Relazione finanziaria semestrale al 30 giugno 2013

Transcription

1 Relazione finanziaria semestrale al 30 giugno

2 This document is an English translation of an Italian language Interim Report. In the event of any inconsistency or interpretation difficulties reference should be made to the Italian language Interim Report, which shall in any event prevail.

3 Interim report on operations as at 30 September 2014 Directors report on operations SIGNIFICANT EVENTS OF THE PERIOD The following significant events occurred in the third quarter of They are described in further detail in the press releases on the company's website in the Investor Relations and News & Media section. In relation to the operations carried out to simplify the TBS Group's corporate structure in Italy by merging legal entities, we can remind you that on 24 July the company Tecnobiopromo was merged by incorporation into the TBS Group, which controlled it directly with 100% and on 8 August the merger by incorporation of the company Caribel into Insiel Mercato was completed. The latter already controlled Caribel directly with 100%. Finally we can note that the contract for the sale of the company Subitec is being defined; the sale should be completed by 30 November ECONOMIC AND FINANCIAL MANAGEMENT The table below presents a summary of the Group's economic data at 30 September 2014 (first 9 months), and a comparison with the same period of 2013, in accordance with the IAS/IFRS, with further information on the interim EBITDA, corresponding to earnings before depreciation and amortisation, write-downs of intangible assets and property, plant and equipment, measurement of equity investments, net financial expenses and income taxes.

4 TBS Group Sale of goods and rendering of services 168, ,043 Other revenue 936 1,166 Total revenue 169, ,209 Cost of materials 24,544 20,205 Service costs 59,310 57,068 Personnel costs 69,734 66,939 Other operating costs 2,375 2,699 Cost adjustments for in-house generation of noncurrent assets -1,873-2,764 Other provisions Total costs 154, ,237 EBITDA 15,669 11,972 EBITDA % 9.2% 7.7% Depreciation, amortisation and impairment 7,397 7,366 EBIT (operating profit) 8,272 4,606 EBIT % 4.9% 2.9% Gains (losses) from investments Financial income Financial expenses -4,600-4,554 PROFIT BEFORE TAX 3, Income taxes -2,728-2,772 NET PROFIT FOR THE PERIOD 1,201-2,403 Result from assets held for sale 0-3,418 NET PROFIT FOR THE PERIOD 1,201-5,821 attributable to the Group 869-6,120 attributable to minority interests (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale The interim report on operations at 30 September 2014 records growth in turnover due both to the development of clinical engineering and ICT services and to the sale, with the related services, of integrated IT solutions. In particular, at 30 September 2014 revenues and other income of Euro million were recognised, an increase of Euro 13.7 million over the for the same period in 2013, thus recording an increase of 8.8%. This increase was only minimally due to the inclusion, in the scope of consolidation, of REM DI, based in Fisciano (Italy), 100% owned by the TBS Group, which started business in March 2013; net of which the organic growth of consolidated revenue would have been 8.1%.

