IMPREGILO GROUP Origins

Progress, our greatest work

2008 Annual Report 2008 The value of a group is tied to its history and concessions market, particularly for motorway IMPREGILO GROUP origins. networks, renewable energy plants and energy 2008 Annual Report Impregilo group was set up at the beginning of the transportation. It is also active in the plant and 1990s but its origins lie much further back as it is engineering and environmental services sectors. the legacy of Girola, Lodigini, Impresit and Cogefar. Dams, hydroelectric plants, motorways, railways, These prestigious Italian companies were at the underground train systems, tunnels, bridges, forefront of international civil engineering from the viaducts, desalination plants, fume treatment plants early twentieth century. and waste-to-energy plants: a wealth of experience gained in Italy and abroad thanks to its constant Active in all five continents, the companies that commitment to meeting deadlines, protecting the merged to become Impregilo engaged in the environment and deploying innovative technologies. IMPREGILO GROUP construction of the main motorway, railway and hydroelectric works underpinning development in Impregilo is a group looking to the future. It is Italy and in many other countries around the world, responsible and sensitive to its stakeholders’ and helped strengthen Italy’s international standing. expectations and has proved itself well capable of exploiting and anticipating market developments This rich history of tradition and success has made over its more than a hundred years of experience. Impregilo, listed on the Italian stock exchange, the leading general contractor in Italy and one of the Today, thanks to its business and organisational major international general construction companies. skills and technical and financial knowledge, Impregilo has a wealth of unrivalled expertise and With more than 10 thousand highly qualified experience. It is ready to take on the challenge of employees and extraordinary technical know-how, growing demand for infrastructure and transportation the group is active worldwide in the construction of for people and goods while protecting and nurturing large infrastructure contracts and highly acclaimed the environment as one of the major players in Italy architectural projects and is a key player in the and on the international field for new development. IMPREGILO S.P.A. _ Viale Italia, 1 _ Sesto S. Giovanni (MI) _ Italy - Tel. +39 02 444.22111 Fax +39 02 444.22293 - e-mail: [email protected] www.impregilo.it Progress, our greatest work

Impregilo S.p.A. Fully paid-up share capital euro 718,364,456.72 - Registered office in Viale Italia 1, Sesto S. Giovanni (MI) Tax code and Milan Company Registration no. 00830660155 R.E.A. no. 525502 - VAT no. 02895590962 This document is available at: www.impregilo.it TABLE OF CONTENTS Pag. 3 General information Pag. 4 Company officers

Pag. 5 Impregilo Group structure

Pag. 13 Group highlights Pag. 14 Introduction Pag. 16 Financial highlights

Pag. 21 Directors’ report – Part I Pag. 22 Analysis of Impregilo group’s and parent’s financial position and results of operations for the year

Pag. 34 Directors’ report - Part II Pag. 35 Performance by business segment Pag. 38 - Corporate Pag. 39 - Construction Pag. 49 - Engineering & Plant Construction Pag. 52 - Concessions Pag. 57 - Imprepar – Impregilo Partecipazioni S.p.A. (in liquidation) Pag. 58 Impregilo group risk management Pag. 59 Non-current assets classified as held for sale and discontinued operations Pag. 69 Human resources and organisation Pag. 73 Safety, the environment and quality Pag. 80 Privacy and data protection Pag. 81 Subsequent events Pag. 83 Outlook Pag. 84 Other information Pag. 87 Corporate governance report

Pag. 118 Proposal to the shareholders of Impregilo S.p.A.

Pag. 119 Consolidated financial statements as at and for the year ended 31 December 2008 Pag. 201 Consolidated financial statements of Impregilo group Intragroup transactions Pag. 215 Consolidated financial statements of Impregilo group Equity investments Pag. 227 Consolidation scope Pag. 237 Statement on the consolidated financial statements Pag. 241 Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008 Pag. 301 Separate financial statements of Impregilo S.p.A. Intragroup transactions Pag. 313 Separate financial statements of Impregilo S.p.A. - Equity investments Pag. 331 Statement on the separate financial statements Pag. 335 Indipendent Auditor’s opinions and report of Statutory Auditors Pag. 353 Abstract from the Shareholder Agreements Pag. 357 Shareholders’ meeting of 29 april 2009 GENERAL INFORMATION 3

2008 Annual Report IMPREGILO COMPANY OFFICERS

Board of directors (i) Chairman Massimo Ponzellini Deputy chairmen Giovanni Castellucci Antonio Talarico Chief executive officer Alberto Rubegni Directors Carlo Buora Alfredo Cavanenghi Claudio Cominelli Nicola Fallica Beniamino Gavio Marcello Gavio Giancarlo Guenzi Maurizio Maresca Andrea Novarese Giuseppe Piaggio Alberto Sacchi Executive committee Chairman Alberto Rubegni Giovanni Castellucci Antonio Talarico Beniamino Gavio Andrea Novarese Giuseppe Piaggio Internal control committee Alfredo Cavanenghi Nicola Fallica Maurizio Maresca Remuneration committee Massimo Ponzellini Carlo Buora Alfredo Cavanenghi Claudio Cominelli Maurizio Maresca Board of statutory auditors (i) Chairman Giuseppe Levi Standing statutory auditors Giorgio Oldoini Alessandro Trotter Substitute statutory auditors Vittorio Amadio Michela Zeme Independent auditors PricewaterhouseCoopers S.p.A.

(i) appointed by the shareholders on 7 May 2008; in office until approval of the financial statements as at and for the year ending 31 December 2010. IMPREGILO GROUP STRUCTURE 5

2008 Annual Report IMPREGILO IMPREGILO GROUP STRUCTURE - 31 DECEMBER 2008

ENGINEERING & CONSTRUCTION PLANT CONST.

IMPREGILO S.p.A. 100 FISIA ITALIMPIANTI S.p.A. 100

Bocoge S.p.A. 100 Fisia Babcock Environment Gmbh 100 CIGLA S.A. 100 - Impregilo Intern. Infrastruc. N.V. 100 CSC Impresa Costruzioni S.A. 100 Steinmuller International Gmbh 100 J.V. Igl S.p.A.-S.G.F. INC S.p.A. 100 - Fisia Babcock Gmbh 100 - Impregilo S.p.A. 99 Gestione Napoli S.p.A. (in liq.) 99 - S.G.F. INC S.p.A. 1 - Fisia Italimpianti S.p.A. 54 S.A. Healy Company 100 - Impregilo S.p.A. 24 S.G.F. - I.N.C. S.p.A. 100 - Fisia Babcock Gmbh 21 S.I.P.E.M. S.p.A. (in liq.) 100 Castalia Ecolmar S.c.p.a. 49.9 Suropca C.A. 100 OTHER 9 COMPANIES - Impregilo S.p.A. 99 - CSC S.A. 1 Consorzio Frana di Spriana S.c.r.l. (in liq.) 100 PGH Ltd 100 Vegas Tunnel Constructors 100 - Impregilo S.p.A. 40 - Healy S.A. 60 Consorzio Torre 94.6 Emp. Const. Costanera Norte Ltda 77.78 Consorzio C.A.V.E.T. 75.98 Consorzio C.A.V.TO.MI. 74.69 Consorcio Impregilo - Ingco 70 Constructora Mazar 70 Rivigo J.V. L.t.d. 70 - PGH L.t.d. 70 Consorcio Impregilo Yarull 70 Consorcio Acueducto Oriental 67 Consorzio Venice Link 61 Impregilo Lidco Libya Co. 60 Nathpa Jhakri J.V. 60 Ghazi-Barotha Contractors J.V. 57.8 Consorzio Scilla 51 Reggio Calabria - Scilla S.c.p.a. 51 Salerno-Reggio Calabria S.c.p.a. 51 Pedelombarda S.c.p.A. 47 Eurolink S.c.p.a. 45 Passante di Mestre S.c.p.A. 42

OTHER 134 COMPANIES

TOTAL 353 USW CAMPANIA CONCESSIONS OTHER PROJECTS

IMPREPAR S.p.A. IMPREGILO INTERNATIONAL FIBE INFRASTRUCTURES N.V. 100 IN LIQUIDATION 100

Impregilo Parking Glasgow Ltd 100 Fibe Campania S.p.A. 99.994 Alia S.c.r.l. (in liq.) 100 Impregilo New Cross Ltd 100 - Impregilo S.p.A. 99.973 Consorzio Pielle (in liq.) 100 IGLYS S.A. 100 - Impregilo Intern. Infrastruc. N.V. 0.007 - Imprepar S.p.A. (in liq.) 33.33 - Impregilo Intern. Infrastruc. N.V.98 - Fisia Babcock Gmbh 0.007 - Incave s.r.l. 66.67 - Incave s.r.l. 2 - Fisia Italimpianti S.p.A. 0.007 C.F.T. Duemila S.c.r.l. 100 Caminos de las Sierras S.A. 90.52 Fibe S.p.A. 99.998 - Incave s.r.l. 100 Mercovia S.A. 60 - Impregilo S.p.A. 99.989 Edilizia Militare R.C. S.c.r.l. (in liq.) 100 Shangai Pucheng T.P.E. Co. L.t.d. 50 - Impregilo Intern. Infrastruc. N.V. 0.003 - Imprepar S.p.A. (in liq.) 85 - Fisia Babcock Gmbh 50 - Fisia Babcock Gmbh 0.003 - Sapin S.r.l. (in liq.) 15 Consorcio Agua Azul S.A. 25.5 - Fisia Italimpianti S.p.A. 0.003 Engeco France S.a.r.l. 100 Aguas del Gran B. Aires S.A. (in liq.) 42.59 - Imprepar S.p.A. (in liq.) 99.67 - Impregilo Intern. Infrastruc. N.V. 23.73 - Incave s.r.l. 0.33 - Impregilo S.p.A. 16.5 Eurotechno S.r.l. (in liq.) 100 - Iglys S.A. 2.36 Imprefeal S.p.A. 100 Ochre Solutions Holding L.t.d. 40 Impregilo U.K. Ltd (in liq.) 100 Primav Ecorodovias S.A. 35 Impresa Castelli S.r.l. (in liq.) 100 7 Puentes del Litoral S.A. 26 Impresit del Pacifico S.A. 100 - Impregilo S.p.A. 22 INCAVE S.r.l. 100 - Iglys S.A. 4 San Martino Prefabbricati S.p.A. (in liq.) 100 Yacylec S.A. 18.67 - Impresa Castelli Sr.l. (in liq.) 100 Savico S.c.r.l. (in liq.) 100 OTHER 24 COMPANIES - Imprepar S.p.A. (in liq.) 81 - Sapin S.r.l. (in liq.) 19 SAPIN S.r.l. (in liq.) 100 Watis Bau GmbH (in liq.) 100 S. Leonardo S.c.r.l. (in liq.) 99.99 Cogefar Cameroun S.A. (in liq.) 99.97 BATA S.r.l. (in liq.) 50.69

OTHER 116 COMPANIES

2008 Annual Report IMPREGILO IMPREGILO 1906-2008 A CENTURY OF INFRASTRUCTURES ALL OVER THE WORLD

8 9 IMPREGILO IN THE WORLD OUR CURRENT PRESENCE

10 11

GROUP HIGHLIGHTS 13

2008 Annual Report IMPREGILO Group highlights

INTRODUCTION

Impregilo group closed 2008 with an operating profit (EBIT) and a profit for the year, amounting to euro 189.1 million and euro 167.6 million, respectively, compared to euro 131.2 million and euro 40.8 million for 2007. The parent’s results were also positive with EBIT at euro 138.9 million (2007: euro 27.5 million) and profit for the year at euro 83.0 million (2007: loss of euro 1.9 million). These results confirm the group’s development and growth despite the very critical domestic and international economic climate, which is not expected to improve in the short term. The crisis which hit the financial markets in October 2008 spread rapidly to all the Italian and international industrial production and services sectors. The main economic and financial growth indicators continue to be negative in early 2009 and the short-term outlook is not at all positive. The judicial issues related to the USW Campania projects continued in this complex scenario and positive developments were only seen in the second half of the year following the Supreme Court’s cancellation of the precautionary seizure measure ordered by the Naples Public Prosecutor. Following this cancellation, in August, the Naples Review Court ordered the immediate return of the seized assets. This decision has been appealed against with the Supreme Court by the Naples Public Prosecutor and the related ruling has yet to be handed down. The group’s diversification of its activities into three core business segments, Construction, Concessions and Engineering & Plant Construction, 14 as well as into different geographical segments continue to be a key strategic element easing the above effects and allowing it to maintain a balanced financial position, which has enabled it to achieve the aforesaid positive results for the year. 2008 revenue amounted to euro 2,957.6 million, up 12.6% on the previous year (euro 2,626.9 million). The group’s operating profit (EBIT) was euro 189.1 million (euro 131.2 million), with a return on sales of 6.4% (5.0%). The operating profit for 2007 included the non-recurring accrual of euro 50.0 million for the USW Campania projects. The Construction and Concessions segments contributed positively to this result with euro 205.9 million (R.o.S. of 11.5%) and euro 29.3 million (R.o.S. of 17.3%), respectively. The Engineering & Plant Construction segment had already encountered difficulties related to certain desalination projects in the second half of 2007, which led to an overall decrease in profitability on certain contracts again in 2008 resulting in an operating loss of euro 15.6 million. Financing income (costs) and gains (losses) on investments came to a negative euro 4.6 million compared to a positive euro 3.4 million for 2007. Specifically, net gains on investments included the gain realised on the sale of the group’s investment in the Brazilian associate Ponte de Pedra S.A. (euro 67.5 million). Profits from discontinued operations amounted to euro 35.6 million (losses of euro 30.8 million) and include settlement of certain clauses included in the agreements for the sale of the Chilean concession company Costanera Norte, entered into in 2006 (euro 40.6 million), and the losses on the USW Campania projects (euro 5.1 million). The profit attributable to the shareholders of the parent for the year is euro 167.6 million (euro 40.8 million for 2007). It includes the gain on the sale of the group’s investment in the Brazilian associate Ponte de Pedra S.A. (euro 67.5 million) and the profits from discontinued operations (as above). The group’s net financial position at 31 December 2008 is a positive euro 42.6 million compared to a negative euro 53.7 million at the end of the previous year. The group acquired new contracts worth euro 2,999.2 million during the year. At year end, the group’s order backlog amounts to euro 16.3 billion, including euro 8.9 billion brought in by the Construction and Engineering & Plant Construction segments and euro 7.4 billion related to the residual Concessions segment order backlog. The parent’s 2008 revenue amounted to euro 1,667.0 million, up 13.3% on the previous year (euro 1,471.3 million). Its operating profit (EBIT) amounted to euro 138.9 million (euro 27.5 million) with a return on sales of 8.3% (1.9%). The operating profit for 2007 included the non-recurring accrual of euro 50.0 million for the USW Campania projects. The parent’s financing income (costs) and gains (losses) on investments came to a positive euro 7.1 million compared to a positive euro 7.6 million in 2007. Its profit for the year is euro 83.0 million compared to a loss of euro 1.9 million for 2007. The parent’s net financial position is a negative euro 475.0 million (31 December 2007: euro 398.1 million) with a debt/equity ratio of below 0.6.

2008 Annual Report IMPREGILO Group highlights

FINANCIAL HIGHLIGHTS (in millions of Euros) Impregilo group The paragraph “Alternative performance indicators” in the “Other information” section gives a definition of the financial statements indicators used to present the group’s and parent’s highlights.

2,957.6

2,626.9

16 131.2 189.1 167.6 40.8 Revenue EBIT Profit 2007 2008

782.3 729.9

824.8

676.2

42.6 (53.7)

Net Equity Net Invested Capital Net Financial Position

December 2007 December 2008 CONSOLIDATED INCOME STATEMENT

(in millions of Euros) 2008 2007 Revenue 2,957.6 2,626.9 Costs (2,707.1) (2,382.5) Provision for USW Campania projects (50.0) Gross operating profit - EBITDA 250.6 194.4 EBITDA % 8.5% 7.4% Operating profit - EBIT 189.1 131.2 R.o.S. 6.4% 5.0% Net financing costs (60.5) (9.8) Net gains on investments 55.9 13.2 Profit before tax - EBT 184.5 134.6 Income tax (52.5) (63.7) Profit from continuing operations 131.9 70.9 Profits (losses) from discontinued operations 35.6 (30.8) 17 Profit attributable to shareholders of the parent 167.6 40.8

CONSOLIDATED BALANCE SHEET

(in millions of Euros) 31 December 2008 31 December 2007 Non-current assets 417.7 436.6 Goodwill 58.9 58.9 Assets classified as held for sale, net 384.3 442.8 Provisions for risks, Post-employment benefits and other employee benefits (211.3) (235.0) Other non-current assets, net 65.0 61.4 Net tax assets 224.2 271.8 Working capital (156.7) (306.6) Net invested capital 782.3 729.9 Equity 824.8 676.2 Net financial position (indebtedness) 42.6 (53.7) Debt/Equity n.a. 0.08

2008 Annual Report IMPREGILO Group highlights

ORDER BACKLOG

Construction, Engineering & Plant Construction

December 2008 December 2007 (Euro 8,928 million) (Euro 9,202 million)

13%

22%

87% 78%

Construction Engineering & Plant Construction Construction Engineering & Plant Construction

Concessions

December 2008 December 2007 (Euro 7,393 million) (Euro 7,742 million)

1% 4% 8% 0% 9% 78% 86% 14%

Motorways Energy Aqueducts Hospitals Motorways Energy Aqueducts Hospitals ORDER BACKLOG BY GEOGRAPHICAL AREA

Construction, Engineering & Plant Construction, Concessions

December 2008 December 2007 (Euro 16,321 million) (Euro 16,944 million)

46% 46%

54% 54%

Italy Abroad Group highlights

SEPARATE INCOME STATEMENT

(in millions of Euros) 2008 2007 Revenue 1,667.0 1,471.3 Costs (1,509.0) (1,371.5) Provision for USW Campania projects - (50.0) Gross operating profit - EBITDA 158.0 49.8 EBITDA % 9.5% 3.4% Operating profit - EBIT 138.9 27.5 R.o.S. 8.3% 1.9% Net financing income 10.1 36.3 Net losses on investments (2.9) (28.7) Profit before tax - EBT 146.0 35.1 Income tax (63.0) (37.0) Profit (loss) from continuing operations 83.0 (1.9) 20 Profits (losses) from discontinued operations - - Profit (loss) for the year 83.0 (1.9)

SEPARATE BALANCE SHEET

(in millions of Euros) 31 December 2008 31 December 2007 Non-current assets 464.1 434.2 Provisions for risks, Post-employment benefits and other employee benefits (127.1) (172.1) Other non-current assets, net 310.2 357.9 Net tax assets 111.6 155.7 Working capital 523.1 347.0 Net invested capital 1,281.9 1,122.7 Equity 806.9 724.7 Net financial indebtedness (475.0) (398.1) Debt/Equity 0.59 0.55 DIRECTORS’ REPORT 21 PART I

2008 Annual Report IMPREGILO Directors’ report - Part I

ANALYSIS OF IMPREGILO GROUP’S AND PARENT’S FINANCIAL POSITION AND RESULTS OF OPERATIONS FOR THE YEAR

This section includes the group’s and parent’s reclassified income statements and balance sheets, as well as their financial positions at the end of 2008. It also includes a summary of the main changes in the consolidated and separate income statements with those for the year ended 31 December 2007 and balance sheets in comparison with the related figures at 31 December 2007. The note numbers given in the schedules refer to the notes to the consolidated and separate financial statements which give a detailed analysis thereof. Unless otherwise indicated, figures are provided in millions of Euros and those shown in brackets relate to the previous year. The paragraph “Alternative performance indicators” in the “Other information” section gives a definition of the financial statements indicators used to present the group’s and parent’s financial position and results of operations for the year.

GENERAL CONSIDERATIONS In order to give a complete picture of changes in the group’s results of operations and financial position during 2008, a brief overview of the international macro-economic situation is set out below, continuing the disclosure given in the 2007 Annual Report. For the first time in the last few years, the international economy saw a generalised slowdown in industrial production in 2007. This trend 22 worsened during 2008 following the negative developments in the US subprime mortgage sector. The crisis expanded throughout the world with generalised growing distrust in the banking system, which led to a strong contraction in liquidity in circulation. The situation become even more evident in the second half of the year and is still ongoing. Starting from September 2008, certain major international financial institutions filed for insolvency, which had a direct adverse effect on financial markets. The fall in share prices was such that the European indices were at comparable levels at the end of February 2009 with those of 1996. The widespread fear about the overall stability of the credit system led to the heavy intervention by the central banks of the main countries in an attempt to restore confidence in the markets. Such actions have not, however, had the desired effects and what originally seemed to be a serious but short-lived financial crisis has rapidly evolved into an economic crisis, with a worldwide slump in demand, industrial production and employment. As part of its activities of monitoring the international economy and its performance, the International Monetary Fund has continued to revise its estimates downwards and they were recently at the lowest levels seen since 1945. Prices of the main energy sources fluctuated widely during 2008. In the first half of the year, oil prices more than doubled compared to the previous year with similar trends seen on the raw materials markets, particularly, copper and iron, which had a direct impact on their semi- finished derivatives. In the last three months of the year, the generalised market volatility was confirmed although there was an about-turn. The prices of oil and the other main raw materials decreased which has speeded up the slowdown in industrial production. This adverse situation was aggravated by the rise in inflation rates which, especially in Italy, have returned to 2001-2002 levels, and the steady appreciation of the Euro against the dollar and dollar-linked currencies. This was not helped by the generalised rise in interest rates with the three month Euribor going from 3.8% at the start of 2007 to 5.20% at 30 September 2008. This trend then changed dramatically for both the dollar, which appreciated against the Euro, and interest rates, which decreased. The impact of this latter decrease was entirely wiped out by the large rise in spreads which contributed to the higher cost of borrowing and the generalised increase in risk factors perceived by the financial system. Despite the repeated intervention of the central banks in the main countries, banks have practically cut any new lending, thus leading to another contraction in available liquidity. A clear sign of the absence of available liquidity, although it exists in the banking system, is the considerable rise in deposits made by banks with the European Central Bank in the last few months. As already described for 2007, the group’s diversification into three core businesses and different geographical segments continues to represent a strong strategic advantage, lessening the above effects and allowing it to maintain a stable financial position and results, despite the complex macroeconomic situation. As a result and thanks to the group’s large and high quality order backlog, it has been able to increase its turnover compared to 2007, resulting in stable operating profit before non-recurring items. Critical factors arising from the macro-economic situation and, specifically, the uncertainty about the internal reference market and considerable reliance on infrastructure investments and raw materials price trends need to be considered. Another critical issue for the group is the entire USW Campania projects situation and their developments, as described in more detail later in this report.

2008 Annual Report IMPREGILO Directors’ report - Part I

GROUP PERFORMANCE Reclassified consolidated income statement of Impregilo group

(Euro/000) Note (*) 2008 2007 Change Revenue 2,867,048 2,530,406 336,642 Other revenue 90,596 96,497 (5,901) Total revenue 12 2,957,644 2,626,903 330,741 Costs 13 (2,707,080) (2,432,481) (274,599) of which: provision for USW Campania projects - (50,000) 50,000 Gross operating profit - EBITDA (**) 250,564 194,422 56,142 EBITDA % (**) 8.5% 7.4% Amortisation and depreciation 13 (61,482) (63,230) 1,748 Operating profit - EBIT (**) 189,082 131,192 57,890 Return on Sales (**) 6.4% 5.0% Financing income (costs) and gains (losses) on investments 24 Net financing costs 14.1 (60,533) (9,831) (50,702) Net gains on investments 14.2 55,912 13,235 42,677 Net financing costs and net gains on investments (4,621) 3,404 (8,025) Profit before tax - EBT 184,461 134,596 49,865 Income tax 15 (52,536) (63,713) 11,177 Profit from continuing operations 131,925 70,883 61,042 Profits (losses) from discontinued operations 16 35,567 (30,756) 66,323 Profit for the year 167,492 40,127 127,365 Minority interests 154 632 (478) Profit attributable to shareholders of the parent 167,646 40,759 126,887

(*) The note numbers refer to the notes to the consolidated financial statements where the items are analysed in detail. (**) The paragraph in the section on "Other information" of this report gives a definition of these indicators

Revenue The group recorded total revenue for 2008 of euro 2,957.6 million (euro 2,626.9 million), up roughly 12.6% on the previous year. All three core businesses (Construction, Engineering & Plant Construction and Concessions) saw increases in their business volumes.

Operating profit (EBIT) The group’s operating profit was euro 189.1 million (euro 131.2 million) for a return on sales (R.o.S.) of 6.4% (5.0%). The operating profit for 2007 included the non-recurring accrual of euro 50.0 million made for the pending proceedings with the Court of Naples for the USW Campania projects. The Construction and Concessions segments made an especially positive contribution to this result: euro 205.9 million (R.o.S. of 11.5%) and euro 29.3 million (R.o.S. of 17.3%), respectively. The reduction in the Concession segment’s EBIT compared to the previous year (2007 R.o.S. of 30.3%) was significantly affected by the full impairment loss recognised on the remaining assets and the provisions made by the Argentine concession company Caminos de Las Sierras S.A. of approximately euro 18 million. This adjustment, described in the section on the Concessions segment, was necessary due to the continued contractual non-compliance by the concession grantor in respect of the contractually-provided for tariff increases, which were never given, and the consequent formal commencement of bankruptcy proceedings by the subsidiary. The Engineering & Plant Construction segment had encountered difficulties related to its desalination projects in the second half of the previous year. This led to an overall reduction in the related contracts’ profitability compared to 2007 and resulted in an operating loss of euro 15.6 million. The group’s other activities made an operating profit of euro 3.7 million, while the corporate structure’s net costs came to euro 34.2 million.

Financing income (costs) and gains (losses) on investments The group recorded net financing costs of euro 60.5 million (euro 9.8 million) while net gains on investments amounted to euro 55.9 million (euro 13.2 million). The net financing costs were affected by a number of factors, the most significant of which are described below. • Net financial expense amounted to euro 70.5 million (euro 40.3 million). The euro 30.2 million increase on 2007 is mainly due to certain 25 South American markets where interest rates and debt levels grew sharply. The rise in Primav Ecorodovias’ debt following its acquisition of the concession company Ecocataratas (formerly Rodovias das Cataratas) led to greater financial expense of approximately euro 10 million for the Brazilian group. In addition, operations in Venezuela saw a temporary increase in their short-term debt due to delays in receiving payments for regularly approved completed work stages from state bodies. As a result of these delays, which started to be recovered in the last few months of 2008 continuing into 2009, the group companies’ exposure in local currency and concurrent considerable rise in the reference rates (the Venezuelan nominal interest rates doubled from the end of 2007 to the end of 2008) led to additional financial expense compared to the previous year of approximately euro 20.0 million. • Net exchange rate losses amounted to euro 26.9 million (net gains of euro 5.1 million) and are analysed below in terms of the different underlying foreign currencies and conditions. - The Construction segment recorded net exchange rate losses of euro 9.7 million in Venezuela, mainly due to the non-payment of progress billings by the local customers of work in US dollars, as contractually provided for and in their favour, but in the local contractual currency (Bolivar). This option to pay in US dollars had been continuously availed of by customers in the past for almost all contractual components expressed in the local currency and had been considered when measuring receivables at the end of 2007. - Net exchange rate losses for the Engineering & Plant Construction segment’s activities in the Persian Gulf area amounted to euro 13.7 million and mainly arose from local currencies, principally tied to the US dollar, as well as the US dollar itself. Despite their not meeting the hedging requirement established by IFRS, the derivatives entered into by the group hedging currency risk on contract revenue are substantially effective. The exchange rate losses classified as financing costs arising from the adjustments of the expected contract performance to current rates have been substantially offset by the performance of the relevant derivatives. - Net exchange rate losses of euro 3.5 million were recorded for the weak and/or limited circulation currencies, such as those for Brazil, Iceland, Tunisia and Nigeria. Hedges cannot be agreed for such exchange rate risks at reasonable conditions. • The euro 4.4 million decrease in gains on the sale of securities. In 2007, these gains were achieved on the management of payments made by customers in currencies other than those contractually provided for, whereas in 2008, these gains were realised by directly

2008 Annual Report IMPREGILO Directors’ report - Part I

financing certain foreign operating branches by the parent using its own funds. It took advantage of the currency mismatches of money markets in relation to certain South American currencies, whose official exchange rates with some strong currencies, including the US dollar, are fixed artificially. • The collection of default interest receivables by both the Engineering & Plant Construction and Construction segments, which had been fully impaired in previous years, allowed the group to achieve results approximately euro 7.6 million better than those of the previous year: euro 8.2 million for 2008 compared to euro 0.6 million for 2007. • A reduction in bank charges and commissions on financial guarantees of euro 1.7 million as well as a decrease in other financial expense (losses on the disposal of financial assets, other income and expense) of euro 6.6 million compared to 2007. With respect to gains (losses) on investments, the group recorded net gains of euro 55.9 million (euro 13.2 million) composed mainly of: • a net gain of euro 67.5 million on the sale of its investment in the Brazilian associate Ponte de Pedra S.A.; • cancellation of the remaining carrying amount of euro 9.9 million of the 50.71% investment in Impresit Bakolori P.l.c. (Nigeria) in the last few months of 2008. This company was excluded from the consolidation scope due to the significant worsening in the general stability of the area in which it operates. As a result, the group was unable to control the subsidiary’s operations and management, as it had done 26 regularly in previous years, nor to obtain reliable figures at 31 December 2008.

Profits (losses) from discontinued operations This caption shows net profits of euro 35.6 million (net losses of euro 30.8 million), which were partly offset by the losses of euro 5.0 million for the USW Campania projects. The net profits include euro 40.6 million for the financial components covered by the agreement signed in 2006 in connection with the sale by Impregilo International Infrastructures of the Chilean concession company Costanera Norte S.A. which were to be defined after the sale. These components related to: a) measurement of the deferred price for attainment of results better than those included in the 2006-2009 business plan used for the sale by the Chilean concession company. This component amounts to euro 8.2 million, net of the related tax effect. At the sale date, only the certain, identifiable consideration had been determined as a minimum guaranteed euro 2.5 million.The positive euro 5.7 million difference was, therefore, recognised entirely in 2008 on the basis of the concession company’s actual 2006 and 2007 results and forecast 2008 and 2009 results, the latter identified in advance based on an appraisal carried out by an independent third party in July 2008; b) sale of the right to subscribe 10% of the buyer’s share capital at its nominal amount, which was estimated at euro 34.9 million by an independent expert in July 2008. These amounts were collected in the fourth quarter of 2008 as already provided for in the contract during negotiations for the sale of the investment in the Chilean concession company and recognised in accordance with IRFS 5 at the time of sale. They also comply with the ruling legal requirements governing related party transactions. In this case, the relationship is between the directors.

Minority interests Minority interests in the subsidiaries contributed positively to the profit for the year attributable to the shareholders of the parent for euro 0.2 million. The 2007 contribution was a positive euro 0.6 million. THE GROUP’S FINANCIAL POSITION

Reclassified consolidated balance sheet of Impregilo group

(Euro/000) Note (*) 31 December 2008 31 December 2007 Change Non-current assets, net 1 417,758 436,597 (18,839) Goodwill with an indefinite life 1.4 58,890 58,890 - Assets classified as held for sale, net 2 384,300 442,789 (58,489) Provisions for risks 3 (177,885) (198,538) 20,653 Post-employment benefits and other employee benefits 4 (33,419) (36,417) 2,998 Other non-current assets, net 5 65,034 61,373 3,661 Net tax assets 6 224,248 271,814 (47,566) Inventories 59,408 59,459 (51) Contract work in progress 707,609 472,159 235,450 Advances on contract work in progress (713,111) (776,588) 63,477 Receivables 1,038,310 1,023,364 14,946 27 Payables (1,236,671) (1,089,279) (147,392) Other current assets 276,206 295,511 (19,305) Other current liabilities (288,419) (291,228) 2,809 Working capital 7 (156,668) (306,602) 149,934 Net invested capital 782,258 729,906 52,352 Equity attributable to shareholders of the parent 820,652 681,392 139,260 Minority interests 4,182 (5,197) 9,379 Equity 8 824,834 676,195 148,639 Net financial position (indebtedness) 9 42,576 (53,711) 96,287 Total financial resources 782,258 729,906 52,352

(*) The note numbers refer to the notes to the consolidated financial statements where the items are analysed in detail.

Net invested capital This caption increased by euro 52.3 million on the previous year end to euro 782.3 million. Goodwill, related to the subsidiaries of the Engineering & Plant Construction segment (euro 26 million), Primav Ecorodovias (euro 14 million) and Shanghai Pucheng (euro 18 million), was tested for impairment as required by the IFRS. The tests did not show any impairment compared to the carrying amount and are described in the notes to the consolidated financial statements to which reference should be made. The increase in net invested capital is mainly due to the factors listed below. • A net decrease in the carrying amount of non-current assets of euro 18.8 million, mainly due to the following: a) increases in capital expenditure for ongoing contracts that, net of impairment losses and disposals for contracts being finalised, amount to euro 28.5 million;

2008 Annual Report IMPREGILO Directors’ report - Part I

b) amortisation and depreciation for the year of euro 61.5 million; c) acquisition of the Brazilian concession company Ecocataratas (formerly Rodovia das Cataratas) by Primav Ecorodovias, which increased non-current assets by euro 77.8 million; d) the full impairment loss on the non-current assets of the Argentine concession company Caminos de Las Sierras of euro 14.2 million; and e) exchange rate losses, the balancing entry to which is recognised in a specific equity reserve as required by the IFRS, which decreased the carrying amount of non-current assets by euro 44.2 million at year end. • Decrease in non-current assets (liabilities) held for sale due to the sale of the group’s investment in the associate Ponte de Pedra, with a carrying amount of euro 52.4 million at the end of 2007, and changes in the assets of the USW Campania projects. Investments of euro 21.5 million were made to complete the Acerra waste-to-energy plant during the year and the group received advances of euro 27.6 million from the commissioner, which decreased its carrying amount. • The euro 149.9 million increase in working capital, due to a number of ordinary factors directly tied to the group’s operations, the key ones of which are: 28 a) increase in production for certain foreign contracts of the Construction and Engineering & Plant Construction segments, for which the related progress billings will be issued after year end and which led to a temporary increase in net working capital (including use of the related advances, when provided for) of euro 298.9 million; b) decrease in trade receivables following collection of receivables for certain contracts being finalised, together with the increase in production volumes for new contracts and the concurrent rise in trade payables in line with operating developments, which will be settled after year end. The combined effect of these captions decreased working capital by euro 132.4 million compared to the previous year end; c) decrease in other current assets net of current liabilities of euro 16.5 million, mainly as a result of: - `early payment of insurance premiums and surety commissions for the Lake Mead (US) contract, which cover the entire project term; - the decrease in payments of advances to suppliers for contracts, which are nearing completion or are being finalised related to the high speed/capacity projects and the Engineering & Plant Construction segment.

Net financial position The net financial position at 31 December 2008 amounts to euro 42.6 million compared to net financial indebtedness of euro 53.7 million at the end of 2007, a net improvement of euro 96.3 million. In addition to the results of current operations, the main factors which contributed positively to the group’s net financial position were the collection of the consideration for the sale of its investment in Ponte de Petra S.A. (approximately euro 109 million), collection of the outstanding financial components related to the sale of its investment in the Chilean concession company Costanera Norte (approximately euro 40 million) and the full repayment of the project financing for Lot 5 of the “Salerno- Reggio Calabria” contract following the early payment by the customer of the parts of the progress billings for which the group had taken out the financing and for which the group received euro 49.4 million. The key transactions using financial resources were the investments in non-current assets (euro 97.7 million) and acquisition of the Brazilian concession company Ecocataratas (formerly Rodovias das Cataratas) by Primav Ecorodovias (euro 55.1 million, net of the liquidity already held by the acquiree). As described in more detail later in this report, on 27 March 2008, the Supreme Court ruled that the precautionary seizure measure for certain financial assets as part of the legal proceedings related to the USW Campania projects be cancelled and referred the proceeding to the Naples Review Court. Following the hearing of 22 July 2008, this Court ordered the cancellation of the measure and released the above amounts from seizure on 7 August 2008. Impregilo gave guarantees in favour of unconsolidated group companies of euro 17.8 million securing loans granted by banks. This amount decreased by euro 2.0 million over the 2007 year-end figure, mainly due to repayments made by such unconsolidated group companies. The group’s net financial position at 31 December 2008 is summarised in the following table.

(Euro/000) Note (*) 31 December 2008 31 December 2007 Change Non-current financial assets 9.1 54 115 (61) Other current financial assets 9.2 47,171 99,811 (52,640) Cash and cash equivalents 9.3 944,880 875,627 69,253 Total cash and other financial assets 992,105 975,553 16,552 Medium/long-term bank and other loans 9.4 (258,734) (353,256) 94,522 29 Bonds 9.5 (55,222) (64,049) 8,827 Financial lease payables 9.6 (1) (219) 218 Total medium/long-term indebtedness (313,957) (417,524) 103,567 Current portion of bank loans and current account facilities 9.4 (543,452) (506,797) (36,655) Current portion of bonds 9.5 (1,903) (3,144) 1,241 Current portion of finance lease payables 9.6 (33) (765) 732 Total short-term indebtedness (545,388) (510,706) (34,682) Derivatives (with positive fair value) 9.7 4,153 3,339 814 Derivatives (with negative fair value) 9.7 (7,168) (2,935) (4,233) Other financial receivables 9.8 23,480 - 23,480 Other financial payables 9.8 (110,649) (101,438) (9,211) Totale other items in net financial position (90,184) (101,034) 10,850 Net financial position (indebtedness) - continuing operations 42,576 (53,711) 96,287 Total net financial position of discontinued operations - - - Net financial position (indebtedness) including discontinued operations 42,576 (53,711) 96,287

(*) The note numbers refer to the notes to the consolidated financial statements where the items are analysed in detail.

2008 Annual Report IMPREGILO Directors’ report - Part I

PERFORMANCE OF THE PARENT IMPREGILO S.p.A.

Reclassified income statement of Impregilo S.p.A.

(Euro/000) Note (*) 2008 2007 Change Operating revenue 1,617,173 1,429,056 188,117 Other revenue 49,804 42,264 7,540 Total revenue 11 1,666,977 1,471,320 195,657 Costs 12 (1,509,010) (1,421,530) (87,480) Gross operating profit - EBITDA (**) 157,967 49,790 108,177 EBITDA % (**) 9.5% 3.4% Amortisation and depreciation 12 (19,102) (22,291) 3,189 Operating profit - EBIT (**) 138,865 27,499 111,366 Return on Sales (**) 8.3% 1.9% Financing income (costs) and gains (losses) on investments 30 Net financing income 13 10,065 36,267 (26,202) Net losses on investments 13 (2,917) (28,660) 25,743 Net financing income and net losses on investments 7,148 7,607 (459) Profit before tax - EBT 146,013 35,106 110,907 Income tax 14 (62,973) (36,986) (25,987) Profit from continuing operations 83,040 (1,880) 84,920 Profits (losses) from discontinued operations - - - Profit for the year 83,040 (1,880) 84,920

(*) The note numbers refer to the notes to the separate financial statements where the items are analysed in detail. (**) The paragraph in the section on "Other information" of this report gives a definition of these indicators

Revenue 2008 revenue amounts to euro 1,667.0 million (euro 1,471.3 million), up 13.3% on the previous year. The increase is due to completion of, and progress on, several foreign and Italian contracts, specifically those in Iceland, the high speed/capacity railway contracts, the Mestre motorway connector and new offices of the Lombardy Regional Authorities in Italy, as well as the commencement of new projects, such as the Pedelombarda contract. Other revenue mainly consisted of cost recoveries and prior year income.

Operating profit (EBIT) The operating profit (EBIT) was euro 138.9 million (euro 27.5 million) with a return on sales of 8.3% (1.9%). The operating profit for 2007 included the non-recurring accrual of euro 50.0 million made for the USW Campania projects. 2008 EBIT includes the corporate structure’s costs of euro 34.2 million. Financing income (costs) and gains (losses) on investments The parent recorded net financing income of euro 10.1 million (euro 36.3 million). The euro 26.2 million decrease is due to a number of factors, the main ones of which are described below. • Total net financial expense increased by euro 17.6 million, mainly due to the payables in Venezuela where interest rates rose significantly. This effect was worsened by a temporary increase in the parent’s short-term exposure as a result of delays in payments of progress billings by state-owned customers, for works duly approved. These delays started to be recovered in the last few months of 2008 and this trend has continued in early 2009. • Gains on the sale of securities increased by euro 8.1 million. In 2007, these gains were realised on payments made by customers in currencies other than those contractually provided for in 2007, whereas in 2008, they were realised through the direct financing of operations using the parent’s own funds. It took advantage of the currency mismatches of money markets in relation to certain South American currencies, whose official exchange rates with some strong currencies, including the US dollar, are fixed artificially. • Net exchange rate losses amounted to euro 11.0 million compared to net gains of euro 7.3 million for 2007, a negative net difference of euro 18.3 million due to the following situations. - Net losses of euro 10.1 million in conjunction with the parent’s operations in Venezuela. This was basically due to the local customers’ 31 failure to exercise their reight to pay progress billings in US collars, as contractually provided for and in their favour, rather than the local contractual currency (Bolivar). This option to pay in US dollars had been continuously availed of by customers in the past for almost all contractual components expressed in the local currency and the parent had measured its receivables in that currency at the end of the previous year. - Net losses of euro 0.9 million on weak and/or limited circulation currencies, such as those for Iceland and Brazil for which hedges cannot be agreed at reasonable conditions. With respect to gains (losses) on investments, the parent recorded a net loss of euro 2.9 million (euro 28.7 million), affected by the euro 8.1 million loss arising from the impairment losses on its investments in FIBE and FIBE Campania at the end of the year to reflect their losses incurred for the USW Campania projects. This loss was partly covered (euro 6.7 million) by the release of the provision for risks on investments set up before 2006 for the Nigerian subsidiary Impresit Bakolori P.l.c. Following the worsening in the general stability in that area, the conditions for the exercise of strategic and management control by the parent ceased to exist. The provision had been set up to provide for the contingent liabilities of restructuring the subsidiary’s operating activities, which never took place due to the changed situation. The parent had already fully impaired its receivables from Impresit Bakolori in previous years. Therefore, it did not have any specific risk positions with it at year end.

2008 Annual Report IMPREGILO Directors’ report - Part I

FINANCIAL POSITION OF THE PARENT IMPREGILO S.p.A.

Reclassified balance sheet of Impregilo S.p.A.

(Euro/000) Note (*) 31 December 2008 31 December 2007 Change Non-current assets, net 1 464,112 434,189 29,923 Provisions for risks 2 (108,915) (156,485) 47,570 Post-employment benefits and other employee benefits 3 (18,234) (15,603) (2,631) Other non-current assets, net 4 310,185 357,938 (47,753) Net tax assets 5 111,582 155,663 (44,081) Inventories 29,947 31,288 (1,341) Contract work in progress 316,201 239,396 76,805 Advances on contract work in progress (200,953) (263,982) 63,029 Receivables 813,065 748,455 64,610 Payables (404,580) (379,052) (25,528) Other current assets 36,778 39,227 (2,449) 32 Other current liabilities (67,323) (68,294) 971 Working capital 6 523,135 347,038 176,097 Net invested capital 1,281,865 1,122,740 159,125 Equity 7 806,894 724,665 82,229 Net financial indebtedness 8 (474,971) (398,075) (76,896) Total financial resources 1,281,865 1,122,740 159,125

(*) The note numbers refer to the notes to the separate financial statements where the items are analysed in detail.

Net invested capital This caption increased by euro 159.1 million. The increase is due to the following: • a decrease of euro 12.1 million in property, plant and equipment following the sale of plant and machinery used in contracts that are being finalised or have been completed of euro 8.0 million and depreciation of euro 16.3 million, partly offset by purchases of machinery for new contracts commenced during the year of euro 18.0 million; • an increase of euro 44.9 million in equity investments, mainly due to the payment of share capital for start-ups; • the net decrease in provisions for risks of euro 47.6 million, mainly as a result of the following transactions: a) utilisation of euro 31.7 million during the year to cover the losses of FIBE and FIBE Campania; this amount had been accrued in 2007; b) utilisation of euro 16.4 million, including euro 5.4 million to directly cover the liabilities for which the provisions had been set up, and euro 11.0 million for the difference between estimates made in previous years and settlement of the litigation which had led to the recognition of the provisions; • a decrease in “Other non-current assets (liabilities)”, mainly due to the reduction in receivables from special purpose entities for foreign contracts and from FIBE S.p.A.; the reduction in the latter’s receivable was due to the parent’s waiver thereof to cover the subsidiary’s losses; • an increase of euro 176.1 million in working capital, mainly due to receivables due from customers and special purpose entities in line with operating developments.

Net financial position The parent’s net financial indebtedness at 31 December 2008 amounts to euro 475.0 million, up euro 76.9 million. This increase is mainly due to the financing of certain contracts which are in a start-up stage and the financial assistance that the parent has had to guarantee to its subsidiaries involved in the USW Campania projects, which saw the continued default by their local administration customers in 2008. As described in more detail later in the section on the USW Campania projects, during 2007, certain of the parent’s financial assets (including cash with Italian banks) were seized following the precautionary measure as part of the proceedings before the Court of Naples and as ruled by the relevant judicial authorities. On 27 March 2008, the Supreme Court ruled that the precautionary seizure measure be cancelled and referred the proceeding to the Naples Review Court. Following the hearing of 22 July 2008, this Court ordered the cancellation of the measure 33 and released the above amounts from seizure on 7 August 2008. The following table shows the parent’s net financial indebtedness at 31 December 2008 and changes therein.

Net financial position of Impregilo S.p.A.

(Euro/000) Note (*) 31 December 2008 31 December 2007 Change Non-current financial assets 8.1 4,820 147 4,673 Cash and cash equivalents 8.2 128,692 233,446 (104,754) Total cash and other financial assets 133,512 233,593 (100,081) Medium/long-term bank and other loans 8.3 (190,583) (235,808) 45,225 Financial lease payables 8.4 - (24) 24 Total medium/long-term indebtedness (190,583) (235,832) 45,249 Current portion of bank loans and current account facilities 8.3 (369,197) (344,506) (24,691) Current portion of finance lease payables 8.4 (24) (445) 421 Total short-term indebtedness (369,221) (344,951) (24,270) Derivatives (with positive fair value) 8.5 4,152 2,200 1,952 Derivatives (with negative fair value) 8.5 (1,623) (121) (1,502) Other financial receivables 8.6 - - - Other financial payables 8.6 (51,208) (52,964) 1,756 Totale other items in net financial position (48,679) (50,885) 2,206 Net financial indebtedness (474,971) (398,075) (76,896)

(*) The note numbers refer to the notes to the separate financial statements where the items are analysed in detail.

2008 Annual Report IMPREGILO DIRECTORS’ REPORT PART II PERFORMANCE BY BUSINESS SEGMENT

This section provides an analysis of the main results and most significant events that affected the operations of the group and its companies during the year, broken down by business segment.

Corporate, coordination and supervision of Impregilo S.p.A.’s main investments; this is carried out by a central unit forming part of the parent;

Construction, business headed by Impregilo S.p.A.;

Engineering & Plant Construction, business headed by FISIA Italimpianti and its subsidiary FISIA Babcock Environment (Germany);

Concessions, business coordinated by Impregilo International Infrastructures (the Netherlands) and carried out through subsidiaries and associates;

Imprepar, slated for disposal, headed by Imprepar S.p.A. in liquidation.

The tables on the following pages highlight the contribution of the individual business segments to the consolidated results, and provide a breakdown of net invested capital by business segment.

The remaining waste disposal activities in the Campania region (“USW Campania projects”) are discussed in a separate section of this report. 35

2008 Annual Report IMPREGILO Directors’ report - Part II

Performance in the year by business segment: Construction Engineering & Plant Const. Impregilo of which: Fisia (Euro/m) Construction Operating Revenue 1,722.3 1,722.3 975.2 Other revenue 65.9 65.9 12.9 Total revenue 1,788.2 1,788.2 988.1 Purchases, subcontracts and other operating expenses (1,341.3) (1,328.9) (936.4) Personnel expenses (239.3) (218.8) (64.0) Provisions and impairment losses 0.5 1.8 (2.1) Gross operating profit (loss) (EBITDA) (*) 208.1 242.3 (14.4) EBITDA % (*) 11.6% 13.5% n.a Amortisation and depreciation (36.4) (36.4) (1.2) Operating profit (loss) - (EBIT) (*) 171.7 205.9 (15.6) Return on sales (*) 9.6% 11.5% n.a Profits (losses) from discontinued operations 36 (*) The paragraph in the section on "Other information" of the directors' report gives a definition of these indicators.

Consolidated balance sheet as at 31 December 2008 by business segment: Impregilo Engineering & Plant Const. Fisia (Euro/m) Non-current assets, net 303.1 16.8 Goodwill (eliminated on consolidation) 211.4 Total non-current assets 303.1 228.2

Assets (liabilities) classified as held for sale - - Provision for contingencies, Post-employment benefits and Other non-current assets (liabilities) (111.3) (8.7) Net tax assets

Working capital 26.3 (247.5) Intra-segment trade receivables (payables) (8.8) 279.8 Total working capital 17.5 32.3 Net invested capital 209.3 251.8 Equity Net financial position Total financial resources Concessions USW Campania Imprepar in Total consolidation Total projects liquidation adjustments Impregilo Intern. Infras. 163.8 - 9.0 (3.3) 2,867.0 5.3 4.5 6.6 (4.6) 90.6 169.1 4.5 15.6 (7.9) 2,957.6 (74.2) (6.0) (6.3) 6.7 (2,357.5) (23.8) (1.4) (0.3) 1.1 (327.7) (18.3) 1.6 (3.6) 0.1 (21.8) 52.8 (1.3) 5.4 - 250.6 31.2% n.a 34.6% 8.5% (23.5) - (0.4) - (61.5) 29.3 (1.3) 5.0 - 189.1 17.3% n.a 32.1% 6.4% 40.6 (5.0) 35.6 37

Concessions USW Campania Imprepar in Total consolidation Total projects liquidation adjustments Impregilo Intern. Infras. 295.2 0.8 1.1 (140.4) 476.6 (211.4) 295.2 0.8 1.1 (351.8) 476.6

- 406.1 - (21.8) 384.3 (9.5) (27.8) 13.6 (2.6) (146.3) 224.2

44.1 (11.1) 30.9 0.7 (156.6) (58.6) (230.5) (3.7) 21.8 - (14.5) (241.6) 27.2 22.5 (156.6) 271.2 137.5 41.9 (353.7) 782.2 824.8 42.6 782.2

2008 Annual Report IMPREGILO Directors’ report - Part II

CORPORATE

Corporate activities are centralised within the parent Impregilo S.p.A. and mainly relate to the following: • coordination, control and strategic planning of the group’s activities; • centralised planning and management of human and financial resources; • management of administrative, tax, legal/corporate and communications requirements; • administrative, tax and management support to group companies. The net cost of corporate activities amounts to euro 34.2 million (euro 91.8 million). The net cost for 2007 included the euro 50.0 million accrual to the provision for risks following the assessments made in relation to the legal proceedings for the USW Campania projects.

