Interim Management Report 31 March 2013 · 2013-03-31 · Mantova register of companies – Tax-payer’s code and VAT number 07918540019 Interim Management Report 31 March 2013 This

IMMSI Società per Azioni Share capital 178,464,000 euro fully paid up

Registered office: P.zza Vilfredo Pareto, 3 – 46100 Mantova Mantova register of companies – Tax-payer’s code and VAT number 07918540019

Interim

Management Report

31 March 2013

This Interim Management Report is a translation provided only for the convenience of foreign readers The Italian version will prevail

Index:

Company boards…………..………………….....……………………….………………........... page 4

Main income and balance sheet figures of the Immsi Group…….………...……………….. page 7

Alternative non-GAAP performance measures……………………………………………….. page 8

Form and contents of the Interim Report…....………………………………………………… page 9

Consolidation area……………..………………………………………………………………… page 10

Reclassified consolidated financial statements and explanatory notes….…….................. page 12

Directors’ comments on the results of operations……………………………...…………...... page 21 Events following 31 March 2013 and predictable evolution of management…………….... page 29

Segment reporting………….…………………….……………………………………………… page 31 This report is available on www.immsi.it web site – under the “Investors – Financial reports” section.

CCoommppaannyy BBooaarrddss 4

COMPANY BOARDS The Board of Directors and the Board of Statutory Auditors of Immsi S.p.A. were appointed by a shareholder resolution on 11 May 2012 and their term in office expires on the date of the Shareholders’ Meeting called to approve the financial statements for the year ending at 31 December 2014.

BOARDOF DIRECTORS

Roberto Colaninno ChairmanCarlo d'Urso Deputy ChairmanMichele Colaninno Managing DirectorMatteo Colaninno DirectorRita Ciccone DirectorGiorgio Cirla DirectorGiovanni Sala DirectorEnrico Maria Fagioli Marzocchi DirectorRuggero Magnoni Director

BOARD OFSTATUTORY AUDITORS

Alessandro Lai ChairmanDaniele Girelli Standing AuditorLeonardo Losi Standing AuditorGianmarco Losi Substitute AuditorElena Fornara Substitute Auditor

INDEPENDENTAUDITORS

PricewaterhouseCoopers 2012 - 2020

GENERAL MANAGER

Michele Colaninno

CCoommppaannyy BBooaarrddss 5

In accordance with the principles of Corporate Governance recommended by the Self-Regulatory Code of Conduct for Listed Companies, as well as in accordance with Italian Legislative Decree D.Lgs. 231/01, the Board of Directors has established the following organs:

REMUNERATION COMMITTEEGiovanni Sala ChairmanGiorgio CirlaCarlo d'Urso

CONTROL AND RISK COMMITTEEGiovanni Sala ChairmanRita CicconeGiorgio Cirla

SUPERVISORY BOARDMarco Reboa ChairmanAlessandro LaiMaurizio Strozzi

LEAD INDEPENDENT DIRECTORGiovanni Sala

DIRECTOR APPOINTEDMichele Colaninno

PERSON IN CHARGE OF THE INTERNAL AUDITMaurizio Strozzi

MANAGER IN CHARGE OF PREPARING THE COMPANYACCOUNTS AND DOCUMENTS

Andrea Paroli

INVESTOR RELATORMassimiliano Mattietti

Immsi Group Interim management report

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MMaaiinn iinnccoommee aanndd bbaallaannccee sshheeeett ffiigguurreess ooff tthhee IImmmmssii GGrroouupp During the first quarter of 2013, the Immsi Group recorded net revenues and operating results in contraction compared to the previous financial year, partly as a result of the continuing highly uncertain reference macroeconomic situation, that particularly concerned the domestic market because of sensing a prolonged downturn in consumption in the motor vehicle sector. The above results also present different trends as regards the various sectors that make up the Group as a consequence of the different business dynamics that characterized the period in question. Referring to the explanations given later in this document for a more detailed description of what is written below, it should be noted at the outset that:

• the “property and holding sector” consolidates the balance sheet and income results of Immsi S.p.A., Immsi Audit S.c.a r.l., ISM Investimenti S.p.A., Is Molas S.p.A., Apuliae S.p.A., Pietra S.r.l. and RCN Finanziaria S.p.A.;

• the “industrial sector” includes the companies owned by the Piaggio group, while • the “naval sector” includes Intermarine S.p.A. and other minor subsidiary or associated

companies. As more widely described later in this document, the parent Rodriquez Cantieri Navali S.p.A. was merged by incorporation into the company, with legal effect from 31 December 2012: in this regard, it should be noted that the operation does not affect the comparability of the balance sheet and income results between the reporting periods, as more thoroughly specified below.

Some of the main income and balance sheet figures of the Immsi Group are presented below, divided by business sector and determined, as already stated, in accordance with the international accounting standards (IAS/IFRS): Immsi Group at 31 March 2013

Property Industrial Naval Immsi and holding in % sector in % sector in % Group in %

In thousands of euros sector

Net revenues 985 303,449 12,085 316,519

Operating earnings before depreciation and amortisation (EBITDA)

-1,085 n/m 30,082 9.9% -3,297 -27.3% 25,700 8.1%

Operating earnings (EBIT) -1,222 n/m 9,804 3.2% -3,902 -32.3% 4,680 1.5%

Earnings before taxation -3,690 n/m 1,764 0.6% -5,310 -43.9% -7,236 -2.3%

Earnings for the period including non-controlling interest

-3,700 n/m 1,058 0.3% -2,897 -24.0% -5,539 -1.7%

Group earnings for the period (consolidable) -2,340 n/m 588 0.2% -1,830 -15.1% -3,582 -1.1%

Net financial position -240,764 -487,739 -151,505 -880,008

Personnel (number) 77 8,487 305 8,869

Hereunder we give the same table referring to the same period of the preceding year. A comparison between the two periods is made in the specific comment related to the single business sectors presented further on.


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Immsi Group at 31 March 2012

Property Industrial Naval Immsi and holding in % sector in % sector in % Group in %


Net revenues 930 343,122 15,861 359,913


-1,370 n/m 33,022 9.6% -5,098 -32.1% 26,554 7.4%

Operating earnings (EBIT) -1,521 n/m 13,039 3.8% -5,953 -37.5% 5,565 1.5%

Earnings before taxation -3,732 n/m 5,829 1.7% -7,501 -47.3% -5,404 -1.5%


-2,926 n/m 3,206 0.9% -5,489 -34.6% -5,209 -1.4%

Group earnings for the period (consolidable) -2,033 n/m 1,737 0.5% -3,468 -21.9% -3,764 -1.0%

Net financial position -198,108 -422,412 -170,095 -790,615

Personnel (number) 78 8,330 312 8,720

Alternative non-GAAP performance measures This Report contains some measures that, albeit not laid down in the IFRS (“Non-GAAP Measures”), derived from IFRS financial measures. These measures – which are presented in order to measure the trend of the Group's operations to a better extent – should not be considered as an alternative to IFRS measures and are homogeneous with those included in the Annual report and financial statements at 31 December 2012 and in the periodical quarterly and half-yearly reports of the Immsi Group. It should, furthermore, be borne in mind that the methods for calculating the measures applied therein might not be homogeneous with those adopted by others, as they are not specifically governed by the reference accounting standards, with the result that said measures might not prove sufficiently comparable. In particular the following alternative performance measures have been used:

• EBITDA: defined as operating earnings gross of amortisation and depreciation; • Net financial debt: represented by (current and non-current) financial liabilities, minus

cash on hand and other cash and cash equivalents, as well as other (current and non-current) financial receivables. The other financial assets and liabilities arising from the valuation at fair value of the derivative financial instruments designated as hedges and the fair value adjustment of the related hedged items do not, however, enter into determining net financial debt. Among the schedules contained in this Report, a table detailing the composition of this indicator is also included. In this respect, in conformity with the CESR recommendation of 10 February 2005 “Recommendations for the consistent implementation of the European Commission’s Regulation on Prospectuses”, it is noted that the indicator thus formulated represents what has been monitored by the Management of the Group and that it differs from what suggested by the Consob Communication no. 6064293 of 28 July 2006 as it also includes the non-current portion of financial receivables.


