the crime
related costs unduly deducted total 280 million euros. In this respect the Company has filed an appeal to the Provincial Tax Commission in April 2014. The Commission rejected the appeal with a decision filed in May 2016.
The Company lodged an appeal with the Regional Tax Commission in October 2016, opposing the judgement in the first instance, requesting a suspension of the
enforcement of this first instance judgement subject to presentation of an appropriate guarantee. In December 2016, the Regional Tax Commission granted this suspension, fixing the date for a hearing on the merits in April 2017.
On 5 April 2017 the appeal was discussed before the Regional Tax Commission of Lazio. On 26 April 2017 the second tier ruling was filed (2310/2017
sec. 11) which rejected the Companys appeal.
During the same month of April an application was filed for the scrapping of the case
opened by Equitalia following the unfavourable judgement of the Rome Provincial Tax Commission concerning the
|
|
|
|
|
|
|
TIM Group
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
108
|
|
application for payment of 2/3rds of the sanction imposed earlier by the Revenues Agency; the probable risk is therefore confirmed as totalling 93 million euros, provision for which was made
in the first quarter of 2017.
●
It should be noted that for some of the disputes described below, it was not possible to make a reliable estimate of the size and/or times of possible
payments, if any, on the basis of the information available at the closing date of the present document, particularly in light of the complexity of the proceedings, the progress made, and the elements of uncertainty of a technical-trial nature.
Moreover, in those cases in which disclosure of information on a dispute could seriously jeopardise the position of TIM or its subsidiaries, only the general nature of the dispute is described.
Of the disputes with the aforementioned characteristics, no significant facts have emerged for those listed below with respect to the information published in
the 2016 Annual Report:
(7)
|
Italian Competition Authority Case
I-761;
|
(11)
|
COLT TECHNOLOGY SERVICES;
|
(12)
|
KPNQ West Italia S.p.A.;
|
(13)
|
EUTELIA and VOICEPLUS;
|
(14)
|
Vodafone Dispute - Universal Service;
|
(15)
|
Olivetti Asbestos exposure;
|
(17)
|
Elinet S.p.A. Bankruptcy;
|
(18)
|
Dispute relative to Adjustments on license fees for the years 1994-1998;
|
(19)
|
Brazil - Docas/JVCO Arbitration;
|
(20)
|
Brazil CAM JVCO Arbitration.
|
Antitrust Case A428
At the conclusion of case A428, in May 2013, Italian
Competition Authority AGCM imposed two administrative sanctions of 88,182,000 euros and 15,612,000 euros on TIM for abuse of its dominant position. The Company allegedly (i) hindered or delayed activation of access services requested by OLOs
through unjustified and spurious refusals; (ii) offered its access services to final customers at economic and technical conditions that allegedly could not be matched by competitors purchasing wholesale access services from TIM itself, only in
those geographic areas of the Country where disaggregated access services to the local network are available, and hence where other operators can compete more effectively with the Company.
TIM appealed against the decision before the Regional Administrative Court (TAR) for Lazio, applying for payment of the fine to be suspended. In particular,
it alleged: infringement of its rights to defend itself in the proceedings, the circumstance that the organisational choices challenged by AGCM and allegedly at the base of the abuse of the OLO provisioning processes had been the subject of specific
rulings made by the industry regulator (AGCom), the circumstance that the comparative examination of the internal/external provisioning processes had in fact shown better results for the OLOs than for the TIM retail department (hence the lack of any
form of inequality of treatment and/or opportunistic behaviour by TIM), and (regarding the second abuse) the fact that the conduct was structurally unsuitable to reduce the margins of the OLOs.
In May 2014, the judgement of the Lazio TAR was published, rejecting TIMs appeal and confirming the fines imposed in the original order challenged. In
September 2014 the Company appealed against this decision.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
109
|
|
In May 2015, with the judgement no. 2497/15, the Council of State found the decision of the court of first
instance did not present the deficiencies alleged by TIM and confirmed the AGCM ruling. The company had already proceeded to pay the fines and the accrued interest.
In a decision notified in July 2015, AGCM started proceedings for
non-compliance
against TIM, to ascertain if the
Company had respected the notice to comply requiring it to refrain from undertaking behaviours analogous to those that were the object of the breach ascertained with the concluding decision in case A428 dated May 2013.
On 13 January 2017 TIM was notified of the conclusive assessment of the Italian Competition Authority (AGCM), acknowledging that TIM has fully complied
with the judgement in proceedings A428 and that therefore the conditions do not exist for the imposition of any sanctions for
non-compliance.
AGCM recognises, furthermore, that TIMs behaviour subsequently to the 2013 proceedings has been directed towards continuous improvement of its
performance in the supply of wholesale access services concerning not only the services which were the subject of the investigation, but also the new super-fast broadband access services. In assessing compliance, AGCM recognised the positive impact
of the implementation, albeit not yet completed, of TIMs New Equivalence Model (NME). AGCMs decision forces TIM to: (i) proceed with the implementation of the NME until its completion which is expected to be by 30 April 2017;
(ii) to inform the Authority about the performance levels of the systems for providing wholesale access services and about the completion of the corresponding internal reorganisation plan by the end of May 2017. Both impositions were promptly
fulfilled.
Vodafone lodged an appeal with the Lazio Regional Administrative Court against the final decision in the proceedings for
non-compliance
taken by AGCM. TIM filed an appearance, as it did in the further proceedings brought in the month of March 2017 by the operators CloudItalia, Kpnqwest and Digitel.
VODAFONE
(I-761)
With a writ of summons before the Milan Court,
Vodafone has sued TIM and some network companies, bringing claims for compensation from the Company for around 193 million euros for damages arising from alleged anti-competitive conduct censured in the known ICA case
I-761
(on corrective maintenance) referring to the period from 2011 to 2017.
Like Wind before it, with which a similar
judgement is pending, Vodafone contests the abuse of a dominant market position allegedly carried out by TIM in the wholesale markets giving access to its fixed network (LLU lines; Bitstream; WLR), through an unlawful agreement with the maintenance
companies to maintain the monopoly on the offer of corrective maintenance services on its network. In particular this restrictive agreement would have concerned the coordination, by the Company, of the financial conditions contained in the offers
formulated by the aforementioned companies with respect to the OLOs, for the maintenance service, at artificially high prices with respect to the cost of the maintenance included in the regulated access subscription charge, in order to make it seem
as if the unbundling of the service itself were not convenient. The Company will file an appearance, contesting all of the other partys requests.
TELEUNIT
With a writ of summons before the Rome Court, Teleunit has claimed 35.4 million euros in compensation from TIM, based on the known decision of the Italian
Competition Authority that settled the A428 case. Specifically, the other party complained that in the period 2009/2010 it had suffered abusive conduct on TIMs part in the form of technical boycotting (refusals to activate network access
services - KOs), and anticompetitive practices in the form of margin squeezing (excessive squeezing of discount margins, considered abusive inasmuch as it cannot be replicated by competitors). Telecom Italia filed an appearance, contesting all of
the plaintiffs allegations.
With a writ of summons issued in October 2009 before the Milan Appeal Court, Teleunit asked that TIM alleged acts of
abuse of its dominant position in the premium services market be ascertained. The plaintiff quantified its damages at a total of approximately 362 million euros. TIM filed an appearance, contesting the claims of the other party.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
110
|
|
After the ruling of January 2014 with which the Court of Appeal declared that it was not competent in this matter
and referred the case to the Court, Teleunit reinstated the case before the Milan Court the following April. TIM filed an appearance in the reinstated proceedings challenging the plaintiffs claims.
In its judgement of May 2017, the Milan Court rejected Teleunits claim in its entirety, and ordered the company to pay the legal costs of the case. This
judgement was appealed by Teleunit, in June 2017, before the Milan Court of Appeal. The Company will file an appeal challenging the arguments presented by the other party and asking that the judgement in the first instance be fully confirmed.
Competition Authority case A514
In June 2017 the Italian Competition Authority (AGCM) started proceedings A514 against TIM, to ascertain a possible abuse of its dominant market position in
breach of article 102 of the Treaty on the Functioning of the European Union. The proceedings were started based on some complaints filed in May and June 2017, by Infratel, Enel, Open Fiber, Vodafone and Wind Tre, and concerns a presumed abuse of
TIMs dominant position in the market for wholesale access services and for retail services using the broadband and ultrabroadband fixed network. In particular, the ICA hypothesised that TIM had adopted conduct aimed at: i) slowing and
hindering the course of the Infratel tender processes so as to delay, or render less remunerative the entry of another operator in the wholesale market; ii)
pre-emptively
securing customers on the retail
market for ultrabroadband services by means of commercial policies designed to restrict the space of customer contendibility remaining for the competitor operators.
After the start of the proceedings, the Authoritys officials carried out an inspection at some of TIMs offices in the month of July 2017. The
proceedings, within which the company will be upholding all its arguments to support the correctness of its work, must be concluded by 31 October 2018.
SKY
TIM has started civil proceedings against SKY Italia in the Milan Court, asking the court to void the partnership contract signed by the two companies in April
2014 for the delivery and marketing, between 2015 and 2019, of the SKY IPTV (Internet Protocol Television) offer on the TIM IPTV platform, due to abuse of dominant position by the other party.
As an alternative, the Company also asked the court to reduce to a fair level the amounts demanded by SKY by way of the
so-called
Guaranteed Minimums (penalties) established to SKYs advantage and related to predetermined customer
sign-up
and churn-rate thresholds in the
five years of the partnership.
Sky filed an appearance in February 2017, challenging TIMs claim and demanding payment of the Guaranteed Minimums it
claimed to have accrued, a request which was opposed by the Company. The proceedings are ongoing: the next hearing is scheduled for the month of May 2018.
Investigation by the Monza Public Prosecutors Office
Criminal charges have recently been brought before the
Monza Court regarding a number of transactions for the leasing and/or sale of assets. At the end of the preliminary hearing, the judge ordered a former employee of the Company to be committed for trial on charges of aggravated fraud and tax crimes,
and, at the same time, declared that the statute of limitations applied to other charges; at the start of the trial, the Court declared that all the remaining offences were statute-barred. As part of these proceedings TIM, which had filed a formal
complaint against persons unknown in 2011, joined the proceedings as a civil party as the person injured and damaged by the offence.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
111
|
|
Brazil - Opportunity Arbitration
In May 2012, TIM and Telecom Italia International N.V
(now merged in Telecom Italia Finance) were served with a notice of arbitration proceedings brought by the Opportunity group, claiming compensation for damages allegedly suffered for presumed breach of a settlement agreement signed in 2005. Based on
the claimants allegations, the damages relate to circumstances that emerged in the criminal proceedings pending before the Milan Court regarding,
inter alia
, unlawful activities engaged in by former employees of TIM.
The investigatory phase having been completed, the hearing for oral discussion took place in November 2014, after which the parties filed their concluding
arguments in preparation for the decision on the case.
In September 2015, the Board of Arbitration declared the proceedings closed, as the award was
going to be filed.
Subsequently, the Board of Arbitration allowed the parties to exchange short arguments and the ICC Court extended the term for the
filing of the award.
In September 2016 the ICC Court notified the parties of its judgement, based on which the Board of Arbitration rejected all the
claims made by the Opportunity group and decided that the legal costs, administrative costs and costs for expert witnesses should be split between the parties.
In April 2017 the Opportunity group filed an appeal against the arbitration award before the Court of Appeal of Paris.
Formal Notice of Assessments against TIM S.p.A.
On 29 October 2015 the Guardia di Finanza concluded a tax investigation into TIM S.p.A., started in 2013, regarding the years 2007 to 2014. The formal
notice of assessment (Processo Verbale di Costatazione, or PVC) contained two substantial findings. The first relates to the presumed
non-debiting
of royalties to the companys indirect subsidiary Tim
Brasil, for the use of the TIM brand. The second regards the alleged
non-application
of withholding tax on interest paid to subsidiary Telecom Italia Capital S.A.
In this regard, on the basis of the aforementioned formal notice of assessment, the Milan Revenues Agency in December 2015 served assessment notices on the
company for the 2010 tax year, and in December 2016 it served assessment notices for the tax years 2007 and 2011.
While believing, on the basis of
opinions issued by established professionals, that it has acted correctly in fulfilling all its tax obligations, the Company has attempted to come to an agreement with the Revenues Agency. Having failed to reach an agreement, as already occurred for
the 2010 tax year, the Company has lodged an appeal with the Provincial Tax Commission against the verification notices relating to the 2007 and 2011 tax years too, in any event without excluding the possibility of coming to a judicial settlement
with the Revenues Agency, with the object of closing the disputes in
pre-litigation
proceedings, for these and the other tax years.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
112
|
|
B) OTHER
INFORMATION
With reference to the cases listed below no significant facts have emerged with respect to that published in the 2016 Annual Report:
(8)
|
Dispute concerning the license fees for 1998,
|
(9)
|
Vodafone (previously TELETU),
|
Mobile telephony - criminal proceedings
In March 2012 TIM was served notice of the conclusion
of the preliminary enquiries, which showed that the Company was being investigated by the Public Prosecutor of Milan pursuant to the Legislative Decree n. 231/2001, for the offences of handling stolen goods and counterfeiting committed, according to
the alleged allegations, by fourteen employees of the
so-called
ethnic channel, with the participation of a number of dealers, for the purpose of obtaining undeserved commissions from TIM.
The Company, as the injured party damaged by such conduct, had brought two legal actions in 2008 and 2009 and had proceeded to suspend the employees involved
in the criminal proceedings (suspension later followed by dismissal). It has also filed an initial statement of defence, together with a technical report by its own expert, requesting that the proceedings against it be suspended, and that charges of
aggravated fraud against the Company be brought against the other defendants. In December 2012, the Public Prosecutors Office filed a request for 89 defendants and the Company itself to be committed for trial.
During the preliminary hearing, the Company was admitted as civil party to the trial and, in November 2013, the conclusions in the interest of the civil party
were filed, reaffirming TIMs total lack of involvement in the offences claimed.
At the end of the preliminary hearing, which took place in March
2014, the Judge for the Preliminary Hearing committed for trial all the defendants (including TIM) who had not asked for their situation to be settled with alternative procedures, on the grounds that examination in a trial was needed. In
April 2016, at the end of the first part of the trial, the Public Prosecutor asked for TIM to be sentenced to pay an administrative fine of 900 thousand euros, but decided not to ask for confiscation of any of the presumed profits of the
offences (quantified in the committal proceedings as totalling several million euros), based on the assumption that TIM had in any event remedied the presumed organisational inadequacies. While acknowledging the considerable redimensioning of the
accusations, the Company has reiterated its total
non-involvement
in the facts at issue. In November 2016 the Court gave a verdict acquitting the Company on the grounds that there was no case to answer. All
the individuals charged were also acquitted on various grounds. The acquittal judgement is not final, as it was challenged in April 2017 by the Public Prosecutor who sought appeal before the Court of Cassation.