Risk areas

38 Tax litigation During 2008, the parent commenced a dispute with the Milan tax office about an assessment challenging the tax treatment of impairment losses and losses in 2003 of certain investments held by the parent in that year. The most significant issue relates to the parent’s sale of its entire investment in the Chilean concession company Costanera Norte S.A. to Impregilo International Infrastructures N.V. in 2003. The parent has challenged the unlawfulness of the criteria adopted by the tax office to determine the “normal value” of the sale. The office redetermined the alleged transfer value using the consideration paid by third parties which acquired the concession company in 2006 as a base, limiting itself to discounting this consideration over the period from the sale date in 2006 to the date of the previous transfer from Impregilo to Impregilo International Infrastructures. This is to demonstrate the greater tax that it claims should have been paid. Before the dispute was commenced, Impregilo had fully demonstrated with the related documentation the correctness of the method adopted in 2003, which had, moreover, been approved by an independent appraisal at the time of the sale. However, the tax office had not considered this documentation. At the date of the original sale, the Chilean concession company was still “constructing” its infrastructure and had only just commenced (without having completed) the activities aimed at obtaining financing to complete these works. During the preliminary stage of the dispute, Impregilo obtained a new, independent appraisal of the disputed transfer price to support its calculation. This was prepared by a leading international advisory firm. It also informed the tax office that another investment in the Chilean concession company then held by SIMEST S.p.A., a state-owned company, had also been transferred to Impregilo International Infrastructures in April 2004 for a substantially equal consideration (given the different investment percentages) to that being disputed. Despite these arguments, the local commission (first level) rejected Impregilo’s case without specifying why, fully accepting the tax office’s claims and ordering the company to pay the assessed tax, interest and fines of approximately euro 52 million. This measure was appealed against before the second level court. The lawyers assisting the parent agree with it that there are valid reasons to hold that the greater tax imposed by the tax office is unlawful, deeming that the unfavourable first level ruling was deficient in terms of the reasoning, based moreover on illegitimate arguments and without objective grounds. Therefore, Impregilo has not made any provision therefor either in its separate or consolidated financial statements. CONSTRUCTION

Impregilo S.p.A. heads the Construction business segment, which encompasses all projects relating to the construction of large-scale infrastructure, such as dams, hydroelectric plants, motorways, railways, underground railways, underground works, bridges and similar works. The business segment recorded revenue of euro 1,788.2 million (euro 1,601.3 million) with an operating profit of euro 205.9 million (euro 161.6 million) and an R.o.S. of 11.5% for the year. Despite the difficult economic situation and continued stagnant domestic large-scale infrastructure market, progress was made on certain large-scale contracts in Italy during the year. Together with developments in foreign activities, this led to a rise in revenue for the year compared to 2007. During the year, the Construction segment continued to manage many projects relating to the construction of large-scale infrastructure. In particular, the most significant events that affected the year in relation to certain significant contracts, broken down by geographical segment, are the following.

39 Italy High-speed/capacity Turin-Novara-Milan Railway Project This project includes two main railway lines, one running between Turin and Novara and the other between Novara and Milan, and is being carried out by a consortium in which Impregilo holds a 74.69% share, the C.A.V.TO.MI. consortium. In December 2006, the Main Test Cer- tificate was issued for all the line and related work and almost all off-line work for the Turin-Novara line, approved by R.F.I. on 21 December 2007. During the last few months of 2008, negotiations were stepped up with the customer to finalise the additional agreement before the final tests are carried out. The related Final Test Certificate is expected to be issued in 2009. Work continued on the Novara-Milan line during the year to complete the civil and technological line works and the off-line civil works. At 31 December 2008, work on the Novara-Milan line was 83.6% complete.

High-speed/capacity Bologna-Florence Railway Project The project is being carried out by the C.A.V.E.T. consortium, 75.98% owned by Impregilo. The tunnel digging work was completed in 2007 and work continued on the railway superstructure, technological systems and work for safety requirements during 2008 as well as the environmental clean-up of the sites where work was carried out. The project was 93.5% complete at 31 December 2008.

Mestre Motorway Connector Project This project covers the design, project management and construction of the motorway connector in Mestre. Impregilo has a 42% investment in the work. On 6 August 2007, the first section of the connector road was opened consisting of 5 km of motorway and 3 km of junctions and feeder roads.

2008 Annual Report IMPREGILO Directors’ report - Part II

In December 2008, Additional Act no. 2 to the contract was signed, formalising the variation for the development of an executive plan, the carrying out of environment work (the “Passante Verde”) and the carrying out of certain changes to the motorway route. The construction work was stepped up during the year with the project 80.6% complete at 31 December 2008.

Salerno - Reggio Calabria Motorway Project: Lots 5 and 6 This project relates to the improvement and upgrading of the last section of the Salerno-Reggio Calabria motorway, between Gioia Tauro and Scilla (Lot 5) and between Scilla and Reggio Calabria (Lot 6). Impregilo’s share of the contract is 51%. Work on Lot 5 slowed down significantly, mostly in the second half of the year. The special purpose entity mainly dealt with the customer’s non-recognition of the significant delay with which it had delivered the work due to its slowness in approving the executive plan. Therefore, the special purpose entity activated the procedure under article 31-bis of Law no. 109/1994 for recognition of the related claims. An agreement was signed in November 2008 providing for, inter alia, the extension of the contract term by three years. ANAS (the Italian National Roads Authority) suspended the work for the “Barritteri” tunnel in December 2008 and it was only restarted in Fe- bruary 2009. Following the partly negative outcome of the procedure under article 31-bis of Law no. 109/1994 in January 2009, the spe- 40 cial purpose entity presented the customer with an arbitration request. Work was 49.7% complete on this lot at 31 December 2008. Part of the areas was delivered by project management for Lot 6 in early 2008 and work started. It subsequently slowed down and was halted, partly due to the investigation commenced by ANAS and the local administrative bodies to identify a solution to the traffic interruptions caused by the work. Work was 14.3% complete on this lot at 31 December 2008.

New offices of the Lombardy Regional Authorities The contract, awarded in 2006, is for the works to be performed for the new offices of the Lombardy Regional Authorities in Milan on behalf of Infrastrutture Lombarde S.p.A.. The new offices will be located between Via Melchiorre Gioia and Via Restelli on an area of 33,700 square metres as part of the project to redevelop the Garibaldi-Repubblica area. The contract involves the construction of a complex consisting of four modern buildings with a sinusoidal shape and a 160-metre high central tower, incorporating a square covered by a transparent roof. Construction work commenced in the last few months of 2006 and the project was 38.2% complete at 31 December 2008.

Bridge crossing the Messina Strait and roadway and railway connectors 41 on the side of Calabria and Sicily In March 2006, as representative of the joint venture created for this project, Impregilo signed a contract with Stretto di Messina S.p.A. for its engagement as general contractor for the definitive project, executive plans and construction of the Strait of Messina Bridge and related roadway and railway connectors. This contract is worth a total of euro 3,900 million. A bank syndicate also signed the financial documentation required in the General Specifications after the joint venture won the tender, for the concession of credit lines of euro 250 million earmarked for this project. The customer was also given performance bonds of euro 239 million, as provided for in the contract. The joint venture headed by Impregilo S.p.A. (with a 45% share) also includes Spain-based Sacyr S.A. (18.70%), Società Italiana per Condotte d’Acqua S.p.A. (15%), Cooperativa Muratori & Cementisti-C.M.C. of Ravenna (13%), Japan’s Ishikawajima – Harima Heavy Industries CO Ltd (6.30%) and Consorzio Stabile A.C.I. S.c.p.A. (2%). In 2006, as provided for by contract, a special purpose entity named “Eurolink S.c.p.A.” was set up for this project. As project leader, Impregilo holds 45% thereof. The customer has not yet issued the Initial Works Order.

High-speed/capacity Milan-Genoa Railway Project The project for the construction of this railway line was assigned to Consorzio CO.C.I.V. as general contractor with the TAV (as concession grantor on behalf of Ferrovie dello Stato)/COCIV agreement of 16 March 1992. Impregilo is the project leader. Following enactment of Law decree no. 7/2007, subsequently converted into Law no. 40 of 2 April 2007, the F.S./TAV concession was cancelled affecting the agreement between TAV and the general contractor. Before enactment of the aforesaid Law decree, the consortium had commenced an arbitration proceeding as per the original contract for the contractual non-compliance of the customer. In April, it appealed to the Lazio Regional Administrative Court against the measures adopted in compliance with the above law.

2008 Annual Report IMPREGILO Directors’ report - Part II

On 12 July 2007, the Lazio Regional Administrative Court allowed the appeal made by CO.C.I.V. against the measures of the Ministry for Transportation and R.F.I.S.p.A., which had ordered the cancellation of the agreement for the high-speed/capacity Milan - Genoa railway line, pursuant to Law no. 40/2007. The Court authorised suspension of the law, deferring the related decision to the European Court of Justice. With its order of 9 October 2007, the Council of State both confirmed the deferral of the ruling to the European Court of Justice and allowed the appeal made by R.F.I. and TAV against the suspension ordered by the Lazio Regional Administrative Court. However, in June, Law decree no. 112/2008 (converted into Law no. 133 of 6 August 2008) reinstated the F.S/R.F.I.concessions, previously revoked by the implementing Law no. 40/2007, including that for the CO.C.I.V. project. Following this measure, the arbitral tribunal deferred the hearing originally set for 22 July 2008 to 10 September 2008 and then to 15 October 2008 for the filing of the fourth brief. On the latter date, the arbitral tribunal set the date for another hearing (29 October 2008). In this meeting, the TAV legal counsel requested extension of the deadline for the handing down of the award to 31 December 2010 should a court-appointed expert be appointed. Given the complexity of the matter, it is not currently possible to foresee its outcome with any reasonable certainty.

Abroad 42 Venezuela - Caracas - Tuy Medio Railway Project The project consists of the civil works and electromechanical works for the approximately 42-km long railway line between Caracas and the Tuy industrial area. The civil works have been entrusted to the Contuy A consortium, in which Impregilo holds 36.4%, while the supply of rails and railway materials and the installation of electrification and control systems have been entrusted to the Contuy C consortium (Impregilo share: 100%). The first stage of the work was completed on 15 October 2006 with the inauguration of the project and works have been mostly completed at the end of 2008. Certain minor works, which do not affect the running of the line, have still to be finished. The consortia have commenced the procedures to obtain the provisional acceptance of the works by the customer. This project was 99.0% complete at 31 December 2008.

Venezuela - Puerto Cabello - La Encrucijada Railway Project This project consists of the construction of civil works of the railway line along approximately 110 km, connecting Puerto Cabello and La Encrucijada. The activities presently underway relate to the preparation of the executive plan, digging and tunnel lining work, construction of the understructure and laying of the viaduct foundations. At 31 December 2008, work was 44.7% complete. Work is slated to be completed by April 2013, as per the recently updated programme. An additional contract was signed in June 2006 for works on the railway superstructures of seven stations, two logistics centres and two car parks as well as the maintenance of railway materials for euro 664 million. The executive plan is currently being drawn up.

Venezuela - San Juan de los Morros – San Fernando de Apure Railway and Chaguaramas – Cabruta Railway Project On 5 June 2006, an Italian joint venture, comprising Impregilo S.p.A., Astaldi S.p.A. and Ghella S.p.A., each with equal shares of 33.33%, signed two contracts with the Independent Railroad Institute of the Bolivarian Republic of Venezuela (IAFE). The contracts relate to the construction of two new railway lines, “San Juan de los Morros- San Fernando de Apure” (252 km) and “Chaguaramas - Las Mercedes- Cabruta” (201 km). The projects are scheduled for completion within 76 months of work start-up and include the laying of 453 km of new lines. They also include the design and installation of a railway superstructure, with the construction of 11 stations and nine logistics centres. The official initial works order was signed on 15 January 2007 for the “San Juan de los Morros - San Fernando de Apure” line. The building site has been set up. Digging and work on the embankment is ongoing. The contractually-agreed advance was received during the first half of 2007 and the project was 8.3% complete at 31 December 2008. The official initial works order for the Chagauramas - Cabruta line was signed on 17 November 2006. Preparation of the executive plans has been completed and work is underway. This project was 14.8% complete at 31 December 2008.

Greece - Acheloos River Deviation Tunnel Project This project relates to the construction of a 17.4-km long hydraulic tunnel with an underground diameter of 7.1 metres and the construction 43 of related works, such as roads and access tunnels. During the third quarter of 2008, the partner Empedos transferred its share of the works to Impregilo group with the consent of the customer. This means that Impregilo group now has full responsibility for the construction contract. The tunnel excavation process was severely slowed due to geological difficulties that necessitated laborious and expensive clean-up and strengthening work. These delays are entirely due to a geological situation completely different to that shown in the contractual documentation which was made available by the customer. This situation had a negative impact on production levels. Negotiations commenced with the customer to remedy this situation led to the suspension of the work in the first quarter of 2007. The outcome was approval of the changes to the designs and technical characteristics of the contract which allowed recommencement of digging. At 31 December 2008, 92.8% of the work was complete.

Greece - Thessalonica Underground Railway Project This project relates to the construction of the automated underground railway in Thessalonica. The contract was signed in 2006 and Impregilo is involved in the civil works together with the Greek construction company Aegek S.A. and Seli S.p.A.. The project entails the construction of an automated light underground railway with the excavation of two 9.5-km tunnels and 13 new underground stations. To date, work is behind schedule due to a dispute with the customer about the design and delay in delivery of areas by it. At 31 December 2008, 13.0% of the work was complete.

2008 Annual Report IMPREGILO Directors’ report - Part II

Order backlog The order backlog at 31 December 2008 for the Construction segment is as follows:

(Impregilo's share is shown in millions of Euros) Area/country Project Residual backlog at Percentage Percentage of 31 December 2008 of total completion High speed 523.5 6.7% Italy Bridge over Messina Strait 1,733.1 22.3% 0.6% Italy Mestre connector road 61.2 0.8% 80.6% Italy Salerno-Reggio di Calabria motorway, Lot 5 214.8 2.8% 49.7% Italy Salerno-Reggio di Calabria motorway, Lot 6 216.8 2.8% 14.3% General Contracting 2,225.9 28.7% Italy GTB 3.5 0.0% 91.8% Italy Genoa underground 5.4 0.1% 86.4% Italy Nuovo Dolonne 0.3 0.0% 99.7% Italy State road 36/Milan motorway connector 167.7 2.2% 10.9% Italy Frana Spriana 1.4 0.0% 94.9% Italy Consorzio Torre 135.6 1.7% 38.2% Italy Pedemontana Veneta 632.8 8.1% 0.0% 44 Italy Work to complete Ravedis tank 18.2 0.2% 4.9% Italy Pedemontana Lombarda - Lot 1 293.7 3.8% 0.8% Italy Riviera Scarl 8.9 0.1% 12.7% Italy Lybia University Center 3.0 0.0% 0.0% Italy SGF 1.8 0.0% Italy Former Building projects 0.4 0.0% Other work in Italy 1,272.5 16.4% Total Italy 4,021.9 51.8% Greece Athens underground - New secxtion 23.2 0.3% 39.1% Greece Acheloos river deviation tunnel 7.4 0.1% 92.8% Greece Thessalonica underground 254.5 3.3% 13.0% Switzerland Transalp Tunnel 64.0 0.8% 74.4% Iceland Karahnjukar hydroelectric project 0.3 0.0% 100.0% Switzerland CSC 145.9 1.9% Europe Former Building projects 1.5 0.0% Europe 496.8 6.4% Dom. Republic Consorzio Acquedotto Oriental 5.5 0.1% 96.6% Dom. Republic Guaigui hydraulic plant 37.7 0.5% 2.6% Venezuela Puerto Cabello - Contuy Ferrocarriles 545.4 7.0% 44.7% Venezuela Puerto Cabello - Contuy Ferrocarriles stations 249.6 3.2% 3.1% Venezuela Caracas - Tuy Medio C railway 2.4 0.0% 99.0% Venezuela Chaguaramas railway 259.4 3.3% 14.8% Venezuela San Juan de Los Morros railway 693.0 8.9% 8.3% Venezuela Venezuela 3.1 0.0% 0.0% Venezuela OIV Tocoma 452.6 5.8% 21.7% Ecuador Mazar 23.1 0.3% 86.2% Brazil Serra Do Mar 5.8 0.1% 75.2% Argentina Argentine Branch 1.4 0.0% USA Vegas Tunnel - Lake Mead 296.7 3.8% 7.3% The Americas 2,575.7 33.2% Africa River state contractors 38.7 0.5% 59.1% Africa Rivigo Flyover 19.6 0.3% 0.0% Africa Lidco 403.5 5.2% Africa Ingula 197.1 2.5% 8.3% Africa SGF - Il nuovo Castoro 11.1 0.1% Africa 670.1 8.6% Total Abroad 3,742.5 48.2% Total Construction 7,764.5 100.0% The Construction segment’s order backlog increased by approximately euro 562 million on the end of 2007. Foreign contracts grew by 29.8% on 31 December 2007, with a foreign order backlog that rose from euro 2,883.1 million at 31 December 2007 to euro 3,742.5 million at 31 December 2008.

Acquisition of new contracts United States - Lake Mead tunnel On 25 March 2008, Impregilo won the international tender called by the Southern Nevada Water Authority (SNWA) for the construction of an articulated water extraction and transportation system from Lake Mead to the Las Vegas (Nevada) area to increase water supplies for drinking and domestic use. Lake Mead is one of the biggest reservoirs in the US and lies roughly 30 km south east of Las Vegas. The contract is worth US$ 447 million. The project is technically very complex and involves construction of a water intake on the lake bed, at a depth of circa 100 metres and of a roughly 5-km long tunnel and the excavation of an access shaft of roughly 200 metres. Work commenced during the year to assemble the building site and is slated for completion in the second half of 2012. At 31 December 2008, 7.3% of the work was complete.

45 Italy - Pedemontana Lombarda motorway Lot 1 On 29 April 2008, as leader and representative with a stake of 47% in the joint venture, Impregilo won the tender for the design and construction of the first lot of the Pedemontana Lombarda motorway. The joint venture includes Astaldi (24%), Pizzarotti (18%) and Itinera (11%). The contract, entrusted to the general contractor, is worth approximately euro 630 million and includes the definitive project, executive plan and construction of the first section of the Como and Varese ring roads and the connector road between the A8 and the A9 motorways (from Cassano Magnago to Lomazzo). It involves roughly 47 km of motorway and secondary roads, approximately 13 km of tunnels and the construction of bridges and viaducts for a total length of approximately 1.7 km. Construction is planned to start in 2010 to be completed after about three years.

Libya - University centres In early July, following authorisation from the Libyan government, the contracts between Impregilo Lidco (company consisting of Impregilo - 60% and Libyan Development Investment Co) and ODAC (Organisation for Development of the Administrative Centres) for the design and construction of three university centres in Misuratah, Tarhunah and Sliten in Libya were formalised. Initial authorisation for the start of works was given for an amount of approximately euro 400 million. Work is scheduled to start in the next few months to be completed in 2011.

2008 Annual Report IMPREGILO Directors’ report - Part II

Risk areas Hydroelectric plant in Kali Gandaki - Nepal The issue dates back to July 2004, when Impregilo began arbitration proceedings before the International Court of Arbitration (I.C.C.) against its customer Nepal Electricity Authority (N.E.A.) and the kingdom of Nepal. The arbitration proceedings are aimed at obtaining payment of a claim that currently amounts to US$ 21 million, plus interest and monetary revaluations, in reference to the construction of the Kali Gandaki hydroelectric plant. The amount claimed by Impregilo mainly relates to work performed and approved, but not yet paid for, in addition to extension of the contractual period, additional claims, interest and damages. Also in relation to the above project, a dispute is pending with the Nepalese Tax Authorities. This dispute is due to the fact that, when the project began, local tax legislation provided for taxation of project activities upon completion of the work. However, this legislation changed while the work was being carried out and, in June 2005, the Nepalese Tax Authorities requested Impregilo pay a total of euro 7.3 million for local taxes. Moreover, the amount requested does not consider the counterclaims deposited by Impregilo since July 2005. Given the difficulty of relationships and in calculating how long it will take to collect the receivables, Impregilo made specific accruals to the provisions for risks and bad debts in previous years. 46 In 2007, the International Court of Arbitration issued its award on the arbitration with the customer NEA, fully accepting the claims made by Impregilo and ordering, inter alia, suspension of any tax claims by the Kingdom of Nepal until all the amounts due to the group had been paid in full. The related proceedings for the discharging of the contractual guarantees are still ongoing, after the first stage when Impregilo’s claims were again accepted. To date, there are no elements that would lead the group to believe that the proceedings could constitute a significant risk for it.

Hydroelectric plant in Nathpa Jhakri – India This project was carried out by a joint venture headed by Impregilo. It was completed in previous years. The plant was delivered to the customer and is currently operating. However, disputes are still pending in relation to the recovery of receivables and to claims made by the customer for compensation and counterclaims.

Arbitration with the customer Arbitration hearings are currently ongoing for a total value of euro 30 million (at current exchange rates). These include the requests for extending the contractual term (over euro 22.5 million) and for recognition of price adjustments (over euro 3.3 million). The relevant arbitration bodies (Dispute Review Board, Additional Dispute Review Board and Claim Review Panel) have already ruled favourably on most of the disputes. The customer has appealed against the rulings of the above bodies, presenting claims for damage from the joint venture for a total amount of approximately euro 27 million. In consideration of the above, the directors had impaired the residual receivables recognised in the financial statements by the same amount, and recognised an accrual to cover any further risks in previous years. Contractual guarantees and additional customer claims In addition to the above claims, in July 2003, the customer began enforcement proceedings on contractual guarantees for euro 21.2 million. However, the enforcement proceedings were suspended following the first level judgement of the local court, which ordered the customer to suspend enforcement until the final outcome of the arbitration proceedings. The customer agreed for the guarantees to be extended until March 2009. These guarantees are first-demand enforceable, but, based on the opinion of its legal advisors, the company believes that the risk of their enforcement is remote. Supporting this assessment, the local supreme court issued a judgement in relation to a similar attempt by the same customer to enforce guarantees against another contractor, definitively denying the claims for compensation made by the customer. In line with the considerations made at the end of the previous year and the fact that the situation has not changed significantly, the related risk of enforcement of the guarantees and additional claims by the customer is considered to be remote.

Proceedings with the Court of Florence - C.A.V.E.T. As part of a number of disputes that the Tuscan judiciary authorities had raised against C.A.V.E.T. and certain directors and managers of the consortium in connection with the Bologna - Florence high speed/capacity railway works, penal proceedings nos. 10221/99 and 47 4923/00 RGNR were commenced in previous years followed by other proceedings. The main charges raised against the consortium included, inter alia: • water theft from the water bed during excavation of the tunnels and subsequent use of such water during construction; • impoverishing and damaging of surface and underground water sources; • illegal traffic of toxic waste during the elimination of soil, rocks and mud which the consortium had treated as if such materials were not “waste”. The first level proceedings were being finalised at year end. The consortium has always sustained that it operated in compliance with the law and, specifically: • with respect to the alleged water theft, in addition to the fact that the issue is no longer punishable by law, the consortium holds that it acted in compliance with the contractual conditions and design specifications agreed with the customer; • with respect to the alleged damaging and impoverishing of the water bed, the consortium holds that, as above, it acted in full compliance with the customer’s instructions and diligently and that, therefore, the penal charges made by the prosecutor are ungrounded. The current situation of the water drainage in this area (Tuscany) following finalisation of the tunnels is in line with the designs and as agreed during the Services Conference. As a result, also when the actual damage is proven and quantified during the later stages of the proceeding, it deems that such damage is not attributable to the consortium but to the design specifications and complex characteristics of the works carried out on behalf of the customer. Therefore, the customer should be directly accountable for any consequences; • with respect to the alleged illegal traffic of waste, classification of materials such as rocks and earth (which the authority considers to be “waste”) complies with the contamination limits set by Law no. 443 of 21 December 2001 for the purposes of their exclusion from the definition as “waste”. The consortium is able to prove this, also on the basis of specific technical appraisals.

2008 Annual Report IMPREGILO Directors’ report - Part II

Following the final hearing for the first level proceeding on 3 March 2009, the Court of Florence cleared the defendants from all claims about the damaging and impoverishing of the water bed, deferred the acts to the Constitutional Court for the “water theft” and found the defendants guilty of the waste management issue. The Court deferred quantification of the compensation to be paid to the civil parties to a separate civil judge and ordered the payment of a “provisional” sum to the Ministry for the Environment, the Tuscan Regional Authorities and the Florence Municipal Authorities of euro 50 million each, plus other amounts to the other civil parties for a total approximate euro 0.2 million. As part of this ruling, additional interdictive sanctions were approved for the individuals involved. These will only be effective if, after finalisation of the other stages of the proceedings, the final ruling is not changed. Application of the Court’s rulings about the “provisional” sums is subject to the lodging of the grounds for the ruling, to take place before 90 days from the date of publication of the ruling, as provided for by the Court. This time limit is the same as that for presentation of an appeal by the consortium, which it will do, including appeals for the suspension of the “provisional” sums. These sums do not represent a calculation of the damage either in terms of an estimate or accurate calculation thereof, but are to protect the civil parties which cannot however consider them as definitively obtained unless a final penal ruling is issued after which an independent civil hearing would have to take place to quantify the damage. At the date of preparation of this report, it is not possible to determine either

48 the amount of the alleged damage to third parties or when any damages will be paid as the ruling would only be valid after hearings at all three levels have been held. The consortium’s lawyers agree with it that its correct conduct can be clearly demonstrated in the appeal hearing. They are confident that the sentence will be substantially changed, including with respect to the negative charges made by the first level hearing. ENGINEERING & PLANT CONSTRUCTION

The Engineering & Plant Construction segment, headed by FISIA Italimpianti and FISIA Babcock Environment (Germany), includes the operations of plants for the desalination of sea water, fume treatment and waste-to-energy processes, as well as environmental services (contamination clean-up), urban solid waste (USW) disposal, sea clean-up activities and coastal protection. The business segment’s revenue amounted to euro 988.1 million for the year (euro 846.4 million) and the operating loss totalled euro 15.6 million (profit of euro 24.6 million). As noted in the first part of this report, the effects of the difficult international economic situation, especially the Euro’s appreciation against the US dollar and dollar-linked currencies together with the significant hike in prices of ferrous and other non- ferrous metals and related derivatives had a negative effect on this segment’s profitability in the year, despite the increase in business volumes compared to 2007 (+17%). The status of the main contracts of FISIA Italimpianti is as follows: • Jebel Ali L2 desalination plant (Dubai - U.A.E.): this contract was awarded in May 2005 and provides for the construction of four desalination units for a total of 55 million gallon/day to be delivered in 2008. The electromechanical assembling work and work to start up the plant were completed during the year. The contract was 95.4% complete at 31 December 2008. 49 • Jebel Ali L1 desalination plant (Dubai): production, calculated using the cost to cost method, equalled euro 5.0 million; the contract was 98.9% complete at 31 December 2008. • Al Taweelah B desalination plant (Abu Dhabi – U.A.E): this is a desalination plant of four units that process a total of 70 million gallon/day. Work started in September 2005 and the assembly work was almost completed during the year. Distilled water production started in February and March. The first part of the plant (group 1) was delivered to the customer on 27 May 2008. At 31 December 2008, the contract was 97.6% complete. • Ras Abu Fontas B2 desalination plant (Doha-Qatar): work commenced on this combined 30 million gallon/day desalination plant/600 MW electricity generation plant in October 2005 to be completed in 21 months as part of a consortium with General Electric (supplier of the electricity generation plant). Negotiations are in place with the customer and the partner for their responsibility for the delays which had led to the extension of the contract term compared to the originally agreed dates. FISIA has already provided for this situation in 2008. At 31 December 2008, the contract was 86.5% complete. • Jebel Ali M desalination plant (Dubai – U.A.E.): this contract was awarded in March 2007 and subsequently integrated with two variations in May 2007 for a total of 140 million gallon/day to be delivered before June 2010. Procurement of the supplies and agreement of the main tender contracts continued during the year. Concurrently, the civil works were continued and the company started to construct the distillers. At 31 December 2008, the contract was 59.5% complete. • Ras Abu Fontas A1 desalination plant (Qatar): the contract was signed in May 2007 for construction of a 45 million gallon/day plant in 23 months. Procurement of the supplies and agreement of the main tender contracts continued during the year. At 31 December 2008, the contract was 57.1% complete. • Shuaiba desalination plant (Kuwait): the contract was signed in July 2007 for construction of a 45 million gallon/day plant in 34 months. Procurement of the supplies and agreement of the main tender contracts continued during the year.At 31 December 2008, the contract was 46.9% complete. The subsidiary FISIA Babcock, active in the fume treatment and waste-to-energy sectors, continued to increase its output during 2008 (+1% compared to 2007). Most of its production (67%) relates to the construction of waste treatment plants with the remainder (29%) relating to fume treatment plants.

2008 Annual Report IMPREGILO Directors’ report - Part II

Order backlog The Engineering & Plant Construction order backlog at 31 December 2008 is as follows:

(millions of Euros) Area/country Project Residual backlog at Percentage Percentage of 31 December 2008 of total completion FISIA Italimpianti Middle East Jebel Ali L2 9.0 1% 95.4% Middle East Jebel Ali L1 2.4 0% 98.9% Middle East Taweelah B 7.5 1% 97.6% Middle East Ras Abu Fontas B 27.4 2% 86.5% Middle East Jebel Ali M 304.0 26% 59.5% Middle East Ras Abu Fontas A1 138.0 12% 57.1% Middle East Shuaibah North 179.2 15% 46.9% Middle East Other 5.7 0% Desalination 673.2 58% Italy Acerra waste-to-energy plant 1.0 0% n.d. Italy Other 2.3 50 Treatment of residue solids and fumes 3.6 0% Italy Porto Marghera 98.3 8% 56.5% Italy Other 3.1 0% Clean-ups, management and other 101.1 9% Total FISIA Italimpianti 777.9 67% FISIA Babcock Middle East Shuaibah FGD 5.7 0% 82.0% Germany Datteln REA 25.8 2% 21.0% Germany Neurath ESP 23.5 2% 35.0% Germany Moorburg - ESP 32.1 3% 4.0% Germany Karlsruhe EDP 11.3 1% 5.0% Germany Manheim Block 9 RRA 1.9 0% 40.0% Netherlands Maasvlakte Block 3 REA 36.6 3% 1.0% Italy Acerra 2.5 0%n.d. South America Puerto Coronel FGD 13.0 1% 21.0% Italy Other Italy 2.2 0% Other abroad 7.0 1% Fume treatment 161.6 14% Germany RZR Herten II WtE 18.7 2% 86.0% Germany Heringen WtE 10.1 1% 83.0% Germany Mönkeloh WtE 30.2 3% 3.0% Germany Krefeld WtE 74.2 6% 11.0% Italy Acerra WtE 24.5 2% 63.0% Norway Kristiansand 50.7 4% 9.0% Other abroad 13.3 1% Waste-to-energy 221.7 19% Other 2.3 Total FISIA Babcock 385.6 33%

Total Engineering & Plant Construction 1.163.5 100% Risk areas The main risk area for the Engineering & Plant Construction segment relates to FISIA Italimpianti and FISIA Babcock Environment’s positions in respect of the USW Campania projects, and which substantially relates to the construction of the waste-to-energy plant in Acerra (Naples). The directors are reasonably certain that the inventories and receivables relating to the construction of the waste-to-energy plant in Acerra and to outstanding progress billing, along with the receivables arising from management of the RDF plants, are recoverable based on the amounts and negotiations underway with the government commissioner for the waste emergency in Campania. Reference should be made to the section on “Assets classified as held for sale and discontinued operations” for further details.

2008 Annual Report IMPREGILO Directors’ report - Part II

CONCESSIONS

Group activities in this business segment relate to the management of investments in its subsidiaries and minority investments in many other companies, almost entirely abroad, which hold concessions mainly for the management of motorway networks, plants that generate energy from renewable sources, electricity transmission, integrated cycle water systems and the management of non-medical hospital service activities. The following tables summarise the key figures of the concessions backlog at year end, split by business segment.

MOTORWAYS Country Concession % of Total Stage Start End company total Km date date Brazil Primav Ecorodovias 35.00 holding Ecovias Dos Imigrantes 35.00 176 active 1998 2023 Ecovia Caminho Do Mar S.A. 35.00 137 active 2000 2021 52 Ecosul S.A. 31.50 623 active 2001 2026 Ecocataratas S.A. 35.00 387 active 2001 2026 Italy Nuova Romea S.p.A. 22.28 promotion under Pedemontana Veneta S.p.A. 20.05 90 construction 2007 2047 Argentina Iglys S.A. 98.00 holding Autopistas Del Sol 19.82 120 active 1993 2020 Caminos de las Sierras S.A. 90.52 395 active 1998 2023 Puentes del Litoral S.A. 26.00 59.6 active 1998 2023 Mercovia S.A. 60.00 18 active 1998 2023

ENERGY FROM RENEWABLE SOURCES Country Concession % of Installed Pop. Stage Start End company total voltage served date date China Shanghai Pucheng Thermal Power Energy Co. Ltd 50.00 17 mw 1.6 m active 2004 2034 Argentina Yacylec S.A. 18.67 T line active 1994 2088 Enecor S.A. 30.00 T line active 1992 2088

INTEGRATED WATER CYCLE Country Concession % of Pop. Stage Start End company total served date date Argentina Aguas del G. Buenos Aires S.A. 42.58 210 k liquidation Italy Mediterranea delle Acque S.p.A 5.11 active unlimited Peru Consorcio Agua Azul S.A 25.50 740 k active 2002 2027 HOSPITALS

Country Concession % of No. of Stage Start End company total beds date date United Kingdom Impregilo Wolverhampton Ltd 20.00 150 k medical visits active 2002 2032 active since Ochre Solutions Holdings Ltd 40.00 220 2009 2005 2038 Impregilo New Cross Ltd. 100.00 holding

CAR PARKS Country Concession % of No. of Stage Start End company total parks date date United Kingdom Impregilo Parking Glasgow Ltd 100.00 1,400 active 2004 2034

As illustrated in the table summarising performance by business segment, the operating profit of the Concessions segment amounted to euro 29.3 million (euro 46.6 million), equal to 17.3% of revenue which came in at euro 169.1 million for the year (euro 153.9 million). 53 With respect to the investment in the Brazilian associate Ponte de Pedra S.A., for which preliminary agreements for the group’s sale of its entire 50% investment therein to third parties were signed at the end of 2007, the conditions precedent provided for in such agreements were met in April 2008. Therefore, the sale was finalised on 30 April 2008. The transaction gave rise to a net gain of approximately euro 67.5 million, including roughly euro 11 million of the accumulated translation reserve at the sale date recognised as gains (losses) on investments in profit or loss. The net proceeds of the transaction approximated euro 109 million, including the contractually provided for price adjustment, calculated on the positive difference in the Brazilian associate’s financial position at the sale date compared to that at 31 December 2007. In accordance with the agreements entered into in 2006 for the sale of the group’s entire investment in the Chilean concession company Costanera Norte S.A. and on the basis of the appraisal prepared by an independent expert in July 2008, the following financial aspects came to light:

(i) with reference to the price adjustment based on the Chilean company’s performance, which was better than that forecast in the business plan on which the sales consideration was based, Impregilo International Infrastructures identified an approximate net euro 8.2 million during the third quarter of 2008 for this contractual component based on the above appraisal. The group had prudently recognised a profit from discontinued operations of approximately euro 2.5 million determined at the time of the sale for this price adjustment as the minimum guaranteed amount. There was, therefore, a positive difference of euro 5.7 million;

(ii) with reference to the agreement which guaranteed Impregilo International Infrastructure’s right to subscribe 10% of the buyer’s share capital at its nominal amount, and the buyer’s parent’s right to repurchase such option, the fair value of Impregilo International Infrastructure’s right was estimated at euro 34.9 million, based on the independent appraisal as described above.

Both components were received in the last part of 2008 and the related effects were recognised as a profit from discontinued operations under IFRS 5 being components of the sales consideration. This section summarises the main events that affected operations in 2008 in the Concessions segment.

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Brazil The group is active in Brazil in the motorway concessions and logistics sector via its jointly controlled subsidiary Primav Ecorodovias S.A.. The motorway concessions sector performed satisfactorily in 2008. Revenue earned by Primav Ecorodovias S.A., determined in proportion to the group’s investment therein, amounted to euro 108.8 million (euro 84.5 million) while the operating profit came in at euro 52.9 million (euro 42.8 million), equal to 48.6% (50.7%) of revenue. The three concession companies, which provide access to the three key ports in South America Santos, Paranaguà and Rio Grande do Sul saw an improvement in traffic volumes compared to the previous year. By its subsidiary Ecopatio, Primav Ecorodovias continued to develop a logistics centre near the Santos Port, linked to San Paolo by a motorway managed by the related company Ecovias, in 2008. This centre will consist of a car park for heavy vehicles providing a connection service for logistics operators which will be extended to provide customs activities. It will also include a logistics centre for container handling, connected to the Santos port. Work on a second logistics centre commenced near San Paolo, again along the motorway managed by Ecovias.

54 Argentina The Argentine market, where the Concession segment is active in motorway management and electrical energy transmission, still presents significant critical issues due to the non re-negotiation of contracts in line with the Argentine monetary policy and the local authorities’ continued policy of freezing tariffs following the economic crisis which began at the end of 2001. The key events of the year were: Mercovia S.A. (subsidiary): this company holds the concession for the road connector that links the cities of Santo Tomè (Argentina) and Sao Borja (Brazil). It also provides customs services and goods warehousing services. It benefited from the rising volumes traded between the two countries, recording revenue of euro 3.7 million in 2008 compared to euro 3.1 million for 2007. Its operating profit was euro 0.5 million (euro 0.3 million). Caminos de Las Sierras S.A. (subsidiary, “Caminos”): this concession company continued to suffer from the non-adjustment of tariffs (expressly required by the emergency law of 2001). Its continued precarious financial situation, despite the repeated requests and negotiation proposals presented to the Province of Cordoba (the concession grantor), obliged the subsidiary to commence the administrative and legal procedures to withdraw from the concession contract in September 2007, for reasons attributable to the concession grantor. Impregilo concurrently commenced proceedings with the International Arbitration Tribunal of International Centre for Settlement of Investment Disputes (ICSID) to protect its investment in Caminos. Non-recognition of the tariff adjustment has also made it necessary for the subsidiary to present a request for admission to an arrangement with creditors on 18 December 2008. This request was accepted on 30 December 2008. Following acceptance of the procedure, the carrying amount of Caminos’ remaining assets was fully impaired and additional provisions of euro 18.0 million were made. In January 2009, the Governor of the Province of Cordoba issued a decree increasing the 2009 tariffs by 50% and another 50% for 2010. However, the concession company is required to make additional investments in the motorway concession. These measures do not enable Caminos to return to a balanced financial position and it has partly challenged the decree while not modifying the above assessments. Puentes del Litoral (associate): the carrying amount of this investment continues to be fully impaired in the financial statements together with its receivables due to the group given the critical issues noted in previous years. Although it has an ongoing bankruptcy proceeding, the risk is not material for the group. Aguas del Gran Buenos Aires S.A. (associate): in liquidation since 2006 following the arbitrary termination of the concession contract by the Province of Buenos Aires, the associate continued to manage its appeals against this measure commenced in international and domestic courts in 2008. The situation does not lead to additional risks for the group as it had already fully impaired the investment in the concession company in previous years.

United Kingdom The group is active in the UK construction, hospital and car park management sectors. Impregilo Parking Glasgow Ltd. (subsidiary) has a concession valid until 2034 for a multi storey car park at the Glasgow hospital with 1,400 spaces. The car park was opened during 2005. 2008 revenue was euro 1.8 million (euro 2.0 million) and the operating profit amounted to euro 0.6 million (euro 0.5 million) after amortisation and depreciation of euro 0.4 million (euro 0.5 million). The group is also involved, via its subsidiaries, in construction of the new oncological unit at the Oxford hospital (substantially 55 completed in 2008), funded with project financing. The related completion certificate was issued on 5 January 2009. The associate Ochre Solutions Holding Ltd, in which the group has a 40% investment, manages the concession, for which the operating stage has now commenced. To date, the renovation of an old building of the hospital has still to be completed and the due date for this is expected to be the end of 2009. The group also has a contract for the maintenance of hospital equipment and buildings of the radiological unit at the Wolverhampton hospital in England.

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China The group operates in the energy generation from renewable sources sector with a plant in the Province of Shanghai owned by Shanghai Pucheng Thermal Power Energy Co. Ltd., a 50% joint venture with a local state body. The joint venture generated revenue, in proportion to the group’s investment percentage, of euro 13.8 million (euro 11.9 million) and an operating profit of euro 4.8 million (euro 3.7 million), after amortisation and depreciation of euro 1.9 million (euro 1.8 million). The group has a development strategy for China which involves acquisitions for its Concessions segment in order to achieve an adequate size for the local company’s listing on the stock exchange.

Acquisition of new concessions Brazil – Ecocataratas (formerly Rodovias das Cataratas) On 6 February 2008, the jointly controlled subsidiary Primav Ecorodovias (the other partner is the Brazilian company CR Almeida) executed its acquisition of 100% of the Brazilian company Rodovias das Cataratas S.A., subsequently called Ecocataratas, which holds a motorway concession in the Paranà state. The investment cost approximately R$ 425 million and was financed by Primav Ecorodovias by taking out a loan.

56 The purchase price allocation (PPA) procedure required by IFRS 3 has been completed. The difference between the price paid to the seller and the related carrying amount of the acquired equity has mostly been allocated to the asset under concession.

Risk areas The risk areas basically relate to the group’s subsidiaries and associates operating in Argentina. The group carried out specific appraisals of the situation in the past and updated them to reflect the developments affecting Caminos. Accordingly, impairment losses of approximately euro 18 million have been recognised on the subsidiary’s remaining assets and additional provisions made. To date, no additional critical issues have come to light. The full impairment losses on the carrying amounts of the group’s investments in the associates Puentes de Litoral S.A. and Aguas del Gran Buenos Aires S.A. and loans due from them have been maintained. IMPREPAR – IMPREGILO PARTECIPAZIONI S.P.A. (IN LIQUIDATION)

Performance Liquidation of the company continued during 2008 in line with the guidelines set out in the plan, updated at the end of 2007. The net invested capital of Imprepar and its subsidiaries, which amounted to euro 53.3 million at 31 December 2007, decreased by euro 11.4 million during the year, coming in at euro 41.9 million at 31 December 2008. This decrease was mainly due to: • final settlement of the disputes with ANAS related to the Antignano contract, whereby Imprepar’s share of the receivables collected from the state body came to euro 10.6 million and the loans granted to the consortium company Antignano S.c.a.r.l. of euro 2.6 million were repaid to Imprepar; • settlement with the Italian partner of the foreign joint ventures set up for the Owen Falls and Kapichira projects, under which Imprepar was repaid the loans granted to the joint ventures of euro 4.0 million; • collection of euro 1.5 million following transfer of the deferred portion of the sales price for Imprepar’s investment in the Argentine company Constructora Alicopà to IECSA and collection of the outstanding receivable of euro 1.7 million from an African state-owned customer; 57 • the approximate euro 5.9 million adjustment made following issue of an arbitration award in favour of the subsidiary Incave, for which provisions for risks had been set up and were now excessive; this lead to a similar increase in invested capital; • payment of euro 1.6 million to settle payables related to foreign joint ventures for which the related agreements had been reached in previous years. The almost ten-year dispute with the Arezzo municipal authorities for the Bisaccioni car park construction and management concession was resolved at the end of December 2008. The company will pay the municipal authorities euro 1.5 million as compensation for its management damaging the car park in the years from 2000 to 2008 while the authorities have recognised its right to collect the contributions of euro 7 million under the Tognoli law accrued during the management period over the next six years. This situation did not affect the company’s financial position as the related effects had already been reflected in the financial statements in previous years. The companies headed by Imprepar recorded a profit for the year of euro 4.7 million, mainly due to the interest accrued on the company’s liquidity. They reported a net financial position for the year of euro 107.3 million, consisting of euro 112.0 million of cash and cash equivalents and euro 4.7 million of bank debt. Guarantees given to third parties decreased by euro 27.3 million, from euro 81.4 million at 31 December 2007 to euro 54.1 million at 31 December 2008.

Risk areas The company is currently involved in a large number of legal cases and out-of-court disputes for which the total amount claimed by it (including requested amounts and claims) approximates euro 375 million (euro 420 million), while the total nominal amount claimed by counterparties totals approximately euro 210 million (euro 240 million).The decrease relates to the judicial and extrajudicial settlement of cases and disputes during the year, the main ones of which have been described earlier.As reported in previous year, many of the claims to/by the company relate to the same dispute and should be assessed together as part of the individual project to which they relate. It cannot be excluded that additional events may come to light in the future that are not currently foreseeable despite the attention paid to any changes that might alter the risk profile of each dispute. These may require further adjustments to be made.

