Electric Power Operations
  • The sale of 100% of Edison France Sarl, which controls 50% of Flandres Energie, to the Dalkia Investissement Group was completed on February 7, 2005. The resulting deconsolidation, which was booked as of January 1, 2005, reflected the sale of an investee company that operates a 40-MW power plant in Lille (France).
  • Monsei Esco (formerly Montecatini Srl), which previously was valued at cost, and Hidro Power Energy Srl, a company established in November, are now consolidated line by line.
Hydrocarbons Operations
  • The sale of 90% of Edison LNG to Qatar Petroleum (45%) and ExxonMobil (45%) was completed on May 2, 2005. Following the sale, Edison LNG changed its name to Terminale GNL Adriatico Srl. The remaining 10% is valued at cost.
  • Styrija Plin D.O.O., previously consolidated line by line, was placed in liquidation. This company was deconsolidated as of July 1, 2005.
  • Edison Gas España Sa, previously consolidated line by line, was placed in liquidation. This company was deconsolidated as of January 1, 2005.
Corporate Activities
  • On November 30, 2005, Edison Spa purchased from EDF International Sa a 20% interest in Finel Spa as a result of EDF International Sa exercising its right to liquidate its investment in Finel Spa. Pursuant to existing agreements between the parties that remain in force, EDF International will sell its remaining 20% interest in Finel Spa to Edison Spa on December 1, 2006. As a result of these developments, the Group increased from 60% to 100% the percentage at which Finel Spa is consolidated, while recognizing a liability equal to the cost of purchasing the remaining 20%.
  • Finimeg, previously consolidated line by line, was placed in liquidation. This company was deconsolidated as of January 1, 2005.
Engineering Operations
In October 2005, further to an agreement executed in July, the group headed by Tecnimont Spa (engineering operations) was sold to the Maire Group and deconsolidated.
Consequently, as required by IFRS 5, the divested group's revenues and expenses for the first half of 2005 were reflected line by line in the consolidated income statement. The result generated by these operations for the period between July 1, 2005 and September 30, 2005 and the net gain on their divestiture are recognized in the income statement under "Profit (loss) from discontinued operations."
Consolidation of Foreign Companies and Criteria Used
to Translate Items Denominated in Foreign Currencies
Assets and liabilities of foreign companies that are denominated in currencies other than the euro are translated at the exchange rates in force on the balance sheet date. Income and expenses are translated at the average rates for the year. Any resulting gains or losses are recognized in equity until the corresponding equity investment is sold.
Upon initial implementation of the IAS/IFRS principles, cumulative translation differences were written off and, consequently, the reserve recognized in the consolidated financial statements reflects only cumulative translation differences that arose after January 1, 2004.
Transactions in foreign currencies are recognized at the exchange rate in force on the transaction date. Monetary assets and liabilities are translated at the exchange rates in force on the balance sheet date. Any resulting foreign exchange translation differences and those realized when the positions are closed are recognized as financial income or expense.
Financial Highlights of Companies Consolidated by the Proportional Method
(Pro rata interest in accordance with IAS guidelines)
(in millions of euros) Edipower Serene Sel Edison Ibiritermo Parco Eolico ED-Ina Galsi Spa IWH Bluefare
            Castelnuovo Srl D.O.O.          
  50.00% 66.32% 42.00%   50.00% 50.00%   50.00%   18.00%   50.00% 50.00%  
INCOME STATEMENT                            
Sales revenues 524 179   9 22   1   5   - 31   -
EBITDA 189 37   5 18   -   -   - 8   -
as a % of net revenues 36.1% 20.7% 52.4%   81.4% n.a. n.a.   - 24.2%   -
Depreciation, amortization and writedowns (-) (124) (12) (3) (8)   -   -   - (1)   -
EBIT 65 25   2 10   -   -   - 6   -
Profit (Loss) 12 15   - (4)   -   -   - 5   -
BALANCE SHEET                  
Total assets 2,455 246 63 83 3 4 - 39 -
Shareholders' equity 1,036 111 37 (1) 1   1 23 -
Net borrowings
(financial assets) 1,009 55 24 62 1 4 (1) (11) -