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FFoorrmm aanndd ccoonntteennttss ooff tthhee IInntteerriimm RReeppoorrtt This Interim Management Report at 31 March 2013 of the Immsi Group, which is not subject to audit, was drawn up pursuant to the Italian Legislative Decree D.Lgs. 58/1998 and subsequent amendments, as well as to the Issuers Regulations emanated by Consob, and contains the reclassified consolidated financial statements and explanatory notes drawn up according to the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (“IASB”) and approved by the European Union. The interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”) were also taken into account. In drawing up the Interim Management Report at 31 March 2013 the Group has applied the accounting standards implemented in drawing up the consolidated financial statements at 31 December 2012 (to which reference is made for any further investigation), as well as the amendments and interpretations contemplated by IASB applicable as of 1 January 2013. In particular, on 16 June 2011 IASB issued an amendment to IAS 1 – Presentation of financial statements to require entities to group all items presented in Other comprehensive income based on whether they are potentially reclassifiable to profit or loss. The amendment is applicable to the financial years started after or on 1 July 2012. It is also noted that, as provided for by the Consob communication no. DEM/5073567 dated 4 November 2005, the Company has availed itself of the right to state fewer details than as required in the international accounting standard IAS 34 – Interim Financial Reporting. Moreover, it should be remembered that, starting from the Half-yearly Financial Report at 30 June 2012, the Immsi Group adopted in advance the IAS 19 "revised" accounting principle, which entails, among other things, the change of the principle of recognition of actuarial profits and losses relating to employee severance indemnities and pension funds (TFR): for more details see the section "New accounting principles, amendments and interpretations adopted from 1 January 2012", contained within the explanatory and additional Notes stated in the Report of the Directors and Financial Statement of Immsi Group at 31 December 2012. Considering the above, in this document some economic and financial data for the first three months of 2012, published at the time, have been – where necessary – suitably revised in order to allow a comparison. The preparation of the Interim Report required the Management to make estimates and assumptions that particularly affect the reported amounts of revenues, expenses, assets and liabilities recorded in the financial statements and disclosure of contingent assets and liabilities at the closing date of the period. If in the future such estimates and assumptions deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate in the year in which the circumstances should change. In addition, some evaluative processes, particularly the more complex ones such as the determination of impairment losses on intangible assets, are generally carried out completely only at the time of drawing up the annual financial statements, when all the potentially necessary information is available, saving the cases in which there are indicators of impairment that require immediate evaluation of possible losses of value. This document can include forward-looking statements, regarding future events and operational, economic and financial results of the Immsi Group. Said statements have a certain degree of risk and uncertainty by nature, since they depend on the occurrence of future events and developments. The actual results may differ even significantly compared to the forecast ones, in relation to several factors. This Interim Management Report is expressed in Euros since that is the currency in which most of the Group’s transactions take place. Unless stated otherwise, the figures in the financial statements and explanatory notes that follow are expressed in thousands of euros.


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As regards the Immsi Group, below can be found the Reclassified income statement and Statement of comprehensive income for the first three months of 2013 compared with the same period in 2012, as well as the Reclassified statement of financial situation at 31 March 2013 compared with the situation at 31 December 2012 and at 31 March 2012, and the Statement of cash flows at 31 March 2013 compared with the same period of the year 2012. There is also a Statement of changes in shareholders' equity at 31 March 2013 compared with the figures for the same period of the previous year. No atypical, non-recurrent or unusual operations have been found during the first three months of 2013, as in the same period of the previous year. The manager in charge of preparing the company accounts and documents, Andrea Paroli, declares, in accordance with paragraph 2 of article 154-bis of the Italian Finance Consolidation Act (“Testo Unico della Finanza”), that the accounting report contained in this document corresponds to the evidence of the documents, books and accounting records. CCoonnssoolliiddaattiioonn aarreeaa For consolidation purposes we have used the financial statements at 31 March 2013 of the companies included in the consolidation area, duly adapted and reclassified, where necessary, in order to make them conform to the international accounting standards and to the standard classification criteria on a comparative basis within the Group. The scope of consolidation includes the companies in which the Parent Company, directly or indirectly, owns more than half of the voting rights exercisable in Shareholders’ Meetings, or has the power to control or direct voting rights by means of contractual or bylaw clauses, or can appoint the majority of the members of the Boards of Directors. Excluded from the line-by-line consolidation are non-operating controlled companies or those with low operating levels as their influence on the final result of the Group is insignificant. The area of consolidation has not significantly changed compared to the consolidated financial statements at 31 December 2012 and the consolidated accounting situation at 31 March 2012. In particular:

• on 1 July 2012, the subsidiary company under Dutch law Aprilia World Service BV has been merged by incorporation into Piaggio Vespa BV, which is also a Dutch company, wholly owned by Piaggio & C. S.p.A.;

• the establishment of the company Piaggio Advanced Design Centre Corp., wholly owned by Piaggio & C. S.p.A. and based in Pasadena (California), took place on 8 October 2012;

• the conclusion of the liquidation procedures for the subsidiary P&D S.p.A. on 28 December 2012;

• the merger by incorporation of Rodriquez Cantieri Navali S.p.A. into the subsidiary Intermarine S.p.A., with legal effect as of 31 December 2012: in this regard it should be noted that, as a result of this transaction, the subsidiaries Rodriquez Pietra Ligure S.r.l. and Rodriquez Cantieri Navali do Brasi Ltda. were valued as of 31 December 2012 with the equity method rather than fully consolidated;

• the increase in the stake held by ISM Investimenti S.p.A. in Is Molas S.p.A., went from 85% at 31 March 2012 to 87.18% and to 87.50% at 31 December 2012 and at 31 March 2013 respectively, following the subscription of the share capital increase of the latter (in the month of December 2012) and the subscription of the unsubscribed share by the non-controlling shareholder IN.CO.FIN. S.p.A. in January 2013;

• the increase in the stake held by Immsi S.p.A. in Apuliae S.p.A., went from 85% at 31 March 2012 to 85.69% at the end of 2012, following the subscription of the share capital increase of the latter in the month of December 2012;


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did not alter the comparability of the balance sheet and income results between the two periods of reference, as the changes are of a limited extent. On 11 April 2012, following the awarding of the competitive tender under art. 105-107 L.F. (Bankruptcy Law), Piaggio & C. S.p.A. signed the deed of purchase of the business complex "Tecnocontrol" located in Pontedera, for a total of approximately 11.3 million euros: with this acquisition, the company brought in-house the machining process of the aluminium components of the engines. The impact on the Statement of financial position of the subsidiary Piaggio & C. S.p.A. was as follows:

• increase of Instrumental plants by about 2.1 million euros; • increase in Instrumental tangible assets by about 7.7 million euros, and • increase in Consumables by about 1.5 million euros.

In this regard, we note that further the application of IFRS 3 revised, the acquisition did not result in the recognition of goodwill or potential liabilities. Lastly, it is pointed out that the Piaggio group consolidated portion of shareholders’ equity, that at 31 March 2013 amounted to 54.83%, was equal to 54.78% at 31 December 2012 and to 54.10% at 31 March 2012: such an increase is shown in the result of the effect of the purchases of Piaggio shares on the “MTA-Mercato Telematico Azionario” (Electronic Share Market) by Piaggio & C. S.p.A. during the year 2012 and during the first quarter of 2013.


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RReeccllaassssiiffiieedd ccoonnssoolliiddaatteedd ffiinnaanncciiaall ssttaatteemmeennttss aanndd eexxppllaannaattoorryy nnootteess As already remembered, the figures for the first quarter of 2012 have been restated, where applicable, resulting from the application of the IAS 19 "revised" principle. For more details see Section “New accounting principles, amendments and interpretations adopted from 1 January 2012" contained within the Explanatory and additional Notes in the Report of the Directors and Financial Statement of Immsi Group at 31 December 2012. Reclassified income statement of the Immsi Group In thousands of euros 1st Quarter 2013 1st Quarter 2012 Change

Net revenues 316,519 100% 359,913 100% -43,394 -12.1%

Costs for materials 180,830 57.1% 211,271 58.7% -30,441 -14.4%Costs for services and the use of third party assets 60,515 19.1% 73,971 20.6% -13,456 -18.2%Personnel costs 66,630 21.1% 66,303 18.4% 327 0.5% Other operating income 22,911 7.2% 26,525 7.4% -3,614 -13.6%Other operating costs 5,755 1.8% 8,339 2.3% -2,584 -31.0%OPERATING EARNINGS BEFORE DEPRECIATION AND AMORTISATION (EBITDA)

