TI Media: approval of TI Media’s statement of financial position as of 8 March 2013, to be submitted to the general Shareholders’ meeting on 5 April 2013

03/14/2013 - 06:15 PM

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Adjustment of impairment loss on the equity investment in TI Media Broadcasting recognized in the separate financial statement for  2012

Approval of  TI Media’s statement of financial position  as of 8 March 2013, to be submitted to the general Shareholders’ meeting  on 5 April 2013

TI Media S.p.A.’s equity as of 8 March 2013 amounted to 3.5 million euro

The Telecom Italia Media Board of Directors, chaired by Severino Salvemini, met today to examine the Statement of Financial Position of the Company in light of the losses recognised as of 31 December 2012 and also taking into account: (i) the accounting effects of the subscription on 6 March 2013 of the agreement for the sale of the 100% stake in La7 S.r.l. – excluding the 51% interest in MTV Italia S.r.l. — to Cairo Communication S.p.A.; and (ii) the recognition in equity of the 100 million euro receivable waived by the parent company Telecom Italia, as part of the disposal agreement.
 

Before examining the Statement of Financial Position as of 8 March 2013, however, it was necessary to further write down Telecom Italia Media Broadcasting S.r.l.’s goodwill recognised in the draft separate financial statements of Telecom Italia Media S.p.A., which had been approved during the meeting held on 4 March 2013, for a further impairment loss of 14.9 million euro, as a result of some observations made by the auditing firm PricewaterhouseCoopers. This led to a reduction by the same amount of the value of Telecom Italia Media S.p.A.’s equity, which as of 31 December 2012 therefore amounted to 56.2 million euro, whereas subscribed and paid-in share capital amounted to 212.2 million euro.

In light of the value adjustment to equity, the new Statement of Financial Position as of 8 March 2013, shows an overall loss of 152.7 million euro generated by the operating performance for the period and the provisions for future losses for the disposal of the equity investment in La7 S.r.l., estimated at 150.7 million euro. As a result, TI Media’s equity as of 8 March 2013 amounted to 3.5 million euro, down by 52.7 million euro compared to 31 December 2012.

The Board of Directors also acknowledged the issue by Telecom Italia S.p.A. of a letter of financial support whereby the parent company confirms its intention and commitment to fund and financially support Telecom Italia Media S.p.A. in order to ensure that the latter discharges its obligations and continues to operate regularly as going concern, at least with respect to financial years 2012 and 2013. This commitment is to be fulfilled according to conditions to be agreed upon with the Board of Directors of Telecom Italia Media, within the terms deemed appropriate and/or necessary in the light of company needs.

In relation to the foregoing, the forthcoming General Shareholders’ Meeting scheduled for 5 April will be submitted the following proposals:

  • approval of the Company’s Statement of Financial Position as of 8 March 2013;
  • deferment of the assumption of appropriate measures with respect to the loss presented in the Company’s Statement of Financial Position as of 8 March 2013 in accordance with Article 2446 of the Italian Civil Code.

The Explanatory Report, accompanied by the observations of the Board of Statutory Auditors and proposals for the Shareholders’ Meeting, will be made available to the public tomorrow at the Company’s registered office and from Borsa Italiana S.p.A. The document will also be published on the website at http://www.telecomitaliamedia.it/, Shareholders’ Meeting 2013 section.

It should be noted that the Statement of Financial Position as of 8 March 2013 has been prepared on the basis of the same criteria used to draft the Financial Statements as of 31 December 2012. No changes have been made to accounting principles with respect to those used in preparing the comparative data as of 31 December 2012; the reclassification criteria applied to accounting data remained unaltered. The Statement of Financial Position as of 8 March 2013 will not be audited.

The following documents are attached hereunder:

  • Telecom Italia Media S.p.A.’s reclassified highlights of the Balance Sheet, Income Statement and Cash Flow Statement as of 8 March 2013; and
  • the reclassified Separate Financial Statements of Telecom Italia Media S.p.A. as of 31 December 2012, which fully replace those attached to the press release issued on 4 March 2013, to include the effects of the value adjustment to the impairment loss approved today by the Board of Directors, as described above.
     

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Pursuant to sub-section 2, clause 154-bis of the Unified Finance Act, the manager in charge of drafting the company’s accounting documents, Mr. Luigino Giannini, has declared that the accounting disclosures contained in this press release correspond to the data records, accounting books and accounts entries.

Milan, 14 March 2013