5 The contribution of the two operating segments to the results achieved is summarised in the following table: 1/1-30/09/2014 1/1-30/09/2013 (*) (amounts in thousands of Euro) Medical Devices and ICT Systems Integrated e-health & e-government Solutions Total Medical Devices and ICT Systems Integrated e-health & e-government Solutions Total Revenue Sales to third parties and other revenue 147,277 22, , ,132 20, ,209 Total revenue 147,277 22, , ,132 20, ,209 % total 86.7% 13.3% 87.1% 12.9% EBITDA 14, ,669 12, ,972 ebitda % 10.0% 4.1% 9.5% -4.8% (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well after classifying the subsidiary Subitec GmbH as held for sale Analysis of revenues per line of business gave the following results: Revenue from the "Medical Devices & ICT Solutions" division showed an increase of Euro 11.1 million, thus rising from million at 30 September 2014 to million in the same period in 2014 (+8.2%) and representing 86.7% of the revenue of the entire Group (87.1% at 30 September 2013). The "Integrated e-health & e-government Solutions" division saw an increase in revenues, up from 20.1 million at 30 September 2013 to Euro 22.7 million during the same period in 2014 (+12.9%). Although Europe was again the main market for the TBS Group's business, an analysis of revenues by geographical area shows significant growth in non-european countries (owing mainly to orders won in China) which in the first 9 months represented 5.9% of total revenues compared with 0.9% in the same period of Italy continues to be the main market, accounting for 67.8% of revenues (72.8% in the first 9 months of 2013), compared with 26.3% of other European countries (26.2% in the first 9 months). Revenue Italy 115, ,774 United Kingdom 19,815 16,045 France 9,796 9,949 Austria 5,590 5,035 Germany 1,878 1,929 Spain 3,537 3,644 Total other European Union countries 4,007 4,369 Other non-european Union countries 10,031 1,464 Total revenue 169, ,209 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in associates and joint ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Consolidated EBITDA came out at Euro 15.7 million, up notably with respect to the Euro 12.0 million in the first 9 months of 2013 (+30.9%). This increase is attributable mainly to the contribution deriving from the services of design, global supply and maintenance of devices provided for international tenders, but also to the recovery of profitability due to an improvement in the margins of the Integrated e-health & e-government Solutions division and to the processes for rationalising the costs of the parent company TBS Group.

6 The operating profit (EBIT) showed an improvement of Euro 3.7 million, in line with that of EBITDA, and went from Euro 4.6 million in the first 9 months of 2013 to 8.3 million in Financial operations in the period showed substantial stability in the results despite an increase in net financial debt. The first 9 months of 2014 ended with a net profit of Euro 1.2 million, sharply up compared with the loss of 5.8 million recorded in the same period of 2013, which included the result of assets held for sale of 3.4 million. The table below presents a summary of the Group's key equity data at 30 September 2014 compared with those for the end of FY 2013, in accordance with IAS/IFRS standards: (amounts in thousands of Euro) 30/09/ /12/2013 (*) Difference Intangible assets 54,620 55,770-1,150 Property, plant and equipment 18,237 17,138 1,099 Other non-current assets 9,253 9, Non-current assets 82,110 82, Current assets 164, ,834-4,102 Assets held for sale 959 1, TOTAL ASSETS 247, ,331-5,530 Group shareholders' equity 48,617 47, Equity attributable to minority interests 2,567 2, Shareholders' equity 51,184 50, Non-current liabilities 37,427 39,230-1,803 Current liabilities 158, , Liabilities held for sale 905 4,970-4,065 TOTAL SHAREHOLDERS EQUITY AND LIABILITIES 247, ,331-5,530 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures The key economic and financial indicators as at 30 September 2014 and 2013, deriving from the ratios between certain data recorded in the income statement and balance sheet, are shown below. 30/09/ /09/2013 EBITDA/Total revenue 9.2% 7.7% EBIT/Total revenue 4.9% 2.9% EBT/Total revenue 2.3% 0.2% Net profit for the year/total revenue 0.7% -3.7% Financial expenses/revenue 2.7% 2.9% NFD/Group Shareholders Equity Total Liabilities/ Group Shareholders Equity NFD/EBITDA (*) OWC/Total revenue (**) 37.2% 42.8% (*) Rolling EBITDA for the period 30/09/ /09/2014 (**) Rolling revenues for the period 30/09/ /09/2014 At 30 September 2014 net financial debt was Euro 67.9 million, an increase of Euro 7.9 million compared with the Euro 59.9 million of the end of 2013, despite the effects of larger transfers of