C) COMMITMENTS AND GUARANTEES
Guarantees, net of
back-to-back
guarantees received, amounted to 21 million euros.
The
guarantees provided by third parties to Group companies, amounting to 5,356 million euros, consisted of guarantees for loans received (1,688 million euros) and of performance under outstanding contracts (3,668 million euros).
The guarantees provided by third parties for TIM S.p.A. obligations include the surety issued in favor of the Ministry of Economic Development for
38
million euros, for the commitment made by the Company to build equipment networks with
eco-sustainable
characteristics. In particular, the Company has made a commitment to achieve energy savings
in the new LTE technologies of approximately 10% on infrastructure and 20% on transmission devices over a period of 5 years (compared to energy consumed by current technology).
A surety was also issued in October 2016 on behalf of Telecom Italia Sparkle, in favor of the Italian Revenue Agency - Lazio Regional Department, for
198 million euros, upon the outcome of the summary
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
113
|
|
suspension order for the provisional execution of the ruling issued by the Provincial Tax Commission of Rome, which had rejected the Companys appeal against the fines issued by the Italian
Revenue Agency Lazio Regional Department for a total amount of 280 million euros (see paragraph a) Significant disputes and pending legal actions). The guarantee has been issued in accordance with Article 68 of Italian Legislative
Decree 546/1992 and gives the Italian Revenue Agency Lazio Regional Department the right, with respect to the appeal lodged by the Company, to collect an amount equal to 2/3 of the original claim.
Main guarantees for loans at June 30, 2017
Issuer
|
|
|
|
|
|
|
Amount
(millions of euros)
|
|
BBVA - Banco Bilbao Vizcaya Argentaria
|
|
|
368
|
|
|
|
|
|
|
SACE
|
|
|
368
|
|
|
|
|
|
|
Intesa Sanpaolo
|
|
|
220
|
|
|
|
|
|
|
Cassa Depositi e Prestiti
|
|
|
158
|
|
|
|
|
|
|
Barclays Bank
|
|
|
105
|
|
|
|
|
|
|
Ing
|
|
|
105
|
|
|
|
|
|
|
Unicredit
|
|
|
105
|
|
|
|
|
|
|
Commerzbank
|
|
|
57
|
|
|
|
|
|
|
Banco Santander
|
|
|
52
|
|
|
|
|
|
|
Sumitomo Mitsui Banking
|
|
|
52
|
|
|
|
|
|
|
Bank of Tokyo - Mitsubishi UFJ
|
|
|
52
|
|
|
|
|
|
|
The amounts shown in the table relate to loans issued by the EIB for the TIM Broadband Digital Divide, TIM Ricerca &
Sviluppo Banda Larga, TIM Rete Mobile a Banda Larga, and TIM RDI for Broadband Services projects.
It is noted that the following guarantees from:
(3)
|
Bank of Tokyo Mitsubishi UFJ of 52 million euros,
|
(4)
|
BBVA Banco Bilbao Vizcaya Argentaria of 157 million euros, and
|
(5)
|
Intesa Sanpaolo of 105 million euros,
|
relating to the loan granted by the EIB for the TIM Broadband
Digital Divide/B project, and repaid in advance in the amount of 300 million euros on December 27, 2016, will remain valid for 13 months after the repayment as provided in the agreement to protect against clawback risk.
It is also noted that the Barclays Bank guarantee of 105 million euros, for the loan granted by the EIB for the Digital Divide/C project, expired on
April 17, 2017 and was replaced, as per the option granted to TIM, with another guarantor bank. The guarantee will remain valid for 3 months after its expiry as provided in the agreement to protect against clawback risk.
There are also surety bonds on the telecommunication services in Brazil for 571 million euros.
D) ASSETS PLEDGED TO GUARANTEE FINANCIAL LIABILITIES
The
contracts for
low-rate
loans granted by the Brazilian development bank BNDES (Banco Nacional de Desenvolvimento Econômico e Social) to Tim Celular for a total equivalent amount of 1,487 million
euros are covered by specific covenants. In the event of
non-compliance
with the covenant obligations, BNDES will have a right to the receipts which transit on the bank accounts of the company.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 18
|
|
|
|
|
at June 30, 2017
|
|
Contingent liabilities, other information, commitments and guarantees
|
|
|
114
|
|
NOTE 19
FINANCE INCOME AND FINANCE EXPENSES
FINANCE INCOME
This item decreased by 902 million euros compared to first half of 2016, and was broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Interest income and other finance income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from financial receivables, recorded in
Non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from securities other than investments, recorded in
Non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from securities other than investments, recorded in Current assets
|
|
|
|
|
|
|
6
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income other than the above:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
|
|
|
|
75
|
|
|
|
62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange gains
|
|
|
|
|
|
|
518
|
|
|
|
613
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from fair value hedge derivatives
|
|
|
|
|
|
|
32
|
|
|
|
31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reversal of the Reserve for cash flow hedge derivatives to the income statement (interest rate
component)
|
|
|
|
|
|
|
290
|
|
|
|
344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
non-hedging
derivatives
|
|
|
|
|
|
|
8
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous finance income
|
|
|
|
|
|
|
12
|
|
|
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a
|
)
|
|
|
941
|
|
|
|
1,089
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Positive fair value adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair value hedge derivatives
|
|
|
|
|
|
|
|
|
|
|
77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underlying financial assets and liabilities of fair value hedge derivatives
|
|
|
|
|
|
|
88
|
|
|
|
124
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-hedging
derivatives
|
|
|
|
|
|
|
81
|
|
|
|
722
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
169
|
|
|
|
923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reversal of impairment loss on financial assets other than investments
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(a+b+c
|
)
|
|
|
1,110
|
|
|
|
2,012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 19
|
|
|
|
|
at June 30, 2017
|
|
Finance income and finance expenses
|
|
|
115
|
|
FINANCE
EXPENSES
This item decreased by 307 million euros compared to first half of 2016, and was broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Interest expenses and other finance expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses and other costs relating to bonds
|
|
|
|
|
|
|
552
|
|
|
|
566
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses to banks
|
|
|
|
|
|
|
57
|
|
|
|
57
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses to others
|
|
|
|
|
|
|
133
|
|
|
|
122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
742
|
|
|
|
745
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions
|
|
|
|
|
|
|
44
|
|
|
|
49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange losses
|
|
|
|
|
|
|
498
|
|
|
|
382
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charges from fair value hedge derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reversal of the Reserve for cash flow hedge derivatives to the income statement (interest rate
component)
|
|
|
|
|
|
|
244
|
|
|
|
304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charges from
non-hedging
derivatives
|
|
|
|
|
|
|
17
|
|
|
|
34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous finance expenses
|
|
|
|
|
|
|
118
|
|
|
|
113
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a
|
)
|
|
|
1,663
|
|
|
|
1,627
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Negative fair value adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair value hedge derivatives
|
|
|
|
|
|
|
82
|
|
|
|
124
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underlying financial assets and liabilities of fair value hedge derivatives
|
|
|
|
|
|
|
|
|
|
|
75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-hedging
derivatives
|
|
|
|
|
|
|
105
|
|
|
|
331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b
|
)
|
|
|
187
|
|
|
|
530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment losses on financial assets other than investments
|
|
|
(c
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(a+b+c
|
)
|
|
|
1,850
|
|
|
|
2,157
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 19
|
|
|
|
|
at June 30, 2017
|
|
Finance income and expenses
|
|
|
116
|
|
For greater clarity of presentation, the net effects relating to derivative financial instruments are summarized
in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Exchange gains
|
|
|
|
|
|
|
518
|
|
|
|
613
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange losses
|
|
|
|
|
|
|
(498
|
)
|
|
|
(382
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net exchange gains and losses
|
|
|
|
|
|
|
20
|
|
|
|
231
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from fair value hedge derivatives
|
|
|
|
|
|
|
32
|
|
|
|
31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charges from fair value hedge derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net result from fair value hedge derivatives
|
|
|
(a
|
)
|
|
|
32
|
|
|
|
31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Positive effect of the reversal of the Reserve of cash flow hedge derivatives to the income
statement (interest rate component)
|
|
|
|
|
|
|
290
|
|
|
|
344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Negative effect of the reversal of the Reserve of cash flow hedge derivatives to the income
statement (interest rate component)
|
|
|
|
|
|
|
(244
|
)
|
|
|
(304
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net effect of the Reversal of the Reserve of cash flow hedge derivatives to the income statement
(interest rate component)
|
|
|
(b
|
)
|
|
|
46
|
|
|
|
40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
non-hedging
derivatives
|
|
|
|
|
|
|
8
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charges from
non-hedging
derivatives
|
|
|
|
|
|
|
(17
|
)
|
|
|
(34
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net result from
non-hedging
derivatives
|
|
|
(c
|
)
|
|
|
(9
|
)
|
|
|
(28
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net result from derivatives
|
|
|
(a+b+c
|
)
|
|
|
69
|
|
|
|
43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Positive fair value adjustments to fair value hedge derivatives
|
|
|
|
|
|
|
|
|
|
|
77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Negative fair value adjustments to Underlying financial assets and liabilities of fair value hedge
derivatives
|
|
|
|
|
|
|
|
|
|
|
(75
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fair value adjustments
|
|
|
(d
|
)
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Positive fair value adjustments to Underlying financial assets and liabilities of fair value hedge
derivatives
|
|
|
|
|
|
|
88
|
|
|
|
124
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Negative fair value adjustments to fair value hedge derivatives
|
|
|
|
|
|
|
(82
|
)
|
|
|
(124
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fair value adjustments
|
|
|
(e
|
)
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fair value adjustments to fair value hedge derivatives and underlyings
|
|
|
(d+e
|
)
|
|
|
6
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Positive fair value to
non-hedging
derivatives
|
|
|
(f
|
)
|
|
|
81
|
|
|
|
722
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Negative fair value adjustments to
non-hedging
derivatives
|
|
|
(g
|
)
|
|
|
(105
|
)
|
|
|
(331
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fair value adjustments to
non-hedging
derivatives
|
|
|
(f+g
|
)
|
|
|
(24
|
)
|
|
|
391
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 19
|
|
|
|
|
at June 30, 2017
|
|
Finance income and expenses
|
|
|
117
|
|
NOTE 20
PROFIT (LOSS) FOR THE PERIOD
Profit for the period decreased by
451 million euros compared to first half of 2016 and may be broken down as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Profit (loss) for the period
|
|
|
654
|
|
|
|
1,105
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
Owners of the Parent:
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
596
|
|
|
|
1,021
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period attributable to owners of the Parent
|
|
|
596
|
|
|
|
1,018
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests:
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
58
|
|
|
|
37
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
50
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period attributable to
non-controlling
interests
|
|
|
58
|
|
|
|
87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 20
|
|
|
|
|
at June 30, 2017
|
|
Profit (loss) for the period
|
|
|
118
|
|
NOTE 21
EARNINGS PER SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
Basic earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period attributable to owners of the Parent
|
|
|
|
|
|
|
596
|
|
|
|
1,018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: additional dividends for the savings shares (0.011 euros per share and up to
capacity)
|
|
|
|
|
|
|
(66
|
)
|
|
|
(66
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of
euros
|
)
|
|
|
530
|
|
|
|
952
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of ordinary and savings shares
|
|
|
(millions
|
)
|
|
|
21,067
|
|
|
|
21,126
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share Ordinary shares
|
|
|
(euros
|
)
|
|
|
0.03
|
|
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plus: additional dividends per savings share
|
|
|
|
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share Savings shares
|
|
|
(euros
|
)
|
|
|
0.04
|
|
|
|
0.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations attributable to Owners of the Parent
|
|
|
|
|
|
|
596
|
|
|
|
1,021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: additional dividends for the savings shares
|
|
|
|
|
|
|
(66
|
)
|
|
|
(66
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of
euros
|
)
|
|
|
530
|
|
|
|
955
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of ordinary and savings shares
|
|
|
(millions
|
)
|
|
|
21,067
|
|
|
|
21,126
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from continuing operations Ordinary shares
|
|
|
(euros
|
)
|
|
|
0.03
|
|
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plus: additional dividends per savings share
|
|
|
|
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from continuing operations Savings shares
|
|
|
(euros
|
)
|
|
|
0.04
|
|
|
|
0.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
(millions of
euros
|
)
|
|
|
|
|
|
|
47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of ordinary and savings shares
|
|
|
(millions
|
)
|
|
|
21,067
|
|
|
|
21,126
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from Discontinued
operations/Non-current
assets held for sale Ordinary shares
|
|
|
(euros
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from Discontinued
operations/Non-current
assets held for sale Savings shares
|
|
|
(euros
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1st Half 2017
|
|
|
|
1st Half 2016
|
|
Average number of ordinary shares
|
|
|
|
|
|
|
15,039,368,195
|
|
|
|
15,098,152,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of savings shares
|
|
|
|
|
|
|
6,027,791,699
|
|
|
|
6,027,791,699
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
21,067,159,894
|
|
|
|
21,125,944,203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 21
|
|
|
|
|
at June 30, 2017
|
|
Earnings per share
|
|
|
119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
Diluted earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period attributable to owners of the Parent
|
|
|
|
|
|
|
596
|
|
|
|
1,018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dilution effect of stock option plans and convertible bonds
(*)
|
|
|
|
|
|
|
29
|
|
|
|
(437
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: additional dividends for the savings shares (0.011 euros per share and up to
capacity)
|
|
|
|
|
|
|
(66
|
)
|
|
|
(66
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions
of euros
|
)
|
|
|
559
|
|
|
|
515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of ordinary and savings shares
|
|
|
(millions
|
)
|
|
|
22,219
|
|
|
|
19,364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share Ordinary shares
|
|
|
(euros
|
)
|
|
|
0.03
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plus: additional dividends per savings share
|
|
|
|
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share Savings shares
|
|
|
(euros
|
)
|
|
|
0.04
|
|
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations attributable to Owners of the Parent
|
|
|
|
|
|
|
596
|
|
|
|
1,021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dilution effect of stock option plans and convertible bonds
(*)
|
|
|
|
|
|
|
29
|
|
|
|
(437
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: additional dividends for the savings shares
|
|
|
|
|
|
|
(66
|
)
|
|
|
(66
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions
of euros
|
)
|
|
|
559
|
|
|
|
518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of ordinary and savings shares
|
|
|
(millions
|
)
|
|
|
22,219
|
|
|
|
19,364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from continuing operations Ordinary shares
|
|
|
(euros
|
)
|
|
|
0.03
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plus: additional dividends per savings share
|
|
|
|
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from continuing operations Savings shares
|
|
|
(euros
|
)
|
|
|
0.04
|
|
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
(millions
of euros
|
)
|
|
|
|
|
|
|
47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dilution effect of stock option plans and convertible bonds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of ordinary and savings shares
|
|
|
(millions
|
)
|
|
|
22,219
|
|
|
|
19,364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from Discontinued
operations/Non-current
assets held for sale Ordinary shares
|
|
|
(euros
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from Discontinued
operations/Non-current
assets held for sale Savings shares
|
|
|
(euros
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1st Half 2017
|
|
|
|
1st Half 2016
|
|
Average number of ordinary shares
(*)
|
|
|
|
|
|
|
16,191,454,392
|
|
|
|
13,336,157,383
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of savings shares
|
|
|
|
|
|
|
6,027,791,699
|
|
|
|
6,027,791,699
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
22,219,246,091
|
|
|
|
19,363,949,082
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
The average number of ordinary shares also includes the potential ordinary shares relating to the equity compensation plans of employees for which the (market and
non-market)
performance conditions have been met, in addition to the theoretical number of shares that are issuable as a result of the conversion of the unsecured equity-linked convertible bond. Consequently, the Net profit (loss) for the period
attributable to Owners of the Parent and the Profit (loss) from continuing operations attributable to Owners of the Parent have also been adjusted to exclude the effects, net of tax, related to the above-mentioned plans and to the
convertible bond (+29 million euros in the 1st Half 2017).