25,700 8.1% 26,554 7.4% -854 -3.2%

Depreciation of tangible assets 10,597 3.3% 9,472 2.6% 1,125 11.9% Impairment of goodwill 0 - 0 - 0 - Amortisation of finite life intangible assets 10,423 3.3% 11,517 3.2% -1,094 -9.5% OPERATING EARNINGS (EBIT) 4,680 1.5% 5,565 1.5% -885 -15.9%Earnings on equity investments 0 - 1,050 0.3% -1,050 - Financial income 5,214 1.6% 2,563 0.7% 2,651 103.4%Financial charges 17,130 5.4% 14,582 4.1% 2,548 17.5% EARNINGS BEFORE TAXATION -7,236 -2.3% -5,404 -1.5% -1,832 -33.9%Taxation -1,697 -0.5% -195 -0.1% -1,502 n/s EARNINGS AFTER TAXATION FROM CONTINUING ASSETS -5,539 -1.7% -5,209 -1.4% -330 -6.3% Profit (loss) from assets for disposal or sale 0 - 0 - 0 - EARNINGS FOR THE PERIOD INCLUDING NON-CONTROLLING INTEREST

-5,539 -1.7% -5,209 -1.4% -330 -6.3%

Non-controlling interest earnings for the period -1,957 -0.6% -1,445 -0.4% -512 -35.4%GROUP EARNINGS FOR THE PERIOD -3,582 -1.1% -3,764 -1.0% 182 4.8%

Statement of comprehensive income of the Immsi Group

31 March 2013

31 March 2012

EARNINGS FOR THE PERIOD INCLUDING NON-CONTROLLING INTEREST (5.539) (5.209) Items that cannot be reclassified in the Income statement Actuarial gains (losses) on defined benefit plans (491) (58) Total (491) (58) Items that can be reclassified in the Income statement Gains/(Losses) on cash flow hedges 1.755 (701) Gains/(Losses) on exchange differences on translating foreign operations 2.336 217 Gains/(Losses) on evaluation at fair value of assets available for sale and property investments

(1.032) 905

Total 3.059 421

Other items of Consolidated comprehensive income statement 2.568 363

TOTAL OF COMPREHENSIVE INCOME (LOSSES) FOR THE PERIOD (2.971) (4.846)

Comprehensive non-controlling interest earnings for the period (352) (1.606)

COMPREHENSIVE GROUP EARNINGS FOR THE PERIOD (2.619) (3.240)

The values presented in the preceding table are all given net of the corresponding fiscal effect.


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Net revenues Consolidated net revenues at 31 March 2013 amount to 316.5 million euros, of which 95.9% (303.4 million euros) are attributable to the industrial sector (Piaggio group), 3.8% (12.1 million euros) to the naval sector (Intermarine S.p.A.) and the balance (about 1 million euros) to the property and holding sector (Immsi S.p.A. and Is Molas S.p.A., net of the intragroup annulments). With reference to the industrial sector (Piaggio group), the first three months of 2013 ended with net revenues down compared to the same period in the previous year (-11.6%), and equal to 303.4 million euro. The decrease in turnover, partly originated by the decrease of vehicles sold, was highlighted by the depreciation of the Indian rupee. India, thanks to the launch of Vespa, is the market that recorded a more limited decrease (-2%). Sales decreases are higher in the Asia Pacific area (-9.4%) and in the EMEA and Americas area (-16.3%). With regard to the latter area, it should be underlined the excellent result obtained in America where sales recorded a growth of 5.7%. If we analyze the sales by type of products, the decrease was more marked for the commercial vehicles (-13.3%). As a result, the impact of two-wheeler vehicles on overall turnover went up from 68.1% in the first quarter of 2012 to 68.7% of the same period in 2013: whereas, the same parameter in the commercial vehicles segment decreased from 31.9% in the first quarter of 2012 to 31.3% of the same period in 2013. As regards the naval sector (Intermarine S.p.A.), consolidated revenues come to 12.1 million euros at 31 March 2013, down by 23.8% compared to 15.9 million euros at 31 March 2012: the decrease is mainly due to lower progress of production carried out regarding the Defence division that during the first quarter of 2013, made progress of production for approx. 11 million euros (compared to 14.8 million recorded in the same period of the preceding year). As regards the property and holding sector, the net revenues at 31 March 2013, equal to approx. 1 million euros, increased (+5.9%) compared to the figure in the first three months of the year 2012, mainly due to higher revenues related to the tourist and hotel business of the subsidiary Is Molas S.p.A.. Operating earnings before depreciation and amortisation (EBITDA) Consolidated operating earnings before depreciation and amortisation (EBITDA) amounts to 25.7 million euros at 31 March 2013 (8.1% of net revenues): compared to the operating earnings before depreciation and amortisation (EBITDA) for the first three months of 2012, this value decreased by around 0.9 million euros (or -3.2%), mainly subsequent to the lower contribution related to the industrial sector (Piaggio group). At 31 March 2012, the operating earnings before depreciation and amortisation (EBITDA) of the Immsi Group amounted to 26.6 million euros (7.4% of net revenues). The portion attributable to the industrial sector (Piaggio group) amounts to 30.1 million euros, 2.9 million euros decrease compared to the figure at 31 March 2012 (33 million euros), and 9.9% of the net revenues of the sector, an increase compared to 9.6% of the same period in 2012. The portion attributable to the naval sector (Intermarine S.p.A.) is negative by 3.3 million euros but 1.8 million euros increase compared to the figure at 31 March 2012 (equal to 5.1 million euros negative). Finally, the portion attributable to the property and holding sector is negative by 1.1 million euros but also 0.3 million euros increase compared to the figure at 31 March 2012 (equal to 1.4 million euros negative). One of the main cost item of the Immsi Group is represented by personnel costs equal to 66.6 million euros (21.1% of net revenues), basically in line with the value recorded during the same period in 2012, equal to 66.3 million euros (18.4% of net revenues of the Group).


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Operating earnings (EBIT) Operating income (EBIT) in the first three months of 2013 amounts to 4.7 million euros (1.5% of net revenues). The decrease on the same period of 2012 is around 0.9 million euros (-15.9%). Consolidated operating income (EBIT) for the first three months of the preceding period was 5.6 million euros (1.5% of net revenues). The portion attributable to the industrial sector (Piaggio group) amounts to 9.8 million euros, 3.2 million euros decrease compared to the figure at 31 March 2012 (13 million euros), and 3.2% of the net revenues of the sector, a decrease compared to 3.8% of the same period in 2012. The portion attributable to the naval sector (Intermarine S.p.A.) is negative by 3.9 million euros but 2.1 million euros increase compared to the figure at 31 March 2012 (equal to 6 million euros negative). Finally, the portion attributable to the property and holding sector is negative by 1.2 million euros but also 0.3 million euros increase compared to the figure at 31 March 2012 (equal to 1.5 million euros negative). Depreciation and amortisation for the period come to a total of 21 million euros (in line with the figure recorded during the first three months of 2012), whose incidence on net revenues (6.6%) was up compared to the first three months of 2012 (5.8%), being made up of 10.6 million euros of depreciation of tangible assets (9.5 million euros in the same period of year 2012) and 10.4 million euros of amortisation of intangible assets (11.5 million euros in the same period of year 2012). In particular, depreciation and amortisation referable to the industrial sector (Piaggio group) amount to about 20.3 million of euros (compared to 20 million euros in the first three months of 2012), of which 10.4 million euros related to intangible assets (11.3 million euros in the first three months of 2012) and 9.9 million euros related to tangible assets (8.7 million euros in the first three months of 2012): the decrease recorded under the item amortizations of intangible assets further to the extension of the useful life of the Aprilia and Moto Guzzi brands (applied in December 2012) was substantially offset by the increase of depreciations of tangible assets owing to the opening of the spares depot in Pontedera and the Vespa plant in India. Moreover, it is pointed out that operating earnings do not include impairments of goodwill either in the first three months of 2013 or in the same period of preceding year, in that, on the basis of the results expected in the multi-year development plans prepared by the Group companies and used for testing for impairment carried out on 31 December 2012 and on 31 December 2011 no write-downs were deemed to be necessary in that such goodwill was considered to be recoverable with future cash flows. In addition, it should be noted that during the first three months of 2013 no events occurred such as to indicate that the activities subject of impairment testing could have suffered a significant loss in value. Considering that the analyses conducted to estimate the recoverable value for the Immsi Group cash-generating unit have also been determined on the basis of estimates, the Group cannot assure that there will not be a loss in value of the goodwill in future periods. Owing to the current context of the crunch in the markets of reference and in the financial markets, the different factors – both inside and outside the identified cash-generating units – used in drawing up the estimates could in the future be reviewed. The Group will constantly monitor these factors and the possible existence of future losses in value. Earnings before taxation Earnings before taxation at 31 March 2013 shows a negative result equal to 7.2 million euros (-2.3% of net revenues of the period). The corresponding consolidated figure for the first three months of the previous year was 5.4 million euros negative with an incidence on net revenues of the period equal to -1.5%.