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IMPREGILO GROUP RISK MANAGEMENT

Impregilo Group uses its complex and articulated risk management process as an important strategic tool in achieving its objectives in terms of creating utmost value for shareholders. The diversification of the group’s operating activities, both in core business sectors and in discontinued operations means management faces a wide variety of issues, which, in many cases, are difficult to foresee. Depending on the various operating situations and the different resulting risk types that can arise, management has created specific ongoing management and monitoring strategies to limit as far as possible fluctuations in cash flows due to the development of situations that arise. To this end, the risk areas existing currently are described in the sections on each segment’s performance so as to allow comparison with the comments given in the 2007 consolidated financial statements and an analysis of any new situations that have arisen at the date of preparation of this report. These descriptions are integrated by additional general considerations about risks common to the entire group’s operations. The key types of risks identified and monitored by Impregilo are: (i) operating risk being the risk related to performance of contracts and relationships with individual customers. (ii) financial risk, split into the following components: 58 • market risk deriving from the group’s exposure to interest rate fluctuations, exchange rate fluctuations and, with respect to the Engineering & Plant Construction Segment, commodity price volatility; • credit risk deriving from the group’s exposure to potential losses arising from the customers’ non-compliance with their obligations; • liquidity risk deriving from the risk that the financial resources necessary to meet obligations may not be available at the agreed terms and deadlines. The notes to the consolidated and separate financial statements give detailed information about management of these risks. NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE AND DISCONTINUED OPERATIONS

I. USW CAMPANIA PROJECTS: THE SITUATION AT 31 DECEMBER 2008 As already described in detail in previous reports, Impregilo group became involved in the urban solid waste disposal projects in the Province of Naples and other provinces in Campania at the end of the 1990’s through its subsidiaries FIBE and FIBE Campania (the “companies”). From 2000 to 2003, the companies completed the construction of the RDF plants, built for them by other Impregilo group companies, namely FISIA Italimpianti and FISIA Babcock Environment (for the electromechanical parts) and Impregilo Edilizia e Servizi (for the civil works) and took the steps necessary to produce RDF and store it temporarily until the waste-to-energy plants were ready. Over the years, the situation began to become increasingly critical due to the following main factors: • non-commencement by the Campania Regional Authorities of the scheduled separated waste collection with the related agreed volumes, an essential factor underpinning the project and service contracts agreed by the companies with the government commissioner; • inadequate landfill areas made available by the government commissioner; • commencement of activities at the Acerra waste-to-energy plant, which should have commenced as per the contract in 2001, only in August 2004 following the extraordinary intervention of more than 450 policemen who cleared the work areas occupied since January 2003 by demonstrators; 59 • the Santa Maria La Fossa waste-to-energy plant only obtained the E.I.V. (environmental impact valuation) in 2007, although activities should have started there concurrently with those at Acerra; • on 12 May 2004, the Naples Public Prosecutor seized the plants with their concurrent release on attachment bond as part of proceedings which included investigation of the directors of the group companies involved in the project (FIBE, FIBE Campania and FISIA Italimpianti) and top management of the commission; • an increasing number of municipalities, companies and inter-municipality consortia started to not pay the tariffs due to the companies for the treatment of their waste with the result that the companies saw a significant rise in receivables leading to the inevitable financial tension; • given this critical situation, the banks that had granted FIBE project financing to construct the RDF plants and waste-to-energy plant at Acerra suspended all further disbursements (they had granted euro 173.5 million); moreover, the negotiations aimed at agreeing similar funding for the RDF plants and waste-to-energy plant of FIBE Campania (at Santa Maria La Fossa) were interrupted; these circumstances worsened the two companies’ financial positions and that of the entire Impregilo group (as FISIA and Impregilo Edilizia e Servizi were engaged to build the RDF plants and the waste-to energy plants and FISIA also provided plant management services). Given this situation, beginning from early 2005, measures and procedures were adopted at top institutional levels following the direct involvement of the Italian government to return the project to its original status and normal operating conditions. Specifically: • the overdue receivables for the waste tariffs through to 31 December 2004 should have been recovered following issue of Law decree no. 14 of 17 February 2005 (converted into Law no. 53 of 15 April 2005) whereby Cassa Depositi e Prestiti should have ensured payment of the outstanding amounts under a specific procedure of roughly 60 days; • recovery of the receivables overdue after that date should have taken place by the appointment of ad acta commissioners by the extraordinary government commissioner using its powers assigned by the Prime Minister’s order (“OPCM”) no. 3397 of 28 January 2005; • the problems related to the judicial seizure of the plants would have been resolved by implementation of a “Programme for structured and management actions for RDF plants” prepared by the commissioner and subject, for certain aspects, to the approval of the Naples public prosecutor, which should have allowed their release from seizure within six months as per the “Conformity Deed” signed by FIBE and FIBE Campania;

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• with respect to the availability of the landfill areas, the government commissioner issued an order on 7 December 2004 for the Monte Sarchio landfill and another for the Campania landfill on 1 April 2005. These orders substantially established that, upon the closure of the then used landfills, two new sites in the Campania region would be set up and used to ensure at least one year of regular performance of the project and giving rise to the concurrent reasonable belief that the issue of the landfills could be managed positively after that time period. Based on these assumptions, the directors of both FIBE and FIBE Campania approved a business plan for the period of the service on a going concern basis. However, a number of events took place in the following months that significantly negatively altered the assumptions inferred from the legal and administrative measures. Specifically: • Cassa Depositi e Prestiti had not yet shown any signs of applying the measures set out in Law decree no. 14/2005 (converted into Law no. 53/2005) many months after its issue and, therefore, the receivables overdue at 31 December 2004 were still outstanding with further problems about the collection of those that became due in 2005; • following social-political agreements, the government commissioner had delayed the use of one of the two previously authorised landfills 60 and had not allowed preparation of the second. This implied that, in order not to disrupt services, FIBE and FIBE Campania had to use private landfills outside the region fully bearing the very high and unplanned disposal and transportation costs from April. No feedback from the commissioner was received about their request for reimbursement; • meanwhile, the government commissioner, with a writ of summons of May 2005, took legal action claiming compensation from FIBE, FIBE Campania and FISIA for alleged damage being the costs it incurred in the past to transport waste outside the region (subsequent sections of this report give more information about this dispute); • the banks that had given the first instalment of euro 173.5 million of the project financing agreed with FIBE not only confirmed that they would not provide the rest of the financing but also formally requested that the project financing structure be dismantled as it was no longer considered suitable given the critical situation of the USW Campania project. In this situation, Law decree no. 245 (converted into Law no. 21 of 27 January 2006) was issued on 30 November 2005 and became applicable on 15 December. It: a) terminated the contracts between FIBE S.p.A., FIBE Campania S.p.A. and the extraordinary government commissioner for the Campania Waste Emergency on an ope legis basis “without prejudice to any claims arising from the terminated contracts” (article 1.1); b) required the commissioner to: (i) identify “urgently”, with a “swift EU” procedure, the new parties to which the waste disposal service for Campania should have been awarded, taking over the contracts from FIBE and FIBE Campania (article 1.2); (ii) construct “the landfills ... continue work to build the waste-to-energy plants at Acerra and Santa Maria la Fossa” (article 6.2); c) provided that responsibility for and the cost of managing the USW Campania project be transferred to the commissioner, pending the identification of new providers of the waste treatment service during the transition period, without prejudice to FIBE and FIBE Campania’s obligation to provide the service against their right to claim payment from the commissioner’s office of expenses and costs incurred in this regard (article 1.7, as modified by the aforesaid Law decree no. 263/2006); d) set specific regulations for: (i) “speeding up the procedure to obtain payment” of the waste disposal tariffs (article 2); (ii) “guaranteeing that the separate waste collection objectives are met … and resolution of the current emergency situation” (article 5). In order to assist the tender procedure described in paragraph “b.i”, FIBE and FIBE Campania complied with the commissioner’s request in March 2006 to formalise a sale promise, irrevocable until 30 September 2006 (“statements of promises to sell”). They thus committed themselves to selling the following assets to the commissioner (or parties indicated by it upon the outcome of the tender): • the waste-to-energy plant in Acerra at its carrying amount on 15 December 2005, increased by additional entries made by the current owner FIBE for work carried out and to capitalise financial expense and technical costs in the period between 16 December 2005 and the payment date; • the land on which the waste-to-energy plant of Santa Maria La Fossa is to be constructed, owned by FIBE Campania, for its carrying amount at 15 December 2005; • sundry equipment used to manage the waste treatment plants and RDF stocking sites, owned by FIBE, FIBE Campania and FISIA Italimpianti, at their carrying amount at 15 December 2005; 61 • the RDF stocking sites and related stocked materials of FIBE and FIBE Campania at their carrying amount at 15 December 2005; this amount did not include two stocking sites not recognised by the commissioner; in addition, the promises to sell provided that part thereof may be decreased by a maximum of 15%. The tenders published on 31 March 2006 also provided that the parties would have had to pay FIBE and FIBE Campania for the right to use the RDF plants (which are owned by the government commissioner) the “unamortised costs incurred by the previous providers of the service up until 15 December 2005”. The tender called on 31 March 2006 was not awarded since only two bids were presented, one of which by a non-eligible bidder. With respect to this situation, the public institutions involved showed their intention to begin a new procedure, calling bids from throughout the European Union and committing themselves to conducting the procedure in a significantly shorter time span than the previous one. They asked FIBE and FIBE Campania to renew their “statements of promises to sell” as described above. This request was accepted and the statements were renewed until 31 March 2007. In August 2006, the tender for the allocation of the urban solid waste disposal services for the Campania region was called again. The assets to be sold and the amounts were unchanged from the previous tender. Given the continued critical waste situation in the region, the government issued two Law decrees aimed at resolving it. Specifically: a) Law decree no. 263 of 9 October 2006 (converted into Law no. 290 of 6 December 2006) which, inter alia: (i) appointed a new commissioner, the head of the Civil Protection Department, who reported directly to the Prime Minister (article 1.1); (ii) cancelled the tender called in August 2006 (article 3.1); (iii) required the new commissioner to redefine “the conditions for allocation of the waste disposal service in Campania” (article 3.1); (iv) amended Law no. 21/2006 establishing that the current holders of the contract are required to continue to provide the service until the tender is closed, and this “considering the necessary transfer of duties to the new holders, including those related to personnel and any movable and immovable property that should be transferred, given their use, age and maintenance” (article 3.1-bis);

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(v) provided for measures aimed at ensuring the effective separate collection of urban solid waste (article 4); (vi) extended the transition period for the waste emergency situation in Campania until 31 December 2007 (article 1.1); b) Law decree no. 61 of 11 May 2007 (converted into Law no. 87 of 5 July 2007) which, inter alia: (i) opened, “also to avoid new emergency situations”, new sites to be used as landfills (article 1.1); (ii) requested the commissioner to identify “urgently … also by directly engaging parties other than the current service providers ... the best possible solutions for the treatment and disposal of waste and possible disposal of waste bales” (article 2); (iii) requested the commissioner to adopt “a plan for introduction of an integrated waste cycle in Campania” (article 9). On 5 July 2007, concurrently with the issue of the aforesaid legal measure, a new extraordinary commissioner for the waste emergency in Campania was appointed, namely the Naples Prefect. Following specific requests presented by FIBE and FIBE Campania, on 10 August 2007, the commissioner provided for the speeding up of the process aimed at reimbursing the two companies the costs incurred by them to manage the service which they had not yet received and for the direct payment by its offices of personnel expenses and subcontracting costs related to the provision of the service by them.

62 In Autumn 2007, the commissioner recommenced the procedures for the preparation of a new tender to identify an USW service operator. To overcome the problems that beset the previous tenders, the commissioner started an in-depth preliminary survey of the actual situation of the plants and equipment as well as the related labour required to provide the service under tender. It was assisted in this by FIBE and FIBE Campania. This survey was based on formats that reflected those underlying the original contracts with FIBE and FIBE Campania that had been terminated: a) geographical: the survey focused on two areas: the Province of Naples and other provinces; b) technical: the existing RDF plants and the Acerra waste-to-energy plant, still under construction. A new tender was called in December 2007 for solely the USW disposal service in the Province of Naples. At the start of the first quarter of 2008, the commissioner received expressions of interest from two major industrial groups active in the waste treatment and energy generation sector. After having requested and obtained an extension of the tender until the end of January 2008, they withdrew from the procedure, communicating their doubts about the existence of both suitable guarantees from the body calling the tender about the availability of landfills for the waste from the RDF processing and suitable certainty about the availability of the benefits provided for under measure “CIP6” for the Acerra waste-to-energy plant under construction for the sale of electricity generated by the plant at favourable tariffs. Given this situation and the further worsening in the waste collection and disposal emergency in the region, the Prime Minister issued orders nos. 3656 and 3657 of 6 February and 20 February 2008, respectively: (i) the first confirmed the benefits provided for by measure “CIP6” for the Acerra waste-to-energy plant: these benefits were confirmed by Law no. 31 of 28 February 2008 whereby, during conversion of the “Milleproroghe decree” “for the plant ... in Acerra ... the government grants and incentives provided for by the Interministerial price committee resolution no. 6 of 29 April 1992 ... are due”;; (ii) the second authorised the disposal of the waste treated by the RDF plants in the waste-to-energy plant under construction (both before and after termination of the contracts as per the aforesaid Law no. 21/2006) and currently stored in the region. After issue of these orders, the government intervened again directly enacting significant measures aimed at resolving the existing situation, including the allocation of the position as extraordinary commissioner for the waste emergency in Campania which had been held to then by the under-secretary of state that reported to the Prime Minister to the head of the Civil Protection Department. These measures were: a) Law decree no. 90 of 23 May 2008 and Law decree no. 107 of 17 June 2008, both converted into Law no. 123 of 14 July 2008. The conversion law, inter alia: (i) confirmed FIBE’s obligation to complete the Acerra waste-to-energy plant (see article 6-bis.4); (ii) expressly authorised “use of the Acerra waste-to-energy plant” (see article 5.2) and combustion of the “eco-bales” (see article 5.1); (iii) authorised “construction of the Santa Maria La Fossa waste-to-energy plant” (see article 5.3) and “construction of a waste-to-energy plant in the Naples municipality” (see article 8.1); (iv) provided for the possible allocation of the benefit of the CIP 6 “for the waste-to-energy plants located in the Salerno, Naples and Santa Maria La Fossa municipalities” (see article 8-bis. 1); (v) definitively authorised Impregilo group’s exit from the waste disposal business, transferring “title” to the RDF plants “located in their municipalities” to the provincial authorities (see article 6-bis.1) and providing for “the involvement of the Armed Forces for the technical and operating management of the plants” (see article 6-bis.3); 63 (vi) ordered “an assessment of the value” of the RDF plants and Acerra waste-to-energy plant “also for the possible purchase against consideration by the new service operator” and that the assessment of the RDF plants be carried out considering “their effective use, age and maintenance” (see article 6.1); (vii) ordered that “all the disputes […] about the waste management service be deferred to the exclusive jurisdiction of the administrative judge” (see article 4.1); b) Law decree no. 97 of 3 June 2008, converted into Law no. 129 of 2 August 2008 which, inter alia, required the Ministry for Economic Development, together with the Ministry for the Environment, to establish “the methods to provide government incentives, as per resolution no. 6 of 29 April 1992 of the Interministerial price committee, to the waste-to-energy plants located in the municipalities of Salerno, Naples and Caserta”; c) Order of the Prime Minister no. 3685 of 19 June 2008 which provided for, inter alia: (i) transfer of the “operating resources present in each plant” to the municipalities that gain title to the RDF plants; (ii) taking over of the employees of the RDF plants (other than management) by the municipalities using term employment contracts; d) Decree no. 3299 of 30 June 2008 and letter no. 1882 of the same date, both issued by the under-secretary of state which, inter alia, included orders related to: (i) completion by FIBE of the Acerra waste-to-energy plant; (ii) transfer of management of the RDF plants to the municipalities. These measures are of fundamental importance given that, in short: a) the Acerra waste-to-energy plant must be completed by FIBE and will be operative within a few months (early 2009); b) combustion of the “eco-bales” is expressly provided for at this plant; c) an additional two waste-to-energy plants will be built, benefiting from CIP 6, like the Acerra waste-to-energy plant; d) management of the RDF plants has been definitively taken from FIBE and FIBE Campania and title thereto has been transferred to the Campania municipal authorities while they will be managed by the Armed Forces.

2008 Annual Report IMPREGILO Directors’ report - Part II

Following enactment of these measures, and as coordinated by the relevant commission offices, FIBE and FIBE Campania took steps to ensure they were fully implemented. Specifically: a) possession of all the plants and related assets by the relevant commission offices has been completed; b) in July 2008, the relevant authority commenced a preliminary investigation to identify the costs already incurred and not yet paid to third parties for work performed after the contracts had been terminated and the activities currently ongoing and required to complete the roll out of the Acerra waste-to-energy plant; c) after the due meetings with the trade unions, the procedure to decrease FIBE's personnel and to transfer them to the relevant commissioner has been completed. In the last few months of the year, a new party has been identified for the plant’s management, namely a leading Italian company which currently owns other major waste-to-energy and RDF plants.

II. THE LITIGATION CURRENTLY PENDING FOR THE USW CAMPANIA PROJECTS 64 II.1 The administrative litigation A). In October 2006, FIBE and FIBE Campania took legal action before the Lazio Regional Administrative Court censuring the commissioner’s failure to comply with its obligations under Law decree no. 245/2005 (converted into Law no. 21/2006), namely: (i) recovery of amounts due by municipalities for waste disposal services outstanding at the date of termination of the contracts (15 December 2005); and (ii) identification of landfills for organic waste and stockpiles generated by the RDF plants and preparation and implementation of a plant maintenance plan. After accepting the precautionary motion presented by FIBE and FIBE Campania (in its ruling of 11 October 2006, confirmed by the Council of State on 7 November 2006), in its decision no. 3790 filed on 27 April 2007, the Court found that: (i) FIBE and FIBE Campania effectively provided the waste disposal service under the 2000 and 2001 contracts up until 15 December 2005; (ii) due to the ope legis termination of the service contracts, FIBE and FIBE Campania “with effect from 15 December 2005 merely provided the service on behalf of the commissioner [waste disposal] and had definitively lost title thereto”; (iii) the commission should complete the procedure aimed at meeting the companies’ requests within 45 days; (iv) an ad acta commissioner to take the necessary measures within a further 45 days, should the local administrative bodies not fulfil their obligations, would be appointed. The commissioner appealed against this ruling with the Council of State. Ruling no. 6057 of 28 November 2007 rejected the appeal, fully confirming the ruling of the Lazio Regional Administrative Court. B). The Lazio Regional Administrative Court recently confirmed the findings of its ruling no. 3790/2007 in its ruling no. 7280 of 23 July 2008. C). In December 2008, FIBE and FIBE Campania challenged a number of orders before the Lazio Regional Administrative Court whereby the parties appointed by the commissioner for technical and operating activities (Technical-operational head under Prime Minister’s no. 3705/2008 and the ad acta commissioners for the provinces) obliged the companies to re-acquire possession of certain areas and storage sites, which such parties had acquired in August 2008, as these areas and stocking sites were not deemed necessary to provide the service. Following the hearing of 19 January 2009, the Court suspended the enforceability of the challenged measures and accepted the appeal made by FIBE and FIBE Campania in its ruling no. 84/09 on 4 March 2009, cancelling the challenged measures. II.2 The civil litigation The government commissioner presented a writ of summons in May 2005 requesting compensation from FIBE, FIBE Campania and FISIA Italimpianti for alleged damage of approximately euro 43 million. During the hearing, the commissioner increased its claims to approximately euro 700 million, further to the additional claim for damage to its reputation, calculated to be euro 1 billion. The companies appeared before the court to dispute the claims made by the government commissioner and lodged a counterclaim requesting compensation for damage and sundry charges determined before the court of first instance for a total of euro 667.5 million, plus another claim for damage to their reputation of euro 1.5 billion. They also complained about the significant delay (compared to that provided for in the 2000 and 2001 contracts) in the release of the authorisations required to construct the waste-to-energy plants and the related delay in the construction of such plants. These delays have led to both the lengthening of the temporary stocking periods of the produced “eco-bales” and an increase in the stocked “eco-bales” with the related need to find bigger stocking areas: circumstances that led to the incurring of greater costs by FIBE and FIBE Campania. In the same proceeding, the banks that issued FIBE and FIBE Campania’s performance bonds to the government commissioner, also requested that the commissioner’s claim be rejected. In addition, they requested to be held harmless by Impregilo from the commissioner’s claims. Impregilo appeared before the court and disputed the banks’ requests. 65 The ruling is still at a preliminary stage. At the hearing of 20 January 2009 to verify the correctness of the cross examination, the companies’ legal counsel raised the objection of the ordinary court’s jurisdiction as opposed to the administrative court (see earlier with respect to Law no. 123/2009). The judge has reserved its decision on this objection.

II.3 The penal litigation In September 2006, the Public Prosecutor at the Court of Naples served Impregilo S.p.A., Impregilo International Infrastructures N.V., FIBE S.p.A., FIBE Campania S.p.A., FISIA Italimpianti S.p.A. and Gestione Napoli S.p.A. in liquidation with a “Notice of the conclusion of the preliminary investigations about the administrative liability of companies” related to the alleged administrative crime pursuant to article 24 of Legislative decree no. 231/2001 as part of a criminal case against several former directors and employees of the above companies, investigated for the crimes as per article 640.1.1/2 of the Penal Code in relation to the tenders for management of the urban solid waste disposal cycle in Campania. Following the preliminary hearing of 29 February 2008, the Judge for the Preliminary Hearing at the Court of Naples accepted the request for a hearing made by the Public Prosecutor. The first hearing for the merits of the case was held on 14 May 2008 and the proceeding is still ongoing. The Public Prosecutor requested the following precautionary measures relating to: • “assets”, pursuant to article 19 of Legislative decree no. 231/2001 (seizure: of the RDF production plants and Acerra waste-to-energy plant; approximately euro 43 million belonging to the Impregilo group companies; receivables of approximately euro 109 million due to FIBE and FIBE Campania from municipalities in the Campania region); and • “interdiction”, pursuant to article 9 of Legislative decree no. 231/2001 (or: ban on negotiating with the public bodies; exclusion from subsidies, loans and similar assistance, ban on advertising goods and services).

2008 Annual Report IMPREGILO Directors’ report - Part II

In its ruling of 26 June 2007, the Judge for the Preliminary Investigation ordered the preventive seizure of the profit from the alleged crime, estimated at approximately euro 750 million; specifically, the Judge ordered the preventive seizure of: • euro 53,000,000.00, equal to the amount advanced by the commissioner to construct the plants in provinces other than Naples; • the total amount of euro 301,641,238.98 for the regularly collected waste tariffs; • certain, liquid and due receivables due from the municipalities and not yet collected of euro 141,701,456.56; • the expense incurred by the commissioner for the disposal of the USW and related processing at the RDF plants of euro 99,092,457.23; • euro 51,645,689.90 being the missing guarantee deposit, payment of which had been agreed to guarantee correct compliance with contractual obligations; • amounts received as premiums for the collection service performed on behalf of the commissioner and municipalities to be determined upon enforcement; • euro 103,404,000.00 being the value of the works carried out to build the Acerra waste-to-energy plant up to 31 December 2005. The Judge for the Preliminary Investigation also ordered that the companies were banned from contracting with the public bodies for one 66 year with respect to waste disposal, treatment and waste-to-energy activities as an interdiction measure; this finished in June 2008. The precautionary measures ordered by the Judge for the Preliminary Investigation did not imply the expropriation of the assets but their “blocking” as they continued to be owned by the parties to which they “belonged” and could only be expropriated after the relevant rulings had been issued by the Court of Naples, the Court of Appeals and the Supreme Court. However, the precautionary measure was partly executed with the seizure of liquidity of approximately euro 124.8 million deposited by Impregilo, FISIA Italimpianti, FIBE and FIBE Campania with several banks as well as receivables of approximately euro 190 million of FIBE and FIBE Campania from local administrative bodies for activities performed prior to 15 December 2005. The seizure precautionary measure was appealed against on 7 July 2007. The Review Court however rejected the appeal on 24 July 2007. The precautionary seizure measure, confirmed by the Review Court, was appealed against with the Supreme Court on 5 November 2007. The Second Chamber of the Supreme Court, charged to hear the appeal, referred the relevant ruling to the United Chambers on 23 January 2008. On 27 March 2008, the United Chambers cancelled and deferred the seizure measure: a) on one side, confirming the principle whereby “the profit from the crime ... is the direct and immediate economic benefit of the crime and can be accurately calculated net of the effective use obtained by the damaged party, as part of the bilateral relationship with the body”; b) on the other, noting that neither the Judge for the Preliminary Investigation nor the Naples Review Court correctly applied this principle. Specifically, as the United Chambers stated: “the reasoning on which [the Review Court’s decision] is based, while considering the factual issues of the events examined, leads to partial and simplistic legal considerations with respect to the concept of “profit”, it does not take into account the notion as specifically set out above and, based solely on the serious breach of contract by the service providers, ends by identifying the assets that can be seized in an abstract manner, without properly checking the relationship between the illegal act and the advantage obtained”. The Supreme Court also analysed the individual items subject to the precautionary seizure in detail, concluding that: (i) none of the above items, except for the tariff net of VAT, constitute “profit from crime”; (ii) the amount of the tariff (net of VAT) that can legitimately be seized is to be determined deducting the value of the services provided by FIBE and FIBE Campania to the benefit of the municipalities from the tariff. In this respect, the following should be emphasised: - the Supreme Court acknowledges that “the service provided” by FIBE and FIBE Campania “was not always characterised by illegality and took place over a long period of time without being formally challenged by the municipalities”; - the Lazio Regional Administrative Court and the Council of State (with the mentioned rulings no. 3790/2007 and no. 6057/2007) recognised that these companies effectively provided the waste elimination service entrusted to them under the 2000 and 2001 contracts up until 15 December 2005. Following this Supreme Court ruling, with its order filed on 7 August 2008, the Review Court ordered that the measure be cancelled and the assets effectively seized be immediately returned. On 18 August 2008, the Naples Public Prosecutor presented an appeal to the Supreme Court against this order. The latter Court deferred the ruling in its hearing of 18 February 2009 to 16 April 2009. * * * Again during the second quarter of 2008, as part of a new inquiry by the Court of Naples into waste disposal and related activities in the region carried out after the ope legis termination of the contracts (15 December 2005), the Judge for the Preliminary Investigations issued 67 personal preventive seizure measures upon the request of the Public Prosecutor against certain managers and employees of FIBE, FIBE Campania and FISIA Italimpianti and managers of the commissioner’s office. The preliminary hearing was concluded on 29 January 2009 with all the defendants being committed for trial. As part of this inquiry, the former service providers and FISIA Italimpianti are again challenged for the administrative liability of companies under Legislative decree no. 231/01. The related deeds describe how this is a both a continuation of the previous investigations and a new proceeding based on new allegations. The group companies involved in the new proceeding are fully convinced of the legitimacy of their actions, also because their activities are not only expressly covered by Law no. 21/2006 but were also carried out merely on behalf of the commissioner (see the rulings of the Lazio Regional Administrative Court and Council of State in paragraph II.A.).

III. THE DIRECTORS’ CONSIDERATIONS ABOUT THE SITUATION AT 31 DECEMBER 2008 The group’s situation with respect to the USW Campania projects at the end of 2008 and in early 2009 continues to be extremely complex and uncertain in some cases (as can be seen from the wealth of the above information). It also contains certain elements that would seem to be very significant for the resolution of the existing critical issues. In fact, as mentioned above: a) at a legislative level, important measures were adopted in 2008, thanks to which: (i) the Acerra waste-to-energy plant must be finished by FIBE; (ii) combustion of the “eco-bales” is expressly provided for; (iii) other waste-to-energy plants will be built, benefiting from CIP 6, like the Acerra waste-to-energy plant; (iv) management of the RDF plants has been definitively taken from FIBE and FIBE Campania and title thereto has been transferred to the Campania municipal authorities while they will be managed by the Armed Forces; (v) the Acerra waste-to-energy plant and RDF plants will be assessed “also for the purposes of their possible purchase against consideration by the new service operators”;

2008 Annual Report IMPREGILO Directors’ report - Part II

b) at a judicial level: (i) the Naples Review Court cancelled in full the seizure ordered by the Naples Judge for the Preliminary Investigation on 26 July 2007 implementing the decision of the United Chambers of the Supreme Court. This decision has been appealed against before the Supreme Court by the Naples Public Prosecutor. The related hearing will be held on 16 April 2009; (ii) two rulings of the administrative courts (see paragraph II.1.A.) expressly recognised that FIBE and FIBE Campania had effectively provided the waste disposal service assigned to them under the 2000 and 2001 contracts up until 15 December 2005; (iii) another ruling by the administrative court confirmed the principle whereby the temporary and definitive stocking sites are also to be taken over by the commissioner, cancelling the measures whereby the commissioner had ordered the former service providers to repurchase them (see the Lazio Regional Administrative Court’s ruling referred to earlier in section II.1.C). c) at an operating level: (i) the commissioner commenced the procedures for the direct settlement of both the operating costs of providing the service in 2008 that the third party suppliers had wrongly charged to the former service provides and of a (modest) part of the costs to complete the Acerra waste-to-energy plant; 68 (ii) in November 2008, the commissioner signed a services agreement for the management of the Acerra plant (and the former RDF plant in Caivano) with the company which performs the waste disposal service in the Municipality of Naples; (iii) in December 2008, the first tests of the working of the Acerra waste-to-energy plant were successfully carried out under the supervision of the commissioner. These tests were continued in early 2009 and the first line is due to be opened on schedule by the end of March 2009. Notwithstanding this improved legislative and judicial situation, although the group’s legal advisors agree with it that developments in the ongoing litigation will show the correctness of the group’s activities and considering the different civil suits presented by local bodies and third parties in the penal cases, also with respect to alleged environmental damage, Impregilo intends to further analyse the proceedings which, as noted, still present uncertainties. Therefore, the group has maintained both the impairment losses recognised at the end of 2007 on the net assets classified as held for sale relating to the USW Campania projects and the accruals to the provisions for risks made at that date. HUMAN RESOURCES AND ORGANISATION

The group continued its activities, commenced in previous years, aimed at implementing a training programme and creating an organisational model based on a streamlined structure and by rationalising structural costs during the year. The key events of the year are described below.

Training The group continued to implement a training programme during the year aimed at strengthening and developing professional skills in order to ensure the ongoing search for excellence in carrying out one’s duties, in performances and results. The training courses are provided to all employees with the objective of developing their technical-specialist expertise pertinent to their professional area and to build up managerial skills for each level of responsibility. In 2008, 711 group employees attended professional courses. These courses covered: • training for professional groups, aimed at providing a deeper knowledge of, and updates about issues of strategic importance to the group; • institutional courses, mainly provided to increase employees’ knowledge about management issues and compliance with relevant 69 legislation; • IT courses, tailored to meet the requirements of the different internal position.

The key courses related to: • the “Workshop on economic-financial information”, which focused on developing technical management skills in the economic-financial environment and improving familiarity with the group’s management control tools; • a course for the Employers on the new issues introduced by the “Consolidated Act for health and safety in the workplace” (Legislative decree no. 81/2008), which is part of a larger training programme on the safety and health of employees which will continue in 2009 and be extended to other contract personnel involved in implementing safety management and risk prevention systems; • continuation of the training and refresher courses for managers and junior managers about Legislative decree no. 231/2001 on the administrative liability of companies and on the “Organisation, management and control model” adopted pursuant to the decree, by both classroom training and e-learning. These training courses were “attended” by 278 junior managers around the world.

Sale of a business unit by FISIA Italimpianti S.p.A. to FIBE S.p.A. - the two companies commenced the trade union negotiation procedure pursuant to article 47 of Law no. 428/1990 with letters dated 5 and 6 December 2007, respectively. This related to the sale of the “Gestione Impianti Campania” business unit by FISIA Italimpianti S.p.A. to FIBE S.p.A.. The procedure was completed on 14 December 2007 and the related documents were signed confirming that the procedure had been carried out correctly. The transaction’s objective is to concentrate the expertise gained from management, treatment and elimination of USW produced in the provinces of Naples, Avellino, Benevento, Caserta and Salerno in one company (the contract holder for the USW disposal service after separate waste collection as per law). This was to facilitate the transfer of the related employees to the parties that will manage the service replacing FIBE and FIBE Campania. The transaction was effective with third parties from 1 February 2008. Employees with the business unit totalled 496.

2008 Annual Report IMPREGILO Directors’ report - Part II

Lay-off programme pursuant to articles 4 and 24 of Law no. 223/1991 FIBE S.p.A. - Following the decision to cease all business activities, in its letter dated 17 June 2008, FIBE S.p.A. commenced a lay-off procedure pursuant to articles 24 and 4 of Law no. 223/1991 to reduce its workforce availing of the “mobilità” scheme due to the ceasing of business activities (555 employees, 505 of which with a metal and mechanical national labour contract and 50 with a building national labour contract) at the different production sites in the five provinces of Campania. Following the joint request received from the relevant trade unions, the case was examined with them as per the law, with meetings held with the different trade unions on 30 June 2008 and 21 July 2008. The procedure was concluded on 31 July 2008 when the parties signed an agreement report stating that they had not come to an agreement. After the joint examination of the situation at administrative level and after the meeting, which also had an interlocutory result, on 27 August 2008, the lay-off programme was held to be satisfactorily concluded with the signing of a report on 1 September 2008. Upon completion of the procedure and considering the hiring of 533 former FIBE employees by the ad acta commissioners in August 2008, the number of redundant employees decreased from 555 to 21. On 2 September 2008, all the operating personnel that had not availed of the employment offers made by the different ad acta commissioners, except for the employees involved in the penal proceedings (ie, seven plant heads and two managers of the storage/unloading sites) were 70 let go. The latter employees were dismissed with effect from 17 September 2008. Following the resignations tendered by personnel still employed with effect from 30 September 2008, the company did not have any employees on its books at that date.

Head office employment figures - At 31 December 2008, head office employees numbered 311, as detailed below:

Managers Junior managers White collars Blue collars Total Impregilo S.p.A 73 64 160 3 300 S.G.F.-I.N.C. S.p.A. 317-11 Total at 31 December 2008 76 65 167 3 311

Management of operating personnel - Normal activities continued with the trade unions in terms of operating personnel management with respect to the ongoing laying-off of personnel taken on for contracts being finalised (CAVET, BOCOGE S.p.A. Costruzioni Generali, CAVTOMI and Consorzio Venice Link). Specifically: CAVET – On 11 October 2007, the second lay-off programme was commenced pursuant to articles 24 and 4 of Law no. 223/91, finalised on 3 December 2007 with the signing of the related agreement with the trade unions. At 31 December 2008, the company had let 336 employees go (35 white collars and 301 blue collars). On 11 November 2008, the third lay-off programme was commenced pursuant to articles 24 and 4 of Law no. 223/91, whereby 121 employees (41 white collars and 80 blue collars) were stated to be redundant. The programme was finalised on 27 November 2008 with the signing of the related agreement with the trade unions for the laying-off of the personnel from 16 January 2009. At 31 December 2008, the consortium had 178 employees, including 10 managers, 21 junior managers, 67 white collars and 80 blue collars.

Bocoge S.p.A. Construction Generali, Arcavacata di Rende (CS) building site - The company commenced a second procedure with a letter of 3 September 2007 involving 49 employees, including seven white collars and 42 blue collars. The related agreement was signed on 16 October 2007 and the company had let 45 employees go at 19 December 2008. Following the resignation of four employees, the company does not have any white collars or blue collars on its books at year end.

C.A.V.TO.MI . - On 7 January 2008, C.A.V.TO.MI commenced the second lay-off programme pursuant to articles 24 and 4 of Law no. 223/1991 whereby 485 workers hired to construct the railway line from 85.576 km to 124.673 km are redundant (including 104 white collars and junior managers and 381 blue collars). This programme is necessary as the works are nearing completion. The procedure was wound up on 4 February 2008 with the signing of an agreement in the offices of the Ministry for Labour.At 31 December 2008, 281 workers had left. At 31 December 2008, the consortium’s employees totalled 301 (10 managers, 152 blue collars and 139 white collars), considering the above 71 dismissals.

Consorzio Venice Link - The consortium commenced a lay-off programme with a letter dated 25 September 2008 using the “mobilità” scheme to lay off 46 employees (42 blue collars and four white collars). The programme was started given the near conclusion of the works entrusted to the consortium by the general contractor (Società di Progetto Passante di Mestre S.C.p.A.) as part of the “A4 motorway - Mestre link road - motorway connector” contract (“Mestre connector” contract). The procedure was wound up satisfactorily on 5 November 2008 with the signing of an agreement with the trade unions in which the parties also agreed that the number of redundant workers had been decreased to 44 (41 blue collars and three white collars) following the dismissals handed in during the period. Another employee left the company on 31 December 2008.

At 31 December 2008, group employees totalled 9,097, as detailed below:

Corporate Construction Concessions Engineering Total & Plant Construction Managers 27 151 25 33 236 White collars 133 1,929 1,344 583 3,989 Blue collars - 4,683 160 29 4,872 Total 160 6,763 1,529 645 9,097 Italy 2,129 Abroad 6,968 Total 9,097

2008 Annual Report IMPREGILO Directors’ report - Part II

The following table gives the average number of employees for 2008 by business segment:

Corporate Construction Concessions FIBE and FIBE Engineering Campania & Plant Construction Total Managers 26 150 26 2 37 241 White collars 136 2,259 1,297 81 573 4,346 Blue collars - 5,919 165 245 61 6,390 Total 162 8,328 1,488 328 671 10,977 Italy 2,682 Abroad 8,295 Total 10,977

Renewal of the building sector national labour contract of June 2008 - The remuneration and regulatory portions of the national labour contract for the building and related sectors was renewed on 18 June 2008, effective from 1 June 2008. The regulatory portion is effective through to 31 December 2011 while the remuneration portion expires on 31 December 2009. Changes include the increase in monthly 72 minimum pay slips and wages in two instalments applicable from 1 June 2008 and 1 January 2009. SAFETY,THE ENVIRONMENT AND QUALITY

Impregilo is the first Italian company and one of the few European companies of the construction sector to have voluntarily adopted a triple Quality, Environment and Safety management system certified under the relevant regulations, UNI EN ISO 9001, UNI EN ISO 14001 and OHSAS 18001. This gives it great standing with the major Italian and international customers. The main scope of the three management systems is the following: • To assist all entities to implement and apply efficient quality management systems, which demonstrate the entity’s ability to regularly provide products that meet customer, legal and internal requirements. Under article 8 of Law no. 109/1994 (Framework law on public works), all contractors entrusted with public works in Italy must have an ISO 9001 certified quality system. • To promote the ongoing and informed commitment of the group companies to complying with environmental legislation and their continued improvement of environmental performances. • To be aware of and monitor all aspects related to the health and safety of employees in the workplace, in order to prevent possible accidents and minimise them. Italian company organisational models that comply with UNI-INAIL or OHSAS 18001 guidelines are assumed to comply with the requirements 73 of article 30 of the new Consolidated act on employees’ health and safety in the workplace (Legislative decree no. 81/2008). All management systems require the active involvement of all parties engaged in production processes and the definition of responsibilities, available resources and controls necessary to ensure the correct and continuous application of the entity’s policies. Thanks to this system, Impregilo has attained the key objectives set out in its Quality, environment and safety policy again in 2008, namely: • ensuring quality work in line with customer expectations and requests; • operating in full compliance with the health and safety requirements for its employees and consultants; • reducing and minimising the impact on the environment during all stages of work; • developing an organisation based on ethical standards to be adopted for all transactions with its stakeholders (employees, shareholders, customers, suppliers, partners, public administration and local communities); and guaranteeing again for 2008, maintenance of the triple certification obtained following the positive outcome of the annual audit performed by the accreditation agency SGS Italia S.p.A. of the environmental management system in the fourth week of April 2008 and of the quality and safety management systems in the third week of December 2008. The agency’s audit plan included the on-site visit to the Sesto San Giovanni registered office and selected contracts, namely the Salerno - Reggio Calabria Lot 5 project (for the environment management system) and the State road 36 and Consorzio Torre (for the quality and safety management systems). As per the management system requirements and the annual audit programme for 2008, prepared by the Quality, Environment and Safety Head, audits were performed at certain headquarters departments (Strategic planning, Bid management, Personnel recruitment, Procurement management, Equipment management) and some foreign contracts (San Juan de Los Morros, Chaguaramas, VIT Tocoma and La Encrucijada, all in Venezuela) and the Italian contracts Reggio Calabria - Scilla motorway, Mestre motorway connector, Consorzio Torre and Diga di Ravedis.

2008 Annual Report IMPREGILO Directors’ report - Part II

Environmental report Environmental variables assume increasing importance for industrial production in a rapidly changing social-economic context. Construction companies are also increasingly aware of the importance of the environment, the need to assess the effect of their construction on the environment and to set up a transparent dialogue with their stakeholders. As part of its vast empire and while it already complies with the legislative constraints of increasingly rigid and severe environmental laws, Impregilo has prepared Environmental reports since 2002 as a communication tool to show its commitment to minimising the effects of its work on the environment and its implementation of policies to safeguard its employees’ health and safety. It is one of the first companies in its sector and one of the few in Europe to do so. The Environmental report is addressed to all Impregilo’s institutional and non-institutional stakeholders that are involved in the group’s activities and to all those parties interested in obtaining detailed information about the complex construction-environment issue. The sixth edition of the report for 2007 was published in June 2008. It presents the environmental aspects tied to construction of large- scale infrastructure and to plant engineering, desalination and waste-to-energy projects. It also discusses the effects of certain contracts carried out on a concession basis on the environment. 74 The report begins with a brief presentation of the parent, Impregilo, and a description of the main contracts carried out in the past, followed by a presentation of the company’s vision and strategy for sustainable growth, which includes its environmental policy and commitment to the ongoing improvement of its environmental performance by adopting certified, internationally-recognised management systems. The next section deals with the company’s environmental responsibility split by business segment: Construction, Engineering & Plant Construction and Concessions. The actions undertaken by Impregilo to minimise the effects of its work on the environment and to make development compatible with protection of the territory. With respect to the Construction segment, the report lists the tools used to limit the effects of construction on the environment during the construction of a large-scale contract covering the atmosphere, surface and underground watercourse, the soil and subsoil, consumption of raw materials and energy, waste generation, noise and vibrations and the landscape. Impregilo’s responsibilities as general contractor are described, especially for environmental monitoring plans, drawn up to ensure full control over the environmental situation during construction work in order to identify any irregularities or critical issues and to promptly implement the necessary remedial actions, considering the above main environmental parameters, and the environmental protection plan, to complete and integrate the environmental monitoring, used to identify the main effects of the work on the surrounding environment and to coordinate all the related prevention actions, considering the many environmental obligations. With respect to the Engineering & Plant Construction segment, the activities undertaken to design sea water desalination plants, to treat discharge water, fume treatment, waste-to-energy treatment are described together with those related to services, such as the collection and storage of urban solid waste, hospital and industrial waste, remediation of contaminated areas, prevention, control and containment of 75 marine pollution and costal protection. With respect to the Concessions segment, the report describes the projects to protect the environment rolled out by the group companies (mostly foreign) and concession holders related mainly to motorway networks, energy generation plants and water treatment plants, such as, for example: • the use of “ecological asphalt” or “rubber asphalt”, containing old tyres, which allows the recycling of used tyres, which would otherwise cause significant environmental damage; • activation of an emergency service for animals accidentally hit by vehicles, which are transported to a specialised centre and healed before being returned to the wild. The report also has a section on Impregilo’s social responsibility, social justice and development of relationships with its contractors, subcontractors, suppliers and, especially, trade union representatives and all its employees, ensuring its effective application.

Our environmental responsibility The focus on the environmental effects of its work, prevention of pollution and the safety and health of its works are one of the key issues dear to Impregilo. Construction of a large-scale engineering contract inevitably leads to the alteration of the natural or anthropic environment in which it is located. It is thus of paramount importance to implement compatible and sustainable development whereby the large-scale infrastructure are integrated into the surrounding area, sometimes becoming the elements which shape it. Even when it is not the general contractor, Impregilo monitors the fall out of the work performed on the local social-environmental context, it adopts special measures to limit its effects on the environment and acts in such a way as to integrate the work with the natural or urban environment, as far as possible.

2008 Annual Report IMPREGILO Directors’ report - Part II

In each Italian and foreign contract, Impregilo assesses and constantly monitors the key environmental parameters: • Atmosphere; • Surface and underground water courses; • Soil and subsoil; • Consumption of raw materials and energy; • Waste generation; • Noise and vibrations; • Landscape, which could be affected by its work. Impregilo identifies and implements specific environmental precautions for each of the above parameters to prevent or minimise the effects.

76 Atmosphere The most significant direct effects of the construction of infrastructure on the atmosphere are clearly linked to dust dispersion caused by the different procedures - excavation, earthwork, movement of heavy vehicles on dirt tracks, crushing plants and the demolition of existing structures. Other effects on the atmosphere may be generated by site vehicles and the self-production of electricity. Impregilo has a number of measures to reduce, as far as possible, dust generation and dispersion. For example, dirt tracks are constantly dampened during dry spells; industrial sites and quarries are equipped with tyre washing systems to prevent trucks from spreading dirt on roads, which would cause dust dispersion. Low-impact vehicles are used to minimize air pollution and regular maintenance is performed on vehicles.

Surface and underground watercourses The construction of infrastructure often has considerable effects on the surface and underground watercourses. When the contract affects water routes, a number of procedures are introduced to minimise the effects which may have a direct impact on the habitat of aquatic organisms and on water quality. Water from the work areas and industrial sites, which include workshops, concrete mixing plants, crushing plants, etc. is collected in a specific network and treated in depurification systems in order to clean the water before it is discharged into streams or rivers. The chemical- physical quality of the water is checked regularly to ensure compliance with the legal limits. Another risk for water is its possible pollution due to petrochemical products used by the work equipment or chemical products used. In this case, Impregilo ensures that contamination does not happen by implementing rigid procedures for the regular maintenance of all the equipment. Soil and subsoil Earthwork is certainly one of most obvious and typical activities of construction of any work: construction of embankments, cuttings or certain types of dams require the movement of large earth quantities. In order to prevent and minimise the use of and damage to the soil, earth is only removed from the areas effectively affected by the construction and is kept at the building site for its reutilisation for other works or to restore sites such as disused quarries or for public works such as parks and car parks. All excavation work is carried out with adequate embankments, ensuring their stabilisation and drainage. Another risk for the soil is the dispersion of chemical or petrochemical products, generated by the damage to containers and/or joints (taps, caps, etc) in the storage area, during the refuelling of vehicles or damage to vehicle tanks, the breaking of flanges and joints, the breaking of hydraulic pistons during work. In order to prevent this type of pollution, specific emergency procedures exist, such as, for example the storage of these products on impermeable surfaces, the use of absorbent materials to contain liquid spillages, the immediate removal and transportation of contaminated earth for restoration or to the landfill.

Consumption of raw materials and energy 77 Motorways, bridges and dams all require large amounts of concrete, water, iron or earth: all non-renewable raw materials. Impregilo pays considerable attention to the rationed use of these raw materials, without however compromising the quality of the finished product and its safety. Construction of a new work also entails use of energy, either in the form of fossil fuels or electricity. Energy consumption has indirect effects on the atmosphere: diesel engines produce polluting emissions while electrical power plants contribute to an increase in the greenhouse effect. Energy consumption may be reduced by using more efficient equipment or low-consumption vehicles.

Waste generation Waste generated during construction of large-scale infrastructure and engineering works can be split into two separate categories: urban waste, from logistics sites where all the support activities for the industrial production are carried out such as offices, accommodation for non-resident workers, canteens, laboratories, first aid unit and recreational facilities for the workers; and special waste deriving from the actual industrial activities. Impregilo complies with the separate waste collection requirements for its urban waste, storing it temporarily in different containers (eg, paper, plastic, glass, other) and subsequently disposing of it using authorised waste collectors. It has special containers for the temporary storage of special waste. This is disposed of at least bi-monthly, or at least annually for amounts of less than 10 mc/year, using authorised waste collectors, managed by company employee who fills out an IDENTIFICATION FORM for the transportation of this special waste as well as keeping an entry/exit ledger.

2008 Annual Report IMPREGILO Directors’ report - Part II

Noise and vibrations Noise created by special procedures (excavation, assembly, finishing works, concrete mixing plants) and the movement of operating equipment is one of the biggest factors that affects the area in which the work is taking place. In order to reduce this polluting factor, Impregilo uses machines with low noise emissions, equipped with silencers, especially when they are used near apartment buildings or production activities, in accordance with the local emission regulations. Work hours are shortened for critical situations to avoid disturbing the local community. Areas subject to the greatest noise impact are protected with noise barriers, that can be constructed or by artificial dunes made of backfill or by support structures and absorption panels, made of different types of materials. Alternatively and where possible, noise barriers may be created with one or more rows of trees or shrubs which both absorb the noise and improve the visual impact. Vibrations that propagate through the soil are another characteristic of civil engineering sites. These vibrations can damage buildings or other structures in the surrounding areas. In this case, specific work methods have to be used, with their regular and ongoing monitoring.

Landscape 78 Any infrastructure during its construction stage has some impact on the landscape, temporary altering its orography. Upon finalisation of its contracts, Impregilo restores the surrounding areas to their original conditions by shaping work, creation of agricultural land, sewing or planting. During this phase, it ensures that the surrounding areas are fully restored. All those substances or materials that could hinder plant growth are removed. In the case of contamination, the soil is reclaimed or treated or removed and subsequently restored. Our social responsibility Impregilo is fully aware that its human resources are an indispensible factor for its existence, development and success. The company is committed to developing their skills and to fostering the management team’s abilities and potential, encouraging relationships based on mutual trust so that they can meet their growth and improvement objectives.

Company management has introduced an effective internal/external communication process aimed at promoting the exchange of information about fundamentally important issues for the company’s development, such as, for example, the integrated Quality-Environment-Safety system, by:

• the internet site and, especially, the internal portal (“the Bridge”) which has information about the system (manual, procedures, instructions, etc.) and also the laws, decrees and regulations useful for performing contracts;

• institutional (financial statements, organisational instructions, operating circulars, press releases, periodic meetings) and informal (notice boards, e-mails) tools;

• periodic meetings, meetings with personnel and the ongoing dialogue with the company’s stakeholders (the market, customers, 79 supervisory bodies, contractors, suppliers, etc.);

• the Environmental report.

Since 2005, Impregilo has started a training programme to strengthen and develop internal skills in order to ensure the ongoing search for excellence in carrying out one’s duties, in performances and results. The training courses are provided to all employees with the objective of developing their technical-specialist expertise pertinent to their professional area and to build up managerial skills for each level of responsibility.

In 2008, the parent held courses for all its personnel, including those of the contractors, depending on the requirements, on health and safety issues. The general courses covered building site risks or the use of personal protective equipment while the specialised courses covered specific machinery or processing. Specifically, courses were held with the consignment of illustrative material and the release of individual certificates on:

• current safety at work and accident prevention legislation;

• fire-fighting procedures;

• first aid;

• manual load handling;

• the use of personal protective equipment.

Impregilo has been committed for many years to minimising the potential causes of accidents at work through structured, plant and organisational measures, pursuing increasingly balanced person-machine-environment interaction. Building site management analyses the technical and human reasons for accidents, assisted by the relevant doctor and the Quality, environmental and safety manager. They adopt and implement measures to prevent and protect workers and to avoid repetition of the event. The results of their findings are reported to the company’s corporate management once a year.

2008 Annual Report IMPREGILO Directors’ report - Part II

Accidents at work are analysed using statistics based on the best practice indexes as well as certain useful accident indicators, such as: • nature of the injury (eg, wound, punctures, bruising, fracture, etc.); • part of the body injured (eg, head, trunk, pelvis, eyes, etc.); • form (active, passive, environment, fall, accident); • agent (eg, machine, lifting and transportation systems, distribution systems, equipment and devices, etc.); • month in which the accident took place. Thanks to this approach and the introduction of new technologies, 2008 saw a further decrease in the probability of accidents happening at work (through its prevention measures) and the seriousness of such accidents (through its protection measures). The centralised database of most common accidents at work (frequency index = no. of accidents/no. of hours worked x 1,000,000 and seriousness index = no. of days off work/no. of hours of attendance x 1,000) showed that such indexes at 18.53 and 0.69 improved significantly on the previous year (44.39 and 1.08, respectively) and were also better than the national average. The New Consolidated act for health and safety in the workplace was enacted on 15 May 2008, introducing significant amendments to the 80 issues of health and safety in the workplace, such as the concept of manslaughter or grievous bodily harm and the administrative liability of companies pursuant to Legislative decree no. 231/01. The company has based itself on the OHSAS 18001 safety management system and has certified it.

PRIVACY AND DATA PROTECTION The group continued its actions in 2008 to ensure compliance with the current legislative requirements about the protection of personal data (Legislative decree no. 196/03, the Privacy Code). SUBSEQUENT EVENTS

Reference should be made to the section on “Non-current assets classified as held for sale and discontinued operations - USW Campania projects” for details on the events that have taken place since 31 December 2008 with respect to the USW Campania projects. In January 2009, Impregilo won the tender for the construction of a tunnel in Roveredo, in the Grigioni canton in Swizerland through its Swiss subsidiary CSC Impresa Costruzioni S.A.. The contract assigned by the Swiss Federal Roads Office (USTRA) is worth approximately Sfr 120 million (approximately euro 80 million at current exchange rates). CSC is the leader of the consortium with the Swiss companies Frutiger AG and PraderLosinger AG. Work on the 2.4-km San Fedele tunnel is the main part of the Roveredo ring road and entails the rerouting of the N13 national road which goes through the city centre to an underground route. On 4 February 2009, as part of the tests of the working of the high speed/capacity Bologna-Florence line, the international speed record for vehicles in tunnels was made by the Frecciarossa train belonging to Trenitalia S.p.A.. This was an Italian record as well. The Mestre motorway connector road was officially opened on 8 February 2009 in the presence of the heads of the state and the Veneto regional authorities, significantly earlier than scheduled and fully complying with the cost budget.

