Financial Highlights

• From 1Q 2007 Net sales showed an organic growth of 2.1% driven by tyres;
  
  
• EBIT including Income from Equity participation stood at € 98.8 mln with an erosion compared to 1Q 2007 mostly due to the Real Estate activity and TI share devaluation;
  
  
• Attributable Net Income was € 33.8 mln plus 39.7% thanks to lower financial charges; the sale of the Olimpia stake has improved dramatically our Net Financial Position, which stood at 31.03.08 at € 851 mln. The variation in Net Financial Position was mainly due to the repurchase  of Pirelli Tyre minorities and cash flow from Ordinary Activity due to the 1Q seasonality (1Q 2007 was € 219 mln);
  
  
• Pirelli Tyre: Net Sales increased to € 1,076.9 mln from € 1,060.0 mln in 1Q 2007, +1.6% Year on Year; EBITDA and EBIT were slightly below 2007, also linked to lower 1Q 2008 seasonality; 1Q 2008 Net income stood at € 57.7 mln, nearly flat Year on Year;
  
  
• Pirelli RE: Pro-Rata Aggregate Revenues were of € 301 mln versus € 405.81 mln in first quarter of the last year; EBIT including Income from Investments has reached € 27.3 mln before the restructuring costs of € 2.3 mln (this compares to the result of € 35.3 mln in first quarter of 2007, which is net of the effect of the temporary consolidation of DGAG); consolidated  Net Income amounted to € 11.6 million versus € 19 million in first quarter 2007;
  
  
• Pirelli Re: Pro-Quota Aggregate Revenues (net of deconsolidation of DGAG) €1,071.9 Mmn (+17%), Ebit Including Income From Equity Participations €164 mn (€141.2 mn net of DGAG effect, +22%), Net Income €95.8 mn (+14%)
  
  
• For 2008 the Pirelli & C. SpA Group business operating results in line with year 2007, notwithstanding continuous pressure on the tyre business due to volatility of raw material costs.