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 21
|
|
|
|
|
at June 30, 2017
|
|
Earnings per share
|
|
|
120
|
|
POTENTIAL FUTURE CHANGES IN SHARE CAPITAL
The table below shows
future potential changes in share capital, based on: the issuance of the convertible bond by TIM S.p.A. in March 2015; the authorizations to increase the share capital in place at June 30, 2017; and the options and rights granted under equity
compensation plans, still outstanding at June 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
maximum shares
issuable
|
|
|
Share
capital
(thousands
of euros)
|
|
|
Additional
Paid-in
capital
(thousands
of euros)
|
|
|
Subscription
price per
share
(euros)
|
|
Additional capital increases not yet approved (ordinary shares)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014-2016 Stock Option Plan
|
|
|
133,042
343,069
893,617
13,555,651
|
|
|
|
73
189
492
7,455
|
|
|
|
80
158
393
5,287
|
|
|
|
1.15
1.01
0.99
0.94
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total additional capital increases not yet approved (ordinary shares)
|
|
|
14,925,379
|
|
|
|
8,209
|
|
|
|
5,918
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital increases already approved (ordinary shares)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 Convertible Bond (ordinary shares)
(*)
|
|
|
1,082,485,386
|
|
|
|
2,000,000
|
|
|
|
n.a.
|
|
|
|
n.a.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible bonds
|
|
|
|
|
|
|
2,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
2,008,209
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
The number of shares potentially issuable shown may be subject to adjustments.
|
Further information is provided
in the Notes Financial liabilities
(non-current
and current) and Equity compensation plans.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 21
|
|
|
121
|
|
at June 30, 2017
|
|
Earnings per share
|
|
|
|
|
NOTE 22
SEGMENT REPORTING
A) SEGMENT REPORTING
Segment reporting is based on the following operating segments:
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 22
|
|
|
122
|
|
at June 30, 2017
|
|
Segment reporting
|
|
|
|
|
Separate Consolidated Income Statements by Operating Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
|
|
Brazil
|
|
|
Other Operations
|
|
|
Adjustments and
eliminations
|
|
|
Consolidated
Total
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Third-party revenues
|
|
|
7,480
|
|
|
|
7,231
|
|
|
|
2,292
|
|
|
|
1,857
|
|
|
|
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intragroup revenues
|
|
|
14
|
|
|
|
16
|
|
|
|
1
|
|
|
|
1
|
|
|
|
|
|
|
|
1
|
|
|
|
(15
|
)
|
|
|
(18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by operating segment
|
|
|
7,494
|
|
|
|
7,247
|
|
|
|
2,293
|
|
|
|
1,858
|
|
|
|
|
|
|
|
9
|
|
|
|
(15
|
)
|
|
|
(18
|
)
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
199
|
|
|
|
98
|
|
|
|
18
|
|
|
|
10
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
217
|
|
|
|
107
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating revenues and other income
|
|
|
7,693
|
|
|
|
7,345
|
|
|
|
2,311
|
|
|
|
1,868
|
|
|
|
|
|
|
|
10
|
|
|
|
(15
|
)
|
|
|
(20
|
)
|
|
|
9,989
|
|
|
|
9,203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of goods and services
|
|
|
(2,976
|
)
|
|
|
(2,812
|
)
|
|
|
(1,169
|
)
|
|
|
(978
|
)
|
|
|
(2
|
)
|
|
|
(5
|
)
|
|
|
11
|
|
|
|
12
|
|
|
|
(4,136
|
)
|
|
|
(3,783
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses
|
|
|
(1,348
|
)
|
|
|
(1,384
|
)
|
|
|
(178
|
)
|
|
|
(161
|
)
|
|
|
(4
|
)
|
|
|
(7
|
)
|
|
|
|
|
|
|
1
|
|
|
|
(1,530
|
)
|
|
|
(1,551
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: accruals to employee severance indemnities
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses
|
|
|
(311
|
)
|
|
|
(276
|
)
|
|
|
(262
|
)
|
|
|
(224
|
)
|
|
|
(3
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
1
|
|
|
|
(576
|
)
|
|
|
(501
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: write-downs and expenses in connection with credit management and provision
charges
|
|
|
(200
|
)
|
|
|
(162
|
)
|
|
|
(86
|
)
|
|
|
(69
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(286
|
)
|
|
|
(231
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in inventories
|
|
|
45
|
|
|
|
32
|
|
|
|
5
|
|
|
|
8
|
|
|
|
|
|
|
|
(7
|
)
|
|
|
|
|
|
|
|
|
|
|
50
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Internally generated assets
|
|
|
258
|
|
|
|
279
|
|
|
|
55
|
|
|
|
43
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
3
|
|
|
|
317
|
|
|
|
325
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
3,361
|
|
|
|
3,184
|
|
|
|
762
|
|
|
|
556
|
|
|
|
(9
|
)
|
|
|
(11
|
)
|
|
|
|
|
|
|
(3
|
)
|
|
|
4,114
|
|
|
|
3,726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
(1,675
|
)
|
|
|
(1,596
|
)
|
|
|
(575
|
)
|
|
|
(450
|
)
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|
|
(1
|
)
|
|
|
(2,249
|
)
|
|
|
(2,047
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on disposals of
non-current
assets
|
|
|
(1
|
)
|
|
|
(2
|
)
|
|
|
7
|
|
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment reversals (losses) on
non-current
assets
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
|
|
|
1,685
|
|
|
|
1,581
|
|
|
|
194
|
|
|
|
121
|
|
|
|
(9
|
)
|
|
|
(11
|
)
|
|
|
1
|
|
|
|
(4
|
)
|
|
|
1,871
|
|
|
|
1,687
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profits (losses) of associates and joint ventures accounted for using the equity
method
|
|
|
(1
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses) from investments
|
|
|
|
(19
|
)
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
|
|
1,110
|
|
|
|
2,012
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses
|
|
|
|
(1,850
|
)
|
|
|
(2,157
|
)
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) before tax from continuing operations
|
|
|
|
1,111
|
|
|
|
1,547
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
|
(457
|
)
|
|
|
(489
|
)
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operations
|
|
|
|
654
|
|
|
|
1,058
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
47
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
654
|
|
|
|
1,105
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
Owners of the Parent
|
|
|
|
596
|
|
|
|
1,018
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
58
|
|
|
|
87
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by operating segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
|
|
Brazil
|
|
|
Other Operations
|
|
|
Adjustments and
eliminations
|
|
|
Consolidated
Total
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Revenues from equipment sales - third party
|
|
|
655
|
|
|
|
430
|
|
|
|
116
|
|
|
|
118
|
|
|
|
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
771
|
|
|
|
556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from equipment sales - intragroup
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues from equipment sales
|
|
|
655
|
|
|
|
430
|
|
|
|
116
|
|
|
|
118
|
|
|
|
|
|
|
|
9
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
771
|
|
|
|
556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from services - third party
|
|
|
6,827
|
|
|
|
6,804
|
|
|
|
2,176
|
|
|
|
1,739
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,003
|
|
|
|
8,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from services - intragroup
|
|
|
14
|
|
|
|
16
|
|
|
|
1
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
(15
|
)
|
|
|
(17
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues from services
|
|
|
6,841
|
|
|
|
6,820
|
|
|
|
2,177
|
|
|
|
1,740
|
|
|
|
|
|
|
|
|
|
|
|
(15
|
)
|
|
|
(17
|
)
|
|
|
9,003
|
|
|
|
8,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues on construction contracts - third party
|
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues on construction contracts-intragroup
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues on construction contracts
|
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total third-party revenues
|
|
|
7,480
|
|
|
|
7,231
|
|
|
|
2,292
|
|
|
|
1,857
|
|
|
|
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total intragroup revenues
|
|
|
14
|
|
|
|
16
|
|
|
|
1
|
|
|
|
1
|
|
|
|
|
|
|
|
1
|
|
|
|
(15
|
)
|
|
|
(18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues by operating segment
|
|
|
7,494
|
|
|
|
7,247
|
|
|
|
2,293
|
|
|
|
1,858
|
|
|
|
|
|
|
|
9
|
|
|
|
(15
|
)
|
|
|
(18
|
)
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 22
|
|
|
|
|
at June 30, 2017
|
|
Segment reporting
|
|
|
123
|
|
Purchase of intangible and tangible assets by operating segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
|
|
Brazil
|
|
|
Other Operations
|
|
|
Adjustments and
eliminations
|
|
|
Consolidated
Total
|
|
(millions of euros)
|
|
1st
Half
2017
|
|
|
1st
Half
2016
|
|
|
1st
Half
2017
|
|
|
1st
Half
2016
|
|
|
1st
Half
2017
|
|
|
1st
Half
2016
|
|
|
1st
Half
2017
|
|
|
1st
Half
2016
|
|
|
1st
Half
2017
|
|
|
1st
Half
2016
|
|
Purchase of intangible assets
|
|
|
436
|
|
|
|
465
|
|
|
|
237
|
|
|
|
244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
673
|
|
|
|
709
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of tangible assets
|
|
|
1,212
|
|
|
|
1,208
|
|
|
|
201
|
|
|
|
189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,413
|
|
|
|
1,397
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets
|
|
|
1,648
|
|
|
|
1,673
|
|
|
|
438
|
|
|
|
433
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,086
|
|
|
|
2,106
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: capital expenditures
|
|
|
1,626
|
|
|
|
1,575
|
|
|
|
430
|
|
|
|
408
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,056
|
|
|
|
1,983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of which: change in financial leasing contracts
|
|
|
22
|
|
|
|
98
|
|
|
|
8
|
|
|
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30
|
|
|
|
123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Headcount by Operating Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
|
|
Brazil
|
|
|
Other Operations
|
|
|
Consolidated Total
|
|
(number)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Headcount
|
|
|
51,095
|
|
|
|
51,280
|
|
|
|
9,471
|
|
|
|
9,849
|
|
|
|
86
|
|
|
|
100
|
|
|
|
60,652
|
|
|
|
61,229
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets and liabilities by Operating Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
|
|
Brazil
|
|
|
Other Operations
|
|
|
Adjustments and
eliminations
|
|
|
Consolidated Total
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
6/30/2017
|
|
|
12/31/2016
|
|
Non-current
operating assets
|
|
|
47,508
|
|
|
|
47,428
|
|
|
|
6,958
|
|
|
|
7,711
|
|
|
|
4
|
|
|
|
5
|
|
|
|
1
|
|
|
|
1
|
|
|
|
54,471
|
|
|
|
55,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current operating assets
|
|
|
4,780
|
|
|
|
4,472
|
|
|
|
1,129
|
|
|
|
1,209
|
|
|
|
14
|
|
|
|
16
|
|
|
|
8
|
|
|
|
(1
|
)
|
|
|
5,931
|
|
|
|
5,696
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating assets
|
|
|
52,288
|
|
|
|
51,900
|
|
|
|
8,087
|
|
|
|
8,920
|
|
|
|
18
|
|
|
|
21
|
|
|
|
9
|
|
|
|
|
|
|
|
60,402
|
|
|
|
60,841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments accounted for using the equity method
|
|
|
17
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations/Non-current
assets
held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unallocated assets
|
|
|
|
8,621
|
|
|
|
9,587
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
|
|
69,040
|
|
|
|
70,446
|
|
|
|
|
|
|
|
|
|
|
|
Total operating liabilities
|
|
|
8,970
|
|
|
|
8,968
|
|
|
|
1,646
|
|
|
|
2,397
|
|
|
|
51
|
|
|
|
57
|
|
|
|
(5
|
)
|
|
|
(16
|
)
|
|
|
10,662
|
|
|
|
11,406
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities directly associated with Discontinued
operations/Non-current
assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unallocated liabilities
|
|
|
|
34,759
|
|
|
|
35,487
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
23,619
|
|
|
|
23,553
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity and Liabilities
|
|
|
|
69,040
|
|
|
|
70,446
|
|
|
|
|
|
|
|
|
|
|
|
B) REPORTING BY GEOGRAPHICAL AREA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
Non-current
operating assets
|
|
|
|
|
|
|
Breakdown by location of operations
|
|
|
Breakdown by location of customers
|
|
|
Breakdown by location of operations
|
|
(millions of euros)
|
|
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
|
06/30/ 2017
|
|
|
12/31/ 2016
|
|
Italy
|
|
|
(a
|
)
|
|
|
7,312
|
|
|
|
7,079
|
|
|
|
6,878
|
|
|
|
6,620
|
|
|
|
47,080
|
|
|
|
46,948
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outside Italy
|
|
|
(b
|
)
|
|
|
2,460
|
|
|
|
2,017
|
|
|
|
2,894
|
|
|
|
2,476
|
|
|
|
7,391
|
|
|
|
8,197
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(a+b
|
)
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
9,772
|
|
|
|
9,096
|
|
|
|
54,471
|
|
|
|
55,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
C) INFORMATION ABOUT MAJOR CUSTOMERS
None of the TIM
Groups customers exceeds 10% of consolidated revenues.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 22
|
|
|
|
|
at June 30, 2017
|
|
Segment reporting
|
|
|
124
|
|
NOTE 23
RELATED PARTY TRANSACTIONS
The following tables show the figures
relating to related party transactions and the impact of those amounts on the separate consolidated income statements, consolidated statements of financial position and consolidated statements of cash flows.