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Financial charges, net of income and of earnings on equity investments, in the first three months of 2013 come to 11.9 million euros (3.8% of net revenues). At 31 March 2012 this figure amounted to 11 million euros, 3% incidence on the revenues of the period. The increase in Net financial charges recorded during the first three months of 2013 to the same period of the preceding year is mainly ascribable to the Piaggio group owing to the fact that during the first three month of 2013 income from equity investments is no longer in relation to the equity valuation of the joint venture in China (1.1 million euros in the first three months of 2012), only partially offset by the net balance increase of financial income and financial charges (+0.3 million euros), essentially reached further to the capitalisation of financial charges made in 2013 for 1.6 million euros. In particular, financial charges (net of the income and of the earnings on equity investments) were 8 million euros for the industrial sector (7.2 in the first quarter of 2012), 1.4 million euros for the naval sector (1.5 in the first quarter of 2012), while the remaining part (2.5 million euros in the first quarter of 2013 compared to 2.2 million in the corresponding period of the preceding year) is attributable to the property and holding sector. Group earnings for the period Earnings for the period after taxation and non-controlling interests at 31 March 2013 recorded a negative value equal to 3.6 million euros (-1,1% of net revenues of the period). In the first three months of the previous year, this figure was negative for 3.8 million euros (-1% of net revenues of the period). The taxes under accrual basis amount to approx. 1.7 million euros (0.2 million euros during the first quarter of year 2012): it should be remembered that the corporate income taxes, also in consideration of IAS 34, have been determined on the basis of the better estimate of the weighted average rate expected for the entire year in progress. Earnings/(Loss) per share In euro From continuing and discontinued operations:

31 March 2013 31 March 2012

Basic

(0.011)

(0.011)

Diluted (0.011) (0.011)

Diluted earnings per share correspond to the basic profit in that there are no potential shares having a diluting effect. At the Interim Management Report closing date there are no gains or losses from assets intended for sale or disposal.


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Reclassified statement of financial position of the Immsi Group In thousands of euros 31.03.2013 in % 31.12.2012 in % 31.03.2012 in %

Current assets: Cash and cash equivalent 111,464 4.8% 96,623 4.4% 114,019 4.8% Financial assets 16,522 0.7% 1,292 0.1% 7,280 0.3% Operating assets 717,879 30.8% 617,239 28.1% 779,811 33.0% Total current assets 845,865 36.3% 715,154 32.6% 901,110 38.1%

Non-current assets: Financial assets 0 0.0% 2,893 0.1% 2,660 0.1% Intangible assets 843,657 36.2% 839,146 38.2% 831,149 35.1% Tangible assets 362,913 15.6% 360,062 16.4% 321,667 13.6% Other assets 280,883 12.0% 276,657 12.6% 308,578 13.0% Total non-current assets 1,487,453 63.7% 1,478,758 67.4% 1,464,054 61.9% TOTAL ASSETS 2,333,318 100.0% 2,193,912 100.0% 2,365,164 100.0%

Current liabilities: Financial liabilities 463,759 19.9% 459,763 21.0% 411,143 17.4% Operating liabilities 662,451 28.4% 657,822 30.0% 695,847 29.4% Total current liabilities 1,126,210 48.3% 1,117,585 50.9% 1,106,990 46.8%

Non-current liabilities: Financial liabilities 544,235 23.3% 410,387 18.7% 503,431 21.3% Other non-current liabilities 118,610 5.1% 118,002 5.4% 144,410 6.1% Total non-current liabilities 662,845 28.4% 528,389 24.1% 647,841 27.4% TOTAL LIABILITIES 1,789,055 76.7% 1,645,974 75.0% 1,754,831 74.2% TOTAL SHAREHOLDERS’ EQUITY 544,263 23.3% 547,938 25.0% 610,333 25.8% TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

2,333,318 100.0% 2,193,912 100.0% 2,365,164 100.0%

Analysis of capital invested by the Immsi Group In thousands of euros 31.03.2013 in % 31.12.2012 in % 31.03.2012 in %

Current operating assets 717,879 46.5% 617,239 43.0% 779,811 50.5% Current operating liabilities -662,451 -42.9% -657,822 -45.8% -695,847 -45.0%Net operating working capital 55,428 3.6% -40,583 -2.8% 83,964 5.4%

Intangible assets 843,657 54.7% 839,146 58.5% 831,149 53.8% Tangible assets 362,913 23.5% 360,062 25.1% 321,667 20.8% Other assets 280,883 18.2% 276,657 19.3% 308,578 20.0% Invested capital 1,542,881 100.0% 1,435,282 100.0% 1,545,358 100.0%

Non-current non-financial liabilities 118,610 7.7% 118,002 8.2% 144,410 9.3% Non-controlling interest capital and reserves 187,360 12.1% 187,943 13.1% 209,861 13.6% Consolidated shareholders’ equity of the Group 356,903 23.1% 359,995 25.1% 400,472 25.9% Total non-financial sources 662,873 43.0% 665,940 46.4% 754,743 48.8% Net financial debt 880,008 57.0% 769,342 53.6% 790,615 51.2%

Invested capital Invested capital amounts to 1,542.9 million euros at 31 March 2013, increasing compared to 31 December 2012 (+107.6 million euros) but slightly decreasing compared to 31 March 2012 (-2.5 million euros) equal to 1,453.3 million euros and 1,545.4 million euros respectively. In particular, compared with the beginning of the year, net working capital has risen by 96 million euros mainly due to an increase in current operating assets related to the effect of the seasonal nature of the Two-wheeler business of Piaggio group which, as known, absorbs resources in the early part of the year and generates them in the later part.


17

The increase in the tangible assets amounts to 2.9 million euros compared to 31 December 2012, whereas intangible assets increase by 4.5 million euros compared to 31 December 2012. Net Financial Debt of the Immsi Group The net financial debt of the Immsi Group, equal to 880 million euros at 31 March 2013, is analysed below and compared with the similar figure at 31 December 2012 and at 31 March 2012. Pursuant to the CONSOB communication no. 6064293 of 28 July 2006 and in conformity with the CESR recommendation of 10 February 2005 “Recommendations for the consistent implementation of the European Commission’s Regulation on Prospectuses”, the Net financial debt - calculated excluding the Receivables for medium and long term loans - amounts to 772,235 thousand euros and 793,275 thousand euros at 31 December 2012 and at 31 March 2012 respectively: this adjustment did not affect the figures at 31 March 2013 as there are no medium/long-term financial Receivables. In thousands of euros 31.03.2013 31.12.2012 31.03.2012 Short-term liquidity Cash and cash equivalent -111,464 -96,623 -114,019 Financial assets -16,522 -1,292 -7,280 Total short-term financial assets -127,986 -97,915 -121,299 Shot-term financial payables Bonds 0 0 0 Amounts due to bank 409,183 406,719 388,317 Amounts due under finance leases 946 936 905 Amounts due to other lenders 53,630 52,108 21,921 Total short-term financial payables 463,759 459,763 411,143 Total short-term financial debt 335,773 361,848 289,844 Medium/long-term financial assets Receivables for loans 0 -2,893 -2,660 Other financial assets 0 0 0 Total medium/long-term financial assets 0 -2,893 -2,660 Medium/long-term financial payables Bonds 193,584 193,550 191,914 Amounts due to bank 341,519 206,496 270,419 Amounts due under finance leases 5,568 5,809 6,515 Amounts due to other lenders 3,564 4,532 34,583 Total medium/long-term financial payables 544,235 410,387 503,431 Total medium/long-term financial debt 544,235 407,494 500,771 Net financial debt * 880,008 769,342 790,615

*) The indicator does not include financial assets and liabilities arising from the fair value valuation of derivative financial instruments designated as hedges, the adjustment to fair value of the related hedged items and related expenses amounting to 12,520 thousand euros at 31 March 2013 (12,406 thousand euros and 8,464 thousand euros at 31 December 2012 and at 31 March 2012 respectively).