The following procedures were commenced with respect to the personnel involved in certain contracts after year end: 81 • On 22 January 2009, C.A.V.To.Mi commenced a lay-off programme pursuant to articles 24 and 4 of Legislative decree no. 223/1991 whereby 290 workers hired to construct the railway line from km 85.576 to km 124.673 are redundant (including 138 white collars and junior managers and 152 blue collars). This programme is necessary as the works are nearing completion. The procedure was wound up satisfactorily on 12 February 2009 with the signing of an agreement with the trade unions in which the parties also agreed that the number of redundant workers had been decreased to 287 (151 blue collars and 136 white collars) following the dismissals handed in during the period. • As part of a far-reaching organisational and production overhaul of the individual companies set up to carry out the upgrading of the Salerno Reggio Calabria motorway, with a letter dated 14 January 2009, the Scilla consortium commenced a lay-off programme due to the ceasing of business activities for 625 workers (159 white collars and junior managers and 466 blue collars) at the maxi lot V and VI building sites. Following the request of 20 January 2009 received from the trade unions of Reggio Calabria, a preliminary meeting was held at the offices of the Reggio Calabria trade association on 29 January 2009. The parties agreed to defer their joint review of the situation to 16 February 2009 when the national and regional secretaries would be present. Moreover, the group restructured certain operating companies due to the worsening of the generalised crisis that has hit both the Italian and international markets. The main group companies involved are: • With its letter of 12 January 2009, SGF Inc S.p.A. commenced a trade union negotiation procedure following the request to integrate salaries on an exceptional basis. The reasons why the company has resorted to this type of welfare support provision is due to its (structural) crisis, which has been going on for more than two years and is due to the finalising of its main contracts and non-acquisition of new ones. Following the communication to the parties from the Ministry for Labour for the completion of the legally-required trade union negotiations, an agreement was signed by the company and the trade unions on 28 January 2009 whereby the company may lay off a maximum of 73 workers from 9 February 2009 on a temporary basis.

2008 Annual Report IMPREGILO Directors’ report - Part II

• To resolve its serious financial and economic difficulties, which have been going on for nearly two years, FISIA Italimpianti S.p.A. has decided to discontinue and dismantle, where possible, all the activities performed by its Environment division and to restructure its Desalination division and Staff structure. Accordingly, with a letter dated 2 February 2009, it commenced a lay-off programme for 136 employees (108 white collars and junior managers and 28 blue collars), located at the different production sites in Italy. On 11 February 2009, following the trade unions’ request, a joint appraisal of the reasons which led to the excess employees took place. This meeting had an interlocutary result and the parties have agreed to update their appraisal on 19 March 2009 after subsequent meetings. Following the proceedings initiated by the Public Prosecutor before the Court of Monza for crimes covered by articles 81 and 110 of the Penal Code and articles 2621 and 2637 of the Italian Civil Code, in which the former chairman of the board of directors and the former CEO of Impregilo at the time of the alleged crimes are under investigation, Impregilo S.p.A. and Imprepar in liquidation were subjected to a preliminary investigation relating to an alleged administrative violation in relation to the crimes covered by articles 25/ter, letters a) and r), points 5 and 44 of Legislative decree no 231/2001. On 13 February 2009, the Judge for the Preliminary Investigation of Milan partly accepted the request for the filing of all the charges made by the Milan Public Prosecutor. The Judge ordered the deferral of the acts to the Public Prosecutor for the preparation of charges for the part of the appeal which was not allowed.

82 As described in previous reports and earlier in this document, as part of a number of disputes that the Tuscan judicial authorities had raised against C.A.V.E.T. and certain directors and managers of the consortium in connection with the Bologna-Florence high speed/capacity railway works, penal proceedings nos. 10221/99 and 4923/00 RGNR were commenced in previous years followed by other proceedings. The main charges raised against the consortium included, inter alia: - water theft from the water bed during excavation of the tunnels and subsequent use of such water during construction; - impoverishing and damaging of surface and underground water sources; - illegal traffic of toxic waste during the elimination of soil, rocks and mud which the consortium had treated as if such materials were not “waste”. Following the final hearing for the first level proceeding on 3 March 2009, the Court of Florence cleared the defendants from all claims about the damaging and impoverishing of the water bed, deferred the acts to the Constitutional Court for the “water theft” and found the defendants guilty of the waste management issue. The Court deferred quantification of the compensation to be paid to the civil parties to a separate civil judge and ordered the payment of a “provisional” sum to the Ministry for the Environment, the Tuscan Regional Authorities and the Florence Municipal Authorities of euro 50 million each, plus other amounts to the other civil parties for a total approximate euro 0.2 million. As part of this ruling, additional interdictive sanctions were approved for the individuals involved. These will only be effective if, after finalisation of the other stages of the proceedings, the final ruling is not changed. Application of the Court’s rulings about the “provisional” sums is subject to the lodging of the grounds for the ruling, to take place before 90 days from the date of publication of the ruling, as provided for by the Court. This time limit is the same as that for presentation of an appeal by the consortium, which will include appeals for the suspension of the “provisional” sums. These sums do not represent a calculation of the damage either in terms of an estimate or accurate calculation thereof, but are to protect the civil parties which cannot however consider them as definitively obtained unless a final penal ruling is issued after which an independent civil hearing would have to take place to quantify the damage. At the date of preparation of this report, it is not possible to determine either the amount of the alleged damage to third parties or when any damages will be paid as the ruling would only be valid after hearings at all three levels have been held. The consortium’s lawyers agree with it that its correct conduct can be clearly demonstrated in the appeal hearing. They are confident that the sentence will be substantially changed, including with respect to the negative charges made by the first level hearing. OUTLOOK The group’s order backlog, results for the year and its strong international presence all represent a solid base to build on to strengthen its business activities, despite the domestic and international financial and economic situation which does not show signs of changing. The group believes that it will continue to have a positive operating profitability ratio (R.o.S.) for 2009, better than that of 2008, notwithstanding the slight downturn in production volumes. The group has a solid, balanced financial position despite the generalised credit crunch and the significant reduction in liquidity in circulation, which is an issue currently being addressed by the European and international monetary authorities in order to limit the potential deflationary effects that are a direct result thereof. The group’s financial stability is a strong competitive advantage and represents the foundation upon which its strategies can be built. The complex legal and operating situation in which the group finds itself due to the USW Campania projects and the high speed/capacity contracts will continue to be critical. The group cannot exclude that events may take place in the future that are not currently foreseeable which would require changes to be made to the valuations formulated to date. At present and excluding any events or circumstances that cannot currently be foreseen, the group does not expect to encounter difficulties in achieving positive results for 2009 for both the group and the parent. 83

2008 Annual Report IMPREGILO Directors’ report - Part II

OTHER INFORMATION

Treasury shares At the date this report was prepared, the parent did not hold any treasury shares either directly or indirectly.

Company bodies In their meeting of 7 May 2008, the shareholders appointed new boards of directors and statutory auditors for the parent. They have a term of office of three years, ie until approval of the financial statements at 31 December 2010. The members of the new boards are presented in the section entitled “Company officers”.

Judicial investigations - Court of Monza Following the proceedings initiated by the Public Prosecutor before the Court of Monza for crimes covered by articles 81 and 110 of the Penal Code and articles 2621 and 2637 of the Italian Civil Code, in which the former chairman of the board of directors and the former CEO of Impregilo at the time of the alleged crimes are under investigation, Impregilo S.p.A. and Imprepar in liquidation were subjected to a preliminary investigation relating to an alleged administrative violation in relation to the crimes pursuant to points 5 and 44, letters a) and r), articles 25- 84 ter of Legislative decree no. 231/2001. The Public Prosecutor notified the company of the allegations against its former chairman and former CEO on 13 October 2005. The allegation is that the company “prepared and implemented an organisation model not suitable to prevent the crimes” that the directors under investigation allegedly committed and from which it benefited. On 6 December 2005, Impregilo received notice that the preliminary investigations were completed, in accordance with article 415-bis of the Criminal Procedural Code. Subsequently, it was notified in a registered letter of 21 February 2006 that a preliminary hearing had been set in accordance with article 419 of the Criminal Procedural Code for 3 April 2006. Impregilo disputed the above allegations, lodging an in-depth brief with the court through its lawyer.The brief was prepared with the assistance of technical experts. On 24 April 2006, the Judge for the Preliminary Investigation of the Court of Monza issued a judgement stating that the court did not have territorial jurisdiction for the case and requested that the acts be sent to the Public Prosecutor with the Court of Milan. The Public Prosecutor with the Court of Monza appealed against this judgement with the Supreme Court: the related hearing was fixed for 23 April 2007 when the Supreme Court rejected the appeal made by the Monza Public Prosecutor and confirmed the Milan court’s jurisdiction to hear the case. In July 2006, the Judge for the Preliminary Hearing at the Court of Milan communicated the date for the new preliminary hearing which was held on 20 October 2006. During the hearing of 12 January 2007, the Judge denied the jurisdictional pleas. On 21 February 2007, the Judge for the Preliminary Hearing of Milan ruled during the related hearing that the former chairman of the board of directors and former CEO of Impregilo should be committed for trial for all the alleged crimes charged to them and also Impregilo S.p.A. and Imprepar in liquidation pursuant to Legislative decree no. 231/01. The Court of Milan ruled on a preliminary basis in the hearing of 12 July 2007 “the invalidity of the ruling issued by the Judge for the Preliminary Hearing at the Court of Milan on 21 February 2007 in the hearing pursuant to article 416 of the Criminal Procedural Code”, accepting the related objections that the defence counsel of the defendants and companies involved in the case had raised since the preliminary hearing. Thus, the Court ordered that the acts were to be returned to the Milan Public Prosecutor’s office. The Milan Public Prosecutor re-opened the proceeding and presented the Judge for the Preliminary Hearing with a request for its filing in November. On 13 February 2009, the Judge for the Preliminary Hearing accepted the Public Prosecutor’s request for a part of the charges and ordered the filing, while it deferred the acts to the Public Prosecutor for the preparation of the charges for the part of the request which was not accepted.

Judicial investigations – Court of Naples Reference should be made to the section on “Non-current assets classified as held for sale and discontinued operations - USW Campania projects” for details on the events that have taken place with respect to the USW Campania projects.

Compliance with the conditions of article 36 of the Stock Exchange Regulation Impregilo confirms that it complies with the conditions of article 36 of Consob regulation no. 16191 (“Regulation on markets”), based on the procedures adopted before article 36 was effective and the availability of the related information. 85

Investments held by directors, statutory auditors, general managers and key managers With respect to the disclosures required by article 79 of Consob resolution no. 11971/99, the following table sets out the investments in Impregilo S.p.A. and its subsidiaries held by the directors, statutory auditors and key managers, directly or via subsidiaries, trustees or nominees, at 31 December 2008 as shown in the shareholder register, communications received and other information acquired from the directors and statutory auditors.

Name Company No. of shares No. of shares No. of shares No. of shares held at end purchased sold held at of previous year end year Cavenenghi Alfredo Impregilo S.p.A. 15,000 15,000 Talarico Antonio Impregilo S.p.A. 60,000 60,000

Related party transactions Note 17 to the consolidated financial statements and note 15 to the separate financial statements of Impregilo S.p.A. give details of and the amounts involved in related party transactions, as defined by IAS 24.

Research and development Pursuant to article 2428 of the Italian Civil Code, we note that the group did not undertake any research and development activities during the year.

2008 Annual Report IMPREGILO Directors’ report - Part II

Alternative performance indicators As required by Consob communication no. 6064293 of 28 July 2006, details of the performance indicators used in this report and in the group’s institutional communications are given below.

Financial ratios: Debt/equity ratio: this ratio shows net financial position (shown with a minus sign when negative, ie, net financial indebtedness) as the numerator and equity as the denominator. The balance sheet items (both consolidated and separate) making up the financial position are given in the related schedules and highlighted with an asterisk (*). The equity items are those included in the relevant section of the balance sheet. For consolidation purposes, equity used for this ratio also includes that attributable to minority interests.

Performance ratios: 1. EBITDA or Gross operating profit: this shows the sum of the following items included in the income statement: a. Total revenue 86 b. Total costs, less amortisation and depreciation. The breakdown of the item “Amortisation, depreciation, provisions and impairment losses” of the income statement is given in the notes.

This can also be shown as the ratio of EBITDA to total revenue. 2. EBIT or Operating profit: the operating profit given in the income statement, being the sum of total revenue and total costs. 3. Return on sales or R.o.S.: given as a percentage, shows the ratio of EBIT (as calculated above) to total revenue.

As required by the above communication, the reconciliation of the parent’s equity and profit for the year with the relevant consolidated figures is given in the notes. CORPORATE GOVERNANCE REPORT 87 pursuant to article 124-bis of the Consolidated Finance Act, article 89-bis of the Consob Issuer Regulation and article IA.2.6 of the Instructions to the Stock Exchange Regulation (traditional administration and control model)

Issuer: Impregilo S.p.A. website: www.impregilo.it Year to which the report refers: 2008 Report date of approval: 25 March 2009

2008 Annual Report IMPREGILO Corporate governance report

1. ISSUER PROFILE The corporate governance structure adopted by Impregilo S.p.A. (the “Issuer” or the “company”) is based on the guidelines set out in the Code of Conduct adopted by the Committee for Corporate Governance of Listed Companies (the “Code”) as it holds that adoption of a structured governance system allows the company to operate at maximum efficiency conditions and also ensures growing levels of transparency which increases investors’ confidence in it. Impregilo is currently the leading general contractor in Italy and one of the most important general construction groups internationally.Thanks to its business and organisational skills, technical and financial expertise, risk management abilities, time and cost optimisation capacity, the group has an unrivalled wealth of expertise and skills which enables it to play a leadership role in the civil engineering large-scale works market and large-scale infrastructure and plant construction business. This report’s scope is to illustrate the parent’s corporate governance model and provide a brief description of how it has been implemented. It is based on the specially designed experimental model prepared by Borsa Italiana S.p.A..

2. INFORMATION ON THE SHAREHOLDING STRUCTURE 88 (pursuant to article 123-bis of the Consolidated Finance Act) at 25 March 2009

a) Share capital structure Subscribed and paid-up share capital in Euros: 718,364,456.72 Share categories: ordinary and savings. In their extraordinary meeting of 12 October 2004, the shareholders eliminated the nominal value of both classes of shares.

No. of shares % of share capital Stock exchange Ordinary shares 402,457,937 99.60 MTA Savings shares 1,615,491 0.40 MTA

To date, Impregilo S.p.A. has not issued other financial instruments that give the right to subscribe newly issued shares. On 7 July 2005, the company’s board of directors (the “board”) approved a stock option plan. This plan has its basis in the company’s intention to create a tool to motivate and encourage the loyalty of its top management and other managers and those of its subsidiaries. It was approved by the shareholders in their extraordinary meeting of 26 September 2005. The plan is still in place due to the following resolution taken by the shareholders whereby: - the board of directors are given the possibility, under paragraphs 1 and 2, article 2443 of the Italian Civil Code, to increase the share capital against consideration, in one or more instalments, within 36 months from the date of publication of the 2006 half year report, by a maximum of euro 501,180.36 by issuing ordinary shares up to a maximum of 1% of the outstanding shares, with regular dividend rights, to be offered for subscription, excluding the options for the shareholders, pursuant to the last paragraph, article 2441 of the Italian Civil Code and paragraph 2, article 134 of Legislative decree no. 58 of 24 February 1998 to the employees of the company and its subsidiaries under point 1, paragraph 1, article 2359 of the Italian Civil Code. These employees are the beneficiaries of the plan and are identified by the board of directors on the basis of objective assessments and in the interests of the company. The board of directors has the widest powers to determine the number of options to be assigned and the related timing, the procedure for assigning and exercising the options, setting the issue price and maximum number of new shares to be allocated to the beneficiaries, to the extent of its proxies and in accordance with the law. The shares will be offered for subscription at a unit price equal to the market price (as defined by tax legislation) on the dates of the related resolutions of the board of directors about the share capital increases. To date, the board of directors has not executed the mandate to increase share capital. The stock option plan included a part reserved for the then CEO of Impregilo S.p.A., Alberto Lina, for a maximum euro 7,089,960.72, by issuing a maximum of 3,983,124 ordinary shares, with regular dividend rights, for a total unit price of euro 3.023, including euro 1.243 as a premium. During 2008, Mr. Lina exercised his options subscribing 983,124 ordinary shares. b) Share transfer restrictions Impregilo S.p.A. does not have any restrictions on share transfers.

89 c) Significant investments in share capital Based on the statements made in accordance with article 120 of the Consolidated Finance Act, shareholders with investments of more than 2% in the Issuer’s ordinary share capital are currently:

Declarant Direct shareholder, if different to the declarant % of ordinary shares IGLI S.p.A. 29.476 FMR LLC 4.853 ASSICURAZIONI GENERALI S.p.A. ASSICURAZIONI GENERALI S.p.A. and subsidiaries (*) 3.249

(*) Agricola San Giorgio S.p.A. (15,000 shares), Augusta Assicurazioni S.p.A. (1,317,366 shares), Augusta Vita S.p.A. (722,681 shares), Fata Assicurazioni Danni S.p.A. (100,000 shares), Genagricola – Generali Agricoltura S.p.A. (15,000 shares), Generali Horizon B.V. (2,400,000 shares), Inf – Società Agricola S.p.A. (15,000 shares), Toro Assicurazioni S.p.A. (1,219,571 shares). d) Shares that give special rights Impregilo S.p.A. has not issued shares that give special rights. e) Employee involvement in share capital: voting rights exercise mechanism Impregilo S.p.A. does not have a plan whereby its employees are involved in its share capital. f) Restrictions on voting rights Impregilo S.p.A. does not have any restrictions on voting rights.

2008 Annual Report IMPREGILO Corporate governance report

g) Shareholder agreements The Issuer is aware of the following shareholder agreements, considered to be material under article 122 of Legislative decree no. 58 of 24 February 1998: - shareholder agreement between TeSir S.r.l. on the one side and Argo Finanziaria S.p.A., Autostrade per l’Italia S.p.A. and Immobiliare Lombarda S.p.A. on the other related to Igli S.p.A. and Impregilo S.p.A.; - shareholder agreement between Argo Finanziaria S.p.A., Autostrade per l’Italia S.p.A. and Immobiliare Lombarda S.p.A. related to Igli S.p.A. and Impregilo S.p.A.. Abstracts of the above agreements, made public as required by article 122 of Legislative decree no. 58 of 24 February 1998 and article 129 of Consob resolution no. 11971/99, as subsequently amended, are given in an annex to this report.

h) Appointment and replacement of directors and changes to the by-laws Article 20) of the Issuer’s by-laws states that “the company is run by a board consisting of fifteen members. Those candidates that meet the requirements set by the legislation and regulations in force at the time of their appointment may accept such 90 appointment. Directors are elected using lists presented by the shareholders (using the methods described below) in which the candidates are set out in consecutive order. In order to be valid, each list includes at least two candidates that meet the independence requirements established by law. They are shown separately and one of the two heads the list. The lists are deposited at the Issuer’s registered office at least fifteen days before the date of the shareholders’ meeting, as detailed in the notice calling the meeting. Shareholders, shareholders forming part of significant shareholder agreements as per article 122 of Legislative decree no 58/1998, the parent, subsidiaries and jointly controlled entities as per article 93 of Legislative decree no. 58/1998 may not present, or be involved in presenting (also via trustees or nominees), more than one list. Nor can they vote (also via trustees or nominees) for more than one list. Moreover, each candidate may only be present in one list in order to be eligible. Inclusion in more than one list or votes for more than one list is/are not counted. Only those shareholders that, either individually or together with other shareholders, own shares making up at least 2% of the share capital with voting rights at ordinary meetings (or a smaller percentage set by mandatory legislative or regulatory instructions), may present lists. Together with each list and within the timeframe described earlier, the shareholders deposit: (i) the relevant certificate issued by a legally- authorised broker showing ownership to the number of shares necessary to present lists; (ii) statements whereby each candidate accepts their candidature and states, under their own responsibility, the inexistence of any reasons for ineligibility or incompatibility and the existence of the requirements for the relevant offices; (iii) a professional and personal profile of each candidate and mention of whether they qualify as independent and any offices held as director or statutory auditor in other companies; and (iv) any other information that is requested in the notice calling the shareholders’ meeting and required by the applicable law or regulations. Lists which are presented that do not meet the above requirements are considered not to have been presented. The following procedure is carried out to elect the directors: a) when there is at least one list that has received votes making up at least 29% of the share capital with voting rights at ordinary shareholders’ meetings, the 14 directors to be appointed are taken from the list which got the most votes in the order in which they are set out in the list while the other director is taken from the list presented by minority shareholders that got the most votes and is not linked in any way (directly or indirectly) to the shareholders that presented or voted for the list that got the most votes. Should the first two lists have received the same number of votes, seven directors are taken from each one in the order in which they are set out therein while one director is taken from the list that came third in terms of the votes received and is not linked in any way (directly or indirectly) to the shareholders that presented or voted for the lists that got the most votes. If only two lists are presented, the fifteenth director is the oldest candidate from those not taken from the first two lists; b) if none of the lists gets votes equal to at least 29% of the share capital with voting rights at ordinary shareholders’ meetings, the 15 directors are taken from all the lists presented as follows: the votes obtained by the lists are divided by entire numbers from one to 15. The resulting scores are assigned to the candidates of each list in consecutive order using the order in which they are included in the lists. The candidates are then included in a single decreasing order list, based on the scores given to each one. Those with the highest 91 score are elected. If more than one candidate has the same score, the one from the list that has not had any director elected from it or has had the smallest number of directors elected is taken. Lists that do not obtain a vote percentage equal to at least half that set by the by-laws for the presentation of lists are not considered. Should no lists be presented or those presented not be accepted for voting purposes, the shareholders use the majority vote system, without considering the above procedure, while ensuring the necessary number of directors with the independence requirements set by law. The list voting procedure is only used when an entire board is being appointed. Should one or more directors leave their position during the year, in order to ensure that the majority of the board is always made up of directors appointed by the shareholders, the board of directors replaces them pursuant to article 2386 of the Italian Civil Code, appointing candidates from the list to which the former director belonged, in consecutive order, and whom are still eligible and willing to accept the position. Directors who have left office are always replaced considering the minimum number of directors with the independence characteristics required by law. If there is no longer a majority, the remaining directors also fall from office with effect from when the board is re-elected by the shareholders”. i) Mandates to increase share capital and to repurchase treasury shares As noted in letter a, paragraph 2, the board of directors is authorised to increase the share capital for the purposes of the stock option plan described in that paragraph. The shareholders have not authorised the repurchase of treasury shares. l) Change of control clause The Issuer is not controlled by another entity.

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m) Compensation for directors in the case of their resignation, dismissal, retirement or termination of the relationship following a public purchase offer The Issuer does not have agreements with its directors for their compensation in the case of their resignation, dismissal, retirement, removal from office without just cause or termination of the relationship following a public purchase offer.

3. COMPLIANCE - Impregilo S.p.A. has complied with the requirements of the original version of the Code of Conduct issued by the Committee for Corporate Governance of Borsa Italiana S.p.A. and the subsequent version published in July 2002. Following publication of the new Code of Conduct in March 2006 by the above Committee, the Issuer’s board of directors’ meeting of 20 December 2006 resolved to request the internal control committee to perform an in-depth comparative analysis of the company’s corporate governance structure compared to the Code requirements and to provide the board with its assessments, opinions and proposals about alignment with the Code and necessary actions. Based on such analysis and proposals, the board meeting of 12 March 2007 resolved to comply with the Code of Conduct drawn up by 92 the Committee for corporate governance of Borsa Italiana S.p.A. (March 2006 version) with the exceptions set out below. Specifically, in order to align its corporate governance structure with the standards and criteria of the Code, the Board of Director resolved: • with respect to letter b) of criterion 1.C.1, to classify Fisia Italimpianti S.p.A., Impregilo International Infrastructures N.V. and Primav Ecorodovias S.A. as “strategic subsidiaries”; to assess the organisational, administrative and general ledger structure of the Issuer and strategic subsidiaries Impregilo International Infrastructures N.V. and Primav Ecorodovias S.A., setting measures to be adopted for Fisia Italimpianti S.p.A.’s organisational structure; • with respect to letter f) of criterion 1.C.1., to adopt the rules described in paragraph 5.2 of this report; • with respect to letter g) of criterion 1.C.1., to perform once a year, during the meeting held to approve the financial statements, an assessment of the size, composition and working of the board of directors itself and its committees; • with respect to criterion 1.C.3., to adopt the rules described in paragraph 5.1 of this report; • with respect to criterion 2.C.1., to confirm the previous assessment stated in the board meeting of 7 July 2005 and, therefore, consider the directors members of the executive committee as non-executive, given that current participation in this committee, considering the frequency of the meetings and subject of the related resolutions, does not entail the systematic involvement of its members in the day-to-day management of the company nor does it lead to a significant increase in their remuneration compared to that received by the other non-executive directors; and, therefore, only the CEO qualifies as an executive director; • with respect to criterion 2.C.2., as proposed by the chairman, that the relevant internal functions provide all the directors and statutory auditors with access to the company’s intranet site to allow their direct access to the documentation and information posted thereon; and to organise their involvement in the training course on the Organisation, management and control model; • with respect to criterion 3.C.4., to generally comply with the requirements set by the Code about directors’ independence and that any non-compliance therewith should be justified; • with respect to criterion 3.C.5., that the outcome of the controls performed to check the correct application of the criteria and procedures put in place by the board to assess the independence of its members be communicated by the board of statutory auditors to the market in its report to the shareholders. The board of statutory auditors stated that it approves of this resolution during the board meeting; • with respect to criterion 3.C.6., that the independent directors meet annually, before the board meeting held to approve the financial statements, for self-assessment purposes, including examination of any remedial action to be taken, to assess the role played by independent directors within the board; they will report to the board on their findings; • with respect to criterion 4.C.1., to approve a specific “Procedure for the internal management and external communication of documents and information” to replace the “Internal regulations for disclosing “price sensitive” documents and information to the market”, approved by the board of directors on 27 March 2001, as described in paragraph 6 of this report; • with respect to letter c) of criterion 5.C.1. , to make available to the internal control and remuneration committees an annual budget of euro 25,000 per committee to be used for any necessary consultancy or other services to carry out their duties. The prior authorisation of outlays is not necessary although the committees are required to document their expenses. They may also avail of internal information and personnel; • with respect to standard 6.P.2., not to set up an appointment committee as, to date, the shareholders have not encountered difficulties in proposing suitable candidates (and no such difficulties are envisaged) such that the composition of the board of directors 93 complies with that recommended by the Code; • with respect to criterion 6.C.1., to comply with the criterion proposing the related change in the by-laws to the shareholders in their extraordinary meeting; the shareholders actually resolved to change the by-laws in their extraordinary meeting of 27 June 2007, as described in paragraph 14 of this report. • with respect to criterion 7.C.3., to assign the duties as per such criterion to the remuneration committee; and that this committee will appoint a chairman from among its members and draw up new rules for its working; • with respect to standard 8.P.4., to ensure that, based on the information provided by the members of the internal control committee, all the members have proper accounting and financial experience; • with respect to letter a) of criterion 8.C.1., considering changes in legislation over time and in the organisational structure, to postpone the procedure, and, when and if necessary, to update the “Guidelines for internal control policies” approved by the board of directors on 21 March 2000 with the assistance of the internal control committee; • with respect to letter b) of criterion 8.C.1., to nominate the CEO as the “Executive director in charge of internal controls”; • with respect to the last paragraph of criterion 8.C.1., to set the remuneration of the internal control supervisor after consulting the internal control committee and upon the proposal of the CEO, as the Executive director in charge of internal controls; • with respect to criteria 8.C.1. and 8.C.3., to give the internal control committee the duties and functions set out in letters a), b), c), f) and g) of criterion 8.C.3 and those in criteria 8.C.1 and 9.C.1.; moreover, considering the positive opinion of the board of statutory auditors (reiterated by the present statutory auditors in their meeting of 7 May 2008), to assign it the duties and functions set out in letters d) and e) of criterion 8.C.3. without altering the fact that, the board of statutory auditors will have to carry out such duties and functions in compliance with the methods that allow the board of directors to review its work which should be made available on a timely basis; that the committee will appoint a chairman from among its members and will draw up operating rules; that the committee will meet at least four times a year and always when the annual, half year and quarterly reports are being approved;

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• with respect to criterion 8.C.5., to give the “Executive director in charge of internal controls” the duties and functions set out in such criterion; • with respect to criterion 8.C.6., to define the duties of the internal control supervisor in line with such criterion; and that this person also reports to the CEO as the “Executive director in charge of internal controls”; • with respect to criterion 9.C.1., given the recent changes in the company’s shareholding structure, to postpone adoption of the new “Guidelines for transactions with related parties”; the board of directors’ resolutions will be taken also considering the ongoing consultations with Consob on the regulation to be issued to implement article 2391-bis of the Italian Civil Code on related party transactions; • with respect to criterion 9.C.2., that, subject to the provisions of article 2391 of the Italian Civil Code, directors with interests, either directly or on behalf of third parties, in a corporate transaction to be approved by the board of directors or executive committee may participate in the related discussions and vote thereon as such participation represents a reason for taking a responsible decision about a transaction about which the director may have greater knowledge than the other directors; that, however, the board of directors or executive committee may ask such directors to leave the meeting during the discussion on a case-by-case basis; 94 • with respect to standard 10.P.3. and criteria 10.C.6. and 10.C.7., to adopt the “Guidelines for relations with the board of statutory auditors” after the latter’s approval, available on the internet site www.impregilo.it, in the “Investor Relations – Corporate Governance – Corporate documents” section; • with respect to criterion 10.C.7., to propose to the shareholders, in an extraordinary meeting, that the lists of candidate statutory auditors are to be deposited at the company’s registered office at least fifteen (rather than ten, as currently provided for) days before the date set for the meeting; in their extraordinary meeting of 27 June 2007, the shareholders actually modified the by-laws as described in paragraph 15 of this report. • with respect to criterion 11.C.1., that the document explaining how shareholders may participate in shareholders’ meetings will be published and posted on the internet site www.impregilo.it, in the “Investor Relations - Corporate Governance - Corporate documents” section. • to note that the company’s corporate governance system already complies with the other provisions of the Code.

- Impregilo S.p.A. and its strategic subsidiaries are not subject to non-Italian legislation that would affect the Issuer’s corporate governance structure.

4. MANAGEMENT AND COORDINATION The company is not managed or coordinated by other companies or entities. 5. BOARD OF DIRECTORS 5.1. COMPOSITION

Composition of the current board at year end and other information

Name Position In office List Executive Non- Indep- Ind. as % BoD Other since Executive endent per Cons. positions Finance Act Massimo Ponzellini Chairman 7.5.2008 SOLE X 100 3 Giovanni Castellucci Deputy chairman 7.5.2008 SOLE X 55.55 8 Antonio Talarico Deputy chairman 7.5.2008 SOLE X 100 11 Alberto Rubegni CEO 7.5.2008 SOLE X 100 0 Carlo Buora Director 7.5.2008 SOLE X X X 100 2 Alfredo Cavanenghi Director 7.5.2008 SOLE X X X 100 12 OFF LIST Claudio Cominelli Director 7.5.2008 APPOINTMENT (I) X X X 100 4 95 Nicola Fallica Director 7.5.2008 SOLE X 100 2 Beniamino Gavio Director 7.5.2008 SOLE X 77.77 8 Marcello Gavio Director 7.5.2008 SOLE X 88.88 6 Giancarlo Guenzi Director 7.5.2008 SOLE X 77.77 3 Maurizio Maresca Director 7.5.2008 SOLE X X X 77.77 1 Andrea Novarese Director 7.5.2008 SOLE X 100 16 Giuseppe Piaggio Director 7.5.2008 SOLE X 77.77 5 Alberto Sacchi Director 7.5.2008 SOLE X 100 9

(I) In their meeting of 7 May 2008, the shareholders appointed a new board of directors for three years until the meeting to be held to approve the financial statements as at 31 December 2010, based on the sole list presented by the shareholder Igli S.p.A. and a nomination (for Claudio Cominelli) made during the meeting by Generali group.

KEY Position: shows whether chairman, deputy chairman, CEO, etc. List: shows M/m depending on whether director has been appointed from the list voted by the majority or minority shareholders (article 144-decies of the Consob Issuer Regulation) Executive: “x” in this column if director qualifies as executive Non-executive: “x” in this column if director qualifies as non-executive Independent: “x” in this column if director qualifies as independent in line with the Code criteria, specifying if these criteria have been integrated or modified at the end of the table (see section 5.5 of this table) Ind. as per Cons. Finance Act: “x” in this column if director qualifies as independent as per paragraph 3, article 148 of the Consolidated Finance Act (article 144-decies of the Consob Issuer Regulation) % BoD: attendance at board meetings as a percentage (when percentage is calculated, number of meetings which director attended compared to total number of meetings held during the year or after the director was appointed) is considered Other positions: total number of positions held in other companies listed on regulated markets (also foreign), in financial companies, banks, insurance companies or significant size companies, identified in accordance with Consob criteria. A list of these companies is attached to this report for each director, showing whether the company in which they hold the position is part of the Issuer’s group.

2008 Annual Report IMPREGILO Corporate governance report

Composition of the board committees at year end

Name Position EC %EC AC % AC RC % RC ICC % ICC Massimo Ponzellini Chairman C 100 Carlo Buora Director M 100 Alfredo Cavanenghi Director M 100 C 100 Claudio Cominelli Director M 100 Maurizio Maresca Director M 50 M 87.50 Nicola Fallica Director M 100 Alberto Rubegni CEO C 100 Giovanni Castellucci Director M 16.66 Antonio Talarico Director M 100 Beniamino Gavio Director M 66.66 Andrea Novarese Director M 100 96 Giuseppe Piaggio Director M 100

KEY EC: Executive committee; C/M stands for either chairman or member of the committee. % EC: shows the attendance, as a percentage, of the director at executive committee meetings (when percentage is calculated, number of meetings which director attended compared to total number of meetings held during the year or after the director was appointed is considered) AP: appointment committee; P/M stands for either chairman or member of the committee % AP: shows the attendance, as a percentage, of the director at executive committee meetings (when percentage is calculated, number of meetings which director attended compared to total number of meetings held during the year or after the director was appointed is considered) RC: C/M stands for either chairman or member of the committee % RC: shows the attendance, as a percentage, of the director at executive committee meetings (when percentage is calculated, number of meetings which director attended compared to total number of meetings held during the year or after the director was appointed is considered) ICC: C/M stands for either chairman or member of the committee % ICC: shows the attendance, as a percentage of the director at executive committee meetings (when percentage is calculated, number of meetings which director attended compared to total number of meetings held during the year or after the director was appointed is considered)

- There have not been any changes in the board or its committees since year end.

Directors that left office during the year

Name Position In office List Executive Non- Indep- % Other from / to executive endent BoD positions Andrea Gardelli Director 3.5.07 - 7.5.08 SOLE X X 100 2 Maximum number of positions held in other companies • In its meeting of 12 December 2007, the board resolved to adopt a specific rule: “Whereas for the purposes of this rule, “companies of significant size” are: a. Italian companies listed on Italian or other EU state regulated markets; b. banks, financial brokers pursuant to article 107 of Legislative decree no. 385 of 1 September 1993, stock brokerage companies pursuant to letter e), paragraph 1, article 1 of the Consolidated Act, variable capital investments companies (OEICs) pursuant to letter i), paragraph 1, article 1 of the Consolidated Act, fund management companies pursuant to letter o), paragraph 1, article 1 of the Consolidated Act, insurance companies pursuant to letters s), t) and u), paragraph 1, article 1 of Legislative decree no. 209 of 7 September 2005 set up as companies as per paragraphs V,VI and VII, section V, chapter V of the Italian Civil Code not listed on Italian or EU state regulated markets; c. companies as per paragraphs V,VI and VII, section V, chapter V of the Italian Civil Code that individually or collectively at group level, if they prepare consolidated financial statements, show: i) revenue from goods and services of more than euro 500 million; or ii) assets of more than euro 800 million, not listed on Italian or other EU state regulated markets. 97 the maximum number of positions that Impregilo directors may hold is: Executive directors The maximum number of positions as director or statutory auditor in other significant size companies cannot exceed four.

Non-executive directors members of the executive committee The maximum number of positions as director or statutory auditor in other significant size companies cannot exceed six.

Non-executive directors who are not members of the executive committee The maximum number of positions as director or statutory auditor in other significant size companies cannot exceed eight.

In order to calculate the number of positions: • positions in companies that are directly and/or indirectly controlled by Impregilo S.p.A., are its parents or subject to joint control are not considered; • positions as substitute statutory auditor are not considered; • positions held in significant size companies belonging to the same group which is not that of the Issuer are considered to have the following “weight”: - first position: one - second position: one and a half - from three up: two.

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Should a director be offered new positions that would lead to their exceeding the above ceilings, they shall inform the board promptly of this so that the board can grant waivers (also temporary) to the maximum number of positions set in this rule. The waiver shall be adequately documented. It shall be described in the company’s corporate governance report together with the reasons therefor.”

The current composition of the board complies with the above general criteria.

5.2. ROLE OF THE BOARD OF DIRECTORS Pursuant to article 24 of the by-laws (available on the internet site www.impregilo.it, in the Investor Relations - Corporate Governance - Corporate documents section), the board of directors has the widest powers for the company’s ordinary and extraordinary management with no exceptions. It has the power to perform all those actions that it deems suitable to carry out the company’s activities as per its business object or related activities, except for those actions reserved exclusively for the shareholders by law. The board of directors may resolve to set up or close branches in Italy or abroad, to decrease share capital if a shareholder withdraws therefrom, to adjust the by-laws to reflect mandatory regulatory requirements, to transfer the legal offices within Italy and to merge other wholly 98 controlled companies or companies, of which at least 90% control is held, into the parent. All of these transactions are to be carried out in accordance with articles 2505 and 2505-bis of the Italian Civil Code. By law, the directors may not remain in office for more than three years and their term of office expires at the date of the shareholders’ meeting held to approve the financial statements of the last year of their term. As not provided for otherwise in the by-laws, the directors may be re-elected. Pursuant to article 21 of the by-laws, the board of directors elects a chairman from among its members and (possibly) one or two deputy chairmen who substitute the chairman in his/her absence. Article 20 of the by-laws provides that the board of directors has 15 members.

During the year, nine board meetings were held, with an average duration of roughly an hour and 10 minutes. The 2009 financial calendar (available on the internet site www.impregilo.it, in the Investor Relations - Corporate Governance - Corporate documents section) shows that five meetings are scheduled to take place during the year, the first of which was held on 26 February 2009.

***

With respect to letter a) of criterion 1.C.1. of the Code, with which the board has resolved to comply, the board is authorised to examine and approve: • the strategic, business and financial plans of the Issuer and its group; • the Issuer’s corporate governance system; • the structure of the group headed by the Issuer.

*** - The board of directors found FISIA Italiampianti S.p.A., Impregilo International Infrastructures N.V. and Primav Ecorodovias S.A. to be “strategic subsidiaries” given their role as subholding of the core Engineering & Plant Construction business segment, as subholding of the core Concessions business segment and as the concession holding company, heading the group companies in Brazil and as one of the key Brazilian operators in the motorway segment, respectively. - With respect to letter b) of criterion 1.C.1.b) of the Code, in its meeting of 12 December 2007, the board found the organisational, administrative and accounting structure of the Issuer and its strategic subsidiaries, Impregilo International Infrastructures N.V. and Primav Ecorodovias S.A. to be adequate. The structure had been previously examined by the internal control committee which met on the same date. The board set certain measures to be adopted by FISIA Italimpianti S.p.A. for its organisational structure. In its today’s meeting, the board confirmed the adequacy for the Issuer, Impregilo International Infrastructures N.V. and Primav Ecorodovias S.A. after the internal control committee had done so. The board also took note of the action plan communicated by Fisia Italimpianti to its Supervisory Body, aimed at resolving the differences compared to the Organisation, management and control model, and found such plan to be adequate. - The shareholders approved a gross annual fee for each director of euro 20,000 in their meeting of 7 May 2008 and an attendance fee of euro 1,000 per meeting, decreased to euro 500 for attendance via audio or video link-up. They also approved the gross annual fee

for each member of the executive committee, when appointed, as an additional euro 20,000 plus an attendance fee of euro 1,000 per 99 meeting, decreased to euro 500 in the case of attendance via audio or video link-up. The board of directors set the gross annual fee for the chairman of the internal control committee of euro 15,000 and for the other members of the internal control committee at euro 10,000 on 14 May 2008 based on the proposal presented by the remuneration committee and after obtaining the favourable opinion of the board of statutory auditors. They also set the attendance fee for each member, including the chairman, of euro 500 per meeting, decreased to euro 250 for attendance via audio or video link-up. In its meeting of 14 May 2008, it fixed the gross annual fee for each member of the remuneration committee at euro 6,000 after obtaining the favourable opinion the board of statutory auditors. - In its meeting of 14 May 2008 and after consulting the remuneration committee and the board of statutory auditors, the board of directors fixed the CEO’s remuneration. On 21 July 2008, it set the remuneration of the chairman and deputy chairmen after consulting the remuneration committee for the chairman’s fees and obtaining the favourable opinion of the board of statutory auditors. - During its meetings, the board assessed the company’s performance, comparing it to the budget objectives and considering information received from the empowered bodies. - On 12 December 2007, the board of directors adopted the following rules with respect to letter f) of criterion 1.C.1. of the Code: “Without prejudice to the decisions related to resolutions to be taken by the relevant bodies of the subsidiaries, the board of directors of Impregilo S.p.A. examines, assesses and approves: a) the exercise by Impregilo S.p.A. of voting rights: (i) at extraordinary meetings of the shareholders of its strategic subsidiaries (as identified by the board of directors and currently FISIA Italimpianti S.p.A., Impregilo International Infrastructures N.V., Primav Ecorodovias S.A., hereafter the “strategic subsidiaries”); and (ii) at ordinary meetings of the shareholders of the strategic subsidiaries called to appoint their directors; b) the performance of all transactions by Impregilo S.p.A. and its subsidiaries with related parties - other than “Immaterial transactions with related parties” as per the “Guidelines for transactions with related parties” currently in force and as possibly amended;

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c) the purchase and sale by Impregilo S.p.A. of investments in companies, consortia or other entities, as well as bodies or business units; d) the group’s business plan, budget and operating plan; Without prejudice to the decisions related to resolutions to be taken by the relevant bodies of the subsidiaries, the board of directors or the executive committee of Impregilo S.p.A. examines, assesses and approves: e) the purchase and sale by its subsidiaries of investments in companies, consortia or other entities, as well as bodies or business units, for amounts of more than euro 5 million for each transaction; f) all other transactions that the board of directors of a subsidiary deems to have strategic, financial or equity importance for Impregilo S.p.A..

- With respect to letter g) of criterion 1.C.1. ) of the Code, and as resolved by the board of directors on 12 March 2007 and set out in paragraph 3 of this report, during its meeting of 25 March 2009, the board assessed the size, composition and working of the board itself and its committees, following the review of the internal control committee that met on 24 March 2009, without raising any objectives. - With respect to criterion 1.C.4., article 20 of the by-laws provides that, unless resolved otherwise by the shareholders, the directors are not bound by the ban of article 2390 of the Italian Civil Code. The board did not bring any issues thereon to the shareholders during the year.

100 5.3. EMPOWERED BODIES Chief executive officers The board of directors may delegate part of its powers to one or more directors, setting limits and proxy operating methods. It may appoint directors and agents, who do not necessarily have to be board members, and establishes their powers (article 25 of the by-laws). On 7 May 2008, the board of directors appointed Alberto Rubegni as CEO. It gave him the legal power to represent the company and signatory powers with third parties and in court. He also has powers to manage the company and may delegate responsibility for the organisation and running of certain business activities. Further to the powers reserved by law to the board of directors, it also has exclusive authority for any decisions related to: a) exercise of voting rights: (i) at extraordinary meetings of the shareholders of the strategic subsidiaries (which the board has identified as FISIA Italiampianti S.p.A., Impregilo International Infrastructures N.V. and Primav Ecorodovias S.A.); and (ii) at ordinary meetings of the shareholders of the strategic subsidiaries called to appoint their directors; b) identification of Impregilo’s strategic subsidiaries; c) approval of the business plan, budget and industrial plan; d) the performance of all transactions with related parties - other than “Immaterial transactions with related parties” as per the “Guidelines for transactions with related parties” currently in force and as possibly amended; e) the purchase and sale of investments in companies, consortia or other entities, as well as in businesses or business units.

Chairman On 7 May 2008, the board of directors gave the chairman the power to execute resolutions passed by it in addition to the legal representation of the company and signatory powers with third parties and in court as per article 28 of the by-laws. These powers are also held separately by the deputy chairman, to be exercised in the chairman’s absence. The chairman does not have special strategic decision-making powers. The chairman of the board of directors is not the CEO nor is he the majority shareholder of the Issuer. Executive committee Pursuant to article 25 of the by-laws, the board of directors may delegate all or part of its powers (not reserved to it by law) to an executive committee consisting of a number of members to be less than half that of the board, including the CEO, who acts as chairman of the executive committee. The board of directors set up an executive committee, in accordance with article 25 of the by-laws, which currently has six members. Meetings are called when necessary and a calendar does not exist. During the year, the committee met six times with meetings averaging roughly an hour and seventeen minutes. Two meetings have been held in 2009. *** The board of directors delegated all the ordinary and extraordinary administrative powers reserved to it to the executive committee, except for those powers reserved exclusively to it by law and those related to the performance of the following actions and transactions, reserved to the board: i. exercise of voting rights: (a) at extraordinary meetings of the shareholders of the strategic subsidiaries as identified each time by the board of directors; and (b) at ordinary meetings of the shareholders of the strategic subsidiaries called to appoint their directors; 101 ii. identification of Impregilo’s strategic subsidiaries; iii. approval of the business plan, budget and industrial plan; iv. “Significant transactions with related parties” as defined by the company’s board of directors in the “Guidelines for transactions with related parties” ruling from time to time; v. the purchase and sale of investments in companies, consortia or other entities, as well as in businesses or business units;

Information to be provided to the board of directors The board of directors meets at least every three months. The CEO, also as chairman of the executive committee, reported to the board and the board of statutory auditors on the activities carried out under proxy at regular intervals and whenever required by the specific circumstances.

5.4. OTHER EXECUTIVE DIRECTORS - The board of directors currently consists of one executive director (the CEO) and 14 non-executive directors. As described in paragraph 3 about criterion 2.C.1., the directors making up the executive committee are considered to be non-executive as involvement in the committee, given the frequency of the meetings and subject of the related resolutions, does not entail the systematic participation of its members in the day-to-day management of the company nor does it lead to a significant increase in their remuneration compared to that received by the other non-executive directors. - In order to increase the directors’ awareness about the company’s activities and situation, all the directors and statutory auditors have been cleared to access the company’s intranet site, thus gaining direct access to the documentation and information posted thereon. They are also included in the training about the Organisation, management and control model.

5.5. INDEPENDENT DIRECTORS At the first opportunity after their appointment and during the meeting held to approve the annual draft financial statements, the board of directors assessed that each non-executive director met the independence criteria set by the Code applying each criterion established

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thereby. The directors Carlo Buora, Alfredo Cavanenghi, Claudio Cominelli and Maurizio Maresca meet the independence requirements pursuant to both Legislative decree no. 58/98 (Consolidated act on financial intermediation) and the Code.

*** The board of statutory auditors checked the correct application of the criteria and procedures adopted to check independence by the board. The outcome of such process will be communicated by the board of statutory auditors to the market in its report to the shareholders. As resolved by the board of directors about criterion 3.C.6. of the Code in its meeting of 12 March 2007, the independent directors meet annually before the board meeting held to approve the annual financial statements for self-assessment purposes and that any remedial action to be taken be examined with respect to the role played by independent directors within the board. They met on 25 March 2009 and reported to the board on the same date.

5.6. LEAD INDEPENDENT DIRECTOR As the requirements of the Code are not met, the board has not deemed it necessary to designate an independent director as lead independent director. 102

6. TREATMENT OF COMPANY INFORMATION On 12 December 2007, the board of directors approved a special “Procedure for the internal management and external communication of documents and information” as proposed by the CEO. This procedure substituted the “Internal regulations for disclosing “price sensitive” documents and information to the market” approved by the board of directors on 27 March 2001. The Procedure includes the guidelines for the internal management and external communication of documents and information, especially privileged information as per paragraph 1, article 114 of Legislative decree no. 58 of 24 February 1998 (“Privileged information”). It covers all those parties who, based on their employment or professional activities or duties, have frequent or infrequent access to company information about the Issuer. These parties are obliged to: (i) maintain such confidential information secret; (ii) use such information solely to carry out their employment or professional activities; and (iii) not use such confidential information contrary to the current legislation. Specifically, the directors and statutory auditors of Impregilo S.p.A. and its subsidiaries are required to maintain information and documents obtained by them during the execution of their duties confidential as well as the contents of any discussions carried out during board meetings and as part of the work of the board of statutory auditors. In order to ensure a coordinated and standard approach, any contact with the press or other mass media or with financial analysts and institutional investors that involves information (even when not confidential) about the company or its subsidiaries can only take place after authorisation by the chairman or CEO or the corporate central manager of Impregilo S.p.A. or the External relations unit of Impregilo S.p.A., in accordance with the Procedure. The chairman and CEO of Impregilo S.p.A. are responsible for managing privileged information. The related administrative bodies are responsible for management of privileged information about the subsidiaries, which may be disclosed in accordance with the Procedure. Only the chairman and CEO of Impregilo S.p.A. may divulge privileged information to the market. The communication of privileged information must respect the criteria of completeness, timeliness, transparency, adequacy and continuity. Investors should be provided with the same information to avoid discontinuity or the creation of situations that could affect the listed share price. The chairman is responsible for ensuring compliance with the Procedure. It provides for penalties to be applied to the parties that violate it.