Related party transactions, when not dictated by specific laws, were conducted at arms length. The transactions were carried out in accordance with the
internal procedure that contains the rules aimed at ensuring the transparency and fairness of related party transactions, in accordance with Consob Regulation 17221/2010.
Up to May 4, 2017, the companies of the Generali group, Intesa Sanpaolo group, Mediobanca group and Telefonica group (shareholders of the company Telco)
were also considered related parties, based on the provision of TIMs procedure for the management of transactions with related parties according to which it applies also to the participants in significant shareholder agreements according
to Article 122 of the Consolidated Law on Finance, which govern the candidacy to the position of Director of the Company, where the slate presented is the slate where the majority of the Directors nominated have been drawn from. The members of
the Board of Directors of TIM in office up to May 4, 2017 had in fact been drawn from the list originally submitted by the shareholder Telco. With the reappointment of the Board of Directors this circumstance no longer applied and the scope of
related parties through Directors was therefore amended.
On May 3 and June 1, 2017, the Board of Directors of TIM approved several changes to
the Procedure for the management of related party transactions, deciding, on a voluntary basis and therefore without any obligations, to treat Vivendi as if it was the parent, in accordance with the Consob Regulation. The process of identifying new
entities that entered the scope of related parties essentially led to the identification of all the entities with which the Group has significant relationships. The full list is currently being completed.
The new Procedure for the management of related party transactions is available for consultation at the website www.telecomitalia.com, About Us
section Governance System channel.
Lastly, you are reminded that the investment held in the Sofora Telecom Argentina group,
classified under Discontinued
operations/Non-current
assets held for sale starting from the consolidated financial statements at December 31, 2013, was sold on March 8, 2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
125
|
|
The effects on the individual line items of the separate consolidated income statements for the first half of
2017 and 2016 are as follows:
SEPARATE CONSOLIDATED INCOME STATEMENT LINE ITEMS FIRST HALF 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
Total
(a)
|
|
|
Associates,
subsidiaries
of
associates
and joint
ventures
|
|
|
Other
related
parties
(*)
|
|
|
Pension
funds
|
|
|
Key
managers
|
|
|
Total
related
parties
(b)
|
|
|
% of
financial
statement
item
(b/a)
|
|
Revenues
|
|
|
9,772
|
|
|
|
2
|
|
|
|
116
|
|
|
|
|
|
|
|
|
|
|
|
118
|
|
|
|
1.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
217
|
|
|
|
3
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
7
|
|
|
|
3.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of goods and services
|
|
|
4,136
|
|
|
|
11
|
|
|
|
88
|
|
|
|
|
|
|
|
|
|
|
|
99
|
|
|
|
2.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses
|
|
|
1,530
|
|
|
|
|
|
|
|
1
|
|
|
|
40
|
|
|
|
13
|
|
|
|
54
|
|
|
|
3.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
|
1,110
|
|
|
|
|
|
|
|
37
|
|
|
|
|
|
|
|
|
|
|
|
37
|
|
|
|
3.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses
|
|
|
1,850
|
|
|
|
9
|
|
|
|
31
|
|
|
|
|
|
|
|
|
|
|
|
40
|
|
|
|
2.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Vivendi Group and Companies belonging to the group that it belongs to; other related parties through directors, statutory auditors and key managers and as participants in shareholder agreements pursuant to Article 122
of the Consolidated Law on Finance.
|
SEPARATE CONSOLIDATED INCOME STATEMENT LINE ITEMS FIRST HALF 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
Total
(a)
|
|
|
Associates,
subsidiaries
of
associates
and joint
ventures
|
|
|
Other
related
parties (*)
|
|
|
Pension
funds
|
|
|
Key
managers
|
|
|
Total
related
parties
|
|
|
Transactions of
Discontinued
Operations
|
|
|
Total related
parties net of
Discontinued
Operations
(b)
|
|
|
% of financial
statement item
(b/a)
|
|
Revenues
|
|
|
9,096
|
|
|
|
2
|
|
|
|
185
|
|
|
|
|
|
|
|
|
|
|
|
187
|
|
|
|
(23
|
)
|
|
|
164
|
|
|
|
1.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
107
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
2
|
|
|
|
1.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of goods and services
|
|
|
3,783
|
|
|
|
11
|
|
|
|
113
|
|
|
|
|
|
|
|
|
|
|
|
124
|
|
|
|
(14
|
)
|
|
|
110
|
|
|
|
2.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses
|
|
|
1,551
|
|
|
|
|
|
|
|
1
|
|
|
|
41
|
|
|
|
24
|
|
|
|
66
|
|
|
|
|
|
|
|
66
|
|
|
|
4.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
|
2,012
|
|
|
|
|
|
|
|
60
|
|
|
|
|
|
|
|
|
|
|
|
60
|
|
|
|
|
|
|
|
60
|
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses
|
|
|
2,157
|
|
|
|
|
|
|
|
67
|
|
|
|
|
|
|
|
|
|
|
|
67
|
|
|
|
|
|
|
|
67
|
|
|
|
3.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from Discontinued
operations/Non-current
assets held for sale
|
|
|
47
|
|
|
|
(1
|
)
|
|
|
10
|
|
|
|
|
|
|
|
|
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Other related parties both through directors, statutory auditors and key managers and as participants in shareholder agreements pursuant to Article 122 of the Consolidated Law on Finance.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
126
|
|
The effects on the individual line items of the consolidated statements of financial position of the Group at
June 30, 2017 and at December 31, 2016 are as follows:
CONSOLIDATED STATEMENT OF FINANCIAL POSITION LINE ITEMS AT 6/30/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
Total
(a)
|
|
|
Associates,
subsidiaries
of
associates
and joint
ventures
|
|
|
Other
related
parties
(*)
|
|
|
Pension
funds
|
|
|
Total
related
parties
(b)
|
|
|
% of
financial
statement
item
(b/a)
|
|
Net financial debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
(2,185
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments (current assets)
|
|
|
(1,102
|
)
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
(5
|
)
|
|
|
0.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other current financial assets
|
|
|
(630
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
(4,086
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
(5,818
|
)
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
(5
|
)
|
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial liabilities
|
|
|
28,887
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities
|
|
|
4,844
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net financial debt
|
|
|
25,728
|
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other statement of financial position line items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous receivables and other current assets
|
|
|
5,617
|
|
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
15
|
|
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
7,056
|
|
|
|
24
|
|
|
|
25
|
|
|
|
27
|
|
|
|
76
|
|
|
|
1.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Vivendi Group and Companies belonging to the group that it belongs to; other related parties through directors, statutory auditors and key managers.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
127
|
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION LINE ITEMS AT 12/31/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related Parties
|
|
(millions of euros)
|
|
Total
(a)
|
|
|
Associates,
subsidiaries
of
associates
and joint
ventures
|
|
|
Other
related
parties (*)
|
|
|
Pension
funds
|
|
|
Total
related
parties
|
|
|
Transactions of
Discontinued
Operations
|
|
|
Total related
parties net of
Discontinued
Operations
(b)
|
|
|
% of
financial
statement
item
(b/a)
|
|
Net financial debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
(2,698
|
)
|
|
|
(12
|
)
|
|
|
(520
|
)
|
|
|
|
|
|
|
(532
|
)
|
|
|
|
|
|
|
(532
|
)
|
|
|
19.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities other than investments (current assets)
|
|
|
(1,519
|
)
|
|
|
|
|
|
|
(110
|
)
|
|
|
|
|
|
|
(110
|
)
|
|
|
|
|
|
|
(110
|
)
|
|
|
7.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial receivables and other current financial assets
|
|
|
(389
|
)
|
|
|
|
|
|
|
(22
|
)
|
|
|
|
|
|
|
(22
|
)
|
|
|
|
|
|
|
(22
|
)
|
|
|
5.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
(3,964
|
)
|
|
|
|
|
|
|
(621
|
)
|
|
|
|
|
|
|
(621
|
)
|
|
|
|
|
|
|
(621
|
)
|
|
|
15.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial assets
|
|
|
(5,872
|
)
|
|
|
|
|
|
|
(753
|
)
|
|
|
|
|
|
|
(753
|
)
|
|
|
|
|
|
|
(753
|
)
|
|
|
12.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial liabilities
|
|
|
30,469
|
|
|
|
|
|
|
|
912
|
|
|
|
|
|
|
|
912
|
|
|
|
|
|
|
|
912
|
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current financial liabilities
|
|
|
4,056
|
|
|
|
|
|
|
|
133
|
|
|
|
|
|
|
|
133
|
|
|
|
|
|
|
|
133
|
|
|
|
3.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net financial debt
|
|
|
25,955
|
|
|
|
(12
|
)
|
|
|
(228
|
)
|
|
|
|
|
|
|
(240
|
)
|
|
|
|
|
|
|
(240
|
)
|
|
|
(0.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other statement of financial position line items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous receivables and other current assets
|
|
|
5,426
|
|
|
|
9
|
|
|
|
127
|
|
|
|
|
|
|
|
136
|
|
|
|
|
|
|
|
136
|
|
|
|
2.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous payables and other
non-current
liabilities
|
|
|
1,607
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
2
|
|
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
7,646
|
|
|
|
37
|
|
|
|
200
|
|
|
|
26
|
|
|
|
263
|
|
|
|
|
|
|
|
263
|
|
|
|
3.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Other related parties both through directors, statutory auditors and key managers and as participants in shareholder agreements pursuant to Article 122 of the Consolidated Law on Finance.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
128
|
|
The effects on the significant line items of the consolidated statements of cash flows for the first half of 2017
and 2016 are as follows:
CONSOLIDATED STATEMENT OF CASH FLOWS LINE ITEMS FIRST HALF 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
Total
(a)
|
|
|
Associates,
subsidiaries
of
associates
and joint
ventures
|
|
|
Other
related
parties (*)
|
|
|
Pension
funds
|
|
|
Total
related
parties
(b)
|
|
|
% of
financial
statement
item
(b/a)
|
|
Purchase of intangible and tangible assets on an accrual basis
|
|
|
2,086
|
|
|
|
75
|
|
|
|
|
|
|
|
|
|
|
|
75
|
|
|
|
3.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Vivendi Group and Companies belonging to the group that it belongs to; other related parties through directors, statutory auditors and key managers and as participants in shareholder agreements pursuant to Article 122
of the Consolidated Law on Finance.
|
CONSOLIDATED STATEMENT OF CASH FLOWS LINE ITEMS FIRST HALF 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related Parties
|
|
(millions of euros)
|
|
Total
(a)
|
|
|
Associates,
subsidiaries
of
associates
and joint
ventures
|
|
|
Other
related
parties (*)
|
|
|
Pension
funds
|
|
|
Total
related
parties
|
|
|
Transactions of
Discontinued
Operations
|
|
|
Total related
parties net of
Discontinued
Operations
(b)
|
|
|
% of
financial
statement
item
(b/a)
|
|
Purchase of intangible and tangible assets on an accrual basis
|
|
|
2,106
|
|
|
|
63
|
|
|
|
|
|
|
|
|
|
|
|
63
|
|
|
|
|
|
|
|
63
|
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Other related parties both through directors, statutory auditors and key managers and as participants in shareholder agreements pursuant to Article 122 of the Consolidated Law on Finance.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
129
|
|
TRANSACTIONS WITH ASSOCIATES, SUBSIDIARIES OF ASSOCIATES AND JOINT VENTURES
The most significant amounts are summarized as follows:
SEPARATE CONSOLIDATED INCOME STATEMENT LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
TYPE OF CONTRACT
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
Italtel group
|
|
|
1
|
|
|
|
1
|
|
|
Provision of equipment rental, fixed and mobile telephone and outsourced communication services.
|
NordCom S.p.A.
|
|
|
|
|
|
|
1
|
|
|
Fixed and mobile voice services, data network connections and outsourced ICT products and services.
|
Other minor companies
|
|
|
1
|
|
|
|
|
|
|
|
Total revenues
|
|
|
2
|
|
|
|
2
|
|
|
|
Other income
|
|
|
3
|
|
|
|
|
|
|
Contributions governed by partnership agreements and penalties with respect to the Italtel group.
|
Acquisition of goods and services
|
|
|
|
|
|
|
|
|
|
|
Italtel group
|
|
|
9
|
|
|
|
9
|
|
|
Supply and maintenance of switching equipment, software development and platforms upgrading, and customized products and services, as part of TIM offerings to the Italtel group customers, and extension of professional services for
the new Multimedia Video Data Center for the provision of the TIM Vision service.
|
W.A.Y. S.r.l.
|
|
|
2
|
|
|
|
1
|
|
|
Supply and installation of geolocation equipment and provision of related technical support services within the TIM customer offering.
|
Other minor companies
|
|
|
|
|
|
|
1
|
|
|
|
Total acquisition of goods and services
|
|
|
11
|
|
|
|
11
|
|
|
|
Finance expenses
|
|
|
9
|
|
|
|
|
|
|
Write-down of the financial receivable due from Alfiere.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
130
|
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
TYPE OF CONTRACT
|
Net financial debt
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
|
|
|
|
12
|
|
|
Shareholder loans to Alfiere S.p.A.
|
Other statement of financial position line items
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous receivables and other current assets
|
|
|
|
|
|
|
|
|
|
|
Alfiere S.p.A.
|
|
|
1
|
|
|
|
|
|
|
Contracts for project management, administration, corporate and compliance services, and sundry chargebacks.
|
Italtel group
|
|
|
12
|
|
|
|
6
|
|
|
Provision of equipment rental, fixed and mobile telephone and outsourced communication services.
|
W.A.Y. S.r.l.
|
|
|
1
|
|
|
|
1
|
|
|
Supply of fixed-line telephony, ICT and mobile services.
|
Other minor companies
|
|
|
1
|
|
|
|
2
|
|
|
|
Total trade and miscellaneous receivables and other current assets
|
|
|
15
|
|
|
|
9
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
|
|
|
|
|
|
|
|
Italtel group
|
|
|
21
|
|
|
|
33
|
|
|
Supply transactions connected with investment and operations activities.
|
Dono per... S.c.a.r.l.
|
|
|
1
|
|
|
|
|
|
|
Payable for fixed and mobile calls made by TIM customers for charity initiatives.
|
Movenda S.p.A.
|
|
|
|
|
|
|
1
|
|
|
SIM-card
supply and certification and functional development of IT platforms.
|
NordCom S.p.A.
|
|
|
|
|
|
|
1
|
|
|
Supply and development of IT solutions, provision of customized services as part of TIM offerings to end customers, and rental expense for base transceiver station housing.
|
W.A.Y. S.r.l.
|
|
|
1
|
|
|
|
2
|
|
|
Supply and installation of geolocation equipment and provision of related technical support services within the TIM customer offering.
|
Other minor companies
|
|
|
1
|
|
|
|
|
|
|
|
Total trade and miscellaneous payables and other current liabilities
|
|
|
24
|
|
|
|
37
|
|
|
|
CONSOLIDATED STATEMENT OF CASH FLOWS LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
TYPE OF CONTRACT
|
Purchase of intangible and tangible assets on an accrual basis
|
|
|
|
|
|
|
|
|
|
|
Italtel group
|
|
|
74
|
|
|
|
63
|
|
|
Purchases of telecommunications equipment.
|
Other minor companies
|
|
|
1
|
|
|
|
|
|
|
|
Total purchase of intangible and tangible assets on an accrual basis
|
|
|
75
|
|
|
|
63
|
|
|
|
The shareholder loan with Alfiere S.p.A. in place at December 31, 2016 was increased by 3 million euros in the first
half of 2017 and subsequently converted into an equity interest amounting to 6 million euros. The remaining amount, of 9 million euros, was fully written down.