7 receivables without recourse (Euro 64.1 million at 30 September 2014 against the 53.9 million of same period of the previous year). This increase was due to an expansion in operating working capital, up from Euro 78.2 million (35.8% of revenues) at the end of 2013 to 86.4 million at 30 September 2014 (37.2% of revenues). (amounts in thousands of Euro) 30/09/ /12/2013 (*) 30/09/2013 (**) Non-current financial liabilities -18,649-19,968-20,514 Current financial liabilities -71,357-68,932-70,518 Other financial assets Current financial assets 1,524 3,472 14,375 Cash and cash equivalents 20,422 27,655 12,557 Debt in assets held for sale -71-2,537-4,819 Net financial debt -67,852-59,918-68,537 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures (**) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale (amounts in thousands of Euro) 30/09/ /12/2013 (*) 30/09/2013 (**) Inventories 9,371 9,342 7,364 Trade receivables 120, , ,141 Trade payables -43,548-48,127-49,143 Operating working capital 86,376 78,172 91,362 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures (**) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale The financial movements are analysed in the summary elements from the statement of cash flows, summarised below. CONSOLIDATED STATEMENT OF CASH FLOWS CASH FLOW PROVIDED BY OPERATING ACTIVITIES 4,272 10,714 CASH FLOW USED BY INVESTING ACTIVITIES -6,936-6,055 CASH FLOW PROVIDED BY (USED IN) FINANCING ACTIVITIES -4,244-8,950 TOTAL CASH FLOWS -6,908-4,291 CASH AND CASH EQUIVALENTS (NET) AT THE START OF THE PERIOD (**) 27,659 16,978 Net foreign exchange difference CASH AND CASH EQUIVALENTS (NET) AT THE END OF THE PERIOD (**) 20,800 12,558 (*) Data restated following classification of the subsidiary Subitec GmbH as held for sale, pursuant to IFRS 5, and deconsolidation of the joint venture Sinopharm TBS (**) Including cash and cash equivalents of the subsidiary Subitec GmbH treated as held for sale Cash flow from operating activities in 2014 had a positive balance of Euro 4.3 million, the result of the pre-tax profit (Euro +3.9 million), depreciation and amortisation (Euro +7.4 million), financial expense (Euro +4.6 million), flows from assets held for sale (Euro -0.9 million), the increase in working capital for the year (Euro -9.8 million) and taxes paid (Euro -1.1 million).

8 Investment activities used cash flow for a total of Euro 7.4 million gross of disinvestments. Cash flows from financing activities (balance between increase and decrease of financial liabilities, including interest payments) used cash of Euro 4.2 million. The resulting total cash flow was Euro -6.9 million. INVESTMENTS IN RESEARCH & DEVELOPMENT As at 30 September 2014, investments had been made in intangible fixed assets totalling Euro 3.0 million, in the following areas: Intangible assets with defined useful life (amounts in thousands of Euro) Acquisitions for the period Industrial patents, intellectual property rights, licences and trademarks 514 Other intangible assets 23 Intangible investments in progress and advances 2,495 Total 3,032 Investments in the first nine months mainly concerned the category Intangible investments in progress, made by Insiel Mercato (Euro 836 thousand), TBS IT (Euro 450 thousand), EBM (Euro 770 thousand) and TBS Group (Euro 373 thousand) to improve/supplement the owned product portfolio of the management companies and software; in addition we can note investments regarding the category Industrial patents, intellectual property rights, licences and trademarks made by Tesan (Euro 208 thousand), Insiel Mercato (Euro 62 thousand), TBS Group (Euro 103 thousand) and EBM (Euro 68 thousand). As at 30 September 2014, investments had also been made in property, plant and equipment totalling Euro 4.4 million, in the following areas: Property, plant and equipment with defined useful life (amounts in thousands of Euro) Acquisitions in the period Land and buildings 45 Plants and machinery 3,511 Other property, plant and equipment 798 Total 4,354 Investments in property, plant and equipment mainly concerned equipment, machinery and other goods for the business of TBS GB for Euro 1,594 thousand, EBM for Euro 1,592 thousand, the Parent Company for Euro 219 thousand, REM DI for Euro 165 thousand, Crimo Italia for Euro 150 thousand and ST NL for Euro 120 thousand.