7. BOARD COMMITTEES The board of directors has set up an internal control committee and a remuneration committee.

8. APPOINTMENT COMMITTEE The board of directors deemed it unnecessary to set up an appointment committee as to date the shareholders have not encountered difficulties in proposing suitable candidates (and no such difficulties are envisaged) such that the composition of the board of directors complies with that recommended by the Code.

9. REMUNERATION COMMITEE As noted in paragraph 7 of this report, the board has set up a remuneration committee. It held two meetings during the year. 103 *** - Its members were non-executive directors, most of whom were independent, during the year. The committee currently consists of five directors, four of whom are independent. - The directors did not attend the committee meetings held to decide on their remuneration to be proposed to the board of directors. - The committee approved rules for its working which establish that all the members of the board of statutory auditors may always attend its meetings as may the CEO, other directors, managers and external consultants, upon invitation and depending on the matters on the agenda. The other directors may also participate. The relevant departments attended committee meetings during the year to discuss matters pertinent to them.

Committee duties: - In line with the resolutions passed by the board on 7 May 2008, the committee has consulting and proposing duties, specifically related to: • the presentation to the board of proposals about the remuneration of the CEOs and other directors with special positions, monitoring the decisions taken by the board; • the regular assessment of the criteria adopted for the remuneration of key managers, supervision of their application in line with the information provided by the CEOs and presentation of general recommendations to the board of directors. - During the year, the committee presented proposals to the board of directors about the remuneration of the chairman, deputy chairmen, the CEO, the members of the internal control committee and the corporate central manager.

*** - Minutes of its meetings are drawn up. - On 12 March 2007, the board of directors resolved to give the remuneration committee an annual budget of euro 25,000 to cover the costs of any necessary consultancy or other services required to carry out its duties. The prior authorisation of outlays is not necessary although the committee is required to document its expenses. It may also avail of internal information and functions.

2008 Annual Report IMPREGILO Corporate governance report

10. DIRECTORS’ REMUNERATION A large part of the CEO’s remuneration is tied to the Issuer’s results of operations as is a significant portion of the remuneration of the key managers and other managers. The company has a stock option plan, described in paragraph 2 of this report.

*** The non-executive directors’ remuneration is not tied to the Issuer’s results nor do they have share-based payment plans. The shareholders set the non-executive directors’ remuneration in their meeting of 7 May 2007, as described in paragraph 5.2 of this report, based on the proposal made by one of the shareholders. *** FEES RECEIVED BY THE DIRECTORS AND GENERAL MANAGER DURING THE YEAR Fees received by the directors and general manager (Consob resolution no. 111971 of 14 May 1999, article 78)

(Euros) 104 Name Position Fees for Fees for positions Other Total Payment of fees position positions as per fees for positions held art 2389, 3c as per art. Italian Civil Code 2389.3c pertaining to previous years Massimo Ponzellini Chairman 34,734.09 929,025.00 963,759.09 Giovanni Castellucci Deputy chairman 46,497.26 50,000.00 96,497.26 Antonio Talarico Deputy chairman 53,997.26 50,000.00 103,997.26 Alberto Rubegni CEO 54,497.26 1,254,342.46 521,370.95 (*) 1,830,210.67 Carlo Buora Director 23,892.56 23,892.56 Alfredo Cavanenghi Director 51,677.64 51,677.64 Claudio Cominelli Director 33,234.09 33,234.09 Nicola Fallica Director 42,452.93 42,452.93 Andrea Gardelli Director 8,743.17 (**) 8,743.17 Beniamino Gavio Director 51,497.26 51,497.26 Marcello Gavio Director 27,748.63 27,748.63 Giancarlo Guenzi Director 25,248.63 25,248.63 Maurizio Maresca Director 47,188.39 47,188.39 Andrea Novarese Director 54,497.26 54,497.26 Giuseppe Piaggio Director 51,997.26 51,997.26 Alberto Sacchi Director 28,748.63 28,748.63 Total 636,652.32 2,283,367.46 521,370.95 3,441,390.73 -

(*) Employee salary (**) In office until approval of the 2007 financial statements as per shareholders' resolution of 3 May 2007.

Total fees received by key managers, identified by the Code of Conduct with respect to Internal Dealing, approved by the directors on 24 March 2006 and subsequently amended and integrated, amounted to euro 2,761,130.30. Such key directors were the general manager Alberto Rubegni (who is also the CEO) and the corporate central manager Rosario Fiumara. 11. INTERNAL CONTROL COMMITTEE As noted in paragraph 7 of this report, the board has set up a remuneration committee. This committee met eight times during the year. *** It has always had three independent members, of whom at least two have adequate accounting and financial expertise. The committee approved rules for its working which establish that the chairman of the board of statutory auditors, or another statutory auditor identified by him, is involved in its duties. All the members of the board of statutory auditors and the internal control supervisor may always attend meetings as may the CEO, other directors, managers, external consultants and representatives of the independent auditors, upon invitation and depending on the matters on the agenda. The other directors may also participate. At least one statutory auditor and the internal control supervisor took part in the meetings held during the year. The relevant departments, the supervisory body and the independent auditors also attended upon invitation.

Committee duties In line with the resolutions passed by the board on 7 May 2008, with respect to criterion 8.C.3. of the Code, the committee has consulting 105 and proposing duties, specifically related to: - assessment, with the manager in charge of financial reporting and the independent auditors, of the correct application of accounting policies and their consistency for the preparation of consolidated financial statements; - expression of opinions on specific issues related to the identification of significant business risks and the design, creation and management of internal controls, upon the request of the specifically appointed executive director; - examination of the work plan drawn up by the internal control supervisors and their periodic reports; - performance of any other duties assigned by the board of directors; - reporting to the board of directors on its activities and the adequacy of internal controls in the meetings held to approve the annual and half year reports.

With respect to criterion 8.C.1. of the Code, the committee assists the board with the following duties: - definition of guidelines for internal controls so that the key risks that could affect the Issuer and its subsidiaries are correctly identified, adequately measured, managed and monitored and determination of criteria for their management in line with the proper management of the business; - identification of an executive director (usually one of the CEOs) to supervise the internal controls; - assessment at least once a year of the adequacy, efficiency and effective working of the internal controls; - description of the key elements of the internal controls in the corporate governance report, expressing its assessment on its overall adequacy.

With respect to criteria 8.C.1 and 9.C.1. of the Code, the committee also assists the board of directors with the following duties: - appointment and revocation of one or more internal control supervisors upon the proposal of the Executive director in charge of internal controls and definition of their remuneration in line with the company policies;

2008 Annual Report IMPREGILO Corporate governance report

- establishment of the methods used to approve and carry out transactions by the Issuer or its subsidiaries with related parties. Definition of specific transactions (ie, the criteria for their identification) which require prior approval by the internal control committee and/or the intervention of independent experts, as well as whenever the board of directors deems it appropriate.

On 7 May 2008, the directors, acknowledging the relevant positive opinion of the board of statutory auditors, resolved to assign it the duties and functions set out in letter d) - assessment of the engagement letter, the audit plan and findings set out in the independent auditors’ report and management letter (if any) - and letter e) - supervision of the audit effectiveness - of criterion 8.C.3 of the Code.

During the year, the internal control committee examined and assessed the audit plan and reports drawn up by the internal control supervisor and the reports prepared by the supervisory body as per Legislative decree no. 231/2001. It also confirmed and reported to the board of directors the correct application of the accounting policies and their consistency for the preparation of the separate and consolidated financial statements, together with the independent auditors and the manager in charge of financial reporting based on the findings of the board of statutory auditors. The committee also reported to the board of directors on its activities and the adequacy, operation and effective working 106 of the internal controls during the meetings held to approve the annual and half year reports, also with respect to identification of the main business risks. The board of statutory auditors agreed with this assessment. The committee also approved the composition and working of the board and its committees. It positively reviewed the revision of the Organisation, management and control model required by article 6 of Legislative decree no. 231/01 in line with the most recent legislative amendments, changes in the company’s organisational structure, updating of areas at risk and best practices. It found that the individual members of the supervisory body continued to meet the subjective requirements of the Organisation, management and control model and, therefore, the body as a whole.

***

Minutes of the committee meetings are drawn up.

As described in paragraph 3 of this report, on 12 March 2007, the board of directors resolved to give the internal control committee an annual budget of euro 25,000 to cover the costs of any necessary consultancy or other services required to carry out its duties. The prior authorisation of outlays is not necessary although the committee is required to document its expenses. It may also avail of internal information and functions.

12. INTERNAL CONTROL SYSTEM On 21 March 2000, the board of directors established the guidelines for the internal control system approving a specific document entitled “Guidelines for internal controls”. During today’s meeting, the board of directors approved a new document setting out the “Guidelines for internal controls of IMPREGILO S.p.A.”, as proposed by the internal control committee in its meeting of 24 March 2009. The internal controls ensure that the key risks that could affect the Issuer and its subsidiaries are correctly identified, adequately measured, managed and monitored and determines criteria for their management in line with the proper management of the business. As required by the Code, the company’s internal controls consist of a set of rules, procedures and organisational structures put in place to ensure a healthy and efficient system which is able to identify, measure, manage and monitor the main risks. The objective is to ensure the safeguarding of the company’s assets, an efficient and effective operating system, reliable financial information and compliance with the laws and regulations. *** During the meeting to approve the annual financial statements, the internal control committee reported to the board of directors on its favourable opinion of the adequacy, operation and effective working of the internal controls following its review of the reports drawn up by the internal control supervisor and the supervisory body and based on interviews with them. The board of directors agreed with and adopted this positive assessment. A similar procedure was carried out during approval of the half year report.

12.1. EXECUTIVE DIRECTOR IN CHARGE OF INTERNAL CONTROLS

As described in paragraph 3 of this report, with respect to letter b) of criterion 8.C.1. of the Code of Conduct, on 12 March 2007, the board 107 of directors nominated the CEO as “Executive director in charge of internal controls”, assisted by the internal control committee.

*** Together with the internal control supervisor and the internal audit unit, this executive director: • supervised identification of the key business risks (strategic, operating, financial and compliance), considering the activities carried out by the Issuer and its subsidiaries, and presented them to the board on 26 March 2008. This review was updated during the year and its findings are currently being finalised; • implemented the guidelines established previously by the board of directors and managed the previously designed and created internal controls, checking their overall adequacy, effectiveness and efficiency on an ongoing basis, assisted by the internal control supervisor; • adapted the internal controls to reflect operating conditions and the legislative and regulatory framework, again assisted by the internal control supervisor; • proposed the remuneration of the internal control supervisor to the board of directors.

12.2. INTERNAL CONTROL SUPERVISOR The board of directors approved the proposal made by the internal control committee and appointed Raffaele Manente as internal control supervisor on 12 September 2000. This employee reports to the chairman of the board of directors alone. He heads a unit of persons with different levels of experience. The supervisor is completely autonomous in terms of his actions and in operating and control terms.

On 12 December 2007, the board of directors set the internal control supervisor’s remuneration, in line with company policies, proposed by the CEO, as executive director in charge of internal controls and after consulting the internal control committee.

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The supervisor is not in charge of any operating functions and does not report to any of the operating managers, including those of the administrative and finance department. *** The supervisor has direct access to all information useful to carry out his duties, reports to the internal control committee and the board of statutory auditors and also to the executive director in charge of internal controls.

The supervisor is financially independent with his own budget approved each year by the board of directors after consulting the internal control committee. The budget was euro 886,500 for the year.

During the year, the internal control supervisor carried out procedures to assist the supervisory body, as part of his duties as head of the internal audit unit, and also analysed, reviewed and updated the business risks as well as checking the internal controls’ adequacy, effective and efficient working on an ongoing basis. *** The Issuer has an internal audit unit, headed by the internal control supervisor. 108 During the year, the internal audit unit continued its activities to identify areas which required attention to decrease risk. It performed 15 audits and drew up the 2009-2011 audit plan.

12.3. ORGANISATION MODEL pursuant to Legislative decree no. 231/2001 On 29 January 2003, the company adopted the “Organisation, management and control model” required by article 6 of Legislative decree no. 231/01, based on the Confindustria guidelines, approved on 7 March 2002. Following the legislative changes made after adoption of the first model, the board of directors revised the model on 30 March 2005 reflecting the update to the Confindustria guidelines of 18 May 2004, the code of conduct and the model drawn up by the National Association of Building Constructors (ANCE), approved on 31 March 2003 and subsequently revised on 1 September 2004. On 12 September 2006, 21 July 2008 and 25 March 2009, following the extension of the crimes covered, the internal reorganisations that had taken place in the meantime, the revision of the “Activities at risk” and in accordance with best practices, the board of directors approved the new “Organisation, management and control model” (the general section of which is available on the internet site www.impregilo.it,in the “Investor Relations – Corporate Governance – Corporate documents” section). The model’s objective is to prevent certain crimes (those committed when dealing with the state, forgery of banknotes, public paper and stamp duties, company crimes, terrorist acts or subversion of democratic order, crimes against people’s life and safety, crimes against the individual, market abuse and international crimes, receiving, laundering and use of stolen money, goods or facilities, crimes against safety in the workplace, cybercrimes and the unlawful processing of data). On 12 September 2006, the board of directors set the number of members of the supervisory body as per article 6 of Legislative decree no. 231/2001 as three, in line with that required by the new Organisation, management and control model and appointed them, consisting of the internal control supervisor (internal employee being the internal audit manager) and two external persons. Previously, the body had been monocratic (internal control supervisor). The only Italian subsidiary of strategic importance, FISIA Italimpianti S.p.A. adopted its own “Organisation, management and control model” on 5 March 2004 and last updated it on 9 September 2008. The group’s Code of Conduct forms part of the Model (available on the internet site www.impregilo.it, in the “Investor Relations - Corporate Governance - Corporate documents” section). The present version was approved by the Issuer’s board of directors on 12 September 2006.

12.4. INDEPENDENT AUDITORS Impregilo and its main subsidiaries have engaged independent auditors to perform the legally-required audit of their financial statements and to check that their accounting records are kept correctly as required by Legislative decree no. 58 of 24 February 1998. Their half year reports are reviewed. The independent auditors perform an audit of Impregilo, in accordance with the applicable legislation. As part of the general audit plan for the group, the subsidiaries that do not exceed the thresholds set by Consob have nonetheless engaged the independent auditors on a voluntary basis.

The shareholders resolved to engage PricewaterhouseCoopers S.p.A. to audit the parent’s financial statements for the period from 2006 to 109 2011 in their meeting of 3 May 2006. On 3 May 2007, they extended the independent auditors’ engagement for the period from 2012 to 2014, pursuant to paragraph 7, article 8 of Legislative decree no. 303 of 29 December 2006.

12.5. MANAGER IN CHARGE OF FINANCIAL REPORTING On 27 June 2007, the shareholders approved article 26 to be included in the by-laws. This new article regulates the appointment and removal from office of the manager in charge of financial reporting, the term of his office, related fee and relevant professional characteristics. Article 26 requires that the board appoint, and remove from office, after consulting the board of statutory auditors, a manager to be in charge of financial reporting, setting his term of office and fee. The candidates shall have at least three years’ experience in: (a) administration and finance or administration and control or management duties with responsibility for financial, accounting and control matters, with companies that have a share capital of at least euro 2 million or consortia of companies with a total share capital of not less than euro 2 million; or (b) legal, economic or financial aspects closely related to the company’s activities; or (c) management at a state body or public administration office active in the credit, financial or insurance sectors or in sectors closely related to that of the company. Aspects and sectors closely related to the company’s activities are those set out in the last paragraph of article 29 (which states: “Pursuant to letters b) and c), paragraph 2, article 1 and paragraph 3 of Ministerial decree no. 162 of 30 March 2000, aspects and sectors closely related to those of the company are those aspects (legal, economic, financial and technical-scientific) and business sectors tied to or related to the company’s activities and part of its business object”). The board of directors carried out a careful analysis to identify the most suitable person from within the company, considering the personal and professional characteristics that this position requires. In accordance with the guidelines of the first professional interpretations of the law and based on its analysis, the board found Rosario Fiumara, the current corporate central manager to be the most suitable candidate. Therefore, as proposed by the CEO, it appointed him as the manager in charge of financial reporting on 11 September 2007 in accordance with article 154-bis of Legislative decree no. 58 of 24 February 1998.

2008 Annual Report IMPREGILO Corporate governance report

During the same meeting, the board established that Rosario Fiumara’s position as manager in charge of financial reporting would have an open term, until otherwise determined by it. It set the fee for the position, as proposed by the remuneration committee which met on the same date. The board also gave Mr. Fiumara all the powers and authority required to effectively carry out his functions and duties in his new position within the budget limits approved and which were provisionally fixed at euro 50,000.00. The manger kept his original powers as corporate central manager and may be given additional powers for this position in the future. Such powers include: • direct access to all information required to produce accounting data; • unlimited use of internal communication channels which ensure the correct intragroup exchange of information; • a free hand in organising his unit in terms of both human and technical resources (materials, IT and any other items); • creation and adoption of administrative and accounting procedures independently, also by availing of the assistance of other company functions when necessary; • assessment and modification of internal administrative and accounting procedures; • participation at meetings of the board and executive committee, especially those which discuss issues related to his function and for which he is responsible; 110 • engaging external consultants, when necessary for specific issues; • interacting with employees with control duties and exchanging information to ensure the ongoing mapping of risks and processes and the proper monitoring of the correct working of administrative and accounting procedures. Rosario Fiumara accepted the position as manager in charge of financial reporting on the same date.

13. DIRECTORS’ INTERESTS AND RELATED PARTY TRANSACTIONS In its meeting of 7 July 2005, the board of directors adopted a new specific procedure to ensure the substantial and formal correctness of the transactions carried out by the company with related parties (“Guidelines for Transactions with Related Parties”).This procedure ensures compliance with the standards set by the Code of Conduct for such transactions. For the purposes of these guidelines, a party is considered to be “related” when: a) directly or indirectly, via one or more intermediary, the party: (i) controls the entity, is a subsidiary thereof, or is subject to joint control (including parents, subsidiaries and related entities); (ii) holds an investment in the entity such that it has significant influence over it; or (iii) jointly controls the entity; b) the party is an associate of the entity; c) the party is a joint venture in which the entity has a share; d) the party is one of the key managers for the entity or its parent; e) the party is a close relative of one of the subjects in points (a) or (d); f) the party is a subsidiary, jointly controlled entity or subject to significant influence by one of the subjects as per points (d) or (e) or the parties hold, directly or indirectly, a significant portion of the voting rights; g) the party is a pension fund for the entity’s employees or any other related entity. For the purposes of the above definition: (i) the concept of control is that set out in IAS 24 (ie, control exists when an entity has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Joint control is the contractually established sharing of control of an economic activity); (ii) the concept of significant influence is that set out in IAS 24 (ie, significant influence is the power to take part in determining the financial and operating policies of an entity without having control. Significant influence may be obtained by holding shares, by-law conditions or agreements); (iii) the concept of an associate is that set out in IAS 28 (ie, an associate is an entity in which the investor has significant influence and is not either a subsidiary or a jointly controlled entity); (iv) key managers are directors and statutory auditors, general managers and managers with powers and responsibilities for the planning, management and control over the company’s activities; (v) close relatives are those that could influence, or be influenced by, the person related to the company; they include persons who reside 111 in the same household, spouses who are not legally separated and relatives and in-laws up to the second degree. The procedure adopted by the board establishes that transactions with related parties should be subjected to the prior approval of the board of directors when they are significant in terms of the object, consideration, method and timing thereof. Significant transactions are all those transactions carried out with related parties other than: (i) transactions with wholly-owned subsidiaries that have a value of less than euro 500,000.00; (ii) transactions carried out within the group that are not atypical or unusual or that have been agreed at standard conditions. Transactions are considered typical or usual when, due to their object or nature, they are part of the company’s normal activities and those that are not critical in terms of their characteristics or risks related to the nature of the counterparty and their timing. Transactions that are agreed at the same conditions with all other parties are considered to have taken place at standard conditions. In order to ensure that conditions that differ from those that would probably have been agreed with unrelated parties are agreed, the board of directors ensures that transactions are agreed with the assistance of independent, highly qualified experts (banks, independent auditors, legal firms and other experts with specialist knowledge). These experts are asked to provide their opinions on the financial conditions, executive and technical methods and legitimacy of the Relevant Transactions with Related Parties.

***

As described in paragraph 3 of this report, on 12 March 2007, the directors resolved, with respect to criterion 9.C.2., that, subject to the provisions of article 2391 of the Italian Civil Code, directors with interests, either directly or on behalf of third parties, in a corporate transaction to be approved by the board of directors or executive committee may participate in the related discussions and vote thereon as such interest (investment) represents a reason for taking a responsible decision about a transaction about which the director may have greater knowledge than the other directors; that, however, the board of directors or executive committee may ask such directors to leave the meeting during the discussion on a case-by-case basis.

2008 Annual Report IMPREGILO Corporate governance report

14. APPOINTMENT OF STATUTORY AUDITORS Article 29) of the Issuer’s by-laws requires that “the shareholders elect a board of statutory auditors, consisting of three standing and two substitute statutory auditors. The statutory auditors shall have the characteristics required by law, the by-laws and any other relevant regulations. Appointment of the board of statutory auditors takes place using lists presented by the shareholders using the methods and within the timeframe set out below. The candidates are listed in consecutive order in each list. Lists have two sections: one for the candidate standing statutory auditors and one for the candidate substitute statutory auditors. They shall include at least one candidate for each position and may comprise up to a maximum of three candidates for the standing statutory auditor position and up to two for the substitute statutory auditor position. Lists presented by the shareholders are deposited at the company’s registered office to be available for public consultation as indicated in the notice calling the shareholders’ meeting. They are deposited at least fifteen days before the date of first call of the meeting, unless other mandatory instructions are given by legislative and regulatory instructions. Shareholders, shareholders forming part of significant shareholder agreements as per article 122 of Legislative decree no. 58 of 24 February 1998, the parent, subsidiaries and jointly controlled entities as per article 93 of the same decree may not present, or be involved in presenting 112 (also via trustees or nominees), more than one list. Nor can they vote (also via trustees or nominees) for more than one list. Moreover, each candidate may only be present in one list in order to be eligible. Inclusion in more than one list or votes for more than one list are not counted. Only those shareholders that, either individually or together with other shareholders, own shares making up at the percentage of share capital required for presentation of lists for candidate directors, may present lists. Together with each list, and within the timeframe described earlier, the shareholders deposit: (i) information about the shareholders presenting the list and the relevant certificate issued by a legally-authorised broker showing ownership to the number of shares necessary to present lists; (ii) statements whereby each candidate accepts their candidature and states, under their own responsibility, the inexistence of any reasons for ineligibility or incompatibility and the existence of the requirements for the relevant offices, including compliance with the ceiling for the number of positions that can be held under the current law and regulations; (iii) a professional and personal profile of each candidate; and (iv) any other information that is requested by the applicable law or regulations given in the notice calling the shareholders’ meeting. Lists which are presented that do not meet the above requirements are considered not to have been presented. Candidates that are ineligible or incompatible or who do not have the requirements established by the relevant legislation or who hold more positions than is allowed by the current laws and regulations cannot be included in the lists. The statutory auditors are elected as follows: 1. two standing statutory auditors and one substitute statutory auditor are taken from the list that got the most votes in the shareholders’ meeting, taken from the list in consecutive order in which they are included in the list sections; 2. the other standing auditor and other substitute auditor are taken from the list that received the second largest number of votes and that was presented and voted by shareholders that are not related directly or indirectly to the shareholders as per paragraph 2, article 148 of Legislative decree no. 58 of 24 February 1998. They are taken in consecutive order from the list sections (“Minority list”). If two lists received the same amount of votes, that presented by the majority shareholders is considered or, subordinately, that presented by the larger number of shareholders. When the list system is not used, shareholders elect statutory auditors by majority vote. The chairman of the board of statutory auditors is the first candidate on the Minority list. Statutory auditors fall from office in the cases provided for by the relevant legislation or whenever the by-law requirements for their appointment are no longer met. When one of the standing statutory auditors needs to be replaced, the substitute statutory auditor from the same list is co-opted. If both the standing and substitute statutory auditors from the Minority list leave their positions, the candidate in the next place on the same list is co- opted or the first candidate on the minority list that received the second largest number of votes. Shareholders appoint or replace statutory auditors in meetings called in accordance with paragraph 1 of article 2401 of the Italian Civil Code complying with the requirement to ensure minority shareholder representation. Outgoing statutory auditors may be re-elected. As required by letters b) and c), paragraph 2, article 1 and paragraph 3 of Ministerial decree no. 162 of 30 March 2000, aspects and sectors closely related to the company’s activities are those aspects (legal, economic, financial and technical-scientific) and business sectors tied to or related to the company’s activities and part of its business object.”

15. STATUTORY AUDITORS 113 At year end, the Issuer’s board of statutory auditors comprised the following members. Details are also given of their appointment, participation at meetings and other positions held as director or statutory auditor in other companies listed on Italian regulated markets.

Name Position In office List Independent % Other since as per Code participation positions OFF LIST Giuseppe Levi Chairman 7.5.2008 APPOINTMENT X 100 Giorgio Oldoini Standing statutory auditor 7.5.2008 SOLE X 100 2 Alessandro Trotter Standing statutory auditor 7.5.2008 SOLE X 100 1 Vittorio Amadio Substitute statutory auditor 7.5.2008 SOLE 2 Michela Zeme Substitute statutory auditor 7.5.2008 SOLE 1

(I) In their meeting of 7 May 2008, the shareholders appointed a new board of statutory auditors based on the sole list presented by the shareholder Igli S.p.A. and another nomination (for the chairman, Giuseppe Levi) presented during the meeting by the shareholder Odasso.

Information about the statutory auditors who left their positions during the year is set out below.

Name Position In office List Independent % Other from / to as per Code participation positions Roberto Ascoli Standing statutory auditor 2.5.2005 to 7.5.2008 SOLE X 100 Vittorio Amadio Standing statutory auditor 2.5.2005 to 7.5.2008 SOLE X 100 2

No change in the board of statutory auditors’ composition has taken place since year end. The board of statutory auditors met seven times during the year.

***

2008 Annual Report IMPREGILO Corporate governance report

On 11 June 2008, following the appointment of the new statutory auditors by the shareholders on 7 May 2008, the board of statutory auditors found that all the statutory auditors complied with the independence requirements of the Code. On 17 February 2009, it confirmed they had continued to meet such requirements throughout 2008. *** - Impregilo complies with the guidelines of criterion 10.C.4 of the Code, whereby statutory auditors that either directly or on behalf of third parties have an interest in a specific transaction shall inform the other statutory auditors and the chairman of the board of directors promptly and completely about the nature, scope, origin and terms of their interest. - In the meetings held during the year, the statutory auditors met the independent auditors who described the scope of their engagement, their responsibilities and independence as well as the procedures carried out for Impregilo and the group companies that have engaged them. - As part of its duties, the board of statutory auditors worked with the internal audit unit and the internal control committee. It took part in meetings of the latter committee with the internal control supervisor and the internal audit head. The internal control supervisor and the internal audit head also participated in several board of statutory auditors’ meetings when it reviewed the supervisor’s work.

114 16. INVESTOR RELATIONS The company believes that it is in its interests and also that it has a duty to the market to have an ongoing dialogue with its shareholders and institutional investors based on a common understanding of their roles. Such dialogue takes place within the boundaries established for confidential information to ensure that investors and potential investors receive information upon which they can base their investment decisions. Therefore, it set up the current Investor Relations unit in July 2001 headed by the Investor Relator (presently Mauro Di Bonito) whose specific duties include managing relations with investors. This person has an e-mail address specifically for receiving communications and requests from shareholders ([email protected]). The company’s internet site (www.impregilo.it) has a section for relations with investors (“Investor Relations”) where all the financial information can be found as well as up-to-date documents of interest to the shareholders, in order that they may exercise their rights in an informed manner. Impregilo posts information of interest to its shareholders on its internet site www.impregilo.it.

17. SHAREHOLDERS’ MEETINGS The document “Methods for participating at meetings by shareholders” is posted on the company’s internet site www.impregilo.it (in the “Investor Relations - Corporate Governance - Corporate documents” section). Pursuant to article 14) of the by-laws, shareholders that have presented the communication required by paragraph 2, article 2370 of the Italian Civil Code to the company within the deadline of two business days before that set for the meeting may participate at such meeting. Article 16) of the by-laws states that the documentation issued for participation at the meeting held on first call is also valid for other meetings and that meetings are called with at least 30 days notice by inclusion of an advertisement setting out the agenda in the Italian Official Journal or in the newspaper Il Corriere della Sera. The latter alternative is simpler in formal terms and allows greater flexibility while also ensuring that more shareholders are aware that the meeting has been called. The by-laws do not require that the shares, for which the communication pursuant to paragraph 2, article 2370 of the Italian Civil Code is required, remain unavailable until the meeting has been held, nor do they allow voting by post or on-screen or video link-up. *** In their ordinary meeting of 8 May 2001, the shareholders approved the “Rules for shareholders’ meetings” (available on the internet site www.impregilo.it, in the “Investor Relations - Corporate Governance - Corporate documents” section), drawn up using the format proposed by Assonime. Their scope is to ensure the orderly carrying out of meetings with respect to each shareholder’s fundamental right to request clarifications about matters on the agenda, to express its opinion and make proposals. These rules set out the methods used to ensure each shareholder’s right to take part in discussions about the matters on the agenda. *** The board of directors reported to the shareholders about the activities both carried out and planned for the future in the meeting held during 2008. It took the necessary steps to ensure that the shareholders received adequate information about the matters in order to be able to make informed decisions. In accordance with current by-law requirements, changes in the Issuer’s market capitalisation during the year did not impair the exercise of actions or privileges designed to protect the minority shareholders.

18. CHANGES SINCE YEAR END 115 No changes in the company’s corporate governance structure have taken place since year end.

List of positions held in other companies listed on regulated markets (also foreign), in financial companies, banks, insurance companies or significant size companies (these companies are not part of the issuer’s group)

DIRECTORS IN OFFICE

Directors Company Position Massimo Ponzellini INA ASSITALIA S.p.A. Deputy chairman BANCA NAZIONALE DEL LAVORO S.p.A. Director B.E.I. Honorary deputy chairman Giovanni Castellucci ATLANTIA S.p.A. CEO AUTOSTRADE PER L’ITALIA S.p.A. CEO AUTOSTRADE SUD AMERICA S.r.l. CEO AUTOSTRADA DEL BRENNERO S.p.A. Director IGLI S.p.A. Director AEROPORTI DI ROMA S.p.A. Director AUTOVIE VENETE S.p.A. Director PEDEMONTANA VENETA S.p.A. Director Antonio Talarico FONDIARIA-SAI S.p.A. Deputy chairman and member of the executive committee IMMOBILIARE LOMBARDA S.p.A. CEO, member of the executive committee and COO MILANO ASSICURAZIONI S.p.A. Director and member of the executive committee SAIAGRICOLA S.p.A. Chairman FINADIN Finanziaria di Investimenti S.p.A. Chairman INTERNATIONAL STRATEGY S.r.l. Chairman NUOVE INIZIATIVE TOSCANE S.p.A. Chairman MARINA DI LOANO S.p.A. Chairman ATAHOTELS S.p.A. member of the supervisory board SAI INVESTIMENTI Società di Gestione del Risparmio S.p.A. Director IGLI S.p.A. Director

2008 Annual Report IMPREGILO Corporate governance report

Directors Company Position Alberto Rubegni none Carlo Buora ISTITUTO EUROPEO DI ONCOLOGIA S.r.l. Director CENTRO CARDIOLOGICO MONZINO S.p.A. Director Alfredo Cavanenghi AUTOSTRADA TORINO MILANO S.p.A. Chairman of the board of statutory auditors S.I.A.S. S.p.A. Standing statutory auditor SOCIETA’ AUTOSTRADA LIGURE TOSCANA p. A. Standing statutory auditor G. & A. S.p.A. Standing statutory auditor LEAS FINANZIARIA S.p.A. Standing statutory auditor LEAS S.p.A. Standing statutory auditor FINANZIARIA DI PARTECIPAZIONI E INVESTIMENTI S.p.A. Standing statutory auditor AUTOSTRADA DEI FIORI S.p.A. Standing statutory auditor VERSIGLIA S.p.A. Standing statutory auditor IBP S.p.A. Standing statutory auditor AUTOSTRADA ASTI-CUNEO S.p.A. Standing statutory auditor S.A.T.A.P. S.p.A. Standing statutory auditor Claudio Cominelli ATLANTIA S.p.A. Director 116 SIMGENIA SIM S.p.A. Director EUROP ASSISTANCE ITALY S.p.A. Director GENERALI MULTIPENSIONS SOLUTIONS SICAV Director Nicola Fallica MARINA DI LOANO S.p.A. Deputy chairman IMMOBILIARE LOMBARDA S.p.A. Director Beniamino Gavio INTERSTRADE S.p.A. Chairman and CEO ARGO FINANZIARIA S.p.A. Chairman SEA – SEGNALETICA STRADALE S.p.A. Chairman AURELIA S.p.A. CEO MOTORWAYS SUD AMERICA S.r.l. Director IGLI S.p.A. Director PROFESSIONALE CONSULENZA ASSICURATIVA Director PCA S.p.A. Director SOCIETA’ INIZIATIVE AUTOSTRADALI E SERVIZI S.p.A. Director Marcello Gavio ITINERA S.p.A. Chairman ARGO FINANZIARIA S.p.A. Deputy chairman G & A S.p.A. Director INTERSTRADE S.p.A. Director PROFESSIONALE CONSULENZA ASSICURATIVA Director PCA S.p.A. Director SEA – SEGNALETICA STRADALE S.p.A. Director Giancarlo Guenzi PAVIMENTAL EST S.p.A. Director AUTOSTRADE SUD AMERICA S.r.l. Director EMITTENTI TITOLI S.p.A. Director Maurizio Maresca HOLCIM S.p.A. Director Directors Company Position Andrea Novarese ALERION INDUSTRIES S.p.A. Director BANCA GESFID S.A. Director BANCA SAI S.p.A. Director BIPIEMME VITA S.p.A. Director IGLI S.p.A. Director DDOR NOVI SAD Director FINADIN S.p.A. Director FINSAI INTERNATIONAL S.A. Director SAIFIN SAIFINANZIARIA S.p.A. Director SAIHOLDING ITALY S.p.A. Director SAINTERNATIONAL S.A. Director SAILUX S.A. – SRP ASSET MANAGEMENT S.A. Director POPOLARE VITA S.p.A. Director MELIORBANCA S.p.A. Deputy chairman GEMINA S.p.A. Director and member of the remuneration committee 117 Giuseppe Piaggio SCHEMAVENTOTTO S.p.A. Chairman ATLANTIA S.p.A. Director AUTOSTRADE PER L’ITALIA S.p.A. Director IGLI S.p.A. Director FONDAZIONE CRT Director Alberto Sacchi ARGO FINANZIARIA S.p.A. CEO AUTOSTRADA TORINO MILANO S.p.A. CEO AUTOCAMIONALE DELLA CISA S.p.A. Director AUTOSTRADA DEI FIORI S.p.A. Director AUTOSTRADE SUD AMERICA S.r.l. Director SITRASB S.p.A. Director SOCIETA’ INIZIATIVE AUTOSTRADALI E SERVIZI S.p.A. Director MILANO SERRAVALLE Standing statutory auditor MILANO TANGENZIALI S.p.A. Standing statutory auditor SOCIETA’ AUTOSTRADA LIGURE TOSCANA p.A. S.A.L.T. Director and member of the executive committee

DIRECTORS WHO LEFT OFFICE DURING THE YEAR

Directors Company Position Andrea Gardelli Immobiliare Construction IM.CO. S.p.A. CEO MARCORA COSTRUZIONI S.p.A. Chairman

2008 Annual Report IMPREGILO Corporate governance report

PROPOSAL TO THE SHAREHOLDERS OF IMPREGILO S.p.A. Dear shareholders, The separate financial statements of Impregilo S.p.A., prepared for your approval, show a profit for the year of euro 83,039,554, which we propose be allocated as follows:

• euro 4,151,977.70, equal to 5% of the profit for the year, to the legal reserve; • euro 32,196,634.96 as a dividend to the shareholders, equal to euro 0.08 per share; • euro 1,260,082.98 as a dividend to the holders of savings shares, equal to euro 0.78 per share, as per letter b), article 33 of the by-laws; • to set the ex-dividend date as 18 May 2009 and the payment date as 21 May 2009. • euro 45,430,858.36 to be carried forward.

118

On behalf of the board of directors Chairman (signed on the original) CONSOLIDATED FINANCIAL STATEMENTS 119 AS AT AND FOR THE YEAR ENDED 31 DECEMBER 2008

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

CONSOLIDATED BALANCE SHEET

(Euro/000) ASSETS Note 31 December 2008 31 December 2007 Non-current assets Property, plant and equipment 1.1 145,787 154,904 Freely transferable assets 1.2 187,457 187,222 Intangible assets 1.3 51,613 52,999 Goodwill 1.4 58,890 58,890 Equity investments 1.5 32,901 41,472 Non-current financial assets (*) 9.1 54 115 Non-current receivables due from associates 5 17,700 19,210 Other non-current assets 5 57,777 64,084 Deferred tax assets 6-15 64,104 74,893 Total non-current assets 616,283 653,789 Current assets Inventories 7.1 59,408 59,459 120 Contract work in progress 7.2 707,609 472,159 Trade receivables 7.4 880,946 866,159 of which: related parties 17 453 823 Current receivables due from associates 7.6 157,364 157,205 Derivatives and other current financial assets (*) 9.2-9.7-9.8 74,804 103,150 Current tax receivables 6 237,362 261,744 Other current assets 7.7 276,206 295,511 Cash and cash equivalents (*) 9.3 944,880 875,627 Total current assets 3,338,579 3,091,014 Non-current assets classified as held for sale 2 411,884 442,789 Total assets 4,366,746 4,187,592

(*) Items included in net financial position. (Euro/000) EQUITY AND LIABILITIES Note 31 December 2008 31 December 2007 Equity Share capital 718,364 716,614 Share premium reserve 1,222 13,310 Other reserves (14,662) 14,185 Losses carried forward (51,918) (103,476) Profit for the year 167,646 40,759 Total equity attributable to the shareholders of the parent 820,652 681,392 Minority interests 4,182 (5,197) Total equity 8 824,834 676,195 Non-current liabilities Bank and other loans (*) 9.4 258,734 353,256 Bonds (*) 9.5 55,222 64,049 Finance lease payables (*) 9.6 1 219 Post-employment benefits and employee benefits 4 33,419 36,417 121 Deferred tax liabilities 6-15 16,954 10,706 Provisions for risks and charges 3 177,885 198,538 Other non-current liabilities 5 10,443 21,921 Total non-current liabilities 552,658 685,106 Current liabilities Bank overdrafts and current portion of loans (*) 9.4-9.8 654,101 608,235 Current portion of bonds (*) 9.5 1,903 3,144 Current portion of finance lease payables (*) 9.6 33 765 Derivatives (*) 9.7 7,168 2,935 Advances on contract work in progress 7.3 713,111 776,588 Trade payables 7.5 1,167,234 1,000,515 of which: related parties 17 12,685 27,878 Current payables to associates 7.6 69,437 88,764 Current tax liabilities 6 60,264 54,117 Other current liabilities 7.8 288,419 291,228 of which: related parties 17 17,667 17,667 Total current liabilities 2,961,670 2,826,291 Liabilities directly associated with non-current assets classified as held for sale 2 27,584 - Total equity and liabilities 4,366,746 4,187,592

(*) Items included in net financial position.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

CONSOLIDATED INCOME STATEMENT

(Euro/000) Note 2008 2007 Revenue Operating Revenue 12 2,867,048 2,530,406 Other revenue 12 90,596 96,497 of which: related parties 17 26 2,054 Total revenue 2,957,644 2,626,903 Costs Raw materials and consumables 13.1 (744,137) (635,897) Subcontracts 13.2 (707,697) (595,068) Other operating expenses 13.3 (905,750) (820,514) Personnel expenses 13.4 (327,673) (348,923) Amortisation, depreciation, provisions and impairment losses 13.5 (83,305) (95,309) of which: provision for USW Campania projects 18 - (50,000) of which: related parties (*) 17 (21,677) (63,033) 122 Total costs (2,768,562) (2,495,711) Operating profit 189,082 131,192 Net financing income (costs) and gains (losses) on investments Net financing costs 14.1 (60,533) (9,831) of which: related parties 17 538 - Net gains on investments 14.2 55,912 13,235 Net financing costs and net gains on investments (4,621) 3,404 Profit before tax 184,461 134,596 Income tax 15 (52,536) (63,713) Profit from continuing operations 131,925 70,883 Profits (losses) from discontinued operations 16 35,567 (30,756) of which: related parties 17 40,605 - Profit for the year 167,492 40,127 Minority interests 8 154 632 Profit attributable to the shareholders of the parent 167,646 40,759 Earnings per share 20 From continuing and discontinued operations Basic 0,41 0,10 Diluted 0,41 0,10 From continuing operations Basic 0,33 0,18 Diluted 0,33 0,18

(*) Relating to the items "Subcontracts" and Other operating expenses" CONSOLIDATED CASH FLOW STATEMENT

(Euro/000)

Note 2008 2007 Cash and cash equivalents 9.3 875,627 918,513 Current account facilities 9.4 (91,166) (88,867) Total cash and cash equivalents at the beginnning of the year 784,461 829,646 Operating activities Profit for the year 167,492 40,127 of which: profits (losses) from discontinued operations 35,567 (30,756) Amortisation 13.5 3,164 5,246 Depreciation 13.5 58,317 57,984 Net impairment losses and provisions 13.5 21,824 32,079 Accrual for post-employment benefits and employee benefits 13.4 18,321 13,460 Net gains on the sale of assets 12-13.3-14.2 (79,477) (17,828) Deferred taxes 15 17,424 27,195 Share of profit or loss of associates 14.2 12,041 (4,875) Other non-monetary items 45,692 5,783 Total income statement 264,798 159,171 Decrease (increase) in inventories (233,447) (52,410) Decrease (increase) in trade receivables (19,003) 352 (Decrease) increase in advances from customers (56,046) 10,535 (Decrease) increase in trade payables 142,501 100,789 123 (Decrease) increase in other assets and liabilities 47,853 (155,435) of which: relating to related parties 17 2,394 (28,929) Total operating cash flows (118,142) (96,169) Cash flows from operating activities 146,656 63,002 Investing activities Net investments in intangible assets 1.3 (1,577) (331) Ecocataratas acquisition, net of cash acquired (55,064) Investments in property, plant and equipment and freely transferable assets 1.1 - 1.2 (97,737) (145,491) of which: relating to assets classified as held for sale (USW Campania projects) 2 (21,523) (57,964) Proceeds from the sale of or reimbursement value of property, plant and equipment 24,605 27,226 Investments in non-current financial assets 1.5 (4,712) (1,889) Dividends and capital repayments from associates 1.5 2,387 6,344 Proceeds from the sale of or reimbursement value of non-current financial assets 109,182 10,642 Cash flows used in investing activities (22,916) (103,499) Financing activities Share capital increase 8 2,972 12,938 Increase in bank and other loans 415,216 383,231 Repayment of bank and other loans (567,380) (401,288) Change in other financial assets/liabilities 27,761 (9,303) Cash flows used in financing activities (121,431) (14,422) Change in consolidation scope 4,804 16,183 Net exchange rate losses on cash and cash equivalents (7,562) (6,449) Decrease in cash and cash equivalents (449) (45,185) Cash and cash equivalents 9.3 944,880 875,627 Current account facilities 9.4 (160,868) (91,166) Total cash and cash equivalents at the end of the year 784,012 784,461 Other information Income taxes paid during the year (24,662) (34,764) Net interest paid during the year (39,285) (54,373)

Ecocataratas acquisition, net of cash acquired Cash and cash equivalents 2,353 Freely-transferable assets 62,055 Other non-current liabilities, net (47) Current portion of loans (3,973) Other current liabilities, net (2,971) Total purchase price 57,417 Less cash acquired (2,353) Cash flows used in the Ecocataratas acquisition, net of cash acquired 55,064

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

STATEMENT OF CHANGES IN CONSOLIDATED EQUITY

Other reserves Share Share Revaluation Legal Translation Stock capital premium reserve reserve reserve option reserve reserve

(Euro/000) As at 31 December 2006 708,996 7,990 1,104 23,559 14,726 4,805 Share capital increase 7,618 5,320 - - - - Allocation of 2006 profit - - - 162 - - Assignment of stock options - - - - - 208 Fair value gains (losses) ------Minority interests in profit or loss ------Other changes including exchange rate gains or losses - - 4 - 898 - Profit for the year ------As at 31 December 2007 716,614 13,310 1,108 23,721 15,624 5,013

124 Share capital increase 1,750 1,222 - - - - Allocation of 2007 profit - (13,310) - (17,870) - (5,013) Assignment of stock options ------Fair value gains (losses) ------Minority interests in profit or loss ------Other changes including exchange rate gains or losses - - (1,108) - (18,875) - Profit for the year ------As at 31 December 2008 718,364 1,222 - 5,851 (3,251) - Other reserves Hedging Fair value Consolidation Capital Total Retained Profit (loss) Equity Share capital TOTAL reserve reserve reserve increase other earnings for the attributable and reserves related reserves (losses) year/ to the attributable charges carried period shareholders to minority forward of the parent interests (116) - 1,375 (25,394) 20,059 (244,778) 141,464 633,731 (5,210) 628,521 ------12,938 - 12,938 - - - - 162 141,302 (141,464) ------208 - - 208 - 208 (1,169) (5,977) - - (7,146) - - (7,146) - (7,146) ------(632) (632) - - - - 902 - - 902 645 1,547 ------40,759 40,759 - 40,759 (1,285) (5,977) 1,375 (25,394) 14,185 (103,476) 40,759 681,392 (5,197) 676,195

------2,972125 - 2,972 125 - - - 25,394 2,511 51,558 (40,759) ------(3,813) (7,562) - - (11,375) - - (11,375) - (11,375) ------(154) (154) - - - - (19,983) - - (19,983) 9,533 (10,450) ------167,646 167,646 - 167,646 (5,098) (13,539) 1,375 - (14,662) (51,918) 167,646 820,652 4,182 824,834

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

SEGMENT REPORTING

Disclosures on the group’s performance by business segment are set out in the section on “Performance” in the directors’ report. The consolidated financial statements figures are summarised below by business segment.

2008 performance by business segment: Construction Engineering & Plant Const. Impregilo of which: Fisia (Euro/m) Construction Operating Revenue 1,722.3 1,722.3 975.2 Other revenue 65.9 65.9 12.9 Total revenue 1,788.2 1,788.2 988.1 Purchases, subcontracts and other operating expenses (1,341.3) (1,328.9) (936.4) Personnel expenses (239.3) (218.8) (64.0) Provisions and impairment losses 0.5 1.8 (2.1) Gross operating profit (loss) (EBITDA) (*) 208.1 242.3 (14.4) EBITDA % (*) 11.6% 13.5% n.a Amortisation and depreciation (36.4) (36.4) (1.2) 126 Operating profit (loss) - (EBIT) (*) 171.7 205.9 (15.6) Return on sales (*) 9.6% 11.5% n.a Profits (losses) from discontinued operations

(*) The paragraph in the section on "Other information" of the directors' report gives a definition of these indicators.

Consolidated balance sheet as at 31 December 2008 by business segment:

Construction Engineering & Impregilo Plant Const. Fisia (Euro/m) Non-current assets, net 303.1 16.8 Goodwill (eliminated on consolidation) 211.4 Total non-current assets 303.1 228.2

Assets (liabilities) classified as held for sale - - Provision for contingencies, Post-employment benefits, Employee benefits and Other non-current assets (liabilities) (111.3) (8.7) Net tax assets

Working capital 26.3 (247.5) Intra-segment trade receivables (payables) (8.8) 279.8 Total working capital 17.5 32.3 Net invested capital 209.3 251.8 Equity Net financial position Total financial resources Other information Increase in non-current assets 42.4 1.4 Net increase in non-current assets held for sale Amortisation and depreciation (36.4) (1.2) Impairment losses recognised in profit or loss 0.6 (2.1) Concessions USW Campania Imprepar in Total consolidation Total projects liquidation adjustments Impregilo Intern. Infras. 163.8 - 9.0 (3.3) 2.867.0 5.3 4.5 6.6 (4.6) 90.6 169.1 4.5 15.6 (7.9) 2,957.6 (74.2) (6.0) (6.3) 6.7 (2,357.5) (23.8) (1.4) (0.3) 1.1 (327.7) (18.3) 1.6 (3.6) 0.1 (21.8) 52.8 (1.3) 5.4 - 250.6 31.2% n.a 34.6% 8.5% (23.5) - (0.4) - (61.5) 29.3 (1.3) 5.0 - 189.1 127 17.3% n.a 32.1% 6.4% 40.6 (5.0) 35.6

Concessions USW Campania Imprepar in Total consolidation Total projects liquidation adjustments Impregilo Intern. Infras. 295.2 0.8 1.1 (140.4) 476.6 (211.4) 295.2 0.8 1.1 (351.8) 476.6

- 406.1 - (21.8) 384.3 (9.5) (27.8) 13.6 (2.6) (146.3) 224.2

44.1 (11.1) 30.9 0.7 (156.6) (58.6) (230.5) (3.7) 21.8 - (14.5) (241.6) 27.2 22.5 (156.6) 271.2 137.5 41.9 (353.7) 782.2 824.8 42.6 782.2

96.1 139.9 21.5 21.5 (23.5) - (0.4) (61.5) (18.3) 1.6 (3.6) (21.8)

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

2007 performance by business segment:

Construction Engineering & Plant Const. Impregilo of which: Fisia (Euro/m) Construction Operating Revenue 1,523.9 1,523.9 837.7 Other revenue 77.4 77.4 8.7 Total revenue 1,601.3 1,601.3 846.4 Purchases, subcontracts and other operating expenses (1,216.1) (1,193.7) (748.4) Personnel expenses (256.8) (237.8) (70.4) Provisions and impairment losses (16.2) 34.3 (1.0) Gross operating profit (loss) (EBITDA) (*) 112.2 204.1 26.6 Ebitda % (*) 7.0% 12.7% 3.1% Amortisation and depreciation (42.5) (42.5) (2.0) Operating profit (loss) - (EBIT) (*) 69.7 161.6 24.6 Return on sales (*) 4.4% 10.1% 2.9% Profits (losses) from discontinued operations 128 (*) The paragraph in the section on "Other information" of the directors' report gives a definition of these indicators.