At June 30, 2017, TIM S.p.A. had issued guarantees in favor of the joint venture Alfiere S.p.A. for 1 million euros.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
131
|
|
TRANSACTIONS WITH OTHER RELATED PARTIES (BOTH THROUGH DIRECTORS, STATUTORY AUDITORS AND KEY MANAGERS AND AS PARTICIPANTS IN SHAREHOLDER AGREEMENTS PURSUANT TO
ARTICLE 122 OF THE CONSOLIDATED LAW ON FINANCE)
Details are provided below of the transactions with:
|
|
Companies (and related groups) formerly shareholders of Telco S.p.A. (in short Former Telco Companies) namely: the Mediobanca group, the Generali group, the Intesa Sanpaolo group and the Telefonica group.
Up to May 4, 2017;
|
|
|
Related companies through Directors whose term of office ended on May 4, 2017;
|
|
|
Vivendi Group and the companies of the group it belongs to (as a result of the resolutions of the Board of Directors of TIM S.p.A. of May 3 and June 1, 2017);
|
|
|
Related companies through Directors appointed on May 4, 2017.
|
The most significant amounts are
summarized as follows:
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
132
|
|
SEPARATE CONSOLIDATED INCOME STATEMENT LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
TYPE OF CONTRACT
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
Generali group
|
|
|
12
|
|
|
|
25
|
|
|
Supply of telephone and data transmission services, peripheral data networks, connections, storage, and telecommunications products and services.
|
Intesa Sanpaolo group
|
|
|
31
|
|
|
|
34
|
|
|
Telephone services, MPLS data and international network, ICT services and Microsoft licenses, Internet connectivity and high-speed connections.
|
Mediobanca group
|
|
|
3
|
|
|
|
3
|
|
|
Telephone and MPLS data network services and marketing of data devices and sale of equipment for fixed and mobile networks.
|
RCS Media Group
|
|
|
|
|
|
|
2
|
|
|
Fixed-line telephony service.
|
Telefónica group
|
|
|
70
|
|
|
|
121
|
|
|
Interconnection services, roaming, broadband access fees, supply of IRU transmission capacity and software.
|
Total revenues
|
|
|
116
|
|
|
|
185
|
|
|
|
Other income
|
|
|
4
|
|
|
|
2
|
|
|
Generali group damage compensation.
|
Acquisition of goods and services
|
|
|
|
|
|
|
|
|
|
|
Bollorè-Havas group
|
|
|
12
|
|
|
|
|
|
|
Conception, planning and implementation of advertising campaigns for products and services for the TIM Group.
|
Generali group
|
|
|
7
|
|
|
|
11
|
|
|
Insurance premiums and property leases.
|
Intesa Sanpaolo group
|
|
|
5
|
|
|
|
6
|
|
|
Factoring fees, fees for smart card
top-ups/activation
and commissions for payment of telephone bills by direct debit and collections via credit cards.
|
Mediobanca group
|
|
|
1
|
|
|
|
1
|
|
|
Credit recovery activities.
|
RCS Media Group
|
|
|
|
|
|
|
1
|
|
|
Provision of content and digital publishing services and fees for telephone
top-up
services.
|
Telefónica group
|
|
|
59
|
|
|
|
91
|
|
|
Interconnection and roaming services, site sharing,
co-billing
agreements, broadband linesharing and unbundling.
|
Vivendi group
|
|
|
4
|
|
|
|
3
|
|
|
Purchase of musical and television digital content (TIMmusic and TIMvision) and supply of D&P cloud-based games (TIMgames).
|
Total acquisition of goods and services
|
|
|
88
|
|
|
|
113
|
|
|
|
Employee benefits expenses
|
|
|
1
|
|
|
|
1
|
|
|
Generali group insurance related to the work of personnel.
|
Finance income
|
|
|
|
|
|
|
|
|
|
|
Intesa Sanpaolo group
|
|
|
27
|
|
|
|
47
|
|
|
Bank accounts, deposits and hedging derivatives.
|
Mediobanca group
|
|
|
8
|
|
|
|
10
|
|
|
Bank accounts, deposits and hedging derivatives.
|
Telefónica group
|
|
|
2
|
|
|
|
3
|
|
|
Finance lease.
|
Total finance income
|
|
|
37
|
|
|
|
60
|
|
|
|
Finance expenses
|
|
|
|
|
|
|
|
|
|
|
Intesa Sanpaolo group
|
|
|
23
|
|
|
|
54
|
|
|
Term Loan Facility, Revolving Credit Facility, hedging derivatives, loans and bank accounts.
|
Mediobanca group
|
|
|
8
|
|
|
|
13
|
|
|
Term Loan Facility and Revolving Credit Facility and hedging derivatives.
|
Total finance expenses
|
|
|
31
|
|
|
|
67
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
133
|
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
TYPE OF CONTRACT
|
Net financial debt
|
|
|
|
|
|
|
|
|
|
|
Non-current
financial assets
|
|
|
|
|
|
|
520
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Securities other than investments (current assets)
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
105
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Vivendi group
|
|
|
5
|
|
|
|
5
|
|
|
Bonds.
|
Total Securities other than investments (current assets)
|
|
|
5
|
|
|
|
110
|
|
|
|
Financial receivables and other current financial assets
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
22
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Total financial receivables and other current financial assets
|
|
|
|
|
|
|
22
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
621
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Total cash and cash equivalents
|
|
|
|
|
|
|
621
|
|
|
|
Non-current
financial liabilities
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
912
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Total
non-current
financial liabilities
|
|
|
|
|
|
|
912
|
|
|
|
Current financial liabilities
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
133
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Total current financial liabilities
|
|
|
|
|
|
|
133
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
134
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
TYPE OF CONTRACT
|
Other statement of financial position line items
|
|
|
|
|
|
|
|
|
|
|
Trade and miscellaneous receivables and other current assets
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
127
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Total trade and miscellaneous receivables and other current assets
|
|
|
|
|
|
|
127
|
|
|
|
Miscellaneous payables and other
non-current
liabilities
|
|
|
|
|
|
|
|
|
|
|
Former Telco Companies
|
|
|
|
|
|
|
2
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Total miscellaneous payables and other
non-current
liabilities
|
|
|
|
|
|
|
2
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
|
|
|
|
|
|
|
|
Bollorè-Havas group
|
|
|
22
|
|
|
|
|
|
|
Conception, planning and implementation of advertising campaigns for products and services for the TIM Group.
|
Former Telco Companies
|
|
|
|
|
|
|
196
|
|
|
See Note 40 of the 2016 Consolidated financial statements of the TIM Group.
|
Vivendi group
|
|
|
3
|
|
|
|
4
|
|
|
Purchase of musical and television digital content (TIMmusic and TIMvision).
|
Total trade and miscellaneous payables and other current liabilities
|
|
|
25
|
|
|
|
200
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated
Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
135
|
|
TRANSACTIONS WITH PENSION FUNDS
The most significant amounts are
summarized as follows:
SEPARATE CONSOLIDATED INCOME STATEMENT LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
|
TYPE OF CONTRACT
|
Employee benefits expenses
|
|
|
|
|
|
|
|
|
|
Contributions to pension funds.
|
Fontedir
|
|
|
5
|
|
|
|
6
|
|
|
|
Telemaco
|
|
|
33
|
|
|
|
34
|
|
|
|
Other pension funds
|
|
|
2
|
|
|
|
1
|
|
|
|
Total employee benefits expenses
|
|
|
40
|
|
|
|
41
|
|
|
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION LINE ITEMS
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
TYPE OF CONTRACT
|
Trade and miscellaneous payables and other current liabilities
|
|
|
|
|
|
|
|
|
|
Payables for contributions to pension funds.
|
Fontedir
|
|
|
3
|
|
|
|
4
|
|
|
|
Telemaco
|
|
|
22
|
|
|
|
21
|
|
|
|
Other pension funds
|
|
|
2
|
|
|
|
1
|
|
|
|
Trade and miscellaneous payables and other current liabilities
|
|
|
27
|
|
|
|
26
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
136
|
|
REMUNERATION TO KEY MANAGERS
In the first half of 2017, the
total remuneration recorded on an accrual basis by TIM or by companies controlled by the Group in respect of key managers amounted to 12.7 million euros (23.6 million euros in the first half of 2016), broken down as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Short-term remuneration
|
|
|
5.5
|
|
|
|
7.6
|
|
|
|
|
|
|
|
|
|
|
Long-term remuneration
|
|
|
2.7
|
|
|
|
0.5
|
|
|
|
|
|
|
|
|
|
|
Employment termination benefit incentives
|
|
|
|
|
|
|
12.5
|
|
|
|
|
|
|
|
|
|
|
Share-based payments (*)
|
|
|
4.5
|
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12.7
|
|
|
|
23.6
|
|
|
|
|
|
|
|
|
|
|
(*)
|
These refer to the fair value of the rights, accrued to June 30, under the share-based incentive plans of TIM S.p.A. and its subsidiaries (2014/2016 Stock Option Plan, Special Awards and Stock Option Plans of the
South American subsidiaries).
|
Short-term remuneration is paid during the period it pertains to, and, at the latest, within the six months
following the end of that period.
The amounts shown in the table do not include:
|
|
in the first half of 2017, the effects of the allocation of a total amount of 4.9 million euros as the 2016/2019 Special Award for the discretionary amount allocated to the managers and/or directors of TIM
or its subsidiaries and consequently to several Key Managers;
|
|
|
in the first half of 2016, the effects of the reversal of the accruals related to the costs for the 2014/2016 Stock Option Plan of 1.6 million euros.
|
In addition, in the first half of 2017, the beneficiaries of the Special Award were identified for the 1.5% of the 2016 over-performance, already allocated in
2016.
The Key Managers, recipients of that bonus, were assigned a total amount of 1,850,000 euros (of which 1,480,000 euros consisted of 1,897,434 TIM
ordinary shares). The payment is scheduled for after the approval of the Financial Statements for the year 2019.
In the first half of 2017, the
contributions paid in to defined contribution plans (Assida and Fontedir) by TIM S.p.A. or by subsidiaries of the Group on behalf of key managers amounted to 47,000 euros (46,000 euros in the first half of 2016).
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
137
|
|
In the first half of 2017, the Key Managers, i.e. those who have the power and responsibility,
directly or indirectly, for the planning, management and control of the operations of the TIM Group, including directors, had been identified as follows:
|
|
|
|
|
Directors:
|
|
|
|
|
Arnaud Roy de Puyfontaine
|
|
(1)
|
|
Executive Chairman of TIM S.p.A.
|
Giuseppe Recchi
|
|
(2)
|
|
Executive Chairman of TIM S.p.A.
|
Flavio Cattaneo
|
|
|
|
Managing Director and Chief Executive Officer of TIM S.p.A.
|
|
|
|
|
General Manager of TIM S.p.A.
|
Managers:
|
|
|
|
|
Stefano De Angelis
|
|
|
|
Diretor Presidente Tim Participações S.A.
|
Stefano Azzi
|
|
|
|
Head of Consumer & Small Enterprise
|
Stefano Ciurli
|
|
|
|
Head of Wholesale
|
Giovanni Ferigo
|
|
|
|
Head of Technology
|
Lorenzo Forina
|
|
|
|
Head of Business & Top Clients
|
Francesco Micheli
|
|
(3)
|
|
Head of Human Resources & Organizational Development
|
Cristoforo Morandini
|
|
|
|
Head of Regulatory Affairs and Equivalence
|
Agostino Nuzzolo
|
|
(4)
|
|
Head of Legal
|
Piergiorgio Peluso
|
|
(5)
|
|
Head of Administration, Finance and Control
|
(3)
|
responsibility for the Human Resources & Organizational Development function has been assigned on an interim basis to the Head of Group Special Projects, Francesco Micheli;
|
(4)
|
from January 10, 2017;
|
(5)
|
the Chief Financial Officer of the Company Piergiorgio Peluso has been assigned responsibility on an interim basis for the Business Support Office function.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 23
|
|
|
|
|
at June 30, 2017
|
|
Related Party Transactions
|
|
|
138
|
|
NOTE 24
EQUITY COMPENSATION PLANS
Equity compensation plans in effect at
June 30, 2017 are used for retention purposes and as a long-term incentive for the managers and employees of the Group.
However, it should be noted
that these plans do not have any significant effect on the economic result or on the financial position or on cash flows at June 30, 2017.
DESCRIPTION OF STOCK OPTION PLANS
For a description of the:
|
|
TIM S.p.A. 2014-2016 Stock Option Plan, and the
|
|
|
Tim Participações S.A. 2011-2013 Stock Option Plan,
|
already in place at December 31, 2016,
see the consolidated financial statements of the TIM Group at that date.
Other Tim Participações S.A. Stock Option Plans.
On April 10, 2014, the General Meeting of Shareholders of Tim
Participações S.A. approved the long-term incentive plan for managers in key positions in the company and its subsidiaries.
Exercise of the options is not subject to the achievement of specific performance targets, but the exercise price is adjusted upwards or
downwards according to the performance of the Tim Participações S.A. shares in a ranking of Total Shareholder Return, in which companies in the Telecommunications, Information Technology and Media industry are compared during each year
of validity of the plan. If the performance of the Tim Participações S.A. shares, in the 30 days prior to September 29 of each year, is in last place in that ranking, the participant loses the right to 25% of the options vesting
at that time.