9 BUSINESS OUTLOOK AND SUBSEQUENT EVENTS On 23 October a further step was taken in implementing the strategic lines in medical-imaging equipment multivendor management and maintenance services by the subsidiary Elettronica Bio Medicale S.r.l. (EBM) of Foligno which signed a preliminary contract for the purchase of 51% of the share capital of Ing. Burgatti S.p.A. of San Lazzaro di Savena (Italy). Finally we must remind you that on 29 October 2014 TBS Group S.p.A. completed the placement of the non-convertible bond exclusively reserved for Italian and foreign institutional investors with a nominal annual interest rate of 6.5% for a total amount of Euro 15 million; the capital invested will be reimbursed in a single payment at bond expiration (October 2019), while the accrued interest will be paid quarterly.

10 Financial statements of the interim report on operations at 30 September 2014 CONSOLIDATED BALANCE SHEET - TBS Group (amounts in thousands of Euro) 30/09/ /12/2013 (*) ASSETS NON-CURRENT ASSETS - Assets with indefinite useful life (goodwill) 31,507 31,427 - Intangible assets with defined useful life 23,113 24,343 Intangible assets 54,620 55,770 - Land and buildings 6,858 6,992 - Plants and machinery 8,505 7,261 - Other property, plant and equipment 2,874 2,885 Property, plant and equipment 18,237 17,138 - Equity investments in associated companies Equity investments in other companies Other financial assets Other non-current assets Advance tax assets 7,362 7,808 Other non-current assets 9,253 9,735 NON-CURRENT ASSETS 82,110 82,643 Inventories 9,371 9,342 Trade receivables 120, ,957 Assets held for trading 0 0 Other current assets 10,596 9,068 Income tax receivables 2,266 2,340 Current financial assets 1,524 3,472 Cash and cash equivalents 20,422 27,655 CURRENT ASSETS 164, ,834 Assets held for sale 959 1,854 TOTAL ASSETS 247, ,331 SHAREHOLDERS' EQUITY - Share capital 4,143 4,143 - Reserves 44,474 43,659 GROUP SHAREHOLDERS' EQUITY 48,617 47,802 EQUITY ATTRIBUTABLE TO MINORITY INTERESTS 2,567 2,783 CONSOLIDATED SHAREHOLDERS EQUITY 51,184 50,585 LIABILITIES Non-current financial liabilities 18,649 19,968 Employee Severance Indemnity 8,025 7,835 Provisions for deferred taxes 9,175 9,550 Provisions for risks and charges 1,251 1,543 Other non-current liabilities NON-CURRENT LIABILITIES 37,427 39,230 Trade payables 43,548 48,127 Other current liabilities 40,773 40,348 Current financial liabilities 71,357 68,932 Tax payables 2,607 1,139 CURRENT LIABILITIES 158, ,546 TOTAL LIABILITIES 195, ,776 Liabilities held for sale 905 4,970 TOTAL LIABILITIES 247, ,331

