Analysis of Salini Impregilo Group’s financial position and results of operations for the six months

This section presents the Group’s reclassified income statement and statement of financial position and a breakdown of its financial position at 30 June 2016. It also provides an overview of the main changes in the Group’s financial position and results of operations compared to the previous year. As shown later, the figures for the first half of 2016 are not fully comparable with those of the corresponding period of 2015 due to the acquisition of Lane on 4 January 2016.

Unless indicated otherwise, figures are provided in millions of Euros and those shown in brackets relate to the previous year.

The “Alternative performance indicators” paragraph in the “Other information” section gives a definition of the financial statements indicators used to present the Group’s financial position and results of operations for the six months.

Initial considerations on the comparability of data

Lane Industries Incorporated

As described in the section on the key events of the period, the acquisition of 100% of Lane was finalised on 4 January 2016.

IFRS 10 – Consolidated financial statements provides that a subsidiary shall be consolidated starting from the date when control is acquired. Therefore, the condensed interim consolidated financial statements at 30 June 2016 present the statement of financial position figures at 31 December 2015 and the income statement figures as at and for the six months ended 30 June 2015 for comparative purposes that do not include Lane Group. It follows that the data for the first half of 2016 are not fully comparable.

In order to make these data more comparable with the corresponding period of 2015, this section sets out Salini Impregilo Group's key figures using the same consolidation scope.

Composition of the combined data for the first half of 2015

The data have been obtained by combining the Group's key figures, restated compared to that shown in the 2015 interim financial report to consider the final disposal scope of Todini Costruzioni Generali, with the key figures of Lane Group, which are its consolidated figures at 30 June 2015 prepared in accordance with US GAAP.

Table A

Comparison of the 2016 and 2015 data using the same consolidation scope

The following table provides a comparison of Salini Impregilo Group's key figures for the reporting period with the combined figures of the two groups for the first six months of 2015:

Table B

Management accounts presentation of the figures for the reporting period and the corresponding period of 2015 ("work under management")

The Group monitors the key figures of Lane Group for management purposes adjusting the IFRS figures to present the results of the non-subsidiary joint ventures consolidated on a proportionate basis. These management accounts results (works under management), show the progress made on the contracts managed directly by Lane Industries or through its non-controlling investments in the joint ventures.

The following table C shows the effects of this presentation on the condensed interim consolidated financial statements at 30 June 2016 compared with the combined figures of Salini Impregilo Group and Lane Group at the same date:

Table C

Sale of Todini Costruzioni Generali

The parent completed the sale of Todini Costruzioni Generali to Prime System Kz Ltd., set up and organised under Kazakhstani law, for about €51 million on 4 April 2016.

In March 2016, before the sale, Todini Costruzioni Generali’s assets not to be sold to third parties were transferred to a newco HCE Costruzioni S.p.A. (“HCE”), which was subsequently sold to Salini Impregilo S.p.A..

Therefore, at that date, Todini Costruzioni Generali solely consisted of the assets and liabilities of the foreign business unit, i.e., the projects and branches operating in Georgia, Azerbaijan, Belarus and Kazakhstan, including

the carrying amount of the investments in the subsidiaries carrying out the relevant projects, JV Todini Takenaka and Todini Central Asia, as well as some operating assets either owned directly by the Group or leased.

The assets transferred to HCE included those belonging to Business unit A - Contracts in Italy, which include the Metrocampania (Naples Alifana and Secondigliano) contracts, the Valico crossing and Naples Sarno River contracts and the plant and machinery at the Lungavilla depot. The Group has received an expression of interest in acquiring this business unit from third parties and the related negotiations are in place. Therefore, it has continued to recognise the assets as non-current assets held for sale.

The breakdown of the subgroup Todini Costruzioni Generali was different in the condensed interim consolidated financial statements at 30 June 2015 based on the expressions of interest received at that date. It was necessary to restate the comparative figures for the first half of 2015 to be consistent with the approach used in the reporting period pursuant to IFRS 5.

The effects of the restatement of the income statement are shown in the following table:

(°) They include provisions and impairment losses.