With reference to the composition of the debt it is possible to note, compared to 31 December 2012, a decrease in the short-term financial debt, passing from a balance equal to 361.8 million euros to a balance equal to 335.8 million euros (or -26.1 million euros), mainly due to an increase of Cash and cash equivalent (passing from 96.6 million euros at 31 December 2012 to 111.5 million euros at 31 March 2013, or +14.8 million euros) and of Financial assets (passing from 1.3 million euros at 31 December 2012 to 16.5 million euros at 31 March 2013, or +15.2 million euros). The financial debt over the medium and long term (equal to 544.2 million euros at 31 March 2013) is increasing compared to the balance at 31 December 2012 (equal to 407.5 million euros) and at 31 March 2012 (equal to 500.8 million euros) for 136.7 and 43.5 million euros respectively.


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Investments Gross capital investments during the period to 31 March 2013 totalled 22.5 million euros, almost fully referring to the Piaggio group, of which 13 million euros in intangible assets and 9.5 million euros in tangible assets. Besides the aforesaid cash flows in the period at issue there have been purchases on the market of treasury stock by Piaggio & C. S.p.A. for around 0.7 million euros. Cash flow statement of the Immsi Group In thousands of euros 31 March 2013 31 March 2012

Operating assets

Earnings of the period (3,582) (3,764) Non-controlling interest (1,957) (1,445) Taxation (1,697) (195) Depreciation of tangible assets (including property investments) 10,597 9,472 Amortisation of intangible assets 10,423 11,517 Provisions for risks and for severance indemnity and similar obligations 5,570 6,476 Write-downs / (Revaluations) 329 427 Losses / (Gains) on disposal of tangible assets (including property investments) 6 0 Interest receivable (539) (760) Interest payable 11,294 10,103 Depreciation of grants (1,942) (1,111)

Change in working capital (102,763) (63,055)

Changes of non-current reserves and other changes (4,088) (19,547)

Cash generated from operations (78,349) (51,882) Interest paid (6,253) (7,696) Taxation paid (3,616) (5,091) Cash flow from operations (88,218) (64,669)

Investments

Investments in tangible assets (9,521) (15,774) Sale price, or repayment value, of tangible assets (including property investments) 22 29 Investments in intangible assets (12,993) (14,769) Sale price, or repayment value, of intangible assets 10 448 Interests received 89 267 Other changes (12,336) (8,278)

Cash flow from investments (34,729) (38.077)

Financing

Purchase of treasury stock by Piaggio & C. S.p.A. (703) (721) Loans received 143,868 138,583 Outflow for repayment of loans (6,174) (91,844) Repayment of finance leases (231) (219)

Cash flow from financing 136,760 45,799

Increase / (Decrease) in cash and cash equivalents 13,813 (56,947)

Opening balance 74,678 139,271 Exchange differences 0 0 Closing balance 88,491 82,324

This schedule shows the changes in cash and cash equivalents that at 31 March 2013 totalled 111.5 million euros, gross of short-term bank overdrafts equal to 23 million euros.


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Total shareholders' equity and equity pertaining to the Immsi Group

Consolidated shareholders’ equity of the

Consolidated non-

controlling interest

In thousands of euros

Group shareholders’ equity

Total consolidated

Group and non- controlling

interest shareholders’

equity Balances at 1st January 2012 403,746 211,983 615,729 Figurative cost of stock options

93

78

171

Other changes (126) (595) (721)

Total of comprehensive income (losses) for the period (3,240) (1,606) (4,846)

Balances at 31 March 2012 400,472 209,861 610,333

Consolidated shareholders’ equity of the

Consolidated non-

controlling interest


Group shareholders’ equity

Total consolidated

Group and non- controlling

interest shareholders’

equity Balances at 1st January 2013 359,995 187,943 547,938 Other changes

(473)

(231)

(704)

Total of comprehensive income (losses) for the period (2,619) (352) (2,971)

Balances at 31 March 2013 356,903 187,360 544,263


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Human resources At 31 March 2013, Immsi Group employed 8,869 staff, of which 77 in the property and holding sector, 8,487 in the industrial sector (Piaggio group) and 305 in the naval sector (Intermarine). The following tables divide resources by category and geographical area: Human resources by category

numbers 31/03/2013 Property and

holding sectorIndustrial

sector Naval sector Group total

Senior managers 7 96 8 111 Middle managers and employees 38 2,773 142 2,953 Manual workers 32 5,618 155 5,805 TOTAL 77 8,487 305 8,869

Human resources by geographical area

numbers 31/03/2013

Property and holding sector

Industrial sector

Naval sector Group total

Italy 77 3,886 305 4,268 Rest of Europe 0 391 0 391 Rest of the World 0 4,210 0 4,210 TOTAL 77 8,487 305 8,869

Human resources by category

numbers 31/03/2013 31/12/2012 Change

Senior managers 111 111 0 Middle managers and employees 2,953 2,968 -15 Manual workers 5,805 5,440 365 TOTAL 8,869 8,519 350

Human resources by geographical area

numbers 31/03/2013 31/12/2012 Change

Italy 4,268 4,263 5 Rest of Europe 391 445 -54 Rest of the World 4,210 3,811 399 TOTAL 8,869 8,519 350

The increase in the number of employees compared to 31 December 2012 (+350) is attributable to the industrial sector (+358) and is entirely related to the Indian subsidiary company of the Piaggio group and the employment of seasonal staff (with term contracts) to face the peak demand during the summer period.


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DDiirreeccttoorrss’’ ccoommmmeennttss oonn tthhee rreessuullttss ooff ooppeerraattiioonnss In the first three months of 2013 the Immsi Group shows a decrease in net revenues and operating results down on the corresponding period of the preceding year. The results of the various sectors making up the Group differ according to their business trends and the impact of seasonality. PPrrooppeerrttyy aanndd hhoollddiinngg sseeccttoorr

31.03.2013 in % 31.03.2012 in % Change in %


Net revenues 985 930 55 5.9%


-1,085 n/m -1,370 n/m 285 20.8%

Operating earnings (EBIT) -1,222 n/m -1,521 n/m 299 19.7%

Earnings before taxation -3,690 n/m -3,732 n/m 42 1.1%


-3,700 n/m -2,926 n/m -774 -26.4%

Group earnings for the period (consolidable) -2,340 n/m -2,033 n/m -307 -15.1%

Net financial position -240,764 -198,108 -42,656 -21.5%

Personnel (number) 77 78 -1 -1.3%

Overall, in the first quarter of 2013, the property and holding sector produced consolidable negative net earning equal to approx. 2.3 million euros and a negative Net financial position equal to approx. 240.8 million euros: below is a description of the developments of the management of the major companies in this sector during the first quarter of 2013. The Parent company Immsi S.p.A. records a negative net result during the first three months of the year 2013 equal to around 0.1 million euros, an improvement compared to what highlighted during the first three months of the previous year (negative net result equal to around 0.5 million euros). In particular, the Company showed negative operating earnings (EBIT) of about 0.1 million euros (-0.2 million euros during the first quarter of 2012) and a net financial result – given by the difference between financial income and financial charges – basically unchanged (compared to a negative balance of approx. 0.3 million euros during the first quarter of the 2012 financial year). It should also be noted that in the preparation of this Interim management report at 31 March 2013, the Parent Company did not carry out specific impairment analyses relative to the carrying value of equity investments in fully consolidated companies as such investments and any changes that may result from related impairment tests would have been cancelled in full upon consolidation. The net financial debt at 31 March 2013 is 69.5 million euros, approximately 2.1 million euros increase compared to the figure at 31 December 2012, mainly in relation to the cash absorption related to the Company operations and the hedging of the temporary financial need of some associated companies. Lastly, we point out that in February 2013 the Company subscribed a share of about 12.2 million euros of the subordinated convertible bond approved by the Extraordinary General Meeting of Alitalia - Compagnia Aerea Italiana S.p.A.. To this regard it should be noted that on 3 April 2013,