11 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures CONSOLIDATED INCOME STATEMENT - TBS Group (amounts in thousands of Euro) 1/1-30/09/2014 1/1/-30/09/2013 (*) Revenues from sales and services 168, ,043 Other revenue 936 1,166 Total revenue 169, ,209 Cost of materials 24,544 20,205 Service costs 59,310 57,068 Personnel costs 69,734 66,939 Other operating costs 2,375 2,699 Cost adjustments for in-house generation of noncurrent assets -1,873-2,764 Depreciation, amortisation and impairment 7,397 7,366 Other provisions Total operating costs 161, ,603 OPERATING PROFIT (EARNINGS BEFORE INTEREST AND TAXES) 8,272 4,606 Gain (losses) from investments Financial income Financial expenses -4,600-4,554 PROFIT BEFORE TAX 3, Income taxes -2,728-2,772 PROFIT/LOSS FOR THE PERIOD from continuing operations 1,201-2,403 Profit/loss from assets held for sale 0-3,418 PROFIT/LOSS FOR THE PERIOD 1,201-5,821 (Profit)/Loss for the period attributable minority interests LOSS FOR THE PERIOD ATTRIBUTABLE TO THE GROUP ,120 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale CONSOLIDATED STATEMENT OF CASH FLOWS TBS Group (amounts in thousands of Euro) 1/1-30/09/2014 1/1/-30/09/2013(*) CASH FLOW PROVIDED BY OPERATING ACTIVITIES 4,272 10,714 CASH FLOW USED BY INVESTING ACTIVITIES -6,936-6,055 CASH FLOW PROVIDED BY (USED IN) FINANCING ACTIVITIES -4,244-8,950 TOTAL CASH FLOWS -6,908-4,291 CASH AND CASH EQUIVALENTS (NET) AT THE START OF THE YEAR (**) 27,659 16,978 Net foreign exchange difference CASH AND CASH EQUIVALENTS (NET) AT THE END OF THE PERIOD (**) 20,800 12,558 (*) Data restated following classification of the subsidiary Subitec GmbH as held for sale, pursuant to IFRS 5, and deconsolidation of the joint venture Sinopharm TBS (**) Including cash and cash equivalents of the subsidiary Subitec GmbH treated as held for sale

12 Notes to the Financial Statements General information, format and content of the consolidated interim report on operations, IFRS compliance and consolidation scope The Group's consolidated interim report on operations has been prepared according to the recognition and measurement criteria provided for in the international accounting standards. The accounting standards adopted are the same as those used at 31 December Consolidation scope The companies included in the consolidation scope as at 30 September 2014 are listed below: Subsidiary Head Office Share capital Type of Investment Stake % Consolidation method TBS Group SpA Trieste (Italy) Euro 4,142,137 Parent Company Parent Company Tesan SpA (single-member company) Vicenza (Italy) Euro 5,000,000 Indirect 100 Line by line Tesan Televita Srl Udine (Italy) Euro 46,800 Indirect 75.1 Line by line PCS Professional Clinical Software GmbH Klagenfurt (Austria) Euro 1,230,000 Indirect 100 Line by line TBS FR Telematic & Biomedical Services Sarl Lyon (France) Euro 1,690,500 Direct 100 Line by line TBS BE Telematic & Biomedical Services BVBA Loncin (Belgium) Euro 150,000 Direct 100 Line by line TBS G.B. Telematic & Biomedical Services Ltd. Southend on Sea (United Kingdom) 500,000 Direct (1) Line by line Telematic & Biomedical Services SL (singlemember company) Barcelona (Spain) Euro 650,000 Direct 100 Line by line STB Servicios Telematicos e Biomedicos Lda Unipessoal Lisbon (Portugal) Euro 100,000 Direct 100 Line by line Surgical Technologies BV Didam (The Netherlands) Euro 18,200 Direct 100 Line by line Subitec GmbH Sulzbach (Germany) Euro 4,500,000 Direct 100 (4) Line by line SLT Srl Cernusco sul Naviglio (Italy) Euro 47,000 Direct 56 Line by line Crimo Italia Srl Gualdo Tadino (Italy) Euro 103,165 Direct Line by line Elettronica Bio Medicale Srl Foligno (Italy) Euro 1,862,500 Direct (2) Line by line MSI MedServ International Deutschland GmbH Pfullendorf (Germany) Euro 321,000 Direct 100 Line by line TBS IT Srl (single member company) Trieste (Italy) Euro 9,000,000 Direct 100 Line by line TBS SE Telematic & Biomedical Services Doo Belgrade (Serbia) RSD 465,000 Direct 100 Line by line Insiel Mercato SpA Trieste (Italy) Euro 3,246,808 Indirect 100 Line by line TBS INDIA Telematic&Biomedical Services Prv. Ltd Bangalore (India) INR 5,000,100 Direct 100 Line by line Erre Effe Informatica Srl Arezzo (Italy) Euro 41,280 Indirect 51 (3) Line by line Delta X Srl Perugia (Italy) Euro 10,000 Indirect 100 Line by line EBME Ltd. Bedfordshire (United Kingdom) Indirect 100 Line by line