The vesting period is 3 years (a third per year), the options are valid for 6 years, and the company does not have the legal
obligation to repurchase or liquidate the options in cash, or in any other form.
Year 2014
On September 29, 2014, the grantees of the options were granted the right to purchase a total of 1,687,686 shares.
At December 31, 2016, a total of 623,027 options were considered lapsed due to failure to achieve the minimum exercise conditions set in
the Plan, whereas 502,097 of the remaining 1,064,659 options were considered vested. No option has been exercised. At June 30, 2017, a further 285,487 options had lapsed.
Year 2015
On October 16,
2015, the grantees of the options were granted the right to purchase a total of 3,355,229 shares.
At December 31, 2016, a total of
780,144 options were considered lapsed and 338,266 options were considered vested.
At June 30, 2017, a total of 157,663 options had
been exercised at a price of 8.7341 reais (initial price of 8.4526 reais adjusted by 3.33%, in line with the positioning in the benchmarking). A further 387,197 options also lapsed.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 24
|
|
|
|
|
at June 30, 2017
|
|
Equity compensation plans
|
|
|
139
|
|
2016
On November 8, 2016, the grantees of the options were granted the right to purchase a total of 3,922,204 shares. At June 30, 2017,
there were no options that could be considered as vested and 381,444 options had lapsed.
DESCRIPTION OF OTHER TIM S.p.A. EQUITY COMPENSATION
PLANS
For the description of the Special Award 2016-2019, launched in 2016, see the 2016 Consolidated financial statements of the TIM Group.
In the first half of 2017, the beneficiaries of the Special Award were identified for the 1.5% of the 2016 over-performance.
The Key Managers, recipients of that bonus, were assigned a total amount of 1,850,000 euros (of which 1,480,000 euros consisted of 1,897,434 TIM S.p.A.
ordinary shares). The payment is scheduled for after the approval of the Financial Statements for the year 2019.
On July 24, 2017, following the
resignation of Mr. Cattaneo, an agreement was reached between the parties that provides for the payment of a gross amount of 22.9 million euros as a settlement arrangement. This amount takes particular, but not exclusive, account of the
Special Award.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 24
|
|
|
|
|
at June 30, 2017
|
|
Equity compensation plans
|
|
|
140
|
|
NOTE 25
SIGNIFICANT
NON-RECURRING
EVENTS AND TRANSACTIONS
The effect of
non-recurring
events and transactions of the first half of 2017 on equity, profit, net financial debt and
cash flows of the TIM Group is set out below in accordance with Consob Communication DEM/6064293 of July 28, 2006. The
non-recurring
effects on Equity and Profit (loss) for the period are shown net of tax
effects.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
|
|
|
Equity
|
|
|
Profit (loss)
for the period
|
|
|
Net financial
debt
carrying
amount
|
|
|
Cash flows
(*)
|
|
Amount financial statements
|
|
|
(a
|
)
|
|
|
23,619
|
|
|
|
654
|
|
|
|
25,728
|
|
|
|
229
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of goods and services - Expenses related to agreements and the development of
non-recurring
projects
|
|
|
|
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
8
|
|
|
|
(8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses - Expenses related to restructuring and rationalization
|
|
|
|
|
|
|
(7
|
)
|
|
|
(7
|
)
|
|
|
65
|
|
|
|
(65
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses - Expenses related to disputes and regulatory penalties and liabilities
related to those expenses, and expenses related to disputes with former employees and liabilities with customers and/or suppliers
|
|
|
|
|
|
|
(61
|
)
|
|
|
(61
|
)
|
|
|
103
|
|
|
|
(103
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains on disposals of
non-current
assets
|
|
|
|
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses Other finance expenses related to litigations
|
|
|
|
|
|
|
(10
|
)
|
|
|
(10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision charges for Sparkle tax dispute
|
|
|
|
|
|
|
(93
|
)
|
|
|
(93
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-recurring
effects
|
|
|
(b
|
)
|
|
|
(173
|
)
|
|
|
(173
|
)
|
|
|
176
|
|
|
|
(176
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Figurative amount financial statements
|
|
|
(a-b
|
)
|
|
|
23,792
|
|
|
|
827
|
|
|
|
25,552
|
|
|
|
405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Cash flows refer to the increase (decrease) in Cash and Cash equivalents during the period.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 25
|
|
|
|
|
at June 30, 2017
|
|
Significant non-recurring events and transactions
|
|
|
141
|
|
The impact of
non-recurring
items on the separate consolidated income
statement line items is as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Acquisition of goods and services:
|
|
|
|
|
|
|
|
|
Sundry expenses
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expenses:
|
|
|
|
|
|
|
|
|
Expenses related to restructuring and rationalization
|
|
|
(10
|
)
|
|
|
(75
|
)
|
|
|
|
|
|
|
|
|
|
Other operating expenses:
|
|
|
|
|
|
|
|
|
Sundry expenses and provisions
|
|
|
(83
|
)
|
|
|
(16
|
)
|
|
|
|
|
|
|
|
|
|
Impact on Operating profit (loss) before depreciation and amortization, capital gains (losses)
and impairment reversals (losses) on
non-current
assets (EBITDA)
|
|
|
(95
|
)
|
|
|
(91
|
)
|
|
|
|
|
|
|
|
|
|
Gains (losses) on
non-current
assets:
|
|
|
|
|
|
|
|
|
Gains on disposals of
non-current
assets
|
|
|
|
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
Losses on disposals of
non-current
assets
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact on EBIT Operating profit (loss)
|
|
|
(96
|
)
|
|
|
(82
|
)
|
|
|
|
|
|
|
|
|
|
Finance expenses:
|
|
|
|
|
|
|
|
|
Interest expenses and miscellaneous finance expenses
|
|
|
(14
|
)
|
|
|
(11
|
)
|
|
|
|
|
|
|
|
|
|
Impact on profit (loss) before tax from continuing operations
|
|
|
(110
|
)
|
|
|
(93
|
)
|
|
|
|
|
|
|
|
|
|
Effect on income taxes on
non-recurring
items
|
|
|
30
|
|
|
|
27
|
|
|
|
|
|
|
|
|
|
|
Provision charges for Sparkle tax dispute
|
|
|
(93
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations Effect of the disposal of the Sofora Telecom Argentina
group
|
|
|
|
|
|
|
(12
|
)
|
|
|
|
|
|
|
|
|
|
Impact on profit (loss) for the period
|
|
|
(173
|
)
|
|
|
(78
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 25
|
|
|
|
|
at June 30, 2017
|
|
Significant non-recurring events and transactions
|
|
|
142
|
|
NOTE 26
POSITIONS OR TRANSACTIONS RESULTING FROM ATYPICAL AND/OR UNUSUAL OPERATIONS
In accordance with Consob Communication DEM/6064293 of July 28, 2006, a statement is made to the effect that in the first half of 2017 no atypical and/or
unusual transactions, as defined by that Communication, were carried out.
NOTE 27
OTHER INFORMATION
A) EXCHANGE RATES USED TO TRANSLATE THE FINANCIAL STATEMENTS OF FOREIGN OPERATIONS
(
*)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end
exchange rates
(statements of financial position)
|
|
|
Average exchange rates for the period
(income statements and statements of
cash flows)
|
|
(local currency against 1 euro)
|
|
6/30/2017
|
|
|
12/31/2016
|
|
|
1st Half 2017
|
|
|
1st Half 2016
|
|
Europe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BGN
|
|
Bulgarian Lev
|
|
|
1.95580
|
|
|
|
1.95580
|
|
|
|
1.95580
|
|
|
|
1.95580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CZK
|
|
Czech koruna
|
|
|
26.19700
|
|
|
|
27.02100
|
|
|
|
26.78393
|
|
|
|
27.03985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHF
|
|
Swiss franc
|
|
|
1.09300
|
|
|
|
1.07390
|
|
|
|
1.07656
|
|
|
|
1.09582
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TRY
|
|
Turkish lira
|
|
|
4.01340
|
|
|
|
3.70720
|
|
|
|
3.93800
|
|
|
|
3.25790
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP
|
|
Pound sterling
|
|
|
0.87933
|
|
|
|
0.85618
|
|
|
|
0.86027
|
|
|
|
0.77859
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RON
|
|
Romanian leu
|
|
|
4.55230
|
|
|
|
4.53900
|
|
|
|
4.53675
|
|
|
|
4.49533
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RUB
|
|
Russian Ruble
|
|
|
67.54500
|
|
|
|
64.30000
|
|
|
|
62.75611
|
|
|
|
78.30656
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
U.S. dollar
|
|
|
1.14120
|
|
|
|
1.05410
|
|
|
|
1.08279
|
|
|
|
1.11572
|
|
|
|
|
|
|
|
Latin America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VEF
|
|
Venezuelan bolivar
|
|
|
15.40620
|
|
|
|
14.23035
|
|
|
|
14.57744
|
|
|
|
15.02350
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BOB
|
|
Bolivian Bolíviano
|
|
|
7.88569
|
|
|
|
7.28383
|
|
|
|
7.48209
|
|
|
|
7.70963
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PEN
|
|
Peruvian nuevo sol
|
|
|
3.70976
|
|
|
|
3.54020
|
|
|
|
3.54696
|
|
|
|
3.77419
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARS
|
|
Argentine peso
|
|
|
18.88510
|
|
|
|
16.74880
|
|
|
|
17.00284
|
|
|
|
15.98614
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CLP
|
|
Chilean peso
|
|
|
758.21400
|
|
|
|
704.94500
|
|
|
|
714.60792
|
|
|
|
769.03591
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COP
|
|
Colombian peso
|
|
|
3,478.65000
|
|
|
|
3,169.49000
|
|
|
|
3,164.52430
|
|
|
|
3,481.92257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BRL
|
|
Brazilian real
|
|
|
3.77532
|
|
|
|
3.43542
|
|
|
|
3.44195
|
|
|
|
4.13001
|
|
|
|
|
|
|
|
Other countries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ILS
|
|
Israeli shekel
|
|
|
3.98880
|
|
|
|
4.04770
|
|
|
|
3.96243
|
|
|
|
4.30633
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Source: data processed by the European Central Bank, Reuters and major Central Banks.
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 27
|
|
|
|
|
at June 30, 2017
|
|
Other information
|
|
|
143
|
|
B)
RESEARCH AND DEVELOPMENT
Expenditures for research and development activities are represented by external costs, labor costs of dedicated staff and
depreciation and amortization. Details are as follows:
|
|
|
|
|
|
|
|
|
(millions of euros)
|
|
1st Half
2017
|
|
|
1st Half
2016
|
|
Research and development costs expensed during the period
|
|
|
24
|
|
|
|
25
|
|
|
|
|
|
|
|
|
|
|
Capitalized development costs
|
|
|
846
|
|
|
|
722
|
|
|
|
|
|
|
|
|
|
|
Total research and development costs (expensed and capitalized)
|
|
|
870
|
|
|
|
747
|
|
|
|
|
|
|
|
|
|
|
Moreover, in the separate consolidated income statements for the first half of 2017, amortization charges are recorded for
development costs, capitalized during the period and in prior years, for an amount of 401 million euros.
Research and development activities
conducted by the TIM Group are detailed in the Report on Operations (Research and Development Section).
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 27
|
|
|
|
|
at June 30, 2017
|
|
Other information
|
|
|
144
|
|
NOTE 28
EVENTS SUBSEQUENT TO JUNE 30, 2017
TERMINATION OF THE EMPLOYMENT RELATIONSHIP WITH THE
CHIEF EXECUTIVE OFFICER AND CONSEQUENT SETTLEMENT AGREEMENT
On July 24, 2017, the Board of Directors of TIM S.p.A. approved a settlement agreement by
majority vote (upon favorable recommendation by majority of the Appointment and Remuneration Committee, also pursuant to the procedure for the approval of minor related-party transactions, due to the Chief Executive Officers status as a
related party) for the termination, with effect from July 28, 2017, of Mr. Flavio Cattaneos term of office as Chief Executive Officer (and as such also as a member of the Strategic Committee) and as the General Manager (with effect
from July 31, 2017). The Board of Statutory Auditors expressed a
non-favorable,
non-binding
opinion in this regard.
The agreement provides for the payment to Mr. Cattaneo, upon termination of the relationship, of the gross amount of 22.9 million euros as a
settlement for the compensation due to Mr. Cattaneo under his contract with the Company, considering in particular the Special Award and the MBO, in relation to the work already carried out as Director and the value identified as having been
created based on available data. The agreement also provides for the payment to Mr. Cattaneo of the gross amount of 2.1 million euros consideration for
non-competition,
non-solicitation
and
non-poaching
covenants, for one year, towards the main competitors of TIM in Italy and Brazil, subject to claw-back in case of breach of the
covenants (as well as the transfer of certain company goods).
GOVERNANCE RESOLUTIONS
On July 27, 2017, the Board of
Directors of TIM S.p.A. acknowledged the start of the direction and coordination by Vivendi S.A..
In relation to Mr Cattaneos termination from the
offices of Chief Executive Officer and Director, the Board, in line with the Companys succession plan, has temporarily assigned his responsibilities to the Executive Chairman Mr. de Puyfontaine, who will lead the Group, with the aid of
the Companys management, in accordance with the guidelines of the strategic plan. The responsibilities related to the Security Function and the company Telecom Italia Sparkle have been assigned on an interim basis to the Deputy Chairman,
Giuseppe Recchi.
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 28
|
|
|
|
|
at June 30, 2017
|
|
Events Subsequent to June 30, 2017
|
|
|
145
|
|
NOTE 29
LIST OF COMPANIES OF THE TIM GROUP
In accordance with Consob
Communication DEM/6064293 dated July 28, 2006, the list of companies is provided herein.
The list is divided by type of investment, consolidation
method and operating segment.
The following is indicated for each company: name, head office, country and share capital in the original currency. In
addition to the percentage ownership of share capital, the percentage of voting rights in the ordinary shareholders meeting, if different than the percentage holding of share capital, and which companies hold the investment.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company name
|
|
Head office
|
|
Currency
|
|
Share capital
|
|
|
%
Ownership
|
|
|
% of
voting
rights
|
|
|
Held by
|
PARENT COMPANY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM S.p.A.
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
11,677,002,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUBSIDIARIES CONSOLIDATED
LINE-BY-LINE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DOMESTIC BU
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4G RETAIL S.r.l.
(sale of fixed and mobile telecommunications products and services and all analog and digital broadcasting
equipment)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
2,402,241
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADVANCED CARING CENTER S.r.l.