22

Immsi S.p.A. – in its capacity as “anticipatory” shareholder – received a reimbursement of approximately 1.3 million euro on the amount initially subscribed, as envisaged under the bond regulation; consequently the subscribed amount, recorded under the “Financial receivables” item, stands at approximately 10.9 million euro. As regards the subsidiary Is Molas S.p.A., we point out that on 28 February 2013 a contract was signed with a primary construction firm, while in March the site was opened to start the works. From the commercial point of view, the marketing of the residential component of the project continued by selecting some of the leading international real estate brokerage companies specializing in the sale of prestigious properties. Regarding the outstanding proceedings there are no relevant updating. Turning to the results for the year, net revenues equal to approx. 0.3 million euros were recorded during the first quarter of 2013, a 18.3% increase compared to the same period of the previous year, mainly further to the increase of bookings compared to the first three months of 2012. In terms of marginality, during the first quarter of 2013 the company recorded a negative operating result equal to approx. 1.1 million euros (-1.3 million in the first quarter of 2012) and a net consolidable loss for the Immsi Group equal to 0.7 million euros (-0.8 in the first quarter of 2012). The company’s Net financial position shows net indebtedness equal to 42.3 million euros, with a net cash absorption of 0.5 million euros compared to 31 December 2012, mainly in relation to the negative contribution of the cash generated internally: in this respect, it should be pointed out that on 7 January 2013, the shareholder ISM Investimenti S.p.A. paid 0.9 million euros in relation to the exercise of its pre-emption right over the unsubscribed share of the first tranche of capital increase equal to 6 million euros (inclusive of capital and premium), regarding which on 6 December 2012 the same shareholder fully exercised its emption right by paying a total of 5.1 million euros. With reference to the Pietra Ligure project (Pietra S.r.l.), we mainly proceeded to carry on the performance of all activities necessary to provide a comprehensive response to the comments and requirements of the Bodies attending the Services Conference and deriving from the analysis carried out by the above mentioned Bodies regarding the Final Project filed pursuant to art. 6 of D.P.R [Presidential Decree] 509/1997 – Burlando Decree. In particular, with reference to the activities aimed at implementing the Characterization Plan, we point out the completion of coring works and researches in seawater and in the stretch of water in front of the shipyard, as well as the starting of coring works and ground researches for the subsequent analyses: in this respect, it should be pointed out that, on 28 February 2013, the Municipality of Pietra Ligure sent the Decision for procedure conclusion (art. 14 ter. Paragraph 6 bis of Law 241/1990) to every Body attending the Services Conference to approve the Characterization Plan (art. 242 of del D.Lgs. Law Decree 152/06 and subsequent modifications and additions) for said area. Also the meetings with professionals, with Municipal Authorities, Regional and Public Maritime Domain offices continued on the final revision of the documents related to the project and the intervention. At 31 March 2013, the company Pietra S.r.l. shows an essential break-even at an economic level and a Net financial debt amounting to 2.2 million euros, unchanged compared to 31 December 2012. With reference to the subsidiary Apuliae S.p.A. there is no further updating compared to the Report of the Directors and Financial Statements of Immsi Group at 31 December 2012, which reference is made to herein. At 31 March 2013, the company shows an essential break-even at an economic level and a Net financial debt slightly positive and basically in line with the figure at 31 December 2012. The other major companies falling within the property and holding sector also include RCN Finanziaria S.p.A. and ISM Investimenti S.p.A.:

• RCN Finanziaria S.p.A., in which Immsi S.p.A. holds a 63.18% stake, and sole shareholder of Intermarine S.p.A., shows a net consolidable loss for the Immsi Group


23

amounting to approx. 0.5 million euros (-0.4 during the first quarter of 2012) and a Net financial debt at 31 March 2013 equal to 92.8 million euros (basically in line with the figure at 31 December 2012);

• ISM Investimenti S.p.A., in which Immsi S.p.A. holds a 71.43% stake, and which controls

Is Molas S.p.A., shows a net consolidable loss for the Immsi Group amounting to approx. 0.5 million euros (in line with the figure recorded during the first quarter of 2012) and a Net financial debt at 31 March 2013 equal to 58 million euros, an increase of approximately 1.1 million euros compared to 31 December 2012 primarily as a result of the aforementioned disbursement of 0.9 million euros in relation to the exercise of its pre-emption right over the unsubscribed share of the first tranche of share capital increase of the subsidiary Is Molas S.p.A..


24

IInndduussttrriiaall sseeccttoorr

31.03.2013 in % 31.03.2012 in % Change in %


Net revenues 303,449 343,122 -39,673 -11.6%


30,082 9.9% 33,022 9.6% -2,940 -8.9%

Operating earnings (EBIT) 9,804 3.2% 13,039 3.8% -3,235 -24.8%

Earnings before taxation 1,764 0.6% 5,829 1.7% -4,065 -69.7%


1,058 0.3% 3,206 0.9% -2,148 -67.0%

Group earnings for the period (consolidable) 588 0.2% 1,737 0.5% -1,149 -66.1%

Net financial position -487,739 -422,412 -65,327 -15.5%

Personnel (number) 8,487 8,330 157 1.9%

In the first quarter of 2013, the Piaggio group sold 138,400 vehicles worldwide, registering a drop of approximately 2.8% in volume over the same period of the previous year, when 142,300 vehicles were sold. Strong growth was recorded in vehicles sold in India (+22%) as a result of Vespa sales (13,100 vehicles sold) that started in the second quarter of year 2012. On the other hand, there was a decrease in sales both in the EMEA and Americas zone (-18.5%) and in Asia Pacific (-11.8%). With regard to the type of products sold, the decrease is mainly concentrated in Commercial Vehicles (-5.4%). The sales of Two-wheeler vehicles were influenced by a particularly negative market context and a complex competitive scenario, in almost all reference markets of the group. In particular, the EMEA two-wheeler market declined by 23.9% (-27.2% for scooters and -19.3% for motorcycles). In the EMEA area, the Piaggio group consolidated its market leadership position with a share of 16.1% (25.4% for scooters). The Group achieved excellent sales results on the North American market (+25.2%) and in India. Sales of commercial vehicles were affected by the downturn on the domestic reference market (Italy -30.4%). With reference to the European Two-Wheeler segment, in the first three months of 2013, the Piaggio group retained its leadership, with a 16.1% share (25.4% in the scooter segment and 4.6% for motorcycles). As regards the Italian market, the Piaggio group confirmed its leadership position, with a total share of 21.6%, (31.5% in the scooter segment), a drop compared to year 2012. The US market achieved an excellent performance, despite the decrease of the scooter segment by 34.1%, the group increased sales by 25.2% taking its share to 24.6%. In this context, the Piaggio group is steadfastly committed to consolidating its presence in the motorcycle segment, with its Moto Guzzi and Aprilia brands. In the second quarter of 2012, Vespa model went on sale in India: in the first quarter of year 2013, 13,100 units had been sold. With reference to the Asia Pacific market, the group increased its market share in the Vietnamese market passing from 17.8% to 18.5%. In the first three months of 2013, the Commercial Vehicles business generated a turnover of approximately 95.1 million euros, including approximately 8.5 million euros relative to spare parts and accessories, down 13.3% over the same period of 2012. Units sold fell from 53,700 units in the first three months of 2012 to 50,800 units in the current period, with a downturn, lower than turnover, of 5.4%. The decrease in the turnover recorded by India is due to the drop of units sold as well as to the depreciation of the Indian rupee. On the EMEA and Americas markets, the