13 REM DI Srl Fisciano (Italy) Euro 100,000 Direct 100 Line by line (1) Following the valuation of a commitment to purchase the remaining 3.87% of the shares, the consolidation percentage is 100%. (2) Following the valuation of a put and call option on the remaining 5.03% of the shares, the consolidation percentage is 100%. (3) Following the valuation of a put and call option on the remaining 49% of the shares, the consolidation percentage is 100%. (4) Since 2013 the subsidiary has been classified as held for sale The consolidation scope as at 30 September 2014 changed with respect to 31 December 2013 due to deconsolidation of Sinopharm TBS (Beijing) Clinical Engineering Technology Co Ltd, controlled at 50%, following the application of IFRS 11. This company is now accounted for using the shareholders' equity method. We should also remind you that: - on 20 June 2014 the Group acquired an additional 3% of the shares of Crimo Italia Srl, already held at 52.75%, at a price of Euro 254 thousand; - on 19 September 2014 the Group acquired an additional 5.1% of the shares of Tesan Televita Srl, already held at 70%, at a price of Euro 130 thousand. We can note that at 30 September 2014, the subsidiary Subitec is classified among assets held for sale (so-called Discontinued Operations), following the decision to sell the associated equity investment. The exchange rates applied as at 30 September 2014 for translating financial statements in foreign currency are as follows (1 Euro=foreign currency) and corresponding to those made available by the Italian Foreign Exchange Office: Currency Average exchange rate 1/1-30/09/ 2014 Exchange rate as at 30/09/2014 Exchange rate as at 31/12/2013 Average exchange rate 1/1-30/09/ 2013 Exchange rate as at 30/09/2013 Pound Sterling (GBP) Serbian dinar (RSD) Indian rupee Seasonality of the business There are no significant seasonal trends in the segment in which the Group operates. The main items of the consolidated balance sheet and the consolidated income statement are commented on below. Intangible assets Goodwill Goodwill refers to cost of the business combination paid in excess allocation of merger deficits or for the acquisition of controlling interests in certain subsidiaries. The following table details the goodwill value allocated to the respective cash generating units ( CGU ): (amounts in thousands of Euro) 30/09/ /12/2013 Clinical Engineering Italy 11,357 11,357 Clinical Engineering Europe 4,643 4,563 Telemedicine and Telecare 7,560 7,560 e-health & e-government Software Production 4,921 4,921 Clinical Engineering India 3,026 3,026 Total goodwill 31,507 31,427 The book value of goodwill as at 30 September 2014 amounted to Euro 31,507 thousand. The difference with respect to the value at 31 December 2013, equal to Euro 80 thousand, derives from

14 recognition of the difference on the Euro/British Pound exchange rate of TBS GB, attributed to the Clinical Engineering Europe CGU. Intangible assets with defined useful life Changes in the period for Intangible assets with defined useful life are shown below: (amounts in thousands of Euro) Development Industrial patents, licenses, trademarks and similar rights Other intangible assets Intangible investments in progress and advances TOTAL Cost at 1 January 2014 net of provisions 2,333 3,854 13,281 4,875 24,343 Net increases ,495 3,032 Disposals (historical cost) Disposals (accumulated amortisation) Amortisation in the period 499 1,698 2, ,257 Foreign exchange translation differences Reclassifications and other -13 2, ,104 0 As at 30 September ,821 4,910 11,116 5,266 23,113 The investments made in the first six months amounted to Euro 3,032 thousand and related to investments by the subsidiaries Insiel Mercato, EBM, TBS IT and by the Parent Company. Property, plant and equipment Changes in the period are shown below: (amounts in thousands of Euro) Land and buildings Plants and machinery Other property, plant and equipment Total property, plant and equipment Cost at 1 January 2014 net of provisions 6,992 7,261 2,885 17,138 Net additions 45 3, ,354 Disposals (historical cost) Disposals (accumulated depreciation) Depreciation in the period ,140 Foreign exchange translation differences Reclassifications and other At 30 September 2014 net of provisions 6,858 8,505 2,874 18,237 Investments in property, plant and equipment amounted to Euro 4,354 thousand and mainly concerned equipment and machinery for the business of TBS GB in the amount of Euro 1,594 thousand and of EBM for Euro 1,592 thousand.