Consolidated balance sheet as at 31 December 2007 by business segment:

Construction Engineering & Impregilo Plant Const. Fisia (Euro/m) Non-current assets, net 313.0 16.9 Goodwill (eliminated on consolidation) - 211.4 Total non-current assets 313.0 228.3

Assets (liabilities) classified as held for sale - 1.9 Provision for contingencies, Post-employment benefits, Employee benefits and Other non-current assets (liabilities) (163.5) (11.5) Net tax assets

Working capital (26.2) (293.5) Intra-segment trade receivables (payables) (31.3) 263.8 Total working capital (57.5) (29.7) Net invested capital 92.0 189.0 Equity Net financial position Total financial resources Other information Increase in non-current assets 60.6 2.0 Increase in non-current assets held for sale Amortisation and depreciation (42.5) (2.0) Impairment losses recognised in profit or loss Concessions USW Campania Imprepar in Total consolidation Total projects liquidation adjustments Impregilo Intern. Infras. 151.3 - 19.0 (1.5) 2,530.4 2.6 2.1 8.3 (2.6) 96.5 153.9 2.1 27.3 (4.1) 2,626.9 (67.5) (5.2) (17.9) 3.6 (2,051.5) (21.4) - (1.0) 0.7 (348.9) (0.3) (5.4) (9.2) (32.1) 64.7 (8.5) (0.8) 0.2 194.4 42.0% n.a n.a 7.4% (18.1) (0.3) (0.4) 0.1 (63.2) 46.6 (8.8) (1.2) 0.3 131.2 30.3% n.a n.a 5.0% (30.8) (30.8) 129

Concessions USW Campania Imprepar in Total consolidation Total projects liquidation adjustments Impregilo Intern. Infras. 273.2 2.2 11.3 (121.1) 495.5 - - - (211.4) - 273.2 2.2 11.3 (332.5) 495.5

52.4 401.5 - (13.0) 442.8 (8.8) (31.7) 19.3 22.6 (173.6) 271.8

(8.0) (20.1) 27.0 14.2 (306.6) (1.5) (226.7) (4.3) - - (9.5) (246.8) 22.7 14.2 (306.6) 307.3 125.2 53.3 (308.7) 729.9 676.2 (53.7) 729.9

25.1 0.2 87.9 58.0 58.0 (18.0) (0.3) (0.4) (63.2) (0.4) (0.4)

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Revenue in the year by geographical segment:

Italy Other EU Other European North countries (Non-EU) America (Euro/m) countries Revenue by geographical segment 1,040.8 281.1 190.5 34.1

Balance sheet as at 31 December 2008 by geographical segment:

Italy Other EU Other European North countries (Non-EU) America (Euro/m) countries Non-current assets, net 155.3 5.6 17.0 13.2 Goodwill (eliminated on consolidation) 211.4 130 Total non-current assets 366.7 5.6 17.0 13.2

Assets (liabilities) classified as held for sale 390.3 - - - Provision for contingencies and charges, Post-employment benefits, Employee benefits, Other non-current assets (liabilities) (114.4) (8.4) 14.5 2.9 Net tax assets

Working capital (471.5) 193.6 (15.9) (21.2) Total working capital (471.5) 193.6 (15.9) (21.2) Net invested capital 171.1 190.8 15.6 (5.1) Equity Net financial position Total financial resources Central and Middle East Rest of Eliminations Consolidated South America and Asia the World

713.7 670.6 48.9 (22.1) 2.957.6

Central and Middle East Rest of Eliminations Consolidated South America and Asia the World

245.7 23.0 10.2 6.6 476.6 (211.4) - 131 245.7 23.0 10.2 (204.8) 476.6

- - - (6.0) 384.3

(8.1) (5.2) (3.8) (23.7) (146.3) 224.2

174.1 33.8 (58.1) 8.6 (156.6) 174.1 33.8 (58.1) 8.6 (156.6) 411.7 51.6 (51.7) (225.9) 782.2 824.8 (42.6) 782.2

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

INTRODUCTION Impregilo group has prepared its 2008 consolidated financial statements on a going concern basis. As required by Regulation no. 1606/2002 issued by the European Parliament and Council, implemented in Italy by Legislative decree no. 38/2005, these consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and endorsed by the European Union up to 31 December 2008. They comprise a consolidated balance sheet, income statement, cash flow statement, statement of changes in equity and these notes. The consolidated financial statements have been prepared using the historical cost principle, except for those items which are recognised at fair value in accordance with IFRS, as described in the section on “Accounting policies”. The carrying amounts of assets and liabilities, hedged with transactions which qualify for hedge accounting, are adjusted to reflect changes in fair value related to the hedged risks. The consolidated balance sheet, income statement, cash flow statement and statement of changes in equity are presented in Euros and the amounts are shown in thousands of Euros, unless stated otherwise.

132 CHANGES IN ACCOUNTING STANDARDS The European Union endorsed IFRIC 11 (IFRS 2 - Group and Treasury Share Transactions), applicable from 1 January 2008. This interpretation has not affected the group’s 2008 financial statements. On 13 October 2008, the IASB issued an amendment to IAS 39 - Financial instruments: recognition and measurement - and to IFRS 7 - Financial instruments: disclosures - applicable from 1 July 2008. This allows in special circumstances: (i) reclassification of non-derivative financial assets belonging to the category “at fair value through profit or loss”; (ii) transfer of loans and receivables classified as “held for sale” to “held to maturity”, if the company has the intention and ability to hold such instruments for a foreseeable future period or until maturity. Adoption of the above amendment has not affected the group’s consolidated financial statements at 31 December 2008 as, due to the type and limited materiality of the above categories of financial instruments held by the group, it has not made the related reclassifications.

FORMAT AND CONTENT OF THE CONSOLIDATED FINANCIAL STATEMENTS The group’s consolidated financial statements include the balance sheet and income statement of the parent, Impregilo S.p.A., and the Italian and foreign operating companies controlled directly or indirectly by Impregilo S.p.A.. The separate financial statements, used for consolidation purposes, at 31 December 2008 approved by the internal bodies of the consolidated companies have been used for consolidation purposes. The financial statements are prepared by adopting the parent’s accounting policies. Where necessary, consolidation adjustments have been made to make the items affected by different accounting policies consistent. A list of the companies and other Impregilo group entities included in the consolidation scope is set out in the annexes with the schedules showing changes therein during the year. Based on information that came to light after preparing the 2005 consolidated financial statements and in accordance with the group’s consultants, the group decided that the conditions for application of IFRS 5 - Non-current assets classified as held for sale and discontinued operations continue to exist as in the 2007 financial statements. Therefore, it has recognised the USW Campania project net assets and results of operations separately in the consolidated balance sheet and income statement. Due to reasons outside Impregilo’s control, the period for completion of the sale has extended beyond the year allowed by IFRS 5. Despite this, the group’s commitment to finalising the sale as described in the directors’ report remains unchanged. Therefore, the directors have not deemed it necessary to change the accounting treatment of the assets in question as provided for in IFRS 5.9.

Format of consolidated financial statements In line with previous years, the group opted to present its consolidated financial statements at 31 December 2008 as follows: • Current and non-current assets and current and non-current liabilities are presented separately in the consolidated balance sheet. Current assets that include cash and cash equivalents are those expected to be realised, sold or used in the group’s normal operating cycle. Non-current assets include positive balances expected to be realised more than twelve months after the balance sheet date, including property, plant and equipment, intangible assets, financial assets and deferred tax assets. Current liabilities include payables 133 expected to be settled no more than twelve months after the balance sheet date, including the current part of medium/long-term loans. Non-current liabilities include payables expected to be settled more than twelve months after the balance sheet date, such as financial payables, personnel-related provisions and deferred tax liabilities. • The consolidated income statement gives a classification of costs by nature and shows the profit or loss before “Financing income (costs) and gains (losses) on investments” and income taxes. The profit or loss from continuing operations, the profits or losses from discontinued operations and the profit or loss attributable to minority interests and that attributable to shareholders of the parent are also disclosed. • The consolidated cash flow statement presents the cash flows from operating, investing and financing activities separately. The indirect method is used.

CONSOLIDATION CRITERIA The consolidated financial statements have been prepared by consolidating the financial statements at 31 December 2008 of Impregilo S.p.A., the parent, and the Italian and foreign companies which the parent directly or indirectly controls on a line-by-line basis. Control exists when the group has the power to govern, directly or indirectly, the financial and operating policies of an entity so as to obtain benefits from its activities. Generally speaking, control is presumed to exist when the group holds more than half of the voting rights either directly or indirectly. Entities or companies over which Impregilo has joint control, by virtue of an investment therein or specific contractual arrangements, are consolidated using the proportionate method as established by IAS 31. Associates are measured using the equity method. The financial statements used for consolidation are modified (made consistent) and reclassified to comply with the group’s accounting policies in line with the currently applicable IFRS.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The financial statements used are expressed in the functional currency, being the local currency or another currency in which most of the economic transactions and assets and liabilities are denominated. The functional currency for the majority of the parent’s foreign group branches is the Euro as this is the main currency they use to operate. Financial statements expressed in currencies other than the Euro are translated into Euros by applying the closing rates to the balance sheet items and the average annual rates to the income statement items. Differences arising from the translation of the opening equity using the closing rates are taken to the translation reserve.

The exchange rates used to translate the foreign currency financial statements into Euros are as follows:

Currency 31.12.2008 31.12.2008 31.12.2007 31.12.2006 Closing rate Average rate Closing rate Closing rate United States - USD 1.39170 1.47076 1.4721 1.3170 United Kingdom - GBP 0.95250 0.79629 0.7334 0.6715

134 Switzerland -CHF 1.48500 1.58739 1.6547 1.6069 Argentina - ARS 4.80444 4.63927 4.6369 4.0451 Brazil - BRL 3.24360 2.67373 2.6108 2.8133 Chile - CLP 888.08600 762.84700 733.0320 701.3880 China - CNY 9.49560 10.22360 10.7524 10.2793 Peru - PEN 4.37155 4.28672 4.4089 4.2097 Dominican Republic - DOP 49.06880 50.57070 49.6969 44.1154 Nigeria - NGN 193.24900 174.71600 174.3700 169.3440 Venezuela - VEB 2.98840 3.15815 3,161.0400 2,827.9900

When an investment is sold, the accumulated amount recognised in equity is released to the income statement. The key consolidation criteria used to prepare these consolidated financial statements may be summarised as follows: • subsidiaries are consolidated on a line-by-line basis, whereby: a) assets and liabilities, costs and revenue shown in the subsidiaries’ financial statements are fully recognised, regardless of the size of the investment therein; b) the carrying amount of the investment is eliminated against the group’s share of its equity; c) the main transactions between fully consolidated entities, including dividends distributed among group companies, are eliminated; d) minority interests are shown separately under equity and their share of the profit or loss for the year is similarly shown separately in the income statement. • investments in associates are measured using the equity method whereby the carrying amount of the investment is adjusted to consider: a) the parent’s share of the profit or loss of the associate realised after the acquisition date; b) modifications arising from changes in equity of the associate that are not taken to profit or loss as per the relevant IFRS; c) dividends distributed by the associates; d) any gains paid at acquisition (measured using the same criteria set out in the section on “Accounting policies” for goodwill); e) the share of the profit or loss deriving from application of the equity method, which is taken to profit or loss; f) standardisation to comply with the group accounting policies, where necessary. • Interests in joint ventures are consolidated using the proportionate method whereby the proportionate amount of the assets, liabilities, costs and revenue of the financial statements of the joint ventures is recognised. Dividends, revaluations and impairment losses on investments in consolidated companies and gains and losses on the intragroup exchange of investments in consolidated entities are eliminated. Gains and losses arising from transactions between consolidated companies, which are not realised directly or indirectly through transactions with third parties, are eliminated in line with the investment percentage.

135 BUSINESS COMBINATIONS The acquisition of subsidiaries is recognised using the method set out in IFRS 3. The cost is determined by summing the fair values of the assets acquired and liabilities assumed or incurred, the equity instruments issued by the group in exchange for control of the company acquired at the date when control is obtained, and the costs directly related to the combination. The identifiable assets, liabilities and contingent liabilities of the acquiree that meet the recognition requirements of IFRS 3 are recognised at their fair value at the acquisition date, except for non-current assets (or disposal groups) which are classified as held for sale as per IFRS 5. They are recognised and measured at the lower of purchase cost and fair value less costs to sell. Goodwill arising from the acquisition is recognised as an asset and initially measured at cost, being the excess of the purchase cost (determined as above) compared to the group’s share of the present value of the recognised identifiable assets, liabilities and contingent liabilities. If the group’s share of the present value of these assets, liabilities and contingent liabilities exceeds the purchase cost after their remeasurement, the excess is taken to profit or loss. Minority interests in the acquiree are initially measured as being equal to their share of the present value of the recognised assets, liabilities and contingent liabilities. When a business combination consists of more than one transaction involving the subsequent purchases of shares or quotas, each transaction is treated separately, using the cost and information related to fair value at the date of each transaction to determine any additional goodwill. When a subsequent purchase ensures control of the company, the part previously held is remeasured using the fair value of the identifiable assets, liabilities and contingent liabilities determined at the date of the subsequent purchase. The balancing entry of this revaluation is taken to equity attributable to the shareholders of the parent. Purchases made subsequent to obtaining control do not entail revaluations of the identifiable assets, liabilities and identifiable contingent liabilities at fair value. The positive or negative difference between the purchase cost and the additional purchase of the company’s net assets is allocated to goodwill. In the case of a sale of shares or quotas that does not involve loss of control, the difference between the sales price and the carrying amount of the assets sold is taken to profit or loss.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

BASIS OF PREPARATION The accounting policies adopted to draw up the group’s consolidated financial statements at 31 December 2008 comply with the IFRS and are consistent with those used to prepare the 2007 consolidated financial statements.

ACCOUNTING POLICIES Property, plant and equipment Impregilo group has opted to recognise property, plant and equipment at purchase or production cost net of accumulated depreciation and any impairment losses. Depreciation is calculated on a straight-line basis using rates determined based on the assets’ residual possible use. The annual rates are as follows:

Category Depreciation rate Land - Buildings 3% 136 Plant and machinery from 10% to 20% Industrial and commercial equipment from 25% to 40% Other assets from 12% to 25%

Land and buildings, plant and machinery with a carrying amount to be recovered mainly through their sale (rather than the asset’s continued use) are measured at the lower of their carrying amount and fair value less costs to sell. Assets classified as held for sale shall be immediately available for sale and their sale shall be highly probable (ie, the related commitments already exist). Their sales value shall be reasonable compared to their fair value. Assets acquired as a result of business combinations are recognised at fair value at the acquisition date and remeasured within a year. Such amount reflects their purchase cost. After their initial recognition, they are measured at cost, depreciated over their estimated useful lives and shown net of any impairment losses. When an asset consists of different significant components with different useful lives, they are recognised and subsequently measured separately. The carrying amount of property, plant and equipment is tested for impairment annually or whenever events or changes in circumstances take place indicating that the carrying amount will not be recovered. Reference should be made to the section on “Impairment of assets” for details on impairment testing. The group has adopted the alternative method to recognise borrowing costs directly related to the acquisition or construction of an asset that provides for their capitalisation as part of the cost of the asset, to the extent of its recoverable amount. As established by IAS 23 - Borrowing costs, the group has applied this method to all qualifying assets. Borrowing costs are capitalised when the costs of the acquisition of the asset and borrowing costs are incurred, and the activities necessary to bring the asset into a condition for its use have been started. The costs provided for but not yet paid related to qualifying assets are excluded from determination of the amount to be capitalised. Capitalisation of borrowing costs is suspended during extended periods in which active development is interrupted. Moreover, capitalisation of borrowing costs ceases when substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are complete. Costs incurred after the purchase are only capitalised if they increase the future economic benefits of the related asset. All other costs are expensed when incurred. Ordinary maintenance costs are fully expensed when incurred. Costs for extraordinary maintenance carried out at regular intervals are capitalised when they meet the criteria for capitalisation. Dismantlement and restoration costs of assets used for work in progress are added to the cost of the related asset and depreciated in line with the depreciation pattern of the asset to which they refer when they are expected and objectively determinable. Leasehold improvements are classified in the different items of property, plant and equipment on the basis of their nature. They are depreciated over the lower of the estimated useful life of the relevant asset and the residual term of the lease.

Property, plant and equipment acquired 137 and/or held with finance leases Assets held under finance leases whereby all the risks and rewards of ownership are substantially transferred to the group are recognised as group assets and classified as property, plant and equipment. The related payable to the lessor is shown under financial payables. The lease payment is split into the financial expense, taken to the income statement, and the principal repayment, offset against the financial payable. The carrying amount of the leased asset is determined considering its fair value or, if lower, the present value of the lease payments. Capitalised leased assets are depreciated over the shorter of the asset’s estimated useful life and the lease term. Leases where the lessor retains all the risks and rewards of ownership are treated as operating leases. The initial negotiation costs incurred for this type of lease increase the value of the related lease and are recognised over the lease term netted against the revenue generated by the lease. Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the lease term.

Freely transferable assets Freely transferable assets are covered by concession contracts. At 31 December 2008, they have been classified as non-current assets and measured, consistently with the criteria used in previous years, at cost, including borrowing costs and general costs that can be capitalised over the related contracts, as defined in the accounting policy for property, plant and equipment. The carrying amount includes any gains or losses deriving from contracts between group companies. This is because the awarding of such contracts takes place through tenders at market value and is similar to contracts performed on behalf of third parties as the resulting assets are transferred free of charge at the end of the concession to the concession grantor. Freely transferable assets are depreciated over the term of the concession in line with their economic lives. Any provision for their repair or replacement is recognised under the provisions for risks and charges. The carrying amount of freely transferable assets is tested for impairment whenever events or changes in circumstances take place indicating that the carrying amount will not be recovered. Reference should be made to the section on “Impairment of assets” for details on impairment testing. Concession contracts are dealt with in IFRIC 12 issued by the IFRIC in November 2006, which has not yet been endorsed by the European Union.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Goodwill and intangible assets with indefinite lives Goodwill and other intangible assets with indefinite lives are recognised at cost net of impairment losses. At 31 December 2008, Impregilo group did not have any intangible assets with indefinite lives other than goodwill. Goodwill acquired as part of a business combination consists of any excess of the cost of the acquisition over the acquirer’s interest in the fair value of the identifiable assets and liabilities and contingent liabilities acquired as at the date of the exchange transaction. Goodwill deriving from acquisitions is not amortised. It is tested annually for impairment or whenever conditions arise that presume impairment as per IAS 36 - Impairment of Assets. For impairment testing purposes, goodwill acquired as part of a business combination is allocated at the acquisition date to each of the cash-generating units (or groups of cash-generating units - CGUs) that will benefit from the acquisition. The carrying amount of goodwill is monitored at cash-generating unit level for internal management purposes. Impairment is determined by defining the recoverable amount of the cash-generating unit (or group of units) to which the goodwill is allocated. When the recoverable amount of the CGU (or group of CGUs) is lower than the carrying amount, an impairment loss is recognised. When goodwill is allocated to a CGU (or group of CGUs), the asset of which has been partly disposed of, the goodwill allocated to the 138 disposed of asset is considered to determine any gain or loss deriving from the transaction. In this case, the transferred goodwill is measured using the amounts related to the disposed of asset compared to the asset still held by the unit.

Other intangible assets Other intangible assets purchased or generated internally are recognised under assets in accordance with IAS 38 - Intangible assets when it is probable that the use of the asset will generate future economic benefits and the cost of the asset can be measured reliably. Those assets with finite useful lives are measured at purchase or development cost and amortised on a straight-line basis over their estimated useful lives. Recoverability of their carrying amount is checked by using the criteria set out in the section on “Impairment of assets”. The excess of the purchase cost compared to the group’s share of the net fair value of the high capacity business units acquired in the past is classified as other intangible assets and mainly refers to acquisition costs of the business units purchased. The related amortisation is calculated in line with the stage of completion of the work. Ancillary charges for share capital increases are recorded in equity as a decrease in the related reserve, net of deferred taxes. Ancillary charges for financing transactions are recognised under liabilities against the disbursed loan as per the criteria given in the section on “Loans and bonds”.

Other non-current assets Other non-current assets mainly consist of loans and receivables and claims related to completed or nearly completed contracts, as in the case of Imprepar S.p.A. in liquidation. This company’s liquidation plan provides for the realisation of the assets after twelve months from year end. These assets are measured at their estimated realisable value, by recognising provisions to adjust their carrying amount accordingly. Claims are only recognised for the amounts matured and that part which is held to be reasonably recoverable. The estimated realisable value is discounted if the time value of money is material depending on when settlement is expected to take place. Impairment of assets If there is any indication that an intangible asset or an item of property, plant and equipment is impaired, the recoverable amount of the asset is estimated to determine the amount of the impairment loss. Goodwill and other intangible assets with indefinite lives are tested annually for impairment. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. If a binding sales agreement does not exist, fair value is estimated using the observable prices of an active market, recent transactions or the best information available to reflect the amount the entity could obtain by disposing of the asset. Value in use is determined by discounting to present value the estimated future cash flows, expected to arise from the continuing use of an asset, gross of taxes, and, if reasonably determinable, from its disposal at the end of its useful life. Discounting is applied by using a pre-tax discount rate which reflects the present market value of the time value of money and specific risks. The assessment is made for individual assets or the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets from its continuing use (cash-generating unit). An impairment loss is recognised when the recoverable amount is lower than the carrying amount. If the reasons for the impairment loss are no longer valid, the impairment loss (except in the case of goodwill) is reversed and the adjustment is taken to profit or loss as a reversal of impairment 139 losses. A reversal of impairment losses is recognised to the extent of the lower of the recoverable amount and original carrying amount less depreciation/amortisation that would have been recognised had the impairment loss not been recognised.

Inventories of goods Inventories of goods are measured at the lower of average purchase cost and net realisable value. Cost includes the directly related costs and estimated realisable value is determined using the replacement cost of the asset or similar assets. Any write-downs are eliminated in subsequent years when the reasons therefor are no longer valid.

Contract work in progress and revenue from construction contracts Contract work in progress consists of work performed net of progress billings issued to customers. When payment of the consideration is completed, the related turnover, including the advances, is recognised under “Revenue - goods and services” in the income statement with the related variation in inventories. The provision for contractual risks is directly offset against inventories and is set up to cover possible charges and losses on contracts performed either directly by the group or as part of a joint venture. Contract work in progress is measured considering the consideration agreed with the customer and the stage of completion of the work. Revenue related to contract work in progress is recognised using the stage of completion method. The stage of completion is determined using the cost to cost method whereby the percentage of completion (the ratio between costs incurred and total estimated costs) is applied to the total estimated revenue. Given the technical complexity, size and length of time involved in completing contracts, the additional considerations are measured before an agreement is reached with the customer. Claims for additional considerations are considered when measuring contract work in progress when they can be quantified and they are reasonably certain to be made.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

In the case of events that take place after the balance sheet date but before the financial statements are approved, which provide additional information about expected profits or losses on the contract, this additional information is considered when determining the contractual revenue or costs to be incurred to complete the contract and for the recognition of any profits or losses. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately. The contract costs, included in the cost to cost calculation, may be classified as: • pre-operating costs, which include costs incurred during the start-up stage of the contract, before construction starts, such as the costs of design and specific studies carried out for the contract; organisation and production start-up costs and building site start-up costs. These pre-operating costs are included in the stage of completion calculation and in the cost to cost calculation once they have been incurred. During the initial stage of the contract, they are included in the carrying amount of work in progress, if recoverable, without recognising any profit margin when the profit or loss cannot be reliably determined; • contract operating costs, which include those directly attributable to the contract (eg, materials, subcontracting, labour, amortisation and depreciation, expropriation costs, etc.). They are recognised on an accruals basis and included in the calculation of the stage of completion; 140 • post-operating costs: this category includes site dismantlement costs generally incurred after the contract has been closed to remove the installations (or entire sites) and to return the machinery or plant to the company’s premises or transfer them to another site. This category also includes losses on abandoned materials and the cost of transporting unused materials. They are included in the contract estimate and, therefore, if incurred during the contract term, they are comprised in the calculation of the stage of completion. Therefore, no specific accruals are made to the income statement; • costs for services to be rendered after completion of the contract: when provided for in the contract, these costs mainly relate to services rendered after the contract has been completed. They may include assistance and supervision provided in the early stages of use of the plant or scheduled maintenance. If the contract does not include specific additional considerations for these services and the contact may be “closed” for accounting purposes (contracts are usually closed once work is completed and the customer has accepted the end result), the costs to be incurred to render these services when the contract is closed in the accounting records should be estimated and provided for in the specific items. These costs are included in the calculation to determine the contract revenue.

Real estate projects Closing inventories of real estate projects are those real estate areas developed with a view to selling them. They are measured at the lower of costs incurred and estimated realisable value. Costs incurred consist of the consideration paid for purchasing the areas and related charges, construction costs and borrowing costs related to the project up to and not exceeding its completion.

Financial assets and liabilities Measurement and presentation of financial instruments are covered by IAS 39 and IAS 32. The group has introduced the disclosure required by IFRS 7 from 2007. The financial instruments used by the group are classified as follows: financial assets or financial liabilities at fair value through profit or loss, loans and receivables, held-to-maturity investments and available-for-sale financial assets. Financial assets or financial liabilities at fair value through profit or loss This category also includes derivatives that do not meet hedge accounting requirements. Fair value gains or losses on derivatives in this category are recognised as “Financing income (costs)” in profit or loss when they arise.

Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted on an active market. They are measured at amortised cost, as detailed further on, and any gains or losses arising therefrom are recognised as “Financing income (costs)” in profit or loss under the amortised cost method.

This category includes the following items: • Trade receivables and payables and other receivables and payables Trade and other receivables are recognised at amortised cost, net of impairment losses determined on the basis of their estimated recoverable amount calculated by analysing each position and the total non-collection risk. 141 If the collection date is postponed and exceeds normal collection times for the sector, these receivables are discounted. All factored receivables that do not meet the requirements for derecognition under IAS 39 continue to be recognised in the group’s financial statements even when they have been legally transferred. They are thus included as assets and a financial liability of the same amount is recognised. Trade and other payables are recognised at amortised cost allocating the effective interest rate to the income statement, being the rate that exactly discounts estimated future cash payments through to the carrying amount of the financial asset.

• Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits and other short-term, highly liquid investments with a term of less than three months. In the cash flow statement, this item is shown net of bank borrowings at the balance sheet date.

• Loans and bonds Loans and bonds are initially recognised at cost, being the fair value of the consideration received less transaction costs. After initial recognition, loans are measured at amortised cost, whereby repayments are determined using the effective interest method with a rate which matches, at initial recognition, the expected cash flows with the initial carrying amount. Amortised cost is calculated considering the issue costs and any discounts or premiums provided for at settlement. The effects arising from the recognition at amortised cost are taken to “Financing income (costs)”.

Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity that the group has the positive intention and ability to hold to maturity. They are recognised at amortised cost, and interest accrued thereon is taken to profit or loss under “Financial income” using the effective interest method.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Available-for-sale financial assets Available-for-sale financial assets are non-derivatives that are not classified in the other categories. They include the following items: •Equity investments Investments in entities other than subsidiaries, associates and interests in joint ventures (reference for which should be made to the section on “Consolidation scope”) are classified as “Equity investments” at the time of their acquisition and are included in the available-for-sale financial assets category required by IAS 39. Since they mainly relate to consortia and consortium companies of which the group holds less than 20%, in accordance with IAS 39, such investments are stated as non-current assets measured at cost, adjusted for impairment, since their fair value cannot be determined. Investments in listed companies belonging to this category are measured at fair value and the related fair value gains or losses are recognised in equity. Dividend income from such financial instruments is recognised in profit or loss under financial income when the group companies holding the investments are given the right to such dividend.

142 Fair value of financial instruments The fair value of financial instruments has been estimated as follows: • The fair value of financial instruments traded on an active market is based on the market price at the reporting date or, where more significant, the average price of the last month of the year. This method has been applied especially to listed financial instruments classified as “Available-for-sale financial assets” and financial instruments classified as “Held-to-maturity investments”. • The fair value of the derivatives classified as “Hedging derivatives” and “Financial assets and financial liabilities at fair value through profit or loss” has been measured based on the Discounted Cash Flow Model. With respect to interest rate swaps, discounted cash flows have been estimated using the implicit forward rate of the market Euro curve at 31 December 2008 and 2007, while the forward exchange rate market prices at the relevant reporting date have been used for currency forward transactions. • The fair value of loans and receivables has been determined on the basis of the present value of their future cash flows discounted at a rate equal to the current interest rates applicable in the relevant markets and the average spread agreed by the group.

Derecognition of financial assets and liabilities (a) Financial assets A financial asset (or, where applicable, part of a financial asset or parts of a group of similar financial assets) is derecognised when: (i) the contractual rights to the cash flows from the financial asset expire; (ii) the group retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients in full and immediately; (iii) the group transfers the contractual rights to receive the cash flows of the asset and: (a) has transferred substantially all the risks and rewards of ownership of the financial asset; or (b) neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset but has transferred control. When the group has transferred the contractual rights to receive the cash flows of the financial asset and has neither transferred nor retained substantially all the risks and rewards or has retained control, it continues to recognise the asset to the extent of its continuing involvement in the asset. Continuing involvement that takes the form of guaranteeing the transferred asset is measured at the lower of the initial carrying amount of the asset and the maximum amount of the consideration that the group could be required to pay. When the group’s continuing involvement takes the form of a written and/or purchased option on the transferred asset (including options settled in cash or similar options), the extent of the group’s continuing involvement is the amount of the transferred asset that the group may repurchase. However, in the case of a written put option on an asset that is measured at fair value (including the options settled in cash or similarly), the extent of the group’s continuing involvement is limited to the lower of the fair value of the transferred asset and the option exercise price.

(b) Financial liabilities Financial liabilities are derecognised when the underlying obligation is discharged, cancelled or expires. When an existing financial liability is exchanged with another by the same lender at substantially different terms, or the terms of an existing liability are substantially modified, this exchange or modification is treated as an extinguishment of the original financial liability and the recognition of a new financial liability. The difference between the carrying amounts is recognised in profit or loss. 143

Impairment of financial assets If there is any indication that a financial asset is impaired, the recoverable amount of the asset is estimated to determine the amount of the impairment loss.

Derivatives and hedging transactions Impregilo group has derivatives recognised at fair value when the related agreement is signed and for subsequent fair value changes. The treatment of the related fair value gains or losses changes depending on whether the conditions for hedge accounting are met, as described below. Impregilo group has derivatives to hedge currency, financial and commodity (raw materials such as copper, nickel and steel) price risks. At the inception of the transaction, it documents the hedging transaction, its risk management and strategy objectives in entering into the transaction, the hedging instrument and hedged item or transaction and the nature of the hedged risk. Moreover, at the inception of the transaction and thereafter on an ongoing basis, the group documents whether or not the hedge meets the effectiveness requirements to offset its exposure to changes in the fair value of the hedged item or cash flows attributable to the hedged risk. Based on the above-mentioned documentation, derivatives used for specific hedging purposes are classified and recognised as follows: (a) Fair value hedge - If a derivative is designated as a hedge of exposure to changes in the fair value of an asset or liability due to a specific risk that may affect profit or loss, the gain or loss deriving from the subsequent measurement of the fair value of the hedging instrument is taken to profit or loss. The gain or loss on the hedged item, related to the hedged risk, changes the carrying amount of this item and is taken to profit or loss. (b) Cash flow hedge - If a derivative is designated as a hedge of exposure to changes in cash flows of an asset or liability or a highly probable transaction and could affect profit or loss, the effective part of the gains or losses on the financial instrument is taken to equity.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The cumulative gain or loss is derecognised from equity and taken to profit or loss in the same period in which the hedged transaction is recognised. The gain or loss related to a hedge or part of a hedge which has become ineffective is taken to profit or loss immediately. If a hedging instrument or a hedging relationship is closed, but the hedged transaction has not yet taken place, the cumulative gains and losses, recognised in equity up to then, are reclassified to profit or loss when the transaction takes place. If it is unlikely the hedged transaction will take place, the unrealised gains and losses recognised in equity are immediately recognised in profit or loss. The scope of the hedge is assessed in strategic terms. When they do not meet the requirements of IAS 39 for hedge accounting, the derivatives are classified as “Financial assets or financial liabilities at fair value through profit or loss”.

Employee benefits • Short-term and long-term benefits Short-term employee benefits, that is, payable within twelve months of the end of the year in which the employees rendered the service, are recognised as a cost and as a liability for the undiscounted amount of benefits expected to be paid in exchange for that service. Long-term benefits, such as remuneration to be paid after twelve months of the end of the year in which the employees rendered the 144 service, are recognised as liabilities for an amount equal to the present value of the benefits at the balance sheet date. • Post-employment benefits Post-employment benefits are recognised at the actuarial value of the group’s payable determined in line with ruling legislation and national and in-house labour agreements. The actuarial method, based on demographic, financial and turnover assumptions, is applied by independent actuaries. The related gains and losses are taken to profit or loss as costs or revenue. The 2007 finance act and related implementing decrees have introduced significant changes to legislation governing Italian post- employment benefits, effective as from 1 January 2007. These include the option given to the employee, to be exercised before 30 June 2007, of where to allocate its future benefits. Specifically, the employee could opt to allocate them to selected pension funds or maintain them with the company, in which case, the latter shall pay the entitlements to the treasury fund of the Italian Social Security Institution (“INPS”). Following these changes, the Italian post-employment benefits accruing after the date of the employees’ decision and, in any case, after 30 June 2007, are considered part of a defined contribution plan and treated like all other social security contributions. • Share-based payments The group has applied the standards set out in IFRS 2 - Share-based payment. In line with the treatments for first-time adoption, IFRS 2 has been applied to all stock options assigned after 7 November 2002 and not yet vested at 1 January 2005. Stock option plans for the subscription of new shares of the parent only cover the physical delivery of the shares issued for the related share capital increase at the exercise date in exchange for payment by the beneficiaries of the exercise price. Share-based payments are measured at fair value of the option at the grant date. This amount is recognised in the income statement on a straight-line basis over the vesting period. This treatment is based on an assessment of the stock options that will effectively vest in favour of the qualifying employees. Determination of fair value is based on the binomial method for the measurement of options. The useful life used in the model was adjusted in line with the measurement of the effects of the non-transferability of shares, restrictions to exercise rights and considerations about employee behaviour. Income taxes Current taxes are provided for using the tax rates and applying the tax laws ruling in Italy and other countries in which the group operates, based on the best estimate of the taxable profit for the year. Group companies net deferred tax assets and liabilities when this is legally allowed. Beginning from 2004, the parent Impregilo S.p.A. and certain of its Italian subsidiaries have joined the national tax consolidation system which is regulated by the conditions set out in agreements drawn up by the participating companies. The group’s overall tax position is shown in the consolidated financial statements after derecognising intragroup transactions deriving from the netting of taxable profits. Deferred tax assets and liabilities are calculated on the basis of the temporary differences between the tax base of an asset or liability and their carrying amount in the balance sheet. Deferred tax assets are recognised when the group holds their recovery to be probable. The carrying amount of deferred tax assets is reviewed at each year end and, to the extent necessary, is decreased when it is no longer probable that sufficient taxable profits will be available in the future to use all or part of the related benefit. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the 145 liability is settled, based on tax rates that have been enacted or substantially enacted by the balance sheet date. Deferred tax assets and liabilities are classified as non-current assets and liabilities, respectively, and are netted at company level if related to taxes that may be compensated. If the balance is positive, it is recognised as “Deferred tax assets”, if not, as “Deferred tax liabilities”. In the case of transactions recognised directly in equity, the related deferred tax asset or liability also affects equity.

Provisions for contingencies and charges In accordance with IAS 37, the group makes accruals to provisions for risks and charges when the following conditions exist:

• the group or a group company has a present obligation (legal or constructive) at the balance sheet date as a result of a past event where an outflow of resources embodying economic benefits will be required to settle the obligation;

• it is probable that the obligation (through an outflow of resources) will have to be settled;

• a reliable estimate can be made of the amount of the obligation.

When the time value is material and the obligation payment dates can be estimated reliably, the amount recognised as the provision equals the pre-tax future cash flows (ie, forecast outflows) discounted at a rate that reflects the present market value and risks specific to the liability. The increase in the provision over time is taken to the income statement as a financial expense. When the expected cash flows are included in an estimate range with the same probability of occurrence, the median value is discounted to measure the liability. Provision for restructuring costs is made when the parent or relevant group company has approved a detailed formal plan that has been implemented and communicated to the third parties involved.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Translation criteria for foreign currency items and translation of financial statements of consolidated companies or companies measured using the equity method expressed in currencies other than the Euro The translation criteria for foreign currency items adopted by the group are as follows: • foreign currency monetary assets and liabilities, excluding property, plant and equipment, intangible assets and equity investments measured at cost, are measured at the closing spot rate with any exchange rate gains or losses taken to the income statement; • property, plant and equipment and intangible assets (non-monetary assets) are recognised at historic cost denominated in the foreign currency and translated using the historic exchange rate; • revenue and costs related to foreign currency transactions are recognised in profit or loss at the exchange rate ruling on the date of the transaction; • any material effects deriving from changes in exchange rates after the balance sheet date are disclosed in the notes. With respect to the translation of financial statements of consolidated companies or companies measured using the equity method and expressed in currencies other than the presentation currency (functional currency), reference should be made to the section on “Consolidation criteria”. 146

Revenue recognition • Operating and other revenue Revenue is measured to the extent it is probable that the economic benefits will flow to the group and the related amount can be reliably determined. Revenue from the sale of goods is recognised when the group has shipped the goods and has transferred all the material risks and rewards of ownership to the buyer. Revenue from construction contracts is recognised as provided for in the related Standard, described below. When the outcome of a construction contract can be estimated reliably, contract revenue is recognised by reference to the stage of completion of the contract activity at the balance sheet date based on the ratio between the costs incurred up to the balance sheet date and the total estimated contract costs, unless this is not held to represent the stage of completion of the contract. Changes in the contract, claims and incentive payments are recognised to the extent that they are reasonably certain. Revenue is recognised only to the extent of contract costs incurred that it is probable will be recoverable. Contract costs are recognised as an expense in the period in which they are incurred. • Interest income Interest income is recognised on an accruals basis, considering the disbursed amount and applicable effective interest rate, ie, the rate that discounts the estimated future inflows over the expected life of the financial asset to return it to its carrying amount. • Dividends Dividends are recognised when the shareholders’ right to receive payment arises in line with local ruling legislation.

Earnings per share Basic earnings per share are calculated as the ratio of the profit or loss for the year attributable to the holders of the ordinary shares of the parent 147 to the weighted number of ordinary shares outstanding during the year. Diluted earnings per share are calculated considering the potential diluting effect of the shares to be allocated to the beneficiaries of vested stock options when calculating the number of outstanding shares.

Segment reporting The group’s primary segment reporting is by business segment followed by geographical segment. The segments in which the group operates and which are used for the primary segment are Construction, Engineering & Plant Construction, Concessions, USW Campania projects and Imprepar. The group’s management and organisational structure mainly reflects the primary segment by business activity. The group’s geographical sectors for the secondary segment reporting are: Europe, North America, Central and South America, Middle East ,Asia and Rest of the World. The operating activities are organised and managed by type of activity and by country (belonging to the geographical area). The inter-segment transfer prices related to the exchange of goods and services are agreed at normal market conditions. Reference should be made to the directors’ report for information on the performance of each segment.

Significant estimates Preparation of financial statements and the related notes in accordance with the IFRS requires management to make judgements and estimates that affect the carrying amount of assets and liabilities and financial statements disclosures. The estimates are used to determine impairment of assets, amortisation and depreciation, employee benefits, taxes and provisions for risks and charges as well as to determine total contract costs and the related stage of completion. The actual results may differ from those estimated due to uncertainties underlying the assumptions and the conditions on which the estimates are based. A significant part of the group’s activities is typically performed on the basis of contracts which provide that a specific consideration is agreed when the contract is awarded. This implies that the profits on these contracts may undergo change compared to the original estimates depending on the recoverability of greater expenses and/or costs the group may incur during performance of such contracts.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Fundamental assumptions about the future and other reasons for uncertainty when making the estimates at the balance sheet date that may lead to material adjustments to the carrying amount of the assets and liabilities are described in the specific section of the directors’ report which gives an analysis of the risk areas of each segment.

Business combinations As mentioned in the directors’ report’s section on the Concessions segment, on 6 February 2008, through Primav Ecorodovias (35% held by the group), Impregilo group executed its acquisition of 100% of the Brazilian company Rodovias das Cataratas S.A., which subsequently changed its name to Ecocataratas. The following table summarises the carrying amounts of assets and liabilities as shown in the company’s balance sheet at the acquisition date and the corresponding fair values determined for purchase price allocation (PPA) purposes (to the extent of the group’s investment):

(Euro/000) Carrying amount Fair value Cash and cash equivalents 2,353 2,353 Freely transferable assets 11,271 62,055 148 Other non-current liabilities, net (47) (47) Current portion of loans (3,973) (3,973) Other current liabilities, net (2,971) (2,971) Total 6,633 57,417

The fair value of freely transferable assets has been measured by discounting the expected future cash flows from the concession arrangement. The cash used for the acquisition of Ecocataratas, net of cash acquired, is set out below:

(Euro/000) Cash and cash equivalents 2,353 Freely transferable assets 62,055 Other non-current liabilities, net (47) Current portion of loans (3,973) Other current liabilities, net (2,971) Total 57,417 Less cash acquired (2,353) Cash used for the acquisition of Ecocataratas, net of cash acquired 55,064

The 2008 income statement includes the following results following the acquisition of Ecocataratas (to the extent of the group’s investment):

(Euro/000) Revenue 13,949 Operating profit 5,802 Profit for the year 3,681 BALANCE SHEET Net invested capital

1. Net non-current assets Net non-current assets are as follows:

(Euro/000) Note 31 December 2008 31 December 2007 Change Property, plant and equipment 1.1 145,787 154,904 (9,117) Freely trasferable assets 1.2 187,457 187,222 235 Intangible assets 1.3 51,613 52,999 (1,386) Goodwill 1.4 58,890 58,890 - Investments 1.5 32,901 41,472 (8,571) Total 476,648 495,487 (18,839)

1.1 Property, plant and equipment 149 Property, plant and equipment amount to euro 145.8 million, down from the 31 December 2007 figure by euro 9.1 million. The historical cost and carrying amount are given in the following table:

31 December 2008 31 December 2007 Cost Acc. Carrying Cost Acc. Carrying (Euro/000) depreciation amount depreciation amount Land 2,489 - 2,489 3,907 - 3,907 Buildings 16,322 (3,829) 12,493 15,927 (1,809) 14,118 Plant and machinery 188,194 (107,436) 80,758 212,355 (118,158) 94,197 Industrial and commercial equipment 39,928 (31,739) 8,189 46,411 (39,061) 7,350 Other assets 86,836 (57,877) 28,959 100,212 (65,663) 34,549 Assets under constr. and payments on account 12,899 - 12,899 783 - 783 Total 346,668 (200,881) 145,787 379,595 (224,691) 154,904

Changes during the year are summarised below:

31 December Increases Depreciation impairment Reclassifi- Disposal Exchange Change in 31 December 2007 losses cations rate consolidation 2008 (Euro/000) losses scope Land 3,907 - - (170) (434) (645) (41) (128) 2,489 Buildings 14,118 410 (418) (969) (1,132) (67) 544 7 12,493 Plant and machinery 94,197 24,457 (23,954) (6,469) 1,287 (9,127) (275) 642 80,758 Industrial and commercial equipment 7,350 4,754 (3,108) (59) 247 (401) (542) (52) 8,189 Other assets 34,549 7,274 (9,613) (415) 431 (2,380) 211 (1,098) 28,959 Assets under constr. and payments on account 783 12,267 - - - - (151) - 12,899 Total 154,904 49,162 (37,093) (8,082) 399 (12,620) (254) (629) 145,787

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The most significant changes include: • increases of euro 49.2 million, mainly due to investments made for the foreign contracts of the Construction segment; • depreciation of euro 37.1 million, including euro 33.6 million relating to the Construction segment, euro 2.6 million to the Concessions segment and euro 0.9 million to the Engineering & Plant Construction segment; • impairment losses totalling euro 8.1 million, recognised on the following items of property, plant and equipment during the year: (i) assets previously used for the contract in Iceland, which the group can no longer use for other contracts, since their wear and tear exceeded expectations; (ii) property, plant and equipment of Caminos de Las Sierras fully impaired together with its other assets, as detailed in note 1.2. • disposals of euro 12.6 million, euro 10.7 million of which relating to the disposal of assets related to Construction segment contracts being wound up.

1.2 Freely transferable assets Freely transferable assets amount to euro 187.5 million. The gross and net carrying amounts are given in the following table: 150

31 December 2008 31 December 2007 Cost Acc. Carrying Cost Acc. Carrying (Euro/000) depreciation amount depreciation amount Freely transferable assets 319,224 (131,767) 187,457 298,643 (111,421) 187,222

Changes of the year are detailed in the following table:

31 December Increases Depreciation Impairment Reclassifications Exchange 31 December 2007 losses rate gains 2008 (Euro/000) (losses) Caminos de Las Sierras 14,170 427 (986) (13,619) - 8 - Parking Glasgow 12,783 - (427) - - (2,871) 9,485 Parcheggio Arezzo 10,154 - (371) - (9,783) - - Mercovia - Argentina 2,210 302 (144) - - (71) 2,297 Primav Ecorodovias - Brazil 147,905 88,378 (19,296) - - (41,312) 175,675 Total 187,222 89,107 (21,224) (13,619) (9,783) (44,246) 187,457

The increase for the year principally relates to the Brazilian company Primav Ecorodovias, due to the fair value gain on the concession acquired in February 2008, together with the investment in the concession company Ecocataratas (formerly Rodovias das Cataratas). The change recognised by Primav was largely due to the strong depreciation of the Brazilian currency against the Euro, which went from an exchange rate of 2.61 at the end of 2007 to 3.24 at the end of 2008, down by 24%, mainly in the last quarter of the year. The carrying amount of assets under concession held by the Argentine company Caminos de Las Sierras, which was affected by the impairment losses recognised in 2005 and 2006, was fully impaired together with the other items making up its invested capital, given the worsening of the concession company’s already unstable financial position due to the non-adjustment of tariffs, as described in the directors’ report’s section on the Concessions segment. Moreover, following the agreement reached with the Arezzo municipal authorities for a car park management concession, currently managed by Imprepar, the group reclassified the carrying amount of part of such assets to current assets (real estate projects of euro 3.5 million) and recognised the grant of euro 6.3 million approved by the Tuscany regional authorities pursuant to the “Tognoli” law as a direct reduction in freely transferable assets (net of the discounting effect).

1.3 Intangible assets Intangible assets amount to euro 51.6 million, slightly down from the 31 December 2007 figure. The gross and net balances are given in the following table:

31 December 2008 31 December 2007 Cost Acc. Carrying Cost Acc. Carrying (Euro/000) amortisation amount amortisation amount Industrial patents 1,551 (1,506) 45 394 (341) 53 Software 1,806 (1,138) 668 1,442 (1,108) 334 Contract acquisition costs 107,018 (57,415) 49,603 107,018 (54,598) 52,420 151 Other 4,142 (2,845) 1,297 2,954 (2,762) 192 Total 114,517 (62,904) 51,613 111,808 (58,809) 52,999

Changes during the year are set out below:

31 December Increases Amortisation Other Reclassifications Exchange 31 December 2007 impairment rate gains 2008 (Euro/000) losses (losses) Industrial patents 53 - (8) - - - 45 Software 334 585 (255) (53) 50 7 668 Contract acquisition costs 52,420 - (2,817) - - - 49,603 Other 192 992 (84) - 245 (48) 1,297 Total 52,999 1,577 (3,164) (53) 295 (41) 51,613

Contract acquisition costs include considerations paid by the parent to purchase the railway high speed/capacity business units in previous years. These assets have a finite life and are amortised in line with the stage of completion of the related contracts. The balance is as follows:

(Euro/000) 31 December 2007 Amortisation 31 December 2008 Cavet (Florence - Bologna railway line) 517 (300) 217 Cavtomi (Turin - Milan railway line) 5,429 (2,517) 2,912 Cociv (Milan-Genoa railway line) 46,474 - 46,474 Total 52,420 (2,817) 49,603

Amortisation of the contract acquisition costs for the high capacity business units is calculated using the stage of completion method of the contracts based on the cost to cost method and considering the related purchase dates.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Amortisation of the acquisition costs for the Milan-Genoa railway line contract has not yet started as the related works have not commenced. Assets recognised at year end are deemed to be recoverable either through the ongoing arbitration proceeding for the customer’s contractual non-compliance or re-commencement of the related works. Reference should be made to the second part of the directors’ report for more information on Consorzio Cociv’s specific position.