25

Piaggio group sold 2,000 units in the first three months of 2013, generating a net total turnover of approximately 15.6 million euros, including spare parts and accessories. The decrease in units sold of 31.8% and in turnover of 22.1%, compared to the same period in 2012, is mainly due to the continuing downturn on the reference market comprising the Italian domestic market of Commercial Vehicles with a total maximum mass of up to 3.5 tons, which recorded a drop of 30.4%. On the Indian three-wheeler market, Piaggio Vehicles Private Limited, with 48,800 units sold against 50,700 over the same period in 2012, retained its position as reference player, with a market share of 32.9%. In more detail, Piaggio Vehicles Private Limited consolidated its role as market leader in the cargo segment, with a market share of 51.3%, and as a leading player in the important passenger segment with a market share of 28.6%. Lastly, in the last quarter of the year 2012, the new Ape City Passenger with a new 200cc engine fully developed by Piaggio went on sale: this new vehicle will enable Piaggio to make a strong entrance on the market of three-wheeler passenger vehicles for city traffic. On the other hand, in the first three months of 2013, with reference to sales on the four-wheeler market, Piaggio Vehicles Private Limited had a marginal role, with a 0.5% market share. In terms of consolidated turnover, the group ended the first three months of 2013 with net revenues down compared to the same period in the previous year (-11.6%), and equal to 303.4 million euro. The decrease in turnover, partly caused by a drop in the quantity of vehicles sold, was affected by the depreciation of the Indian rupee. India, thanks to the launch of Vespa, is the market that recorded a more limited decrease (-2%). Sales decreases are higher in the Asia Pacific area (-9.4%) and in the EMEA and Americas area (-16.3%). With regard to the latter area, it should be underlined the excellent result obtained in America where sales recorded a growth of 5.7%. If we analyze the sales by type of products, the decrease was more marked for the commercial vehicles (-13.3%). As a result, the impact of two-wheeler vehicles on overall turnover went up from 68.1% in the first quarter of 2012 to 68.7% of the same period in 2013: whereas, the same parameter in the commercial vehicles segment decreased from 31.9% in the first quarter of 2012 to 31.3% of the same period in 2013. The operating result before depreciation and amortisation (EBITDA) in the first quarter of 2013 was equal to 30.1 million euros (-2.9 million euros compared to the same period of 2012). In terms of incidence on net revenues, EBITDA at 31 March 2013 is 9.9%, an increase compared to the figure in the corresponding period of 2012 (9.6%). The operating income (EBIT) in the first three months of the year 2013 is equal to 9.8 million euros, 3.2 million euros decrease compared to 13 million euros of the same period in 2012. Operating profitability (measured as operating income divided by net revenues) also decreased: 3.2% against the 3.8% for the same period in 2012. In the first three months of 2013, the Piaggio group recorded earnings before tax equal to 1.8 million euros (-4.1 million euros compared to the same period in 2012): this decrease is basically related to the aforementioned decrease of the operating income, as well as to the decrease of net financial income, mainly owing to the lack of income from equity investments during the first three month of 2013 (1.1 million euros in the first three months of 2012), only partially offset by the net balance increase of financial income and financial charges (+0.3 million euros), essentially reached further to the capitalisation of financial charges made in 2013 for 1.6 million euros. Taxation for the period, in application of the IAS standards, reflects a cost of 0.7 million euros (a 1.9 million euros decrease compared to the result recorded during the first quarter of last year) and was determined on the basis of the average tax rate expected for the entire financial year. Earnings for the period including non-controlling interest at 31 March 2013 totalled 1.1 million euros (3.2 million euros in the same period of year 2012), of which 0.6 million euros represent the consolidable portion for Immsi Group.


26

The net financial debt at 31 March 2013 was 487.7 million euros compared to 391.8 million euros at 31 December 2012: the increase of 95.9 million euros of the net financial position is mainly due to the seasonality of the Two-Wheeler business that, as known, absorbs financial resources in the early part of the year and generates them in the later part.


27

NNaavvaall sseeccttoorr

31.03.2013 in % 31.03.2012 in % Change in %


Net revenues 12,085 15,861 -3,776 -23.8%


-3,297 -27.3% -5,098 -32.1% 1,801 35.3%

Operating earnings (EBIT) -3,902 -32.3% -5,953 -37.5% 2,051 34.5%

Earnings before taxation -5,310 -43.9% -7,501 -47.3% 2,191 29.2%


-2,897 -24.0% -5,489 -34.6% 2,592 47.2%

Group earnings for the period (consolidable) -1,830 -15.1% -3,468 -21.9% 1,638 47.2%

Net financial position -151,505 -170,095 18,590 10.9%

Personnel (number) 305 312 -7 -2.2%

With reference to the naval sector, it should be remembered at the outset that, during the month of December 2012, the company Rodriquez Cantieri Navali S.p.A. was merged by incorporation into Intermarine S.p.A., a company previously controlled by it with a stake of 100%. The transaction in question represented the final step in an extensive process of restructuring which involved over the last two years the companies belonging to the Rodriquez Cantieri Navali group, in order to implement a simplification and streamlining of the corporate chain: please note, in fact, that in 2010 the companies Conam S.p.A. and Rodriquez Marine System S.r.l. were merged by incorporation into the then parent Rodriquez Cantieri Navali S.p.A.. All of these operations were aimed to achieve a more efficient administrative and business management of the activities of the companies involved, in order to pursue operating synergies, reduce overhead costs and simplify the management of the cash flows. With reference to the economic data of the sector, during the first quarter of 2013 there was a decrease in net sales revenues (consisting of turnover and variations by order on the works in progress) on the previous year equal to 23.8%, reaching 12.1 million euros, compared to 15.9 million euros in the first quarter of 2012. The progress in production, including the activities of research and development, and the completion of the constructions and deliveries have concerned particularly:

• the Defence division with 11 million euros (14.8 million euros during the first quarter of 2012), mainly for progress in the construction of minesweepers for the Finnish Navy, in the construction and supply of logistics packages for the Guardia di Finanza (i.e.Tax Revenue Corps) and in the modernisation of the Italian Navy’s Gaeta class minesweepers;

• Fast Ferries and Yacht divisions, with overall 1.1 million euros (1.1 million euros during the first quarter of 2012), mainly for repair work, for activities related to the transfer to Oman of one of the two 52 meter catamarans for the Sultanate, and for progress of works on the remaining unit.

The production has been characterized by altogether still insufficient marginality to absorb the direct costs of production and those of the fixed structures, particularly due to i) final costs of Oman contract; and ii) costs incurred for the order of minesweepers for the Finnish Navy. Furthermore, it should be noticed that for the yacht business there is a continued lack of new significant sales contracts for both new and second-hand boats. The company, in the light of the results recorded,


28

and pending a market recovery and developments on the sales front, which are crucial for absorbing indirect costs and overheads to an adequate degree, exploited to the full every opportunity to contain structural costs in the first quarter of 2013 so as to minimise the incurred losses. Given the foregoing, a negative operating loss (EBIT) of 3.9 million euros (-6 million euros over the same period in 2012) was recorded in the first quarter of 2013, whereas the before taxes operating loss amounted to 5.3 million euros (-7.5 million euros in the first quarter of 2012). The negative net consolidable result for the Immsi Group amounted at 31 March 2013 to 1.8 million euros compared with the loss of 3.5 million euros during the first quarter of 2012. At 31 March 2013, the overall order book of the company amounts to approximately 126 million euros. In particular, the share relating to the Defense business amounts to about 123 million euros, mainly related i) to the refitting programme of eight Gaeta minesweepers (for approx. 82 million euros); ii) to the programmes of construction and supply of logistics packages for the Guardia di Finanza (i.e. Tax Revenue Corps) (for approx. 36 million euros), and iii) to the residual advances with regard to the program of construction of three minesweepers (one delivered in May 2012) for the Finnish Navy (for about 4 million euros). The remaining order book of the company is ascribable to the Fast Ferries business and mainly regards i) the completion of the contract for the Sultanate of Oman; ii) repair and maintenance works ; and iii) the share in the RTI order to build 22-metre patrol boats for the customer Guardia di Finanza. From a financial standpoint, the Net financial debt, equal to 151.5 million euros at 31 March 2013 has increased by approximately 11.3 million euros compared to the balance at 31 December 2012, equal to 140,2 million euros. Such an increase is almost entirely due to the absorption of the resources related to the cash flow generated by the group management mainly referable to the use of credit lines to pay debts for the supply of the outstanding contracts and in particular the contract stipulated with the Finish Navy, whose collections will be against the delivery of the outstanding units.