15 Inventories The breakdown of inventories as at 30 September 2014 is as follows: (amounts in thousands of Euro) 30/09/ /12/2013 Work in progress Cost 1,145 1,130 Inventory write-down provision Net realisable value Raw & auxiliary materials and consumables Cost 9,698 9,508 Inventory write-down provision Net realisable value 8,778 8,764 Advances 0 0 Total inventories 9,371 9,342 Trade receivables The table below provides a breakdown of trade receivables: (amounts in thousands of Euro) 30/09/ /12/2013 (*) Trade receivables 124, ,462 Provision for doubtful accounts -4,033-3,505 Total 120, ,957 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures As in previous years, some Group companies entered into without recourse deals with factors, resulting in receivables assigned totalling Euro 64.1 million being derecognised (Euro 89.8 million for the whole of 2013). Trade payables The table below provides a breakdown of trade payables: (amounts in thousands of Euro) 30/09/ /12/2013 (*) Trade payables to suppliers 43,548 48,127 Total trade payables 43,548 48,127 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures Net financial position The net financial debt in each period considered is shown below: (amounts in thousands of Euro) 30/09/ /12/2013 (*) Medium and long term interest-bearing loans and borrowings 18,649 19,968 Current financial liabilities 71,357 68,932 Non-current financial assets Current financial assets -1,524-3,472 Cash and cash equivalents -20,422-27,655 Net financial debt 67,781 57,381 Financial debt, assets held for sale 71 2,537 Total net financial debt 67,852 59,918 Group shareholders' equity 48,617 47,802 Ratio net financial debt/group shareholders' equity (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures

16 The financial debt increased from Euro 59,918 thousand at 31 December 2013 to Euro 67,852 thousand at 30 September The change is mainly attributable to the use of cash in support of net current assets and current operations. Non-current loans include the convertible bond loan, the principal portions of mortgage loans and those of financial leasing maturing at more than 12 months. Current liabilities include mainly payables for current account overdrafts, advances on invoices, loan instalments and payables to other lenders maturing after 30 September Revenue The table below provides a breakdown of revenues as at 30 September 2014 and 30 September 2013: Sale of goods and rendering of services 168, ,083 Change in inventories of work in progress Total revenue 168, ,043 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Revenues primarily relate to contractual amounts accrued on the basis of the progress of services performed and accrued in the year, changes in contract work in progress for services that have a value at period end but have not been completed, invoices issued to customers or entities in temporary joint ventures with the Group for the sale of consumables and spare parts, and ISTAT adjustment invoices in the period at issue and previous periods. The increase in revenues is in part attributable to the company REM DI which began its business in March 2013 and for Euro 8,324 thousand to the Parent Company's international tenders. Other revenues and income The table below provides a breakdown of other income as at 30 September 2014 and 30 September 2013: Grants Other operating revenues Total other income 936 1,166 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Revenues from grants include both revenues linked to cost components and revenues linked to investments in non-current assets, and are recognised on an accruals basis for their offsetting against related costs. The positive components regarding use of the risk provisions are recognised under other revenues. Cost of raw materials and consumables The table below provides a breakdown of the cost of raw materials and consumables as at 30 September 2014 and 30 September 2013:

17 Raw materials, consumables and goods 24,558 20,832 Changes in inventories of raw materials, consumables and goods Total raw materials, consumables and goods 24,544 20,205 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale The costs shown primarily relate to the purchase of spare parts for medical devices on receipt of orders. Costs for services The table below provides a breakdown of service costs as at 30 September 2014 and 30 September 2013: Consultancy and technical contracts 34,205 33,228 Legal administrative and commercial services 4,515 4,300 Travel expenses 2,492 2,518 Telephone expenses 1,150 1,318 Directors remuneration Board of statutory remuneration Commission on sales 1,231 1,149 Banks and factors charges 1,158 1,001 Insurance 1, Transportation and shipping 1,034 1,003 Other repairs and maintenance Advertising, promotion, exhibitions and trade fairs Leases and rentals 2,523 2,611 Vehicle rental 2,654 2,574 Other service costs 5,171 4,242 Total service costs 59,310 57,068 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Other costs for services is a residual item that includes other charges such as utilities, postal charges and meal vouchers. Personnel costs The table below provides a breakdown of personnel costs as at 30 September 2014 and 30 September 2013: Salaries and wages 52,110 50,013 Social security contributions on salaries 13,657 13,347 Retirement benefits Employee Severance Indemnity 2,558 2,464 Other personnel costs 1, Total personnel costs 69,734 66,939 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale

18 Other operating costs The table below provides a breakdown of other operating costs as at 30 September 2014 and 30 September 2013: Write-downs of receivables under current assets Taxes Other costs 1,333 1,622 Other operating costs 2,375 2,699 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Cost adjustments for in-house generation of non-current assets The following table illustrates the extent of the cost adjustments for in-house generation of noncurrent assets as at 30 September 2014 and 30 September 2013: (amounts in thousands of Euro) 1/1-30/09/2014 1/1-30/09/2013 Cost adjustments for in-house generation of non-current assets 1,873 2,764 Total cost adjustments for in-house generation of non-current assets 1,873 2,764 The item Cost adjustments for in-house generation of non-current assets as at 30 September 2014 amounted to Euro 1,873 thousand (Euro 2,764 thousand at 30 September 2013). It related entirely to personnel and service expenses incurred for some development of new software and information technology. In particular, should such costs be deducted from the corresponding income statement item, there would be a reduction in personnel and service costs. Depreciation, amortisation and impairment The following table shows the breakdown of depreciation, amortisation and impairment as at 30 September 2014 and 30 September 2013: Depreciation of property, plant and equipment 3,140 2,997 Amortisation of intangible assets 4,257 4,369 Total depreciation, amortisation and impairment 7,397 7,366 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Other provisions The table below provides a breakdown of other provisions for doubtful account as at 30 September 2014 and 30 September 2013: Allocations Contractual risk provision for disputes 4 27 Allocations Supplementary customer indemnity provision Allocations Other provisions for liabilities and charges Total allocation to provisions (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale

19 Financial income and expenses The table below provides a breakdown of financial income and expenses as at 30 September 2014 and 30 September 2013: Interest payable on loans 4,506 4,161 Other financial expenses Total Financial Expenses 4,600 4,554 Bank interest receivables Other interest receivables Other financial income Total Financial Income Total Financial Income and Expenses 4,295 4,163 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Income taxes The table below provides a breakdown of income taxes with separate current, deferred and advanced taxes and, in relation to current taxes, a breakdown of Italian and foreign taxes: Current IRAP 1,343 1,533 IRES Current income taxes, Foreign Current income taxes 2,657 2,318 (Advance)/deferred taxes Total income taxes 2,728 2,772 (*) Data restated following the application of IFRS 11 - Joint Arrangements and IAS 28 - Investments in Associates and Joint Ventures, as well as after classifying the subsidiary Subitec GmbH as held for sale Trieste, 13 November 2014 On behalf of the Board of Directors Chief Executive Officer Paolo Salotto

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