1.4 Goodwill Goodwill amounts to euro 58.9 million, unchanged from 31 December 2007, and relates to the following cash-generating units:

(Euro/000) Business Unit 31 December 2008 FISIA Babcock Engineering & Plant Construction 11,875 FISIA Italimpianti Engineering & Plant Construction 14,230 Shangai Pucheng Concessions 18,515 Primav Ecorodovias Concessions 14,270 Total 58,890 152 The FISIA Italimpianti balance includes euro 10.9 million generated by the purchase of 49% of FISIA Italimpianti S.p.A. by the parent on 21 December 2005 from Equinox Investment Company S.c.p.a. for euro 68.5 million. The residual euro 3.3 million is the goodwill that arose on the merger of FISIA Partecipazioni into FISIA carried out before 2004. The Primav Ecorodovias balance is the result of its consolidation using the proportionate method (the investment in this Brazilian concession company is held by Impregilo International Infrastructures). The FISIA Babcock and Shangai Pucheng balances arose from the acquisitions from third parties of the related investments and business units in previous years. As required by IAS 36, goodwill, being an intangible asset with an indefinite life, is not amortised systematically but is subject to impairment testing at least annually. The impairment test is carried out by estimating its recoverable amount, value in use and the future cash flows that the related cash-generating unit will generate.

In order to calculate value in use, the relevant pre-tax cash flows have been discounted using the following rates:

31 December 2008 31 December 2007 Growth rate Discount rate Growth rate Discount rate Fisia Babcock 2.00% 10.90% 2.00% 9.70% Fisia Italimpianti 2.00% 11.70% 2.00% 9.70% Shangai Pucheng n.a (*) 5.90% n.a (*) 8.75% Primav Ecorodovias n.a (*) 12.92% n.a (*) 9.07%

(*) The growth rates are those set out in the concession’s financial plans included in the agreements with the concession grantor. The expected future cash flows were estimated by management on the basis of past experience and expected future market trends.

Expected cash flows are based on the following:

(i) with reference to FISIA Babcock and FISIA Italimpianti, the forecasts included in the 2009-2011 business plans and the terminal value estimated using the growth rates set out in the previous table;

(ii) with reference to Shangai Pucheng, the forecasts included in the business plan, which has been drawn up based on the agreement with the local government which expires in 2033. This agreement allows a reliable estimate of the future cash flows based on stable rates and business volumes, with a slight decrease due to the wear and tear of plant over time. The terminal value has been estimated as the carrying amount of current assets and liabilities at the end of 2033, since the agreement provides that they will be paid at the expiry date;

(iii) with reference to Primav, the forecasts based on the existing concession contracts and estimated traffic volumes over their term.

Given the current overall market crisis, the group has performed a sensitivity analysis, considering the potential effects of changes in the 153 reference variables:

• discount rates, for all cash-generating units, since they are caused by conditions that the group cannot control;

• growth rates, with particular reference to FISIA Italimpianti, considering the recent events affecting the company. For the other cash- generating units, expected future cash flows are sufficiently ensured by the existing contracts with their customers and the conditions of the markets in which they operate.

The recoverable value determined as above, also considering the sensitivity analysis described above, was greater than the related carrying amounts of all the cash-generating units detailed above and, therefore, no impairment losses were recognised.

1.5 Equity investments Investments in associates and other companies amount to euro 24.0 million, almost unchanged from 31 December 2007. Available-for- sale financial assets decreased by euro 7.6 million to euro 8.9 million.

(Euro/000) 31 December 2008 31 December 2007 Change Investments in associates and other companies 23,957 24,966 (1,009) Available-for-sale financial assets 8,944 16,506 (7,562) Total 32,901 41,472 (8,571)

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The key figures of equity-accounted investees are set out below:

(Euro) IFRS Segment Investee Country Business % Equity Total Net financial Equity Revenue Profit (loss) under local assets position for the year GAAP (debt) Concessions Cons. Agua Azul S.A. Perù Water 25.50% 4,956,537 9,169,117 3,403,199 4,956,537 2,147,616 246,714 Concessions Impregilo Wolverhampton United Ltd. Kingdom Hospitals 20.00% 34,231 3,870,250 1,201,105 34,231 801,318 108,888 Concessions Enecor S.A. Argentina Energy 30.00% 266,468 1,083,731 1,021,205 1,023,162 429,827 9,378 Concessions Yacylec S.A. Argentina Energy 18.67% 1,472,995 1,893,515 287,229 1,472,995 2,818,464 1,041,765 Concessions Coincar Argentina Concessions 35.00% 3,662,528 8,259,847 (4,541,438) 3,662,528 (956,593) (215,516)

154 No significant events occurred during the year with reference to the Argentine associates Puentes de Litoral and Aguas del Gran Buenos Aires such as to require revision of the assessments made in previous years, which are described in the notes to those previous year annual financial statements. Information on the term of the concession agreements is set out in the directors’ report, in the section on the relevant business segment. “Available-for-sale financial assets” relate to the investment in the listed company Mediterranea delle Acque which is measured at fair value at euro 8.9 million (euro 16.5 million at 31 December 2007). The euro 7.6 million loss has been recognised in the related equity reserve. The December 2008 average market price has been used to calculate the fair value of this asset. Following an accurate assessment of this fair value loss, the group holds that it does not reflect an impairment loss.

The decrease in “Investments in associates and other companies” is summarised in the following table:

Change in consolidation method 7,478 Acquisitions/disinvestments 4,712 Share of profit or loss of associates (8,098) Dividends from associates and other investees (2,387) Change in translation reserve of associates (2,714) Total (1,009)

The group’s share of profit or loss of associates, which, as detailed in note 14.2 was a loss of euro 12.0 million, affected the caption “Investments in associates and other companies” to the extent of the carrying amount of such investments, which was positive at the reporting date, for euro 8.1 million. The residual loss of euro 3.9 million refers to investments with a negative carrying amount, which has been therefore recognised in the “Provision for risks on investments” (see note 3). The group’s share of profit or loss of associates also includes the cancellation of the remaining carrying amount of euro 9.9 million of the 50.71%investment in Impresit Bakolori P.l.c. (Nigeria) in the last few months of 2008. This company was excluded from the consolidation scope due to the significant worsening in the general stability of the area in which it operates. As a result, the group was unable to control the subsidiary’s operations and management, as it had done regularly in previous years.

2. Assets (liabilities) classified as held for sale Net non-current assets classified as held for sale may be analysed as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current assets classified as held for sale 411,884 442,789 (30,905) Liabilities directly associated with non-current assets as held for sale (27,584) - (27,584) Non-current assets (liabilities) classified as held for sale 384,300 442,789 (58,489)

The following table summarises the assets and liabilities classified as held for sale: 155

31 December 2008 31 December 2007 USW Total USW Ponte de Pedra Total Change (Euro/000) Campania proj. Campania proj. Non-current assets classified as held for sale Non-current assets 411,884 411,884 389,660 - 389,660 22,224 Equity investments - - 52,428 52,428 (52,428) Current assets - - 701 - 701 (701) Cash and cash equivalents ------Total non-current assets classified as held for sale 411,884 411,884 390,361 52,428 442,789 (30,905) Liabilities directly associated with non-current assets as held for sale Current liabilities (27,584) (27,584) - - - (27,584) Total liabilities directly associated with assets as held for sale (27,584) (27,584) - - - (27,584) Assets (liabilities) classified as held for sale 384,300 384,300 390,361 52,428 442,789 (58,489) Net financial position ------

Changes during the year in non-current assets are summarised below:

(Euro/000) 31 December 2007 Increase Decrease Reclassification 31 December 2008 USW Campania projects 389,660 21,523 - 701 411,884 Investment in Ponte de Pedra 52,428 - (52,428) - - Total 442,088 21,523 (52,428) 701 411,884

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The USW Campania projects’ increase is due to continuation of works at the Acerra waste-to-energy plant. The current liabilities associated with the above-mentioned assets relate to advances received from the commissioner. During the first half of the year, the group executed the sale of the investment in the Brazilian concession company Ponte de Pedra S.A., which had already been classified as held for sale at 31 December 2007 as required by IFRS 5. The net consideration of roughly euro 109 million led to a net gain for the group of euro 67.5 million, which has been recognised in profit or loss under “Gains (losses) on investments”.

3. Provisions for risks and charges The provisions for risks and charges amount to euro 177.9 million at year end, as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Provisions for risks on investments 16,492 11,020 5,472 Other provisions 161,393 187,518 (26,125) Total 177,885 198,538 (20,653)

156 The provisions for risks on investments relate to expected impairment losses on investments in associates for the part that exceeds their carrying amount. Changes in these provisions are detailed below:

Acquisitions/disinvestments (102) Share of profit or loss of equity-accounted investees 3,943 Dividends from associates and other investees 323 Other changes, including change in translation reserve 1,308 Total 5,472

Other provisions are comprised as follows:

(Euro/000) 31 December 2008 31 December 2007 Change USW Campania projects 80,471 85,958 (5,487) Provisions set up by Imprepar and its subsidiaries 24,646 27,679 (3,033) Contract completion losses 15,608 16,268 (660) Ongoing litigation 15,440 30,654 (15,214) Building and Services segment litigation 13,471 16,429 (2,958) Environmental risks 2,961 1,344 1,617 Other 8,796 9,186 (390) Total 161,393 187,518 (26,125)

The euro 26.1 million decrease over 31 December 2007 is summarised in the following table:

31 December Accrual Utilisation Other Exchange Other 31 December 2007 on P&L Utilisation rate gains changes 2008 (Euro/000) (losses) Total other provisions 187,518 14,091 (28,651) (3,353) (947) (7,265) 161,393 Changes of the year comprise:

(i) the euro 14.1 million accrual mainly relating to Imprepar (euro 5.0 million), the Construction segment (euro 3.6 million), the Concessions segment (euro 3.5 million, especially in relation to Caminos de la Sierras) and the Engineering & Plant Construction segment (euro 2.0 million);

(ii) utilisations of euro 28.6 million, including euro 16.6 million used against the risks for which they had been accrued and euro 12.0 million for the difference between estimates made in previous years and settlement of the litigation which had led to the recognition of the provisions. This item mainly relates to contracts of the Construction segment (euro 20.1 million) and ongoing litigation on old contracts of Imprepar (euro 3.7 million).

The change in consolidation scope relates to the 31 December 2007 carrying amount of the provision for risks recognised in the separate financial statements of Impresit Bakalori. Following the latter’s exit from consolidation, the item has been eliminated.

The provisions for the USW Campania projects include the estimated costs and a prudent estimate of the risks relating to pending litigation based on information currently available. Reference should be made to the relevant section of the directors’ report for additional information. 157 The provisions set up by Imprepar and its subsidiaries include accruals made for probable future charges related to the closing of contracts and effects of ongoing litigation.

The provision for ongoing litigation refers to disputes involving Impregilo and certain of its subsidiaries.

“Building and Services segment litigation” relates to provisions for risks and charges previously accrued by Impregilo Edilizia e Servizi, which was merged into Impregilo S.p.A. in 2007. The utilisations for the year principally relate to a number of disputes nearing settlement for the Greek branch and Arabian branch.

The provision for environmental risks, set up by FISIA Italimpianti and FISIA Babcock, mainly relates to the management of the Fossano landfill for future charges related to the closing and post-closing activities.

“Other” comprises accruals for sundry litigation (including of a tax nature), for Italian and foreign group companies.

During 2008, the parent commenced a dispute with the Milan tax office about an assessment challenging the tax treatment of impairment losses and losses in 2003 of certain investments held by the parent in that year. The most significant issue relates to the parent’s sale of its entire investment in the Chilean concession company Costanera Norte S.A. to Impregilo International Infrastructures N.V. in 2003.

The parent has challenged the unlawfulness of the criteria adopted by the tax office to determine the “normal value” of the sale. The office redetermined the alleged transfer value using the consideration paid by third parties which acquired the concession company in 2006 as a basis, limiting itself to discounting this consideration over the period from the sales date in 2006 to the date of the previous transfer from Impregilo to Impregilo International Infrastructures. This is to demonstrate the greater tax that it claims should have been paid. Before the dispute was commenced, Impregilo had fully demonstrated with the related documentation the correctness of the method adopted in 2003, which had, moreover, been approved by an independent appraisal at the time of the sale. However, the tax office had not considered this documentation. At the date of the original sale, the Chilean concession company was still “constructing” its infrastructure and had only just commenced (without having completed) the activities aimed at obtaining financing to complete these works. During the preliminary stage of the dispute, Impregilo obtained a new, independent appraisal of the disputed transfer price to support its calculation. This was prepared

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

by a leading international advisory firm. It also informed the tax office that another investment in the Chilean concession company, then held by SIMEST S.p.A., a state-owned company, had also been transferred to Impregilo International Infrastructures in April 2004 for a substantially equal consideration (given the different investment percentages) to that being disputed. Despite these arguments, the local commission (first level) rejected Impregilo’s case without specifying why, fully accepting the tax office’s claims and ordering the company to pay the assessed tax, interest and fines of approximately euro 52 million. This measure was appealed against before the second level court. The lawyers assisting the parent agree with it, as already stated in 2007 when the dispute was commenced, that there are valid reasons to hold that the greater tax imposed by the tax office is unlawful, deeming that the unfavourable first level ruling was deficient in terms of the reasoning, based moreover on illegitimate arguments and without objective grounds. Therefore, Impregilo has not made any provision therefor either in its separate or consolidated financial statements.

4. Post-employment benefits and employee benefits At 31 December 2008, the group’s liability due to all its employees determined using the criteria set out in IAS 19 is euro 33.4 million. An independent actuary performed the actuarial valuation of the post-employment benefits, which are the largest component of this item. 158 The actuarial valuation was based on the following rates: • turnover rate 8%; • discount rate 4.5%; • advance payment rate 2%; • inflation rate 2%.

Changes in the provision are as follows:

31 December Accrual Payments Contributions paid Other December 2007 to INPS treasury changes 2008 (Euro/000) and other funds Post-employment benefits and employee benefits 36,417 18,321 (18,123) (3,701) 505 33,419

5. Other non-current assets (liabilities) and non-current receivables due from associates These items include:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current receivables due from associates 17,700 19,210 (1,510) Other non-current assets 57,777 64,084 (6,307) Other non-current liabilities (10,443) (21,921) 11,478 Total 65,034 61,373 3,661

Non-current receivables due from associates at year end (euro 17.7 million) are substantially in line with the previous year.They relate to amounts due from associates, including the English Ochre Holding (Concessions segment) of euro 5.7 million, the Swiss consortium CMC 851 (Construction segment) of euro 4.5 million, the joint venture Iris Terna (in which Impregilo holds an investment through its Greek branch) of euro 3.7 million and the joint venture Linea metropolitana 3 (in which Impregilo holds an investment through its Greek branch) of euro 1.3 million. Other non-current assets amount to euro 57.8 million, down euro 6.3 million on the 31 December 2007 balance. The item mainly consists of financial and other receivables of the Imprepar segment as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Imprepar and its subsidiaries 51,981 57,877 (5,896) Caminos - 3,019 (3,019) Primav 1,047 1,186 (139) Vegas Tunnel 3,233 - 3,233 Other 1,516 2,002 (486) Total 57,777 64,084 (6,307)

The decrease is mainly due to the reclassification of the euro 6.7 million balance relating to Imprepar, which includes work in progress, trade receivables and other receivables due within one year, in line with the related liquidation plan, to other current assets. The items relate 159 to both Italian and foreign customers. Other non-current liabilities amount to euro 10.4 million, down euro 11.5 million on 31 December 2007 balance, as shown in the following table:

(Euro/000) 31 December 2008 31 December 2007 Change Other non-current payables to third parties 1,034 18,139 (17,105) Financial payables to third parties 510 511 (1) Payables to employees 1,239 894 345 Payables to state bodies 7,660 2,377 5,283 Total 10,443 21,921 (11,478)

The decrease in other non-current liabilities of euro 11.5 million mainly relates to the payable due by Primav Ecorodovias group companies to the concession grantors. This caption has been reclassified from “Other non-current payables to third parties (31 December 2007) to “Payables to state bodies” (31 December 2008).

6. Net tax assets Net tax assets total euro 224.2 million at 31 December 2008, down euro 47.6 million on 31 December 2007, as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Deferred tax assets 64,104 74,893 (10,789) Current tax assets 237,362 261,744 (24,382) Deferred tax liabilities (16,954) (10,706) (6,248) Current tax liabilities (60,264) (54,117) (6,147) Total 224,248 271,814 (47,566)

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Deferred tax assets, net of deferred tax liabilities when offsetting is permitted, total euro 64.1 million, down euro 10.8 million on 31 December 2007. Deferred tax liabilities amount to euro 17.0 million, up euro 6.2 million on the previous year end. Details on the related changes are given in note 15.

Current tax assets decreased by euro 24.4 million to euro 237.4 million at 31 December 2008 as follows:

(Euro/000) 31 December 2008 31 December 2007 Change VAT 102,371 130,654 (28,283) Other Italian indirect taxes 9,210 1,947 7,263 Foreign indirect taxes 5,437 3,696 1,741 Direct taxes 87,020 72,549 14,471 IRAP 3,946 4,877 (931) Other Italian direct taxes 2,356 14,783 (12,427) Foreign direct taxes 15,706 18,400 (2,694) 160 Tax credits and withholdings 11,135 14,482 (3,347) Other 181 356 (175) Total 237,362 261,744 (24,382)

Impregilo group factored part of its VAT and IRPEG receivables with recourse to leading factoring companies in 2007. The amount involved totalled euro 101.4 million (including VAT and IRPEG receivables of euro 61.3 million and euro 40.1 million, respectively). The group collected euro 35.0 million of that amount relating to VAT claimed for reimbursement by the CA.V.TO.MI. consortium in 2003 and 2004.

Current tax liabilities of euro 60.3 million rose euro 6.1 million over 31 December 2007. They may be analysed as follows:

(Euro/000) 31 December 2008 31 December 2007 Change IRES 6,074 2,364 3,710 IRAP 2,229 3,462 (1,233) Foreign taxes 15,579 32,172 (16,593) Withholdings 1,354 884 470 VAT 26,036 7,720 18,316 Foreign indirect taxes 547 651 (104) Withholdings applied in Italy 4,272 5,224 (952) Other 4,173 1,640 2,533 Total 60,264 54,117 6,147 7. Working capital The working capital at 31 December 2008 is a negative euro 156.7 million (31 December 2007: negative euro 306.6 million) and is made up as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Inventories 7.1 59,408 59,459 (51) Contract work in progress 7.2 707,609 472,159 235,450 Advances on contract work in progress 7.3 (713,111) (776,588) 63,477 Trade receivables 7.4 880,946 866,159 14,787 Trade payables 7.5 (1,167,234) (1,000,515) (166,719) Net receivables due from associates 7.6 87,927 68,441 19,486 Other current assets 7.7 276,206 295,511 (19,305) Other current liabilities 7.8 (288,419) (291,228) 2,809 Total (156,668) (306,602) 149,934

7.1 Inventories 161 Inventories total euro 59.4 million at year end, as shown in the following table:

31 December 2008 31 December 2007 Gross carrying Provision Net carrying Gross carrying Provision Net carrying Change (Euro/000) amount amount amount amount Real estate projects 25,320 (9,120) 16,200 21,800 (7,772) 14,028 2,172 Finished products and goods 4,200 - 4,200 4,914 - 4,914 (714) Raw materials, consumables and supplies 43,830 (4,822) 39,008 40,842 (428) 40,414 (1,406) Work in progress and semi-finished products - - - 103 - 103 (103) Total 73,350 (13,942) 59,408 67,659 (8,200) 59,459 (51)

7.1.1 Real estate projects Real estate projects amount to euro 16.2 million, up by euro 2.2 million from 31 December 2007. The year-end balance mainly relates to the real estate project of euro 11.5 million (net of the related provision of euro 7.8 million) for the construction of a factory outlet. This project has been delayed since the relevant municipality has not yet implemented the measures necessary to start the works, as mentioned in the notes to the 2007 consolidated financial statements. The increase is due to the reclassification of the Arezzo car park by Imprepar (euro 2.2 million, net of the provision of euro 1.3 million) from freely transferable assets to real estate projects, following the agreement reached with the Arezzo municipal authorities for the park’s management, currently carried out by Imprepar.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

7.1.2 Finished products and goods and Raw materials, consumables and supplies The net balance of these items totals euro 4.2 million and euro 39.0 million, respectively, and mainly relates to goods to be used for a number of foreign contracts, including those of the Construction segment in Venezuela and Nigeria, as well as the Italian contracts for the construction of the new offices of the Lombardy Regional Authorities and the Salerno-Reggio Calabria motorway, and the Engineering & Plant Construction segment.

7.2 Contract work in progress Current assets include contract work in progress, which totals euro 707.6 million at 31 December 2008, up by euro 235.4 million on the 31 December 2007 balance. The following table shows contract work in progress calculated using the stage of completion method net of losses realised or estimated at the reporting date and progress billings:

(Euro/000) 31 December 2008 31 December 2007 Change Contract work in progress 9,727,799 8,874,223 853,576 Advances received (on approved work) (9,020,190) (8,402,064) (618,126) Total 707,609 472,159 235,450

162 A breakdown of contract work in progress by business unit is as follows:

Contract work in progress (Euro/000) 31 December 2008 31 December 2007 Change Construction 362,484 283,284 79,200 Engineering & Plant Construction 314,675 172,689 141,986 Concessions 345 - 345 Imprepar 30,105 16,186 13,919 Total 707,609 472,159 235,450

Contract work in progress of the Construction segment mainly relates to railway work in Venezuela (euro 143.6 million, with production of euro 210.1 million during the year), high speed/capacity railway contracts (euro 60.8 million, with production of euro 324.5 million during the year) and works on the Lots 5 and 6 of the Salerno-Reggio Calabria motorway (euro 63.9 million, (with production of euro 122.3 million during the year). The increase in the Construction segment, is due to the completion of the works relating to the Icelandic branch, in addition to the progress of the contracts in Venezuela and the Salerno-Reggio Calabria motorway. Contact work in progress of the Engineering & Plant Construction segment mainly relates to the Qatar and United Arab Emirates desalination plant, with respect to which reference is made to the relevant section in the directors’ report. The item “Imprepar” relates to contracts being wound up.

7.3 Advances on contract work in progress The item “Advances on contract work in progress” included in “Current liabilities” amounts to euro 713.1 million, down euro 63.5 million on the figure at 31 December 2007. It comprises:

(Euro/000) 31 December 2008 31 December 2007 Change Contract work in progress (5,140,965) (5,564,353) 423,388 Advances received (on approved work) 5,488,795 5,973,677 (484,882) Contractual advances 365,281 367,264 (1,983) Total 713,111 776,588 (63,477) Contract work in progress recognised under liabilities (negative WIP) is the negative net balance, for each contract, of work performed to date, the provision for contractual risks and progress billings.

The following table shows the contribution by segment:

31 December 2008 31 December 2007 (Euro/000) Negative WIP Advances Total Negative WIP Advances Total Construction 188,598 286,403 475,001 211,560 251,432 462,992 Engineering & Plant Construction 159,040 71,391 230,431 194,563 109,099 303,662 Concessions - - - 3,009 427 3,436 Imprepar 192 7,487 7,679 192 6,306 6,498 Total 347,830 365,281 713,111 409,324 367,264 776,588

The Construction segment balance relates principally to the high speed/capacity railway contracts (euro 251.4 million, with production of euro 242.2 million), contracts in Venezuela (euro 60.3 million), while the remainder mainly relates to the new contracts in Libya (euro 70.0 163 million, relating to advances) and the United States, Lake Mead, (euro 48.9 million, with production of euro 24.6 million).

7.4 Trade receivables At 31 December 2008, receivables show a net increase of euro 14.8 million at euro 880.9 million. They may be broken down as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Trade receivables 986,546 975,450 11,096 Provision for bad debts (105,600) (109,291) 3,691 Total 880,946 866,159 14,787

The balance relates to amounts due from customers for invoices issued and for work performed and approved by customers but still to be invoiced. The increase is due to invoices issued mainly in the Construction segment for the Venezuelan contracts (euro 48.4 million), by Consorzio Torre (euro 20.5 million) and for the Lake Mead contract (euro 13.3 million), partially offset by the decrease due to contracts being wound up (Turin-Milan high speed/capacity railway consortium and Icelandic branch) and collections for the Salerno-Reggio Calabria motorway collected at the end of the third quarter from Anas.

The provision for bad debts decreased by euro 3.7 million to euro 105.6 million during the year, as follows:

31 December Accrual Utilisation Other Exchange 31 December 2007 on P&L Utilisations rate gains 2008 (Euro/000) scope (losses) Provision for bad debts 49,129 4,820 (3,627) (3,737) (423) 46,162 Provision for default interest 60,162 47 (125) (646) - 59,438 Total 109,291 4,867 (3,752) (4,383) (423) 105,600

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Changes of the year relate to: • accruals of euro 4.9 million made to adjust the carrying amount of receivables to reflect their actual recoverability, euro 4.2 million of which relating to Imprepar; • utilisations of euro 8.1 million, mainly relating to the settlement of certain disputes, for which the amount had been provided for by Impregilo and Imprepar.

7.5 Trade payables Trade payables amount to euro 1,167.2 million at year end, with an increase of euro 166.7 million on 31 December 2007. They are made up as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Trade payables 1,167,234 1,000,515 166,719

The main item of the trade payables consists of euro 500.0 million due to suppliers of the Construction segment, which rose euro 79.2 164 million over the previous year end, euro 510.3 million due to those of the Engineering & Plant Construction segment, up by euro 122.7 million over the previous year end, and euro 128.4 million due to those of the USW Campania projects, down by euro 39.9 million over the previous year end.

7.6 Receivables and payables due from and to non-consolidated group companies The net intragroup balance at year end is a positive euro 87.9 million, up euro 19.5 million with respect to 31 December 2007. It is analysed in the following table:

(Euro/000) 31 December 2008 31 December 2007 Change Receivables 157,364 157,205 159 Payables (69,437) (88,764) 19,327 Net balance 87,927 68,441 19,486

This item mainly relates to trading and financial relationships among equity-accounted investees.

7.7 Other current assets Other assets of euro 276.2 million show a decrease of euro 19.3 million on the previous year end and may be analysed as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Financial receivables 8,886 12,750 (3,864) Advances to suppliers 103,885 143,621 (39,736) Other receivables 104,780 110,294 (5,514) Prepayments and accrued income 58,655 28,846 29,809 Total 276,206 295,511 (19,305) Financial receivables decreased to euro 8.9 million, down by euro 3.9 million over 31 December 2007, mainly due to the collection of the receivable of euro 3.0 million by the Greek branch. Advances to suppliers fell euro 39.7 million over 31 December 2007 due to the Engineering & Plant Construction segment’s completion of a number of contracts, and the decrease in the Construction segment, mainly in relation to the high speed/capacity railway contracts.

A breakdown by segment is set out in the following table:

(Euro/000) 31 December 2008 31 December 2007 Change Construction 34,682 46,620 (11,938) Engineering & Plant Construction 68,885 96,319 (27,434) Concessions 182 594 (412) Imprepar 136 88 48 Total 103,885 143,621 (39,736)

Other receivables amount to euro 104.8 million, down euro 5.5 million on the 2007 year end. The decrease is due to amounts due from 165 partners in consortia and joint ventures. Other receivables include receivables of FIBE and FIBE Campania totalling euro 69.2 million due from the commissioner for the waste emergency in Campania. These are amounts incurred by FIBE and FIBE Campania in the name and on behalf of the commissioner, to be borne by the latter, which had not been settled at the reporting date. Reference should be made to the directors’ report for details on the relevant contractual terms. Prepayments and accrued income of euro 58.7 million show an increase of euro 29.8 million on 31 December 2007. The rise is mainly due to commissions on sureties and other costs related to the Vega Tunnel and Venezuelan contracts which will be recognised in profit or loss in future periods based on the stage of completion of the related contracts.

They are broken down in the following table:

(Euro/000) 31 December 2008 31 December 2007 Change Accrued income: - Other 69 296 (227) Total accrued income 69 296 (227) Prepayments: - Insurance 16,466 11,596 4,870 - Commissions on sureties 19,833 4,226 15,607 - Leases 510 671 (161) - Costs recognised in line with stage of completion of contracts 19,934 8,423 11,511 - Other 1,843 3,634 (1,791) Total prepayments 58,586 28,550 30,036 Total 58,655 28,846 29,809

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

7.8 Other current liabilities Other current liabilities of euro 288.4 million (euro 291.2 million) comprise:

(Euro/000) 31 December 2008 31 December 2007 Change Social security institutions 9,952 14,357 (4,405) Personnel 27,333 28,537 (1,204) Compensation and compulsory purchases 31,832 35,954 (4,122) State bodies 117,832 116,245 1,587 Other payables 80,139 71,569 8,570 Accrued expenses and deferred income 19,990 22,990 (3,000) Provisions for risks and charges 1,341 1,576 (235) Total 288,419 291,228 (2,809)

They comprise: • payables due to employees for matured holiday pay; 166 • payables due to state bodies (euro 117.8 million), related to FIBE and FIBE Campania (euro116.2 million, unchanged from the previous year end) and Primav Ecorodovias (euro 1.6 million, nil at 31 December 2007); • payables for compensation and compulsory purchases, related to the high speed/capacity railway contracts nearing completion (euro 4.1 million); • other payables of euro 80.1 million (euro 71.6 million at 31 December 2007), mainly relating to sums due for the acquisition of business units in previous years and to partners in foreign joint ventures; • accrued expenses and deferred income of euro 20.0 million, which relate to the following items:

(Euro/000) 31 December 2008 31 December 2007 Change Accrued ex penses: - Commissions on sureties 5,466 5,340 126 - Ten-y ear liability insurance 7,204 7,898 (694) - Insurance 784 571 213 - Other accrued ex penses 6,341 3,540 2,801 Total accrued expenses 19,795 17,349 2,446 Deferred income: - Other deferred income 195 5,641 (5,446) Total deferred income 195 5,641 (5,446) Total 19,990 22,990 (3,000)

8. Equity Equity attributable to the shareholders of the parent amounts to euro 824.8 million at 31 December 2008 compared to euro 676.2 million at the end of 2007. Changes of the year in the different equity items are summarised in the schedule attached to the consolidated financial statements. For a better understanding of changes in consolidated equity, a breakdown of equity of Impregilo S.p.A. at 31 December 2007 is set out below:

(Euro) Share capital 716,614,496 Reserves to be used to cover losses, including: Legal reserve 23,721,420 Share premium reserve 13,310,015 Stock option reserve 5,013,388 Negative goodwill 5,068,362 Total 47,113,185 Unavailable hedging reserve 2,200,055 Negative components: Share capital increase related charges (25,394,224) Losses carried forward (13,987,660) Total (39,381,884) Loss for the year of Impregilo S.p.A. (1,880,487) 167 In their meeting held on 7 May 2008, the shareholders of Impregilo S.p.A. resolved to cover the loss for the year of euro 1.9 million and the other negative equity items of euro 39.4 million, giving a total of euro 41.3 million, by using: • the entire stock option reserve of euro 5.0 million; • the entire share premium reserve of euro 13.3 million; • part of the legal reserve for euro 17.9 million. In addition to the above utilisations, shown in the statement of changes in consolidated equity under “Allocation of profit”, the resolution provided for the use of the entire negative goodwill of euro 5.1 million, which, in the consolidated financial statements, is included in “Retained earnings (losses) carried forward”. Disclosures about the individual items are set out below.

Share capital The parent’s share capital of euro 718.4 million increased by euro 1.7 million over 31 December 2007 due to a share capital increase carried out for the purposes of the stock option plan, as detailed below:

(Euro/000) Share capital 31 December 2007 716,614 Share capital increase 1,750 31 December 2008 718,364

A statement of capital increase to euro 718,364,456.72 was filed with the Milan Company Registrar on 9 May 2008, following the subscription of newly-issued shares by those benefiting from the stock option plan approved by the shareholders of Impregilo S.p.A. in the extraordinary meeting of 26 September 2005. As a result, the parent’s share capital amounts to euro 718,364,456.72 at 31 December 2008, split into 404,073,428 shares, including 402,457,937 ordinary shares and 1,615,491 savings shares.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Share premium reserve This reserve underwent the following changes:

(Euro/000) Share premium reserve 31 December 2007 13,310 Coverage of losses (13,310) Share capital increase 1,222 31 December 2008 1,222

The use of the entire reserve available at 31 December 2007 is due to the shareholders’ resolution of 7 May 2008 mentioned above. The rise in this reserve is due to the share capital increase carried out during the year for the purposes of the stock option plan, following the exercise by the related beneficiaries of their options.

Other reserves 168 This item is broken down in the following table:

(Euro/000) 31 December 2008 31 December 2007 Change Revaluation reserve - 1,108 (1,108) Legal reserve 5,851 23,721 (17,870) Translation reserve (3,251) 15,624 (18,875) Stock option reserve - 5,013 (5,013) Hedging reserve (5,098) (1,285) (3,813) Fair value reserve (13,539) (5,977) (7,562) Consolidation reserve 1,375 1,375 - Capital increase related charges - (25,394) 25,394 Total (14,662) 14,185 (28,847)

• Revaluation reserve Following the exclusion of Impresit Bakolori from the consolidation scope, the revaluation reserve has been fully reversed.

• Legal reserve This reserve underwent the following changes:

(Euro/000) Legal reserve 31 December 2007 23,721 Coverage of losses and negative reserves (17,870) 31 December 2008 5,851

The use of the reserve is due to the shareholders’ resolution of 7 May 2008 mentioned above. • Translation reserve Differences arising from the translation of equity of the consolidated companies and those measured using the equity method at the closing rates are taken to this reserve which was a negative euro 3.3 million, following the changes for the year set out below:

(Euro/000) Translation reserve 31 December 2007 15,624 Reclassification to profit or loss of the portion relating to the associate Ponte de Pedra sale (11,639) Exit of Bakolori from consolidation scope 1,183 Increase (decrease) (8,419) 31 December 2008 (3,251)

The reduction for the year is due to exchange rate fluctuations of certain foreign currencies, especially those of South America.

• Stock option reserve The use of the entire reserve is due to the shareholders’ resolution of 7 May 2008. 169

• Hedging reserve Certain group companies have agreed interest rate swaps to hedge existing loans. Changes in the reserve that includes their fair value gains or losses are as follows:

(Euro/000) Hedging reserve 31 December 2007 (1,285) Reclassification of fair value gains/losses on settled transactions to profit or loss (1,529) Fair value gains/losses (3,248) Other net exchange rate gains 964 31 December 2008 (5,098)

The conditions giving rise to the recognition of this reserve are commented on the notes to the relevant financial assets (liabilities) that generated it.

Changes in this reserve during 2007 are set out below for comparative purposes:

(Euro/000) Hedging reserve 31 December 2006 (116) Reclassification of fair value gains/losses on settled transactions to profit or loss (646) Reclassification of fair value gains/losses on hedging transactions that are no longer effective (1,238) Net fair value gains 715 31 December 2007 (1,285)

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

• Fair value reserve The euro 7.6 million decrease in the carrying amount of the investment in the listed company Mediterranea delle Acque due to fair value losses entailed a balancing entry made in this equity item. The conditions giving rise to the recognition of this reserve are commented on the notes to the relevant assets that generated it.

• Consolidation reserve This reserve of euro 1,375 thousand is unchanged from 31 December 2007.

• Share capital increase related charges This item had a negative balance of euro 25,394 thousand at the end of 2007 and has been fully covered, as described above.

Minority interests Changes in minority interests are as follows:

170 (Euro/000) Share capital and reserves Profit (loss) Total minority interests 31 December 2007 (4,565) (632) (5,197) 2007 profit (632) 632 - Profit or loss for the year attributable to minority interests - (154) (154) Change in consolidation scope 9,021 - 9,021 Change in translation reserve and other changes 512 - 512 31 December 2008 4,336 (154) 4,182

Reconciliation of equity and profit of Impregilo S.p.A. with consolidated equity and consolidated profit The following table shows the reconciliation of equity and profit of the parent with the corresponding consolidated items.

(Euro/000) Equity Profit or loss 2008 equity and profit for the year of Impregilo S.p.A. under IFRS 806,894 83,040 Elimination of consolidated investments (341,282) 9,614 Elimination of the provision for risks on consolidated investments 22,812 Equity and profit or loss of consolidated companies 406,089 30,766 Other consolidation entries Elimination of internally-generated goodwill (119,953) 29,021 Elimination of dividends (25,476) Gains on intragroup sales 574 Elimination of national tax consolidation system effects 46,092 40,107 Equity and profit for the year attributable to the shareholder of the parent 820,652 167,646 Minority interests 4,182 (154) 2008 consolidated equity and profit for the year 824,834 167,492 9. Net financial position The group’s net financial position amounts to euro 42.6 million compared to net financial indebtedness of euro 53.7 million at the previous year end. It may be broken down as follows:

(Euro/000) Note 31 December 2008 31 December 2007 Change Non-current financial assets 9.1 54 115 (61) Other current financial assets 9.2 47,171 99,811 (52,640) Cash and cash equivalents 9.3 944,880 875,627 69,253 Total cash and other financial assets 992,105 975,553 16,552 Medium/long-term bank and other loans 9.4 (258,734) (353,256) 94,522 Bonds 9.5 (55,222) (64,049) 8,827 Financial lease payables 9.6 (1) (219) 218 Total medium/long-term financial indebtedness (313,957) (417,524) 103,567 Current portion of bank loans and current account facilities 9.4 (543,452) (506,797) (36,655) Current portion of bonds 9.5 (1,903) (3,144) 1,241 171 Current portion of finance lease payables 9.6 (33) (765) 732 Total short-term financial indebtedness (545,388) (510,706) (34,682) Derivatives (with positive fair value) 9.7 4,153 3,339 814 Derivatives (with negative fair value) 9.7 (7,168) (2,935) (4,233) Other financial receivables 9.8 23,480 - 23,480 Other financial payables 9.8 (110,649) (101,438) (9,211) Totale other items in net financial position (90,184) (101,034) 10,850 Net financial position (indebtedness) continuing operations 42,576 (53,711) 96,287 Total net financial position of discontinued operations - - - Net financial position (indebtedness) including discontinued operations 42,576 (53,711) 96,287

There are no financial receivables/payables due from/to related parties at either 31 December 2008 or 2007.

9.1 Non-current financial assets Non-current financial assets are almost unchanged from the previous year end, as shown below:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current financial assets 54 115 (61)

This item includes treasury bonds whose carrying amount is in line with their fair value.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

9.2 Other current financial assets Other current financial assets are as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Other current financial assets 47,171 99,811 (52,640)

This item includes the group companies’ investments of liquidity in treasury bonds and guaranteed-return insurance instruments.

Specifically, the following have been classified as “Held-to-maturity financial investments”:

• investments of the subsidiary FISIA Babcock Environment GmbH in short-term German treasury bonds bearing market interest rates. Their carrying amount at the balance sheet date is euro 0.1 million (euro 15.5 million at 31 December 2007), which is in line with fair value;

• securities issued by a leading Italian insurer held by the CAV.TO.MI. consortium (euro 40.7 million, euro 75.3 million at 31 December 2007), initially pledged as a guarantee for the surety given to the customer TAV for payment of the contractual advance for the Novara- 172 Milan railway line. The change for the year is due to the partial repayment and accrued interest;

• Venezuelan treasury bonds held by the Venezuelan subsidiary of Impregilo S.p.A. (euro 3.5 million) to temporary invest its liquidity. These bonds were redeemed immediately after year end for an amount equal to their carrying amount;

• other securities totalling euro 2.9 million, which include treasury bonds mainly held by group companies in liquidation. Their carrying amount is in line with their fair value.

9.3 Cash and cash equivalents At 31 December 2008, cash and cash equivalents amount to euro 944.9 million, up by euro 69.3 million, as shown below:

(Euro/000) 31 December 2008 31 December 2007 Change Cash and cash equivalents 944,880 875,627 69,253

The consolidated cash flow statement shows the reasons for this increase and changes in current account facilities (note 9.4).

The restrictions on cash and cash equivalents include Consorcio Acqueducto Oriental’s deposits of euro 13.3 million which are tied up for specific projects.

Moreover, the obtaining of funds by the members of consortia (in which Impregilo is involved) is subject to approval by all the consortium members in order to protect the financial requirements of the related contracts. 9.4 Bank and other loans Bank and other loans decreased by euro 57.9 million over 31 December 2007 to euro 802.2 million at year end, as summarised below:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current 258,734 353,256 (94,522) Current 543,452 506,797 36,655 Total 802,186 860,053 (57,867)

The group’s financial indebtedness is broken down by loan type in the following table:

31 December 2008 31 December 2007 (Euro/000) Non-current Current Total Non-current Current Total Bank corporate loans 190,583 311,234 501,817 284,289 335,545 619,834 Bank project financing 30,781 328 31,109 21,534 73,644 95,178

Bank concession financing 27,056 49,963 77,019 31,830 2,364 34,194 173 Financing and mortgage loans of companies in liquidiation 2,714 1,706 4,420 4,403 537 4,940 Other loans 7,600 19,353 26,953 11,200 3,282 14,482 Total bank and other loans 258,734 382,584 641,318 353,256 415,372 768,628 Current account facilities - 160,868 160,868 - 91,425 91,425 Total 258,734 543,452 802,186 353,256 506,797 860,053

Bank corporate loans Bank corporate loans relate to the loans granted to the parent Impregilo (euro 425.5 million) and the subsidiary FISIA Italimpianti (euro 76.3 million). They are broken down in the following tables:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current financial portion current (Euro/000) liabilities portion liabilities portion Banca Intesa Impregilo Italy 192,332 83,474 108,858 235,956 111,541 124,415 MCC Impregilo Italy 106,409 106,409 - 106,690 106,690 - Popolare dell'Emilia Impregilo Italy - - - 15,007 15,007 - OPI/West LB Impregilo Italy 106,709 24,984 81,725 154,659 46,265 108,394 Royal Bank of Scotland Impregilo Italy 20,028 20,028 - - - - Banca di Roma FISIA Italimpianti Italy 38,550 38,550 - 69,638 30,658 38,980 West LB FISIA Italimpianti Italy 12,630 12,630 - 37,884 25,384 12,500 Popolare di Sondrio FISIA Italimpianti Italy 25,159 25,159 - - - - Total 501,817 311,234 190,583 619,834 335,545 284,289

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The main conditions of the loans in place at 31 December 2008 are as follows:

Company Interest rate Expiry date Note Banca Intesa Impregilo Euribor 1M 2011 (2) MCC Impregilo Euribor 1M 2009 (2) OPI/West LB Impregilo Euribor 6M 2012 (1) Royal Bank of Scotland Impregilo Euribor 1M 2009 Banca di Roma FISIA Italimpianti Euribor 6M 2010 (3) West LB FISIA Italimpianti Euribor 6M 2009 Popolare di Sondrio FISIA Italimpianti 5.20% 2009

In addition, variable spreads are applicable to the interest rates set out above, based on the term and conditions of the loan. Note: (1) An interest rate hedge has been agreed against this loan. A description of the derivative contract is set out in note 9.7. Moreover, the loan includes certain covenants, ie, the obligation to maintain certain financial ratios. At the reporting date, no indications of non-compliance with such covenants were noted. (2) The loan agreement includes certain covenants, ie, the obligation to maintain certain financial ratios. At the reporting date, no indications of non-compliance with such covenants were noted. 174 (3) The loan includes certain covenants, ie, the obligation to maintain certain financial ratios. Those ratios have not been complied with during 2008 and, therefore, the group is currently renegotiating the loan structure with the lending bank. As required by IAS 1, the non-current portion of the loan has been reclassified to current financial indebtedness.

The non-current portion of the above loans will be repaid at their contractual maturity, based on the following time bands:

Company Country Total Due after Due after Due after non-current 13 months 25 months 60 months portion but within but within (Euro/000) 24 months 60 months Banca Intesa Impregilo Italy 108,858 82,140 26,718 - OPI/West LB Impregilo Italy 81,725 28,801 52,924 - Total 190,583 110,941 79,642 -

The fair value of non-current loans, measured as set out in the accounting policy section, totalled euro 186.1 million at 31 December 2008.

Bank project financing Project financing at 31 December 2008 relates to the Salerno Reggio Calabria motorway contract, for a total amount of euro 31.1 million, broken down as follows:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current financial portion current (Euro/000) liabilities corrente liabilities portion Banca Intesa Passante di Mestre Italy - - - 23,067 23,067 - Banca Intesa Greek branch Greece - - - 3,000 - 3,000 Depfa Bank Salerno - Reggio Calabria Italy 15,604 123 15,481 53,835 50,399 3,436 Depfa Bank Reggio Calabria - Scilla Italy 15,505 205 15,300 15,276 178 15,098 Total 31,109 328 30,781 95,178 73,644 21,534 The main conditions of the financing in place at 31 December 2008 are as follows:

Company Country Interest rate Expiry date Note Depfa Bank Salerno - Reggio Calabria Italy Euribor n.a (1) Depfa Bank Reggio Calabria - Scilla Italy Euribor n.a (1)

In addition, variable spreads are applicable to the interest rates set out above, based on the term and conditions of the financing.

Note: (1) Project financing agreements do not provide for any contractual maturity, since repayments and extinctions are in line with the performance of the relevant contract. Interest rate hedges have been agreed for this financing. A description of the derivative contracts is set out in note 9.7.

The non-current portion of the above financing will be repaid in line with the expected performance of the relevant contract, based on the following time bands: 175

Company Country Total Due after Due after Due after non-current 13 months 25 months 60 months portion but within but within (Euro/000) 24 months 60 months Depfa Bank Salerno - Reggio Calabria Italy 15,481 - 15,481 - Depfa Bank Reggio Calabria - Scilla Italy 15,300 - 15,300 - Total 30,781 - 30,781 -

The fair value of project financing, measured as set out in the accounting policy section, is substantially in line with its carrying amount.

Concession financing The foreign group concession companies have the following financing:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current financial portion current (Euro/000) liabilities corrente liabilities portion BNDES Primav Brazil 6,981 629 6,352 5,220 190 5,030 Unibanco Primav Brazil 57 46 11 145 65 80 Bradesco Primav Brazil 5,848 4,068 1,780 3,918 969 2,949 ITAU Primav Brazil 39,031 39,031 - - - - ITAU BBA Primav Brazil 4,408 4,408 - - - - Banco Galicia Caminos de las Sierras Argentina 11,761 1,680 10,081 13,184 1,015 12,169 Royal Bank of Scotland Impregilo Parking Glasgow United Kingdom 8,933 101 8,832 11,727 125 11,602 Total 77,019 49,963 27,056 34,194 2,364 31,830

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The main conditions of the financing in place at 31 December 2008 are as follows:

Company Country Interest Expiry Note rate date BNDES Primav Brazil 8,4% (*) 2017 (1) Unibanco Primav Brazil 12% (*) 2010 (1) Bradesco Primav Brazil CDI (**) 2012 (1) ITAU Primav Brazil CDI (**) 2009 (1) ITAU BBA Primav Brazil CDI (**) 2009 (1) Banco Galicia Caminos de las Sierras Argentina TECBP (§) 2014 (2) Royal Bank of Scotland Impregilo Parking Glasgow GB Euribor 2029 (3)

(*) index ed to inflation (**) equal to the Brazilian interbank rate (§ equal to the Argentine interbank rate

176 In addition, variable spreads are applicable to the interest rates set out above, based on the term and conditions of the financing.

Note: (1) These loans are included in the project financing category, and are secured by the revenue flows arising from the activities carried out under the related concessions. With respect to the 2007 year end, two new loans of euro 43.4 million have been taken out for the acquisition of the concession company Ecocataratas (formerly Rodovias das Cataratas S.A.). (2) The financing was granted following the restructuring of Caminos de las Sierras S.A.’s debt finalised in 2006 and is guaranteed by Impregilo S.p.A.. (3) This loan is included in the project financing category, and is secured by the revenue flows arising from the activities carried out under the related concessions. Interest rate hedges have been agreed for this loan. A description of the derivative contracts is set out in note 9.7. The loan agreement included a number of covenants, all of which the concession company had complied with at year end.

The above loans will be repaid in line with the expected performance of the relevant contract, based on the following time bands:

Company Country Total Due after Due after Due after non-current 13 months 25 months 60 months portion but within but within (Euro/000) 24 months 60 months BNDES Primav Brazil 6,352 866 2,599 2,887 Unibanco Primav Brazil 11 11 - - Bradesco Primav Brazil 1,780 1,187 593 - Banco Galicia Caminos de las Sierras Argentina 10,081 1,665 5,536 2,880 Royal Bank of Scotland Impregilo Parking Glasgow United Kingdom 8,832 92 405 8,335 Total 27,056 3,821 9,133 14,102

The fair value of the financing, measured as set out in the accounting policy section, is euro 24.3 million. Financing and mortgage loans of companies in liquidation This category includes the loans obtained by Imprepar and its subsidiaries. The related repayment plans are linked to the liquidation procedures of the companies to which the loans refer. A breakdown of these loans is as follows:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current financial portion current (Euro/000) liabilities corrente liabilities portion Banco di Sicilia Sundry Italy 1,745 1,745 1,745 1,745 Banca Intesa Aquilgest Italy 969 - 969 952 - 952 Italfondiario Imprepar Italy 1,706 1,706 - 2,243 537 1,706 Total 4,420 1,706 2,714 4,940 537 4,403

The main conditions of the loans in place at 31 December 2008 are as follows:

177 Company Country Interest rate Expiry date Banco di Sicilia Sundry Italy Sundry Banca Intesa Aquilgest Italy 5.15% Italfondiario Imprepar Italy Euribor 6M 2009

In addition, variable spreads are applicable to the interest rates set out above, based on the term and conditions of the loan. The above loans will be repaid in line with the forecasts set out in the liquidation plans, presumably within 24 months. Imprepar’s loan was repaid in early 2009.

The fair value of the loans, measured as set out in the accounting policy section, is substantially in line with their carrying amount.