(telemarketing, market research and surveys activities and development)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
600,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECONTACT CENTER S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALFABOOK S.r.l.
(on-line
sale of digital texts)
|
|
TURIN (ITALY)
|
|
EUR
|
|
|
100,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
OLIVETTI S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BEIGUA S.r.l.
(purchase, sale and maintenance of systems for repair work and radio and television broadcasting)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
51,480
|
|
|
|
100.0000
|
|
|
|
|
|
|
PERSIDERA S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CD FIBER S.r.l.
(design, construction, maintenance and management of network infrastructure services and high-speed electronic
communication systems)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
50,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FLASH FIBER S.r.l.
(development, implementation, maintenance and supply of the fiber network in Italy)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
30,000
|
|
|
|
80.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
H.R. SERVICES S.r.l.
(personnel training and services)
|
|
LAQUILA (ITALY)
|
|
EUR
|
|
|
500,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INFRASTRUTTURE WIRELESS ITALIANE S.p.A.
(installation and operation of installations and infrastructure for the management and the sale of telecommunications
services)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
600,000,000
|
|
|
|
60.0333
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MED 1 SUBMARINE CABLES Ltd
(construction and management of the submarine cable lev1)
|
|
RAMAT GAN (ISRAEL)
|
|
ILS
|
|
|
55,886,866
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOVERCA S.r.l.
(development and provision of services in the TLC and multimedia sector in Italy and abroad)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
10,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OLIVETTI MULTISERVICES S.p.A.
(real estate management)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
20,337,161
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OLIVETTI S.p.A.
(production and sale of office equipment and information technology services)
|
|
IVREA (TURIN) (ITALY)
|
|
EUR
|
|
|
10,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERSIDERA S.p.A.
(purchase, sale and maintenance of systems for repair work and radio and television broadcasting)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
21,428,572
|
|
|
|
70.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA SAN MARINO S.p.A.
(San Marino telecommunications management)
|
|
BORGO MAGGIORE
(SAN MARINO)
|
|
EUR
|
|
|
1,808,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA SPARKLE S.p.A.
(completion and management of telecommunications services for public and private use)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
200,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA TRUST TECHNOLOGIES S.r.l.
(other operations related to
non-classified
IT services)
|
|
POMEZIA
ROME (ITALY)
|
|
EUR
|
|
|
7,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA VENTURES S.r.l.
(investment holding company)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
10,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECONTACT CENTER S.p.A.
(telemarketing services)
|
|
NAPLES (ITALY)
|
|
EUR
|
|
|
3,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELEFONIA MOBILE SAMMARINESE S.p.A.
(development and management of mobile telecommunications plants and services)
|
|
BORGO MAGGIORE
(SAN MARINO)
|
|
EUR
|
|
|
78,000
|
|
|
|
51.0000
|
|
|
|
|
|
|
TELECOM ITALIA SAN MARINO S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELENERGIA S.r.l.
(import, export, purchase, sale and trade of electricity)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
50,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 29
|
|
|
|
|
at June 30, 2017
|
|
List of companies of the TIM Group
|
|
|
146
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company name
|
|
Head office
|
|
Currency
|
|
Share capital
|
|
|
%
Ownership
|
|
|
% of
voting
rights
|
|
|
Held by
|
TELSY ELETTRONICA E TELECOMUNICAZIONI S.p.A.
(production and sale of equipment and systems for crypto telecommunications)
|
|
TURIN (ITALY)
|
|
EUR
|
|
|
390,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE NETHERLANDS B.V.
(telecommunications services)
|
|
AMSTERDAM (NETHERLANDS)
|
|
EUR
|
|
|
18,200
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE AMERICAS Inc.
(managed bandwidth services)
|
|
MIAMI (UNITED STATES)
|
|
USD
|
|
|
10,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE ARGENTINA S.A.
(managed bandwidth services)
|
|
BUENOS AIRES (ARGENTINA)
|
|
ARS
|
|
|
9,998,000
|
|
|
|
95.0000
5.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE AUSTRIA Gmbh
(telecommunications services)
|
|
VIENNA (AUSTRIA)
|
|
EUR
|
|
|
2,735,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE BELGIUM S.P.R.L. - B.V.B.A
(telecommunications services)
|
|
BRUSSELS (BELGIUM)
|
|
EUR
|
|
|
2,200,000
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
TI SPARKLE UK Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE BOLIVIA S.r.l.
(managed bandwidth services)
|
|
LA PAZ
(BOLIVIA)
|
|
BOB
|
|
|
1,747,600
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
TI SPARKLE AMERICAS
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE BRASIL PARTIÇIPAÇÕES Ltda
(investment holding company)
|
|
RIO DE JANEIRO
(BRAZIL)
|
|
BRL
|
|
|
71,563,866
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
TI SPARKLE AMERICAS
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE BRASIL TELECOMUNICAÇÕES Ltda
(managed bandwidth services)
|
|
RIO DE JANEIRO
(BRAZIL)
|
|
BRL
|
|
|
69,337,363
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TI SPARKLE BRASIL
PARTIÇIPAÇÕES Ltda
TI SPARKLE AMERICAS
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE BULGARIA EOOD
(telecommunications)
|
|
SOFIA (BULGARIA)
|
|
BGN
|
|
|
100,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE CHILE SPA
(managed bandwidth services)
|
|
SANTIAGO (CHILE)
|
|
CLP
|
|
|
5,852,430,960
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE COLOMBIA Ltda
(managed bandwidth services)
|
|
BOGOTA (COLOMBIA)
|
|
COP
|
|
|
5,246,906,000
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
TI SPARKLE AMERICAS
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE CZECH S.R.O.
(telecommunications services)
|
|
PRAGUE (CZECH REPUBLIC)
|
|
CZK
|
|
|
6,720,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE FRANCE S.A.S.
(installation and management of telecommunications services for fixed network and related activities)
|
|
PARIS (FRANCE)
|
|
EUR
|
|
|
18,295,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE GERMANY Gmbh
(telecommunications services)
|
|
FRANKFURT (GERMANY)
|
|
EUR
|
|
|
25,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE GREECE S.A.
(telecommunications)
|
|
ATHENS (GREECE)
|
|
EUR
|
|
|
368,760
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE IRELAND TELECOMMUNICATIONS Ltd
(telecommunications services, installation and maintenance of submarine cable systems for managed bandwidth
services)
|
|
DUBLIN (IRELAND)
|
|
USD
|
|
|
1,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE ISRAEL Ltd
(international wholesale telecommunication services)
|
|
RAMAT GAN (ISRAEL)
|
|
ILS
|
|
|
1,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE MED S.p.A.
(installation and management of submarine cable systems)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
3,100,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE NORTH AMERICA, Inc
(telecommunications and promotional services)
|
|
NEW YORK (UNITED STATES)
|
|
USD
|
|
|
15,550,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE PANAMA S.A.
(managed bandwidth services)
|
|
PANAMA
|
|
USD
|
|
|
10,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE PERU S.A.
(managed bandwidth services)
|
|
LIMA (PERU)
|
|
PEN
|
|
|
57,101,788
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
TI SPARKLE AMERICAS
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE PUERTO RICO LLC
(managed bandwidth services)
|
|
SAN JUAN (PUERTO RICO)
|
|
USD
|
|
|
50,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE ROMANIA S.r.l.
(telecommunications services)
|
|
BUCHAREST (ROMANIA)
|
|
RON
|
|
|
3,021,560
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE RUSSIA LLC
(telecommunications services)
|
|
MOSCOW (RUSSIA)
|
|
RUB
|
|
|
8,520,000
|
|
|
|
99.0000
1.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
TI SPARKLE UK Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE SINGAPORE Pte.Ltd
(telecommunications services)
|
|
SINGAPORE
|
|
USD
|
|
|
5,121,120
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
TI SPARKLE NORTH
AMERICA, Inc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE SLOVAKIA S.R.O.
(telecommunications services)
|
|
BRATISLAVA (SLOVAKIA)
|
|
EUR
|
|
|
300,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE SPAIN Telecommunications S.L.
(telecommunications services)
|
|
MADRID (SPAIN)
|
|
EUR
|
|
|
1,687,124
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA
SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE St. Croix LLC
(managed bandwidth services)
|
|
VIRGIN ISLANDS (UNITED STATES)
|
|
USD
|
|
|
10,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND
TELECOMMUNICATIONS
Ltd
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 29
|
|
|
|
|
at June 30, 2017
|
|
List of companies of the TIM Group
|
|
|
147
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company name
|
|
Head office
|
|
Currency
|
|
Share capital
|
|
|
%
Ownership
|
|
|
% of
voting
rights
|
|
|
Held by
|
TI SPARKLE SWITZERLAND Gmbh
(telecommunications
services)
|
|
ZURICH (SWITZERLAND)
|
|
CHF
|
|
|
2,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE TURKEY TELEKOMÜNIKASYON ANONIM SIRKETI
(telecommunications services)
|
|
YENISBONA ISTANBUL (TURKEY)
|
|
TRY
|
|
|
40,600,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND TELECOMMUNICATIONS Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE UK Ltd
(value-added and networking
services)
|
|
LONDON (UNITED KINGDOM)
|
|
EUR
|
|
|
3,983,254
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA SPARKLE S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TI SPARKLE VENEZUELA CA.
(managed bandwidth
services)
|
|
CARACAS (VENEZUELA)
|
|
VEF
|
|
|
981,457
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE IRELAND TELECOMMUNICATIONS Ltd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM REAL ESTATE S.r.l.
(real estate)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
50,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIMB2 S.r.l.
(management of television
frequency user rights)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
10,000
|
|
|
|
99.0000
1.0000
|
|
|
|
|
|
|
PERSIDERA S.p.A. TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIMVISION S.r.l.
(production,
co-production,
conception and creation of programs, films and
audiovisual content, including multimedia and interactive content)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
50,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TMI TELEMEDIA INTERNATIONAL DO BRASIL Ltda
(telecommunications services and promotional services)
|
|
SÃO PAULO (BRAZIL)
|
|
BRL
|
|
|
8,909,639
|
|
|
|
100.0000
|
|
|
|
|
|
|
TI SPARKLE BRASIL PARTIÇIPAÇÕES Ltda
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TN FIBER S.r.l.
(design, construction, maintenance and supply of optical network access to users in the province of Trento)
|
|
TRENTO (ITALY)
|
|
EUR
|
|
|
55,918,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BRAZIL BU
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTELIG TELECOMUNICAÇÕES Ltda
(telecommunications services)
|
|
RIO DE JANEIRO (BRAZIL)
|
|
BRL
|
|
|
4,041,956,045
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TIM PARTICIPAÇÕES S.A.
TIM
CELULAR S.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM BRASIL SERVIÇOS E PARTICIPAÇÕES S.A.
(investment holding company)
|
|
RIO DE JANEIRO (BRAZIL)
|
|
BRL
|
|
|
7,169,029,859
|
|
|
|
99.9999
0.0001
|
|
|
|
|
|
|
TELECOM ITALIA FINANCE S.A.
TIM
S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM CELULAR S.A.
(telecommunications
services)
|
|
SÃO PAULO (BRAZIL)
|
|
BRL
|
|
|
9,434,215,720
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM PARTICIPAÇÕES S.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM PARTICIPAÇÕES S.A.
(investment holding company)
|
|
RIO DE JANEIRO (BRAZIL)
|
|
BRL
|
|
|
9,913,414,422
|
|
|
|
66.5819
0.0264
|
|
|
|
|
|
|
TIM BRASIL SERVIÇOS E PARTICIPAÇÕES S.A.
TIM PARTICIPAÇÕES S.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OLIVETTI DEUTSCHLAND GmbH
(sale of office
equipment and supplies)
|
|
NURENBERG (GERMANY)
|
|
EUR
|
|
|
25,600,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
OLIVETTI S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OLIVETTI ESPAÑA S.A. (in Liquidation)
(sale and maintenance of office supplies, consultancy and network management)
|
|
BARCELONA (SPAIN)
|
|
EUR
|
|
|
1,229,309
|
|
|
|
100.0000
|
|
|
|
|
|
|
OLIVETTI S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OLIVETTI UK Ltd.
(sale of office equipment and
supplies)
|
|
NORTHAMPTON (UNITED KINGDOM)
|
|
GBP
|
|
|
6,295,712
|
|
|
|
100.0000
|
|
|
|
|
|
|
OLIVETTI S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA CAPITAL S.A.
(financial
company)
|
|
LUXEMBOURG
|
|
EUR
|
|
|
2,336,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA FINANCE IRELAND Ltd
(in
liquidation)
(financial company)
|
|
DUBLIN
(IRELAND)
|
|
EUR
|
|
|
1,360,000,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TELECOM ITALIA FINANCE S.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA FINANCE S.A.
(financial
company)
|
|
LUXEMBOURG
|
|
EUR
|
|
|
1,818,691,979
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELECOM ITALIA LATAM PARTICIPAÇÕES E GESTÃO ADMINISTRATIVA Ltda
(telecommunications and promotional services)
|
|
SÃO PAULO (BRAZIL)
|
|
BRL
|
|
|
118,925,803
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIAUDIT COMPLIANCE LATAM S.A.
(in
liquidation)
(internal audit services)
|
|
RIO DE JANEIRO (BRAZIL)
|
|
BRL
|
|
|
1,500,000
|
|
|
|
69.9996
30.0004
|
|
|
|
|
|
|
TIM S.p.A
TIM BRASIL SERVIÇOS E
PARTICIPAÇÕES S.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIESSE S.c.p.A.
(installation and assistance for electronic, IT, telematics and telecommunications equipment)
|
|
IVREA
(TURIN) (ITALY)
|
|
EUR
|
|
|
103,292
|
|
|
|
61.0000
|
|
|
|
|
|
|
OLIVETTI S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM TANK S.r.l.
(fund and securities
investments)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
16,600,000
|
|
|
|
100.0000
|
|
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TIM Group
|
|
|
|
|
|
|
Half-year Condensed Consolidated Financial Statements
|
|
Note 29
|
|
|
|
|
at June 30, 2017
|
|
List of companies of the TIM Group
|
|
|
148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company name
|
|
Head office
|
|
Currency
|
|
Share
capital
|
|
|
%
Ownership
|
|
|
% of
voting
rights
|
|
Held by
|
ASSOCIATES AND JOINT VENTURES ACCOUNTED FOR USING THE EQUITY METHOD
|
ALFIERE S.p.A. (*)
(real estate)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
9,250,000
|
|
|
|
50.0000
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AREE URBANE S.r.l. (in liquidation)
(real
estate management)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
100,000
|
|
|
|
32.6200
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSCOM INSURANCE BROKERS S.r.l.