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EEvveennttss ffoolllloowwiinngg 3311 MMaarrcchh 22001133 aanndd pprreeddiiccttaabbllee eevvoolluuttiioonn ooff mmaannaaggeemmeenntt With reference to the Parent company Immsi S.p.A., as already anticipated, on 3 April 2013, in its capacity as anticipatory shareholder, the company received a reimbursement of approximately 1.3 million euro on the amount initially subscribed (12.2 million euro) for the subordinate convertible bond deliberated by the extraordinary shareholders' meeting of Alitalia - Compagnia Aerea Italiana S.p.A. on 22 February 2013, as envisaged under the bond regulation; consequently the subscribed amount now stands at approximately 10.9 million euro. The Immsi S.p.A. Shareholders’ General Meeting of 30 April 2013 approved a plan for the buyback and disposal of ordinary own shares of the Company, revoking the shareholder resolution of 11 May 2012 during the Ordinary Shareholders’ Meeting. At an extraordinary session, the shareholders approved the cancellation of 2,670,000 own shares in portfolio (representing 0.778% of the share capital), subject to elimination of the par value of outstanding ordinary shares and without a reduction in the numerical amount of the share capital. After this operation and after registration of the resolution in the Companies Register – on 9 May 2013 – the share capital of Immsi S.p.A. is unchanged at 178,464,000.00 euro, represented by 340,530,000 ordinary shares. With reference to the Pietra Ligure project on 8 April 2013, the Pietra Ligure municipal council approved the Definitive Project as per art. 6 of the Burlando Decree: the discussion by the municipal council was requested by the Liguria regional authority prior to calling the Reference Services Conference ex art. 6 of the Burlando Decree. On 26 April 2013, the Pietra Ligure municipal council called the Reference Services Conference for Thursday 16 May 2013, to examine the request for a concession of maritime public land for the construction and management of a tourist port in the areas covered by the project: the 150 days required by the procedure for the proceedings to be closed with the Deliberating Services Conference will begin from this date. With reference to the industrial sector (Piaggio group), on 9 April 2013 the Aprilia Caponord 1200 enduro road bike was presented to the international press. The new motorcycle features exclusive patented technological content such as the Aprilia ADD semi-active suspension system, which automatically adjusts regulation according to the road surface and driver style. On 24 April 2013, the National Hospital for Paediatrics in Hanoi and the Bambino Gesù Children’s Hospital in Rome announced a cooperation project to treat more than two thousand Vietnamese children aged between 0 and 18, organised with the support of Piaggio Vietnam; the project is the first initiative in the new “Vespa for Children” program of social activities recently announced by the Piaggio group. Regarding the predictable evolution of the management during year 2013, with reference to the subsidiary Is Molas S.p.A. it is expected that this year will see the beginning of the construction of the residential component of the project and - depending on market feedback - the construction of additional residential lots will go ahead, as well as the launch of the tourism and hotel investment. With reference to the Piaggio group – despite the slowdown in growth at a global level and of western economies in particular – the group is committed to the strategies outlined in its industrial plan presented in December 2011. Thus it is committed to generating strong growth for productivity (harnessing its increased international presence, to increase the competitiveness of product costs in key processes such as purchasing, manufacturing and design), to its strategy of industrial and business development in Asia and to consolidating its leadership position on western markets. As regards business and industrial operations:

• the growth strategy for the Asia Pacific area will be continued, expanding the range of two-wheeler vehicles and pursuing development on various markets in the area, also through an industrial presence which was further consolidated in 2012, with the start-up of the engine manufacturing plant in Vietnam;


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• sales on the Indian scooter market will be stepped up. This market is characterised by high growth rates, with the group starting operations in Spring 2012, introducing its premium brand Vespa - and will be supported by expansion of the sales network and consolidation of product ranges;

• the group will confirm its leadership position on the European two-wheeler market, where Piaggio has retained its market share for scooters for the fourth year running, by further consolidating its product range to include the launch of the iconic Vespa 946 in the first half of 2013, and by achieving a growth in sales and margins in the motorcycle segment, thanks to the Moto Guzzi and Aprilia ranges;

• sales of commercial vehicles in India will be expanded, also thanks to three-wheelers being launched in new segments of the Indian market, such as the new Apé City with 200cc petrol engine, and new models in the four-wheeler segment, while exports will be further developed in emerging countries, targeting African, Asian and Latin American markets;

• current positions on the European commercial vehicles market will be maintained. As for technology, the Piaggio group will continue its focus on developing ranges of two-wheeler and commercial vehicles, and standard and hybrid engines that offer considerable fuel savings and lower pollutant emissions. In light of the continuing difficulties in the general economic situation, by the end of the year the company will present a new 2014-2018 Business Plan, before the expiry of the previous 2011-2014 Plan. With reference to the naval sector (Intermarine S.p.A.), it is pointed out how – in the current context of the international economic crisis – aims to grow significantly in the Defence sector that doesn’t seem to show the same critical state shown in the pleasure craft and passenger transport markets. This goal will be pursued with the completion of orders in progress and the participation in important tenders and negotiations at present in progress on an international level. The main objectives for 2013 will be to complete i) the minesweepers contract with the Finnish Navy; and ii) the last unit under construction for the Sultanate of Oman. In this respect, it should be pointed out that the penultimate vessel of the Oman order was delivered in Muscat and accepted by the customer on 9 May 2013. Furthermore, the company, awaiting for market recovery and commercial developments – decisive to absorb adequately indirect and general costs – will continue pursuing the possibility to reduce any structure costs in view of minimizing the losses and building up a cost structure consistent with the production status progress. From the financial point of view, the company expects a reduction in net financial exposure mainly following receipts expected for orders in progress, in particular for the contract with the Finnish Navy, which should allow a flow of receipts for the delivery of the two remaining units for a total of approximately 80 million euros, allowing for a significant repayment of the existing bank lines.


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SSeeggmmeenntt rreeppoorrttiinngg The application of the IFRS 8 - Operating Segments is mandatory as of 1 January 2009. This principle requires operating segments to be identified on the basis of an internal reporting system which top company management utilises to allocate resources and to assess performance. The information for operating sectors presented below substantially reflects the internal reporting utilised by management for taking strategic decisions. In this respect, as regards the different business areas – where possible – information is provided relating to the property and holding sector, industrial and naval sectors. PPrriimmaarryy sseeccttoorr:: bbuussiinneessss aarreeaass IInnccoommee ssttaatteemmeenntt

Property Industrial Naval Immsi and holding sector sector Group


NET REVENUES 985 303,449 12,085 316,519

OPERATING EARNINGS (EBIT) -1,222 9,804 -3,902 4,680

Earnings on equity investments 0 Financial income 237 4.900 77 5,214 Financial charges 2.705 12.940 1.485 17,130

EARNINGS BEFORE TAXATION -3.690 1.764 -5.310 -7,236

Taxation 10 706 -2.413 -1,697

EARNINGS AFTER TAXATION FROM CONTINUING ASSETS -3.700 1.058 -2.897 -5,539

Gain (loss) from assets intended for disposal or sale 0 0 0 0

EARNINGS FOR THE PERIOD INCLUDING NON-CONTROLLING INTEREST

-3.700 1.058 -2.897 -5,539

Non-controlling interest earnings for the period -1.360 470 -1.067 -1,957

GROUP EARNINGS FOR THE PERIOD -2.340 588 -1.830 -3,582

BBaallaannccee sshheeeett



Segment assets 372,844 1,602,223 358,036 2,333,103 Equity investments in associated companies 0 201 14 215

TOTAL ASSETS 372,844 1,602,424 358,050 2,333,318

TOTAL LIABILITIES 274,387 1,158,576 356,092 1,789,055


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OOtthheerr iinnffoorrmmaattiioonn



Investments in tangible and intangible assets 12 22,309 17 22,338

Depreciation, amortisation and write-downs 137 20,607 605 21,349

Cash flow from operations -3,468 -73,655 -11,095 -88,218

Cash flow from investments -12,555 -22,188 14 -34,729

Cash flow from financing 17,934 109,096 9,730 136,760

SSeeccoonnddaarryy sseeccttoorr:: ggeeooggrraapphhiiccaall aarreeaass IInnccoommee ssttaatteemmeenntt

Italy Rest of India United Rest of the Immsi In thousands of euros Europe States World Group

NET REVENUES 158,626 7,101 87,701 17,368 45,723 316,519

BBaallaannccee sshheeeett


Segment assets 1,956,872 30,202 182,887 28,152 134,990 2,333,103 Equity investments in associated companies 150 3 0 0 62 215

TOTAL ASSETS 1,957,022 30,205 182,887 28,152 135,052 2,333,318


Total receivables * 155,494 47,955 12,606 8,022 25,535 249,612

Total payables ** 390,732 115,612 96,372 3,499 29,164 635,379

* Contract works in progress and Amounts due from the Tax authorities are not included.

** Payables for Current taxation and Financial liabilities are not included.


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OOtthheerr iinnffoorrmmaattiioonn


Investments in tangible and intangible assets

14,799 160 4,341 159 2,879 22,338

Depreciation, amortisation and write-downs

16,320 282 3,040 29 1,678 21,349

* * * This document was published on 15 May 2013 by authorisation of the Chairman of the Company, Roberto Colaninno.

Documents

Interim Management Report 31 March 2013 · 2013-03-31 · Mantova register of companies – Tax-payer’s code and VAT number 07918540019 Interim Management Report 31 March 2013 This