Share of earnings (losses) of associates and joint ventures

38. Share of earnings (losses) of associates
and joint ventures

The share of earnings (losses) of associates and joint ventures accounted for using the equity method is an earnings figure of Euros 118,608 thousand (earnings of Euros 103,958 thousand in 2006). This caption particularly includes the earnings of the investments accounted for using the equity method by the Pirelli & C. Real Estate Group equal to Euros 117,042 thousand (Euros 101,570 thousand in 2006). This amount includes the positive effect of Euros 70.5 million arising from changes in the fair value of the “Investment properties” held by Raissa, Tecla and Spazio Investment Office Property Investment Funds.

In 2006, the change in fair value relating to Fondo Spazio Investment amounted to Euros 33.5 million, of which Euros 22.5 million was realized with third parties during the course of the same year thanks to the listing of the associate Spazio Investment N.V..

The earnings from these Funds are recorded by using the equity method to account for the joint ventures or associates which hold the relative shares; more to the point, in 2007, the positive effect includes Euros 46.2 million relating to transfers from “Inventories” to “Investment properties” since such properties will be become part of a common investment platform for buildings intended for office use.