(insurance
brokerage)
|
|
MILAN (ITALY)
|
|
EUR
|
|
|
100,000
|
|
|
|
20.0000
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALTEA S.r.l. (in bankruptcy)
(production and
sale of office products and telecommunications IT services)
|
|
IVREA (TURIN) (ITALY)
|
|
EUR
|
|
|
100,000
|
|
|
|
49.0000
|
|
|
|
|
OLIVETTI S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CLOUDESIRE.COM S.r.l.
(design, implementation
and marketing of a marketplace platform for the sale of
software-as-a-service
applications)
|
|
PISA (ITALY)
|
|
EUR
|
|
|
11,671
|
|
|
|
(
|
**)
|
|
|
|
TELECOM ITALIA VENTURES S.r.l.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSORZIO ANTENNA COLBUCCARO Società Consortile a RL
(installation, management and maintenance of metal pylons complete with workstations for device recovery)
|
|
ASCOLI PICENO (ITALY)
|
|
EUR
|
|
|
121,000
|
|
|
|
20.0000
|
|
|
|
|
PERSIDERA S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSORZIO ANTENNA MONTECONERO Società Consortile a RL
(multimedia services)
|
|
SIROLO (ANCONA) (ITALY)
|
|
EUR
|
|
|
51,100
|
|
|
|
22.2211
|
|
|
|
|
PERSIDERA S.p.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSORZIO E O (in liquidation)
(training
services)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
30,987
|
|
|
|
50.0000
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DONO PER...S.C.A.R.L. (in liquidation)
(collection and distribution of funds for charitable purposes or for financing of political parties or political or social movements)
|
|
ROME (ITALY)
|
|
EUR
|
|
|
30,000
|
|
|
|
33.3333
|
|
|
|
|
TIM S.p.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ECO4CLOUD S.r.l.
(development, production and
sale of innovative products or services with high technological value)
|
|
RENDE (COSENZA) (ITALY)
|
|
EUR
|
|
|
19,532
|
|
|
|
(
|
**)
|
|
|
|
TELECOM ITALIA VENTURES S.r.l.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ITALTEL GROUP S.p.A.
(investment holding
company)
|
|
SETTIMO MILANESE (MILAN) (ITALY)
|
|
EUR
|
|
|
825,695
|
|
|
|
34.6845
|
|
|
19.3733
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TELECOM ITALIA FINANCE S.A.
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ITALTEL S.p.A
(telecommunications
systems)
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SETTIMO MILANESE (MILAN) (ITALY)
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EUR
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2,000,000
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(
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**)
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TIM S.p.A
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KOPJRA S.r.l.
(development, production and sale
of innovative products or services with high technological value)
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SCHIO (VICENZA) (ITALY)
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EUR
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16,207
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22.8491
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TELECOM ITALIA VENTURES S.r.l.
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MOVENDA S.p.A.
(design, construction and
diffusion of Internet sites, products and computer media)
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ROME (ITALY)
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EUR
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133,333
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24.9998
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TELECOM ITALIA FINANCE S.A.
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NORDCOM S.p.A.
(application service
provider)
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MILAN (ITALY)
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EUR
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5,000,000
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42.0000
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TIM S.p.A
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OILPROJECT S.r.l.
(research, development,
marketing and patenting of all intellectual property related to technology, information technology and TLC)
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MILAN (ITALY)
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EUR
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13,556
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(
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**)
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TELECOM ITALIA VENTURES S.r.l.
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PEDIUS S.r.l.
(implementation of specialized
telecommunications applications, telecommunications services over telephone connections, VOIP services)
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ROME (ITALY)
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EUR
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159
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(
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**)
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TELECOM ITALIA VENTURES S.r.l.
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TIGLIO I S.r.l.
(real estate
management)
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MILAN (ITALY)
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EUR
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5,255,704
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47.8019
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TIM S.p.A
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TIGLIO II S.r.l. (in liquidation)
(real estate
management)
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MILAN (ITALY)
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EUR
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10,000
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49.4700
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TIM S.p.A
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W.A.Y. S.r.l.
(development and sale of
geolocation products and systems for security and logistics)
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TURIN (ITALY)
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EUR
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136,383
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39.9999
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OLIVETTI S.p.A.
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WIMAN S.r.l.
(development, management and
implementation of platforms for social-based
Wi-Fi
authentication)
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MATTINATA (FOGGIA) (ITALY)
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EUR
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21,568
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(
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**)
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TELECOM ITALIA VENTURES S.r.l.
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(**)
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Associate over which TIM S.p.A., directly or indirectly, exercises significant influence pursuant to IAS 28 (Investments in Associates and Joint Ventures).
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TIM Group
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Half-year Condensed Consolidated Financial Statements
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Note 29
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at June 30, 2017
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List of companies of the TIM Group
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149
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CERTIFICATION OF THE HALF-YEAR CONDENSED CONSOLIDATED FINANCIAL STATEMENTS PURSUANT TO
ARTICLE
81-TER
OF THE CONSOB REGULATION 11971 DATED MAY 14, 1999, WITH AMENDMENTS AND ADDITIONS.
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We, the undersigned, Arnaud Roy de Puyfontaine, as Chairman, Flavio Cattaneo, as Chief Executive Officer, and Piergiorgio Peluso, as Manager responsible for preparing TIM S.p.A. financial reports, certify, having also
considered the provisions of Article
154-bis,
paragraphs 3 and 4, of Italian Legislative Decree 58 of February 24, 1998:
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the adequacy in relation to the characteristics of the company and
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the effective application
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of the administrative and accounting procedures used in the
preparation of the half-year condensed consolidated financial statements for the period January 1 June 30, 2017.
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TIM has adopted the Internal Control Integrated Framework Model (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission, as its framework for the establishment and assessment of its
internal control system, with particular reference to the internal controls for the preparation of the financial statements.
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The undersigned also certify that:
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◾
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the Half-year Condensed Consolidated Financial Statements at June 30, 2017:
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a.
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are prepared in conformity with international accounting standards adopted by the European Union pursuant to EC regulation 1606/2002 of the European Parliament and Council of July 19, 2002 (International Financial
Reporting Standards IFRS) as well as the legislative and prescribed provisions in force in Italy also with reference to the measures enacted for the implementation of Article 9 of Italian Legislative Decree 38 of February 28, 2005;
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b)
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agree with the results of the accounting records and entries;
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2)
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provide a true and fair view of the financial condition, the results of operations and the cash flows of the Company and its consolidated subsidiaries;
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the interim management report contains a reliable analysis of important events which took place during the first six months of 2017 and their impact on the half-year condensed consolidated financial statements at
June 30, 2017, together with a description of the main risks and uncertainties for the remaining six months of 2017. The interim management report also contains a reliable analysis of information concerning significant related party
transactions.
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27 July 2017
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Chairman
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Chief Executive Officer
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Manager responsible for
preparing corporate financial
reports
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[signature]
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[signature]
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[signature]
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Arnaud Roy de Puyfontaine
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Flavio Cattaneo
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Piergiorgio Peluso
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TIM Group
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Half-year Condensed Consolidated Financial Statements
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at June 30, 2017
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Certification of the consolidated financial statements
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150
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REVIEW REPORT ON CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS
To the shareholders of
TIM SpA
Foreword
We have reviewed the accompanying consolidated
condensed interim financial statements of TIM SpA and its subsidiaries (TIM Group) as of and for the
six-month
period ended 30 June 2017, comprising the statement of financial position, the
separate income statement, the statement of comprehensive income, the statement of changes in shareholders equity, the statement of cash flows and related explanatory notes. The directors of TIM SpA are responsible for the preparation of the
consolidated condensed interim financial statements in accordance with International Accounting Standard 34 applicable to interim financial reporting (IAS 34) as adopted by the European Union. Our responsibility is to express a conclusion on these
consolidated condensed interim financial statements based on our review.
Scope of review
We conducted our work in accordance with the criteria for a review recommended by the National Commission for Companies and Stock Exchange (CONSOB) in
Resolution No. 10867 of 31 July 1997. A review of consolidated condensed interim financial statements consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than a full-scope audit conducted in accordance with International Standards on Auditing (ISA Italia) and, consequently, does not enable us to obtain assurance that we would become aware of
all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion on the consolidated condensed interim financial statements.
Conclusion
Based on our review, nothing has come to our
attention that causes us to believe that the accompanying consolidated condensed interim financial statements of TIM Group as of and for the
six-month
period ended 30 June 2017 are not prepared, in all
material respects, in accordance with International Accounting Standard 34 applicable to interim financial reporting (IAS 34) as adopted by the European Union.
Milan, 9 August 2017
PricewaterhouseCoopers SpA
Signed by
Francesco Ferrara
(Partner)
This report has been translated into English from
the Italian original solely for the convenience of international readers
PricewaterhouseCoopers SpA
Sede legale e amministrativa: Milano 20149 Via Monte Rosa 91 Tel. 0277851 Fax 027785240 Cap. Soc. Euro 6.890.000,00 i.v., C .F. e P.IVA e Reg. Imp. Milano
12979880155 Iscritta al n° 119644 del Registro dei Revisori Legali - Altri Uffici:
Ancona
60131 Via Sandro Totti 1 Tel. 0712132311 -
Bari
70122 Via Abate Gimma 72 Tel. 0805640211 -
Bologna
40126 Via Angelo Finelli 8 Tel.
0516186211 -
Brescia
25123 Via Borgo Pietro Wuhrer 23 Tel. 0303697501 -
Catania
95129 Corso Italia 302 Tel. 0957532311 -
Firenze
50121 Viale Gramsci 15 Tel. 0552482811 -
Genova
16121 Piazza Piccapietra 9 Tel. 01029041 -
Napoli
80121 Via dei Mille 16 Tel. 08136181 -
Padova
35138 Via Vicenza 4 Tel. 049873481 -
Palermo
90141 Via Marchese Ugo 60 Tel. 091349737 -
Parma
43121 Viale Tanara 20/A Tel. 0521275911 -
Pescara
65127 Piazza
Ettore Troilo 8 Tel. 0854545711 -
Roma
00154 Largo Fochetti 29 Tel. 06570251 -
Torino
10122 Corso Palestro 10 Tel. 011556771 -
Trento
38122 Viale della Costituzione 33 Tel. 0461237004 -
Treviso
31100 Viale Felissent 90
Tel. 0422696911 -
Trieste
34125 Via Cesare Battisti 18 Tel. 0403480781 -
Udine
33100 Via Poscolle 43 Tel. 043225789 -
Verona
21100 Via Albuzzi 43 Tel. 0332285039 -
Verona
37135 Via Francia 21/C Tel. 0458263001-
Vicenza
36100 Piazza Pontelandolfo 9 Tel. 0444393311
www.pwc.com/it
USEFUL INFORMATION
Free copies of this report, can be obtained by:
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Calling
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Free Number 800.020.220 (for calls inside Italy)
or +39 011 2293603 (for calls outside Italy)
providing
information and assistance to shareholders
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E-mail
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ufficio.soci@telecomitalia.it
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Internet
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Users can view the Half-Year financial Report at June 2017, by visiting the website telecomitalia.com/Bilanci-Relazioni
They can also obtain information about TIM at the following URL: www.telecomitalia.com and
information about its products and services at the following URL: www.tim.it
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Investor Relations
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+39 02 85954131 (switchboard)
+39 02 85954132
(fax)
investor_relations@telecomitalia.it
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TIM S.p.A.
A company directed
and coordinated by Vivendi S.A.
Registered Office Via G. Negri n. 1 - Milan
Headquarters and Secondary Office in Corso dItalia 41 - Rome
PEC (Certified Electronic Mail) box: telecomitalia@pec.telecomitalia.it
Share Capital 11,677,002,855.10 euros, fully paid up
Tax
Code/VAT no. and Milan Companies Register file no. 00488410010
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Interim Management Report
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TIM People
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152
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at June 30, 2017
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Cautionary Statement for Purposes of the Safe Harbor Provisions of the United States Private
Securities Litigation Reform Act of 1995.
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements. The Groups interim report as of and for the six months ended June 30, 2017 included in this Form
6-K
contains certain forward-looking statements. Forward-looking statements are
statements that are not historical facts and can be identified by the use of forward-looking terminology such as believes, may, is expected to, will, will continue, should,
seeks or anticipates or similar expressions or the negative thereof or other comparable terminology, or by the forward-looking nature of discussions of strategy, plans or intentions.
Actual results may differ materially from those projected or implied in the forward-looking statements. Such forward-looking information is based on certain
key assumptions which we believe to be reasonable but forward-looking information by its nature involves risks and uncertainties, which are outside our control, that could significantly affect expected results.
The following important factors could cause our actual results to differ materially from those projected or implied in any forward-looking statements:
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1.
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our ability to successfully implement our strategy over the 2017-2019 period;
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2.
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the continuing effects of the global economic crisis in the principal markets in which we operate, including, in particular, our core Italian market;
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3.
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the impact of regulatory decisions and changes in the regulatory environment in Italy and other countries in which we operate;
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4.
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the impact of political developments in Italy and other countries in which we operate;
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5.
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our ability to successfully meet competition on both price and innovation capabilities of new products and services;
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6.
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our ability to develop and introduce new technologies which are attractive in our principal markets, to manage innovation, to supply value added services and to increase the use of our fixed and mobile networks;
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7.
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our ability to successfully implement our internet and broadband strategy;
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8.
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our ability to successfully achieve our debt reduction and other targets;
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9.
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the impact of fluctuations in currency exchange and interest rates and the performance of the equity markets in general;
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10.
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the outcome of litigation, disputes and investigations in which we are involved or may become involved;
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11.
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our ability to build up our business in adjacent markets and in international markets (particularly in Brazil), due to our specialist and technical resources;
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12.
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our ability to achieve the expected return on the investments and capital expenditures we have made and continue to make in Brazil;
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13.
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the amount and timing of any future impairment charges for our authorizations, goodwill or other assets;
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14.
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our ability to manage and reduce costs;
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15.
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any difficulties which we may encounter in our supply and procurement processes, including as a result of the insolvency or financial weaknesses of our suppliers; and
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16.
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the costs we may incur due to unexpected events, in particular where our insurance is not sufficient to cover such costs.
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The foregoing factors should not be construed as exhaustive. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such
forward-looking statements, which speak only as of the date hereof. We undertake no obligation to release publicly the result of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date
hereof, including, without limitation, changes in our business or acquisition strategy or planned capital expenditures, or to reflect the occurrence of unanticipated events.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: September 7, 2017
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TELECOM ITALIA S.p.A.
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BY:
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/s/ Umberto Pandolfi
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Umberto Pandolfi
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Company Manager
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