Sustainability Channel

The board of directors of pirelli & c. Spa approves 2009 financial statements

Milan, 10 March 2010 - The Board of Directors of Pirelli & C. SpA, which met today, reviewed and approved 2009 draft financial statements.

PIRELLI & C. SPA

• PARENT COMPANY RETURNS TO PROFIT WITH 112.6 MILLION EUROS IN NET PROFIT (NET LOSS OF 189.5 MILLION EUROS IN 2008)

• BOARD TO PROPOSE DISTRIBUTION OF A DIVIDEND OF 0.0145 EUROS PER ORDINARY SHARE AND 0.0406 EUROS PER SAVINGS SHARE

PIRELLI & C. GROUP

• 2009 REVENUES: 4,462.2 MILLION EUROS (-3.3% ON A LIKE-FOR-LIKE BASIS), COMPARED WITH A TARGET OF MORE THAN 4.3 BILLION EUROS

• EBIT POST RESTRUCTURING CHARGES QUINTUPLED TO 217.4 MILLION EUROS, (43.2 MILLION EUROS IN 2008);

EBIT MARGIN 4.9%, BETTER THAN TARGET OF 4.5% DESPITE THE IMPACT OF ADDITIONAL RESTRUCTURING CHARGES OF APPROX. 50 MILLION EUROS COMPARED WITH 30 MILLION EUROS INITIALLY FORECAST IN 2009-2011 PLAN

• ATTRIBUTABLE NET RESULT RETURNS TO PROFIT OF 22.7 MILLION EUROS, COMPARED WITH A LOSS OF 347.5 MILLION EUROS IN 2008; TOTAL NET RESULT NEGATIVE FOR 22.6 MILLION EUROS, SIGNIFICANTLY IMPROVED OVER 2008 LOSS OF 412.5 MILLION EUROS

• NET DEBT NEARLY HALVED: 528.8 MILLION EUROS (1,027.7 MILLION EUROS IN 2008) COMPARED WITH THE INITIAL TARGET OF 1 BILLION EUROS, WHICH HAD ALREADY BEEN IMPROVED AT THE END OF Q3 TO 700 MILLION EUROS

PIRELLI TYRE

• 2009 REVENUES: 3,992.9 MILLION EUROS (-1.6% ON A LIKE-FOR-LIKE BASIS COMPARED WITH 4,100.2 MILLION EUROS IN 2008) COMPARED WITH A TARGET OF 3,900 MILLION EUROS (ALREADY IMPROVED AT THE END OF Q3)

• EBIT POST RESTRUCTURING CHARGES: 308.5 MILLION EUROS, MORE THAN DOUBLE THE 150.7 MILLION EUROS OF 2008;

EBIT MARGIN 7.7% (3.7% IN 2008), HIGHER THAN THE TARGET OF AT LEAST 7% (WHICH HAD BEEN IMPROVED AT THE END OF Q3)

• IN 2009 OPERATING CASH FLOW POSITIVE FOR 561.5 MILLION EUROS (-18.1 MILLION EUROS IN 2008)

• NET DEBT APPROX. 1 BILLION EUROS POST DIVIDENDS, COMPARED WITH A TARGET OF 1.3 BILLION EUROS BEFORE DIVIDENDS

2010 TARGETS

• PIRELLI & C. GROUP: REVENUES 4.7/4.8 BILLION EUROS, EBIT MARGIN 6.5%/7%

• PIRELLI TYRE: REVENUES +6%/+8%, EBIT MARGIN TENDENTIALLY IN LINE WITH 2009

NEW 2011-2013 THREE-YEAR PLAN TO BE PRESENTED BEFORE THE END OF 2010

The Pirelli Russia project grows with Rome’s agreement

The acquisition of an already existing factory in addition to building a new industrial plant
Today, Pirelli and Russian Techonologies signed in Rome a new agreement for the production of tyres and steelcord in Russia.

In addition to the plan already announced by the Parties to build a new industrial plant in the Russian region of Samara in the second half of 2010, the new agreement foresees the acquisition of an already existing factory, which is currently being identified among some potentially interesting Russian enterprises. It is foreseen that the acquisition will take place in 2010.

The agreement was signed today in Rome in the presence of Russian President Dmitry Medvedev and Italian Prime Minister Silvio Berlusconi, by the Director General of Russian Technologies Sergey Chemezov and the Chairman of the Pirelli Group Marco Tronchetti Provera.

 The new industrial hub will be established on the territory of Togliatti industrial technology park (Samara region).

 The hub establishment will begin as soon as the Russian authorities make the decision on the area for production of automotive components, which is expected in the second half of 2010. The new factory will be built in two phases. In the first phase a factory for radial tyres for industrial vehicles will be built. The second phase foresees a factory to manufacture steelcord. At full capacity, the industrial hub will employ about 1500 workers.

 In the five-year period, the new factories together with the expected acquisition will guarantee manufacturing capacity of more than 4 million pieces, as foreseen by the initial plans. Total resources to be committed by the joint venture, in line with what has already been announced, will amount to about 300 million euros. 
Download the Press Release (PDF Version)

Tyre and Parts signs the Copenhagen Communiqué

Pirelli Tyres and Parts has adhered to the Copenhagen Communiqué, the initiative promoted by the British organisation the Prince of Wales’s Corporate Leaders’ Group on Climate Change and supported by over 500 companies at a world level.

The objective of the commitment: develop new policies – in particular for the control of CO2 emissions – as a response to the urgency of the question of climate change.

The basic structure of the agreement envisages:

• a maximum limit of global emissions and a long term procedure for the reduction of all gas sourced emissions of greenhouse effect for the period 2013-2050.
• immediate commitment by the industrialised countries for the ‘de-carbonisation’ of the economy
• intervention by the developing countries to delineate a plan for the reduction of emissions.

To read the text of the Communiqué, download the pdf

The Copenhagen Communiqué will be presented at the next United Nations Conference on the climate due to take place from 7 December. Pirelli Tyre and Parts, together with ENEL and Telecom, is among the Italian signatories of the paper, a testimony to the Group’s commitment to a sustainable environment.

In 2007, Pirelli Tyre had already adhered to the Bali Communiqué on the occasion of the United Nations Conference there on climatic change, together with 150 other international companies, a document for concrete strategic development through joint intervention of governments for an exhaustive world agreement on the climate.

To know more: http://www.copenhagencommunique.com/