Other loans This item includes the loans granted to FISIA Italimpianti for the “Venezia Nuova” contract, already existing at 31 December 2007, and Consorzio Torre, granted in 2008, as follows:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current financial portion current (Euro/000) liabilities corrente liabilities portion Meliorfactor FISIA Italimpianti Italy 11,076 3,476 7,600 14,482 3,282 11,200 Meliorfactor Consorzio Torre Italy 15,877 15,877 - - - - Total 26,953 19,353 7,600 14,482 3,282 11,200

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

A breakdown of terms of these loans is as follows:

Company Country Interest rate Expiry date Meliorfactor FISIA Italimpianti Italy Euribor 3M 2011 Meliorfactor Consorzio Torre Italy Euribor 3M 2009

In addition, variable spreads are applicable to the interest rates set out above, based on the term and conditions of the loan. The above loans will be repaid in line with the expected performance of the relevant contract, based on the following time bands:

Company Country Total Due after Due after Due after non-current 13 months 25 months 60 months portion but within but within (Euro/000) 24 months 60 months Meliorfactor FISIA Italimpianti Italy 7,600 4,000 3,600 Total 7,600 4,000 3,600 - 178

The fair value of the loans, measured as set out in the accounting policy section, is substantially in line with their carrying amount.

Current account facilities Current account facilities rose by euro 69.4 million to euro 160.9 million. This item includes euro 152.6 million relating to the Venezuelan contracts.

9.5 Bonds The outstanding bonds at 31 December 2008 relate to the Brazilian concession company Primav Ecorodovias which has been proportionately consolidated since 2007. They are analysed in the following table:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current portion 55,222 64,049 (8,827) Current portion 1,903 3,144 (1,241) Total 57,125 67,193 (10,068)

The Brazilian company’s bond issue was placed on 21 December 2006 in three instalments with a total nominal amount of R$ 450,000 million, the first with a nominal amount of R$ 135,000 million, due in November 2013, and the other two with a nominal amount of R$ 157,500 million each and due on 1 May and 1 November 2014, respectively. The first instalment bears interest at the interbank rate (currently approximately 12.4%) plus a spread of 4% of such rate paid every six months while the other two instalments bear an annual interest rate of 9.5% indexed to the Brazilian inflation rate. A leading independent body rated the bond issue AA-. A breakdown of this item is set out in the following table:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current financial portion current (Euro/000) liabilities corrente liabilities portion Banco Bradesco S.A. - first issue Primav Ecorodovias Brazil 14,881 314 14,567 20,157 942 19,215 Banco Bradesco S.A. - second issue Primav Ecorodovias Brazil 24,616 1,286 20,330 23,518 1,101 22,417 Banco Bradesco S.A. - third issue Primav Ecorodovias Brazil 20,628 303 20,325 23,518 1,101 22,417 Total 57,125 1,903 55,222 67,193 3,144 64,049

The terms of these bonds may be broken down as follows:

Company Country Interest Expiry Note rate date Banco Bradesco S.A. - first issue Primav Ecorodovias Brazil 104% CDI 2013 (*) Banco Bradesco S.A. - second issue Primav Ecorodovias Brazil 9,5% + IGP-M 2014 (§) 179 Banco Bradesco S.A. - third issue Primav Ecorodovias Brazil 9,5% + IGP-M 2014 (§)

(*) CDI is equal to the Brazilian interbank rate (§) IGP-M is equal to the Brazilian inflation rate

The above bonds will be repaid based on the following time bands:

Company Country Total Due after Due after Due after non-current 13 months 25 months 60 months portion but within but within (Euro/000) 24 months 60 months Banco Bradesco S.A. - first issue Primav Ecorodovias Brazil 14,5673,105 9,317 2,145 Banco Bradesco S.A. - second issue Primav Ecorodovias Brazil 20,3304,334 13,003 2,993 Banco Bradesco S.A. - third issue Primav Ecorodovias Brazil 20,3254,333 12,999 2,993 Total 55,222 11,772 35,319 8,131

The fair value of the bond issue, measured as set out in the accounting policy section, is euro 46.5 million.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

9.6 Finance lease payables Finance lease payables may be broken down as follows at 31 December 2008:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current financial payables 1 219 (218) Current financial payables 33 765 (731) Total 34 984 (950)

This item includes the principal of future lease payments of contracts existing at year end, comprising current amounts of euro 34 thousand. It decreased euro 0.9 million from 31 December 2007 following settlement of lease payment falling due during the year.

In addition to the lease payments relating to 2008, leased assets have been purchased for a total of euro 0.9 million.

Finance leases relate to plant and machinery. They have an average term of between three and five years. The effective average interest rate was 4.332% at year end. 180 Payables for these leases are guaranteed to the lessor via rights on the leased assets.

9.7 Derivatives These items show the fair value of the agreements hedging currency and interest rate risks at the reporting date. They may be broken down as follows:

31 December 2008 31 December 2007 (Euro/000) Assets Liabilities Assets Liabilities Interest rate swaps - cash flow hedges - 4,370 2,200 2,809 Interest rate swaps - FVTPL 1 641 976 - Currency swaps - FVTPL 4,152 2,157 163 126 Total 4,153 7,168 3,339 2,935

Moreover, Impregilo group entered into the following derivatives during the year, hedging fair value changes in working capital items:

31 December 2008 31 December 2007 (Euro/000) Assets Liabilities Assets Liabilities Interest rate swaps - cash flow hedges - 11,028 - 11,809 Currency swaps - fair value hedges - - 18,038 - Total - 11,028 18,038 11,809 The following tables set out the characteristics of the derivatives existing at year end, showing the company owning the contract and the related fair value at the reporting date:

INTEREST RATE SWAPs - Cash flow hedges Negative fair value

Company Agreement date Expiry date Currency Notional amount Fair value (euro) Impregilo S.p.A. 1-02-2006 31-12-2011 Euro 49,829,500 (791,365) Impregilo S.p.A. 1-02-2006 31-12-2011 Euro 49,829,500 (791,365) Impregilo Parking Glasgow 22-06-2004 30-06-2029 GBP 8,673,785 (2,041,798) Impregilo Parking Glasgow 22-06-2004 30-06-2029 GBP 672,028 (745,289) Totale (4,369,817)

This category includes derivatives that have been entered into to hedge the group against interest rate risks and that meet hedge accounting requirements. To check compliance with these requirements, the effectiveness of the hedges have been verified and confirmed and therefore, the hedging reserve (see note 8) has been recognised in equity. 181

INTEREST RATE SWAPs - FVTPL Positive fair value

Company Agreement date Expiry date Currency Notional amount Fair value (euro) Salerno-Reggio Calabria 12-01-2006 12-01-2009 Euro 27,715,969 632 (*) Total 632

(*) Impregilo's share

Negative fair value

Company Agreement date Expiry date Currency Notional amount Fair value (euro) Passante di Mestre 30-06-2006 30-06-2009 Euro 10,000,000 (3,877) (*) Passante di Mestre 30-06-2006 30-06-2009 Euro 25,000,000 (34,423) (*) Passante di Mestre 30-06-2006 30-06-2009 Euro 25,000,000 (31,496) (*) Reggio Calabria Scilla 17-07-2007 18-10-2010 Euro 44,136,375 (571,326) (*) Total (641,122)

This category includes derivatives that have been entered into to hedge the group against interest rate risks but that do not meet (or no longer meet and the situation has not been currently resolved) hedge accounting requirements for cash flows hedges.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

EXCHANGE RATE DERIVATIVES - FVTPL Positive fair value

Company Agreement date Expiry date Currency Notional amount Fair value (euro) Impregilo S.p.A. 1-12-2008 9-01-2009 USD 8,000,000 716,811 Impregilo S.p.A. 26-11-2008 12-01-2009 USD 6,400,000 432,225 Impregilo S.p.A. 6-12-2008 12-01-2009 USD 6,176,729 461,755 Impregilo S.p.A. 10-10-2008 14-01-2009 USD 3,700,000 114,089 Impregilo S.p.A. 11-12-2008 20-01-2009 USD 3,500,000 181,111 Impregilo S.p.A. 24-10-2008 26-01-2009 USD 4,000,000 357,829 Impregilo S.p.A. 28-10-2008 30-01-2009 USD 5,000,000 489,936 Impregilo S.p.A. 3-12-2008 5-02-2009 USD 4,000,000 357,931 Impregilo S.p.A. 9-11-2008 11-02-2009 USD 6,000,000 454,113 Impregilo S.p.A. 13-11-2008 17-02-2009 USD 6,000,000 586,352 Total 4,152,153

182 Negative fair value

Company Agreement date Expiry date Currency Notional amount Fair value (euro) Impregilo S.p.A. 18-12-2008 23-03-2009 USD 8,000,000 (40,537) FISIA Italimpianti 4-06-2008 29-05-2009 USD 20,000,000 (1,106,046) FISIA Italimpianti 4-09-2008 31-08-2009 USD 32,000,000 (1,010,772) Total (2,157,355)

This category includes derivatives that have been entered into to hedge the group against currency risks but that do not meet (or no longer meet and the situation has not yet been resolved) hedge accounting requirements for fair value hedges. Despite their not meeting the hedging requirement established by the IFRS, the derivatives entered into by FISIA Italimpianti hedging currency risks on contract revenue are substantially effective. The exchange rate losses classified as financing costs arising from the adjustments of the expected contract performance to current rates have been substantially offset by the performance of the relevant derivatives.

COMMODITY DERIVATIVES - FAIR VALUE HEDGES Quantity Amount Forward Fair value Fair value Reference Expiry date (tonnes) Currency in currency price USD Euro Purchase of copper 20-1-2009 1,338 USD 9,232,200 6,900 (5,419,221) (3,893,958) Purchase of copper 20-1-2009 288 USD 1,843,200 6,400 (1,022,469) (734,691) Purchase of copper 20-1-2009 636 USD 4,038,600 6,350 (2,226,153) (1,599,592) Purchase of nikel 20-1-2009 88 USD 3,361,600 38,200 (2,483,855) (1,784,764) Purchase of nikel 20-1-2009 153 USD 5,722,200 37,400 (4,196,121) (3,015,105) Total (11,028,109)

The subsidiary FISIA Italimpianti entered into commodity (copper and nickel) derivative contracts, with a view to hedging the profit margins of the contracts to which they relate against the risk of fluctuations in raw material prices and foreign currency contract revenue. 9.8 Other items included in net financial position The other items included in net financial position amount to euro 87.2 million, as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Financial receivables Passante di Mestre 23,480 - 23,480 Total financial receivables 23,480 - 23,480 Financial payables Impregilo S.p.A. (51,208) (52,964) 1,756 Passante di Mestre (23,480) - (23,480) CA.V.TO.MI (13,444) (48,474) 35,030 Consorzio Torre (22,517) - (22,517) Total financial payables (110,649) (101,438) (9,211) Total (87,169) (101,438) 14,269

This item includes: (i) Financial receivables and payables arising from the factoring of the receivables relating to Passante di Mestre (euro 23.5 million). These are receivables due from customers factored without recourse, which, however, do not meet the derecognition requirements of IAS 39. 183 (ii) Financial payables due to factoring of tax receivables. Impregilo group factored tax receivables totalling euro 101.4 million with recourse in previous years. The carrying amount of these financial payables at the reporting date relates to: • VAT receivables of euro 11.0 million factored by Impregilo S.p.A. in previous years; • VAT receivables of euro 13.4 million (Impregilo’s share) factored by the C.A.V.TO.MI. consortium during 2007. Since the tax authorities reimbursed euro 35.0 million of these tax receivables, the relevant carrying amount of the previous year end has been reduced accordingly; • IRPEG receivables of euro 40.2 million factored by the parent during 2007. (iii) Financial payables arising from the with recourse factoring of receivables due from customers to Consorzio Torre (euro 22.5 million).

10. Guarantees and commitments The key guarantees given by the group are set out below: • Contractual sureties: these total euro 3,386.7 million and are given to customers as performance bonds, to guarantee advances, withholdings and involvement in tenders for all ongoing contracts. In turn, the group has guarantees given by its subcontractors that partially cover the contractual sureties given. • Sureties for credit: they amount to euro 17.8 million and relate to the non-consolidated companies. • Sureties granted to Sace for export credit of euro 56.5 million. • Other personal guarantees of euro 263.3 million consisting of guarantees related to customs and tax obligations. • Collateral related to: - liens on shares of the consortium companies Salerno Reggio Calabria S.c.p.a. and Reggio Calabria-Scilla S.c.p.a. given to guarantee a loan (euro 43.4 million); - liens on shares of the consortium company Passante di Mestre S.c.p.a. given to guarantee a loan (euro 21.0 million); - guarantee deposits for shares of Impregilo Wolverhampton Ltd., Impregilo Parking Glasgow Ltd., Yacilec S.A., Caminos de Las Sierras, and Ecovias dos Imigrantes (euro 36.7 million). Commitments mainly comprise: - sales commitment given by Impregilo for investments in consortia (euro 21.7 million).

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

11. Financial instruments and risk management

11.1. Classes of financial instruments The group’s financial instruments are broken down by class in the following table, which also shows their fair value:

31 December 2008 Note Loans and Financial assets Hedging Held-to- Available-for- Total Fair Value receivables at fair value through derivatives maturity sale financial (Euro/000) profit or loss investments assets Financial assets Equity investments in other companies 1.5 8,944 8,944 8,944 Non-current financial assets 9.1 54 54 54 Non-current receivables due from associates 5 17,700 17,700 17,700

184 Trade receivables 7.4 880,946 880,946 880,946 Current receivables due from associates 7.6 157,364 157,364 157,364 Other current financial assets 9.2 47,171 47,171 47,171 Other financial assets 9.8 23,480 23,480 23,480 Derivatives 9.7 4,153 4,153 4,153 Cash and cash equivalents 9.3 944,880 944,880 944,880 Total financial assets 2,000,890 4,153 - 70,705 8,944 2,084,692 2,084,692

31 December 2008 Note Other liabilities to Financial liabilities amortized cost at fair value through Hedging Total Fair Value (Euro/000) profit or loss derivatives Financial liabilities Bank and other loans 9.4 802,186 802,186 794,809 Otther financial liabilities 9.8 110,649 110,649 110,649 Bonds 9.5 57,125 57,125 48,417 Derivatives 9.7 2,798 4,370 7,168 7,168 Trade payables 7.5 1,167,234 1,167,234 1,167,234 Current payables to associates 7.6 69,437 69,437 69,437 Total financial liabilities 2,206,631 2,798 4,370 2,213,799 2,197,714 31 December 2007 Note Loans and Financial assets Hedging Held-to- Available-for- Total Fair Value receivables at fair value through derivatives maturity sale financial (Euro/000) profit or loss investments assets Financial assets Equity investments in other companies 1.5 16,506 16,506 16,506 Non-current financial assets 9.1 115 115 115 Non-current receivables due from associates 5 19,210 19,210 19,210 Trade receivables 7.4 866,159 866,159 866,159 Current receivables due from associates 7.6 157,205 157,205 157,205 Other current financial assets 9.2 6,895 92,916 99,811 99,811 Other financial assets 9.8 - -- Derivatives 9.7 1139 2200 3,339 3,339 185 Cash and cash equivalents 9.3 875,627 875,627 875,627 Total financial assets 1,925,096 1,139 2,200 93,031 16,506 2,037,972 2,037,972

31 December 2007 Note Other liabilities to Financial liabilities amortized cost at fair value through Hedging Total Fair Value (Euro/000) profit or loss derivatives Financial liabilities Bank and other loans 9.4 860,053 860,053 859,351 Otther financial liabilities 9.8 101,438 101,438 101,438 Bonds 9.5 67,193 67,193 59,642 Derivatives 9.7 126 2,809 2,935 2,935 Trade payables 7.5 1,000,515 1,000,515 1,000,515 Current payables to associates 7.6 88,764 88,764 88,764 Total financial liabilities 2,117,963 126 2,809 2,120,898 2,112,645

The note column gives the section in which the relevant item is described.

Reference should be made to the section on accounting policies for information on the fair value measurement of these items. Specifically, the fair value of equity investments in other companies is based on stock exchange prices, while that of the other items is based on the present value of forecast future cash flows.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Risk management Impregilo group is exposed to financial risks, including the following: • market risk deriving from the group’s exposure to interest rate fluctuations, exchange rate fluctuations and, with respect to the Engineering & Plant Construction Segment, commodity price volatility; • credit risk deriving from the group’s exposure to potential losses arising from the customers’ non-compliance with their obligations; • liquidity risk deriving from the risk that the financial resources necessary to meet obligations may not be available at the agreed terms and deadlines.

Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises currency risk, interest rate risk and other price risk (commodities and, to a lesser extent, stock prices).

186 Currency risk The group’s international presence entails its exposure to the risk of fluctuations in exchange rates of the Euro and the currencies of the various countries in which it operates. Currency risk at 31 December 2008 mainly related to the following currencies: • Dollar (United States) • Real (Brazil) • Naira (Nigeria) • Krona (Iceland) • Peso (Argentina) • Peso (Santo Domingo) • Bolivar (Venezuela)

The group’s currency risk management strategy is essentially based on the following policies: • agreement of contractual considerations for works and projects in countries with weak currencies using a primarily multi-currency format, in which only a portion of the consideration is expressed in local currency; • use of portions of the contractual considerations in local currency mainly to cover project expenses to be incurred in that currency; • analysis of exposure in US dollars on a cumulative and prospective basis with consistent deadlines and setting up forward transactions in the same currency to hedge the group’s net exposure at those deadlines. Adoption of the above-mentioned policies has contained the group’s exposure to currency risk, which only relates to the USD and VEB. Had the Euro appreciated or depreciated by 5% against the USD at year end, the consolidated profit for the year would have been respectively greater or lower by euro 1.5 million, assuming that all other variables remained constant, mainly due to exchange rate losses (gains) arising from the adjustment of net liabilities in USD. A similar change at the end of the previous year would have led to a euro 0.7 million decrease (or increase in the case of depreciation) in the consolidated profit for the year. Had the Euro appreciated or depreciated by 5% against the VEB at year end, the consolidated profit for the year would have been respectively lower or greater by euro 2.8 million, assuming that all other variables remained constant, mainly due to exchange rate losses (gains) arising from the adjustment of net assets in VEB. A similar change at the end of the previous year would have led to a euro 0.9 million decrease (or increase in the case of depreciation) in the consolidated profit for the year.

Other price risk The group’s results are affected by fluctuations in the price of metals used in production solely in the Engineering & Plant Construction segment. Against this risk, the subsidiary FISIA carries out hedging transactions through forward purchase agreements which enables it to fix the purchase price of semi-finished products in nickel, copper and zinc in advance with respect to the actual need. Such transactions qualify as fair value hedges and the related fair values are assessed using appropriate methods. Had nickel, copper and zinc prices increased or decreased at both year ends, the consolidated profit for the years would have not changed significantly since the relevant hedging instruments are highly effective. 187

Interest rate risk Impregilo group has adopted a combined strategy of streamlining group operations by disposing of non-strategic assets, containing debt and hedging interest rate risks on a portion of the medium/long-term structured loans through interest rate swaps (IRSs). The financial risks arising from market interest rate fluctuations to which the company is potentially exposed and which are monitored by the relevant company personnel relate to medium/long-term financial payables bearing variable rates. Such risk is mitigated by interest accrued on short-term investments of liquidity available at the Italian-based consortia and consortium companies and foreign subsidiaries, which are used to support the group’s operations. Had interest rates increased (or decreased) by 50 basis points at year end, the consolidated profit for the year would have been respectively greater or lower by euro 0.9 million and consolidated equity by euro 1.5 million, assuming that all other variables remained constant. A similar change at the end of the previous year would have led to a euro 1.4 million increase (or euro1.5 million decrease) in consolidated equity and a euro 0.5 million increase (or decrease) in the consolidated profit for the year, assuming that all other variables remained constant.

Credit risk Credit risk is that deriving from the group’s exposure to potential losses arising from the customers’ (which are mostly governments or state bodies) non-compliance with their obligations. Management of this risk is complex, starting as early as the assessment of offers, through a careful analysis of the characteristics of the countries in which the group’s activities should be carried out and the customers requesting an offer, which are usually state or similar bodies.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Therefore, this risk can be essentially assimilated to country risk. An analysis of this risk based on the age of the outstanding amounts is not very meaningful, since the receivables should be assessed together with the other working capital items, especially those reflecting the net exposure to customers (positive and negative work in progress, advances and payments on account) in relation to contract work in progress as a whole.

A breakdown of working capital by country, as shown in the section on “Segment reporting”, is set out below:

(Euro/000) Working capital by country 31-12-2008 31-12-2007 Italy (471,551) (737,844) Other EU countries 193,629 297,820 Other non-EU countries (15,878) 52,890 Central and South America 174,114 239,347 Other and eliminations (36,982) (158,815) Total (156,668) (306,602) 188

The group’s exposure to customers, broken down by contract location, is analysed below:

Group’s exposure to customers by country Receivables Positive WIP Negative WIP Total Impairment and advances losses 31 December 2008 Italy 594,350 332,035 (374,420) 551,965 4,505 Other EU countries 15,639 24,647 (37,460) 2,826 - Other non-EU countries 5,483 1,424 (16,713) (9,806) - Central and South America 234,712 171,294 (79,602) 326,404 174 Other and eliminations 30,762 178,209 (204,916) 4,055 141 Total 880,946 707,609 (713,111) 875,445 4,820

31 December 2007 Italy 656,113 340,401 (595,822) 400,692 4,906 Other EU countries 13,770 16,920 (85,197) (54,507) 3 Other non-EU countries 22,424 32,730 (3,009) 52,145 - Central and South America 155,515 81,160 (71,541) 165,134 659 Other and eliminations 18,337 948 (21,019) (1,734) - Total 866,159 472,159 (776,588) 561,730 5,568

Liquidity risk Liquidity risk derives from the risk that the financial resources necessary to meet obligations may not be available to the group at the agreed terms and deadlines. The group’s strategy aims at ensuring that each ongoing contract is financially independent. This strategy is strictly monitored centrally. A breakdown of financial liabilities by due date (based on undiscounted future cash flows) is set out below:

(Euro/000) 31-12-2009 31-12-2010 31-12-2013 After Total Current account facilities 160,868 - - - 160,868 Bonds 6,811 21,007 49,550 9,439 86,807 Bank and other loans 365,079 148,395 130,010 19,415 662,899 Other financial liabilities 42,355 4,315 3,729 - 50,399 Finance lease payables 34 - - - 34 Derivatives 7,168 - - - 7,168 Gross financial liabilities 582,315 173,717 183,289 28,854 968,175 Trade payables 1,167,234 1,167,234 Total payables 1,749,549 173,717 183,289 28,854 2,135,409

The corresponding figures of the previous year are set out below for comparative purposes.

(Euro/000) 31-12-2008 31-12-2009 31-12-2012 After Total Current account facilities 91,425 - - - 91,425 Bonds 6,102 25,826 35,557 25,635 93,120 189 Bank and other loans 533,756 292,519 65,297 22,710 914,282 Finance lease payables 765 219 - - 984 Derivatives 2,935 - - - 2,935 Gross financial liabilities 634,983 318,564 100,854 48,345 1,102,746 Trade payables 1,000,515 - - - 1,000,515 Total payables 1,635,498 318,564 100,854 48,345 2,103,261

Future interest has been estimated based on the market interest rates at the date of preparation of these financial statements summarised in the notes. Liquidity risk management is mainly based on containing debt and maintaining a balanced financial position. This strategy is pursued by each of the group’s operating units. Financial and trade payables falling due before 31 March 2009 are compared with the cash and cash equivalents that can be used to meet such obligations in the table below:

Total financial and trade Cash and cash Difference payables and falling equivalents (Euro/00) due before 31 March 2009 Impregilo S.p.A. (245,628) 128,692 (116,936) Subsidiaries (429,742) 289,855 (139,887) SPEs (280,216) 405,437 125,221 Companies in liquidation (13,510) 115,044 101,534 Total (969,096) 939,028 (30,068)

The difference shown above is the “worse case scenario” occurring should all short-term credit lines without due dates be requested for repayment by lenders. In this respect: • at the date of preparation of these financial statements, the group has received no requests for early termination or immediate repayment of the above credit lines, nor are such requests expected in the next few months; • all asset items are expected to be collected.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Income statement

12. Revenue Revenue for 2008 amounts to euro 2,957.6 million, up 12.6% on the corresponding figure of the previous year:

(Euro/000) 2008 2007 Change Change % Revenue - goods and services 1,972,679 1,725,872 246,807 14.3% Change in work in progress, semi-finished products and finished products and real estate projects (1,331) (2,381) 1,050 (44.1%) Change in contract work in progress 895,700 806,915 88,785 11.0% Total operating revenue 2,867,048 2,530,406 336,642 13.3% Other revenue and income 90,596 96,497 (5,901) (6.1%) Total 2,957,644 2,626,903 330,741 12.6%

190 The change in contract work in progress includes contractual revenue deriving from production carried out during the year measured using the cost to cost method. Reference should be made to the note on work in progress for a breakdown of contract work in progress and related changes during the year.

A breakdown of operating revenue by business segment is given in the following table:

(Euro/000) 2008 2007 Change Change % Construction 1,722,269 1,523,943 198,326 13.0% Engineering & Plant Construction 975,218 837,727 137,491 16.4% Concessions 163,771 151,347 12,424 8.2% Other 5,790 17,389 (11,599) (66.7%) Total 2,867,048 2,530,406 336,642 13.3%

A breakdown of other revenue is given in the following table:

(Euro/000) 2008 2007 Change Change % Cost recoveries 26,035 34,076 (8,041) (23.6%) Rent and leases 925 3,309 (2,384) (72.0%) Gains on disposals of property, plant and equipment 16,189 13,528 2,661 19.7% Prior year income 31,664 32,919 (1,255) (3.8%) Utilisations of provisions for risks 20 582 (562) (96.6%) Other 15,763 12,083 3,680 30.5% Total 90,596 96,497 (5,901) (6.1%)

The 2007 “Cost recoveries” item included insurance compensation of approximately euro 12 million. 13. Costs 13.1 Raw materials and consumables The cost of raw materials and consumables amounts to euro 744.1 million, incurred in 2008 increased by euro 108.2 million compared to the corresponding figure of the previous year:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Purchases of raw materials and consumables 737,951 25.0% 637,808 24.3% 100,143 Change in raw materials and consumables 6,186 0.2% (1,911) (0.1%) 8,097 Total 744,137 25.2% 635,897 24.2% 108,240

The rise in costs for raw materials is mainly due to the combined effect of: • net increase seen for projects carried out by the Engineering & Plant Construction segment of euro 152.8 million, directly related to the rise in business volumes in that segment; • net decrease for the Construction segment of euro 45.5 million due to the reduction for a number of contracts currently being finalised, partly offset by increases seen for new projects such as certain contracts in Venezuela and for the upgrading of the Salerno-Reggio Calabria motorway. 191

13.2 Subcontracts Costs of subcontracts increased to euro 707.7 million, up euro 112.6 million on the corresponding figure of the previous year, as shown in the following table:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Subcontracts 707,697 23.9% 595,068 22.7% 112,629

The change is mainly due to the upturn for the Construction and Engineering & Plant Construction segments (euro 101.3 million and euro 10.1 million, respectively).

13.3 Other operating expenses In 2008, other operating expenses rose to euro 905.8 million, up euro 85.2 million on the corresponding figure of the previous year, as follows:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Consultancy and technical services 343,228 11.6% 355,864 13.5% (12,636) Fees to directors, statutory auditors and independent auditors 5,345 0.2% 8,188 0.3% (2,843) Maintenance 10,302 0.3% 13,722 0.5% (3,420) Transportation and freight 53,804 1.8% 53,290 2.0% 514 Insurance 29,563 1.0% 25,526 1.0% 4,037 Recharges and allocation of costs from consortia and joint ventures 299,892 10.1% 187,441 7.1% 112,451 Rent and leases 46,336 1.6% 53,418 2.0% (7,082) Concessions costs - - 69 - (69) Other operating expenses 100,431 3.4% 106,993 4.1% (6,562) Prior year losses 12,645 0.4% 13,298 0.5% (653) Losses on disposal of assets 4,204 0.1% 2,705 0.1% 1,499 Total 905,750 30.6% 820,514 31.2% 85,236

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

“Consultancy and technical services” mainly consist of costs for the design and construction work carried out by the special purpose entities. These costs are broken down in the following table:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Design and engineering services 296,110 10.0% 294,281 11.2% 1,829 Testing 1,715 0.1% 1,269 - 446 Construction 21,505 0.7% 30,872 1.2% (9,367) Administrative, legal and other services 23,898 0,8% 29,442 1.1% (5,544) Total 343,228 11.6% 355,864 13.5% (12,636)

“Recharges and allocation of costs from consortia and joint ventures” comprise all costs that unconsolidated consortia and joint ventures allocate to the parent. The increase over the previous year is mainly due to Consorzio OIV Tocoma in Venezuela and the other Brazilian contracts, Rio Tocantis and Serra do Mar, whose works had not yet started in 2007. The decrease of “Consultancy and other technical services” is mainly due to the reduction in construction work and administrative and legal

192 services. Fees to the independent auditors, PricewaterhouseCoopers S.p.A, and other companies of its network for 2008 are detailed as follows:

(Euro/000) Fees Audit Impregilo S.p.A. 648 Audit Subsidiaries 748 Total audit 1,396 Tax assistance Impregilo S.p.A. 29 Tax assistance Subsidiaries 180 Total tax assistance 209 Other services Other services Impregilo S.p.A. 20 Other services Subsidiaries 25 Total other services 45 Total 1,650

13.4 Personnel expenses Personnel expenses for 2008 amount to euro 327.7 million, down by euro 21.2 million on 2007. The item is made up as follows:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Wages and salaries 215,359 7.3% 236,238 9.0% (20,879) Social security and pension charges 56,005 1.9% 65,334 2.5% (9,329) Accrual to post-employment benefits 18,321 0.6% 13,460 0.5% 4,861 Other personnel expenses 37,988 1.3% 33,891 1.3% 4,097 Total 327,673 11.1% 348,923 13.3% (21,250) The euro 21.2 million decrease is due to finalisation of work on certain foreign (Iceland and Switzerland) and Italian (high speed) contracts, partly offset by the new projects in Venezuela. The new contracts of the Engineering & Plant Construction segment did not significantly affect operating personnel expenses, since works at the building sites were mainly subcontracted. Other personnel expenses principally relate to repayments of travel expenses.

13.5 Amortisation, depreciation, provisions and impairment losses This item of euro 83.3 million shows a decrease on the previous year figure of euro 95.3 million. It may be analysed as follows:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Accrual to the provision for bad debts 5,234 0.2% 7,597 0.3% (2,363) Accrual to the provision for risks 14,091 0.5% 76,292 2.9% (62,201) Impaiment losses 16,392 0.6% (24,503) (0.9%) 40,895 Release of excess provisions (13,893) (0.5%) (27,307) (1.0%) 13,414 Total provisions and impairment losses 21,824 0.7% 32,079 1.2% (10,255) Amortisation of intangible assets 3,164 0.1% 5,246 0.2% (2,082) 193 Depreciation of property, plant and equipment 37,093 1.3% 41,939 1.6% (4,846) Depreciation of freely transferable assets 21,224 0.7% 16,045 0.6% 5,179 Total amortisation and depreciation 61,481 2.1% 63,230 2.4% (1,749) Total 83,305 2.8% 95,309 3.6% (12,004)

The previous year balance included a non-recurring euro 50.0 million accrual made for risks related to the ongoing prosecution for the USW Campania projects. Reference should be made to the relevant section of the directors’ report for further information on this issue. The item “Accrual to the provision for risks” relates to an updated estimate of the risk of losing the pending cases or the recoverable amount of receivables at the reporting date. “Release of excess provisions” mainly relates to the release of the excess provisions for bad debts and risks compared to estimates or because the risk for which the provision had been made never arose.

14. Financing income (costs) and gains (losses) on investments Financing income (costs) and gains (losses) on investments came to a negative euro 4.6 million in 2008, compared to a positive euro 3.4 million in 2007.

The item may be analysed as follows:

(Euro/000) 2008 2007 Change Net financing costs (60,533) (9,831) (50,702) Net gains on investments 55,912 13,235 42,677 Total (4,621) 3,404 (8,025)

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

14.1 Financing income (costs) Net financing costs rose to euro 60.5 million from euro 9.8 million in 2007, as follows:

(Euro/000) 2008 2007 Change Bank interest income (a) 35,173 31,812 3,361 Interest on financial receivables (a) 1,354 3,060 (1,706) Bank interest expense (a) (88,253) (64,435) (23,818) Interest on bonds (a) (7,280) (6,750) (530) Interest on other financial payables (a) (11,474) (3,799) (7,675) Interest on leases (a) (12) (174) 162 Bank charges and commissions (e) (9,905) (8,927) (978) Commissions on sureties (e) (9,641) (12,358) 2,717 Gains on securities (e) 3,119 2,799 320 Gains on the sale of securities (c) 37,890 42,317 (4,427) Losses on the sale of and impairment losess on securities (e) - (2,013) 2,013 194 Interest on tax assets (e) 4,087 3,345 742 Default interest, net (d) 8,217 638 7,579 Financial discounts and allowances (e) 2,177 2,145 32 Impairment losses on financial receivables (e) (893) (2,816) 1,923 Other financial income (e) 2,339 1,173 1,166 Other financial expense (e) (570) (932) 362 Fair value gains on financial instruments (b) 2,687 1,118 1,569 Realised exchange rate gains (losses) (b) (38,027) 6,689 (44,716) Unrealised exchange rate gains (losses) (b) 8,479 (2,723) 11,202 Total (60,533) (9,831) (50,702)

Reference should be made to note 8 “Equity”, for information on the reclassification of the hedging reserve to profit or loss and its changes during the year. Net financing costs were the results of many effects, the more significant of which are summarised below: (a) Total net financial expense totalled euro 70.5 million (euro 40.3 million). The euro 30.2 million rise over the previous year is mainly due to certain South American markets, where interest rates jumped and so did the group’s debt. In this context, the interest accrued on the loan of Primav Ecorodovias taken on to acquire the concession company Ecocataratas (formerly Rodovias das Cataratas) rose by approximately euro 10 million over the previous year. In addition, the short-term debt in Venezuela temporarily increased as a result of a number of delays in payments of progress billings by state-owned customers, for works duly approved. The delays, which started to be recovered in the last few months of 2008 and first few months of 2009, led to an increase in local currency exposure, which was accompanied by a rise in interest rates (the nominal interest rates in Venezuela doubled from the end of 2007 to the end of 2008), leading to greater financial expense of roughly euro 20.0 million with respect to the previous year. (b) Net exchange rate losses, including fair value gains on financial instruments, totalled euro 26.9 million (net exchange rate gains of euro 5.1 million). Their analysis by underlying foreign currency and conditions is as follows: - the Construction segment recognised net exchange rate losses of euro 9.7 million in Venezuela. This is basically due to the local customers’ failure to exercise their right to pay progress billings in US dollars, as contractually provided for and in their favour, rather than the local currency (Bolivar). They had continuously availed of this option in previous years for almost all contractual components expressed in the local currency and the related receivables were assessed on this basis at the end of the previous year; - the Engineering & Plant Construction segment recorded net exchange rate losses of euro 13.7 million in the Persian Gulf area, mainly arising from local currencies, principally tied to the US dollar, as well as the US dollar itself. Despite their not meeting the hedging requirement established by IFRS, the derivatives entered into by the group hedging currency risks on contract revenue are substantially effective. The exchange rate losses classified as financing costs arising from the adjustments of the expected contract performance to current rates have been substantially offset by the performance of the relevant derivatives; - the group realised net exchange rate losses of euro 3.5 million on weak and/or limited circulation currencies, such as those for Brazil, Iceland, Tunisia and Nigeria. Hedges cannot be agreed for such exchange rate risks at reasonable conditions. (c) A decrease of euro 4.4 million in gains on the sale of securities. In 2007, these gains were realised on the management of payments made by customers in currencies other than those contractually provided for, whereas in 2008, these gains were realised by directly financing certain foreign operating branches of the parent using own funds. The group took advantage of the currency mismatches of money markets for certain South American currencies, whose official exchange rates with some strong currencies, including the US dollar, are fixed artificially. 195 (d) The collection of a number of default interest receivables by the Engineering & Plant Construction and the Construction segments, which had been fully impaired in previous years. This led to an approximate euro 7.6 million increase over the previous year (euro 8.2 million in 2008 compared to euro 0.6 million in 2007). (e) A reduction in bank charges and commissions on guarantees of euro 1.7 million and the overall decrease in other financial expense (losses on the disposal of financial assets and other income and expense) of euro 6.6 million over 2007.

14.2 Gains (losses) on investments Net gains on investments amount to euro 55.9 million in 2008, compared to euro 13.2 million in 2007, as follows:

(Euro/000) 2008 2007 Change Profit or loss of associates (12,041) 4,875 (16,916) Dividends 561 203 358 Gains on the sale of investments 67,492 7,005 60,487 Other gains (losses) on investments and profits (losses) of joint ventures (100) 1,152 (1,252) Total 55,912 13,235 42,677

Net gains on investments are mainly due to the following: • the sale of the group’s investment in the Brazilian concession company Ponte de Pedra S.A., finalised in April 2008, which generated a net gain of euro 67.5 million; • the cancellation of the remaining carrying amount of euro 9.9 million of the 50.71% investment in Impresit Bakolori P.l.c. (Nigeria) in the last few months of 2008. This company was excluded from the consolidation scope due to the significant worsening in the general stability of the area in which it operated. As a result, the group was unable to control the operations and management of the subsidiary, as it had done regularly in previous years.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

The overall loss of associates of euro 12.0 million is broken down in the following table:

(Euro/000) 2008 2007 Change Ponte de Pedra - 5,149 (5,149) Yacilec 1,385 1,401 (16) Varie Iglys 49 706 (657) Agua Azul 252 575 (323) Impresit Bakolori (9,877) - (9,877) Other (3,850) (2,956) (894) Total (12,041) 4,875 (16,916)

“Other” mainly relates to investments held by Imprepar.

15. Income tax expense 196 The group’s income tax expense for the year is euro 52.5 million as follows:

(Euro/000) 2008 2007 Change Current taxes 34,178 39,224 (5,046) Net deferred tax expense 17,424 27,195 (9,771) Prior year taxes (5,597) (12,434) 6,837 Total 46,005 53,985 (7,980) IRAP 6,531 9,728 (3,197) Total 52,536 63,713 (11,177)

An analysis and reconciliation of the theoretical income tax rate, calculated under Italian tax legislation, and the effective tax rate are set out below:

Income tax expense (Euro/m) % Profit before tax 184.5 Theoretical tax expense 50.7 27.5% Tax effect of permanent differences 7.1 3.8% Greater tax rate of foreign consolidated companies 5.6 3.0% Irrecoverable taxes paid abroad 16.2 8.8% Other 6.7 3.6% Prior year taxes (5.6) (3.0%) Effect of national consolidated tax system (34.7) (18.8%) Total 46.0 25.0% The above-described tax expense is affected by the following: a) the temporary non-recovery in Italy of taxes paid abroad under the law of the countries in which the consolidated companies’ branches operate, which led to greater taxes of euro 16.2 million compared to the “theoretical” tax burden. This is mainly due to the mismatch between the taxable profit earned abroad and, in particular, that earned in Italy, which the parent calculates together with those of its Italian subsidiaries (the national consolidation tax system). In 2008, the IRES tax base is negative and, therefore, foreign taxes cannot currently be recovered. However, their future recovery is still possible in accordance with current tax legislation; b) permanent differences, which have increased the effective tax expense by euro 7.1 million with respect to the “theoretical” tax burden; c) the greater tax rates applied to certain foreign consolidated companies, which increased the effective tax expense by euro 5.6 million; d) the effects of application of the national consolidation tax system to the prior year temporary differences of FIBE and FIBE Campania, which reversed in 2008, but which did not meet the requirement for the recognition of deferred tax assets in the years to which they pertained. This decreased the effective tax expense by euro 34.7 million with respect to the theoretical tax burden. 197

An analysis and reconciliation of the theoretical IRAP tax rate, calculated under Italian tax legislation, and the effective tax rate are set out below.

IRAP (Euro/m) % Operating profit 189.1 Personnel expenses 327.7 Net operating profit 516.8 Theoretical tax expense 20.2 3.9% Tax effect of foreign companies' production (6.6) (1.3%) Tax effect of foreign production (5.6) (1.1%) Tax effect of permanent differences (1.5) (0.3%) Total 6.5 1.2%

The net deferred tax expense contributes negatively to the consolidated profit for euro 17.4 million as shown below:

(Euro/000) Deferred tax expense for the year 11,594 Reversal of deferred tax liabilities recognised in previous years (1,512) Deferred tax income for the year (4,999) Reversal of deferred tax income recognised in previous years 12,341 Total 17,424

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

Changes in deferred tax assets and liabilities and the related impact on profit or loss are set out below:

31 December Accruals Utilisations Change in consolidation 31 December 2007 scope and exchange 2008 (Euro/000) rate gains (losses) Deferred tax assets: Amortisation and depreciation exceeding tax rates 3,190 - (106) - 3,084 Provisions for risks and impairment losses 36,496 1,543 (5,404) - 32,635 2005 share capital increase related charges 5,228 - (2,084) - 3,144 Fisia Hiatus goodwill 40,912 - (3,589) - 37,323 Other 4,763 3,456 (1,158) (269) 6,792 Total 90,589 4,999 (12,341) (269) 82,978 Offsetting (15,696) - - (3,178) (18,874) (a) Net deferred tax assets 74,893 4,999 (12,341) (3,447) 64,104 Deferred tax liabilities: 198 Unrecognised fiscally-driven amortisation and depreciation (4,670) - - - (4,670) Other (21,732) (11,594) 1,512 656 (31,158) Total (26,402) (11,594) 1,512 656 (35,828) Offsetting 15,696 - - 3,178 18,874 (b) Net deferred tax liabiilties (10,706) (11,594) 1,512 3,834 (16,954) (a)+(b) Net deferred tax expense (6,595) (10,829) (17,424)

Deferred tax assets and liabilities are offset mainly when relating to Italian companies participating in the national consolidation tax system.

16. Profits (losses) from discontinued operations Profits (losses) from discontinued operations for 2008 and 2007 are analysed below:

2008 2007 USW Campania Costanera Total Total Change (Euro/000) projects Revenue - - - 141,391 (141,391) Costs (5,038) - (5,038) (172,147) 167,109 Gains (losses) on the disposal of assets and impairment losses - - - - - Gain on investments - 40,605 40,605 - 40,605 Total (5,038) 40,605 35,567 (30,756) 66,323

The net profits from discontinued operations amount to euro 35.6 million (net losses of euro 30.8 million in 2007). They mainly derive from the financial components of the agreement defined in 2006 for the sale of the Chilean concession company Costanera Norte S.A. by Impregilo International Infrastructures, which were to be defined after the sale. This profit of euro 40.6 million has been partially offset by the loss on the USW Campania projects of euro 5.0 million. 17. Related party transactions Impregilo group’s transactions with its associates mainly related to: • trading transactions, namely purchases and procurement of services necessary to carry out work on contracts, contracting and subcontracting; • services (technical, organisational, legal and administrative), carried out at centralised level; • financial transactions, namely loans and joint current accounts as part of cash pooling transactions and guarantees given on behalf of group companies. Transactions are carried out with associates in the interests of Impregilo, aimed at building on existing synergies in the group in terms of production and sales integration, efficient use of existing skills, streamlining of centralised structures and financial resources. These transactions are regulated by specific contracts and carried out on an arm’s length basis. The key related party transactions, as defined by IAS 24 and group policies, carried out in 2008 are summarised below:

199 (Euro/000 - Impregilo’s share) 31 December 2008 Related party Receivables Payables Other Revenue Costs Financial Profits Cash flows current income (losses) from for the year liabilities (expense) discontinued operations Impresa Grassetto S.p.A. 33 (1) (17,667) 26 - - - - Itinera S.p.A. 420 (5,202) - - 7,812 - - (18,374) Interstrade S.p.A. - (836) - - 2,925 - - (7,217) Satap S.p.A. - (6,646) - - 10,940 - - (15,791) Autostrade Sud America S.r.l. - - - - - 463 34,870 35,363 Autopista Do Pacifico S.A. - - - - - 75 5,735 8,413 Total 453 (12,685) (17,667) 26 21,677 538 40,605 2,394

The above related party transactions relate to the following: (i) transactions carried out as part of the high speed/capacity railway contracts; (ii) valuations of the financial components of the agreement defined in 2006 related to the sale of the Chilean concession company Costanera Norte S.A. by Impregilo International Infrastructures, which were to be valued after the sale, as described earlier. The above transactions are governed by specific agreements and carried out on an arm’s length basis. Their effects on the balance sheet and income statement are shown together with the related contract. Their impact on the group’s financial position and results of operations for 2008 has not been material, except for net profits from discontinued operations. The fees of the directors and key managers for 2008 amount to euro 4.6 million while those of the statutory auditors come to euro 0.2 million. As required by Consob communication no. DEM/6064293, the effects of the above most significant related party transactions are disclosed in the balance sheet, income statement and cash flow statement.

2008 Annual Report IMPREGILO Consolidated financial statements as at and for the year ended 31 December 2008

18. Significant non-recurring events and transactions With respect to significant non-recurring events as defined in Consob communication no. DEM/6064293(1), apart from the net profits from discontinued operations, the group’s financial position and results of operations for 2008 were not affected by significant non-recurring events and transactions. 2007 had a significant non-recurring euro 50 million accrual for the prosecution commenced by the Naples Public Prosecutor for the USW Campania projects, as described in the directors’ report.

19. Balances or transactions arising from atypical and/or unusual transactions Impregilo group did not carry out any atypical and/or unusual transactions, as defined in the Consob communication no. DEM/6064293(2), during the year.

20. Earnings per share 200 Earnings per share are disclosed at the foot of the income statement. They have been calculated in accordance with IAS 33, taking into account the dilutive effects of potential shares arising from stock option plans.

On behalf of the board of directors Chairman (signed on the original)

1) Significant non-recurring events and transactions are those that do not frequently occur in the normal course of business. 2) Atypical and/or unusual transactions are those that, due to their significance and relevance, the counterparty, the object of the transaction, exchange pricing and timing, may cast doubts as to the accuracy and completeness of disclosures, conflicts of interest, protection of the group’s assets and minority interests. CONSOLIDATED FINANCIAL STATEMENTS 201 OF IMPREGILO GROUP INTRAGROUP TRANSACTIONS

2008 Annual Report IMPREGILO Intragroup transactions

CONSOLIDATED FINANCIAL STATEMENTS OF IMPREGILO GROUP – INTRAGROUP TRANSACTIONS 31 DECEMBER 2008

(Euro) RECEIVABLES

trade financial other Total receivables trade Other ENGINEERING & PLANT CONSTRUCTION 00127 - Consorzio Agenzia del Mare (7,196) 22015 - Consorzio Macopsissa Ambiente 214,678 214,678 (1,619) 31980 - Consorzio Ramsar Molentargius 40,107 37,319 77,426 (34,089) 37080 - Consorzio Unitam (1,931) Total Engineering & plant construction 40,107 251,997 292,104 (44,835)

CONCESSIONS 00318 - Autopistas del Sol S.A. 18,608 18,608 28094 - Pedemontana Veneta S.p.A. 121 121 Total Concessions 18,729 18,729

202 CONSTRUCTION 00006 - Arbeitsgemeinschaft Aschertunnel 2,331 2,331 00153 - Joint Venture Aktor Ate - Impregilo S.p.A. 471,288 471,288 00156 - Joint Venture Aktor SA - Impregilo S.p.A. 00309 - Arbeitsgemeinschaft tunnel (ATUS) 374,714 374,714 (114,986) 00628 - Arbeitsgemeinschaft Tunnel Zurich - Thalwil AZT 1,377 1,377 00823 - Aoet Arbeitsgemeinschaft Oenzberg Tunnel Arge (6,567) 01090 - Arge Haupttunnel Eyholz (47,913) 01416 - Autostrada Estense S.c.p.a. (101,587) 04121 - Consorzio Allargamento Strada Vogorno 421 421 04158 - C.B.N. Chiasso consorzio 27,067 27,067 04174 - CCB Consorzio Centro Balneare 65,686 65,686 04213 - Consorzio Edile Palazzo Mantegazza 422,298 422,298 04251 - Consorzio Galliera Scaglioni 95,661 95,661 04310 - J.Cartellone C.C. S.A.-Igl S.p.A - (Casisa UTE) 214,579 3,395,106 120,396 3,730,081 (2,387,790) 04372 - CMC Consorzio Monte Ceneri lotto 851 243,849 243,849 04501 - Impregilo SpA-Iglys SA-Hochtief AG-Hochtief UTE 375,046 375,046 04508 - Joint Venture Impregilo S.p.A. - Empedos S.A. - Ak 1,182 489,324 490,506 04521 - Consorcio Impregilo Cosapi 6,014 6,014 04689 - Consorcio Grupo Contuy-Proyectos y Ob. De F. 04694 - Consorcio Contuy Medio 4,299,030 4,299,030 04790 - Consorzio CPS Pedemontana 295,945 295,945 (123,114) 04796 - CRA Consorzio Realizzazione Arca 158,472 158,472 04905 - CSLN Consorzio (10,683) 05008 - Churchill Consortium 102,403 102,403 05009 - Churchill Hospital J.V. 166,176 166,176 10118 - Consorzio Felce 134,025 134,025 10463 - Consorzio FLP 175,615 20,202 195,817 10473 - Consorzio FLP II 351,926 351,926 (6,364) PAYABLES NET Revenue from Costs for Financial Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsorship fees income expense

(7,196) (7,196) (1,619) 213,059 (34,089) 43,337 (2,776) (4,707) (4,707) (2,776) (47,611) 256,396 (11,903)

18,608 121 18,729

203 2,331 2,784 471,288 44,569 8,492 (114,986) 259,728 198,850 1,377 32 (6,567) (6,567) 40 (1,212,121) (1,260,034) (1,260,034) 37,609 (101,587) (101,587) 421 773 1,575 27,067 65,686 21,545 422,298 21,211 95,661 17,587 863 (1,220,649) (3,608,439) 121,642 22,963 197,674 243,849 756,521 (54,716) (54,716) 320,330 490,506 6,014 (1,895,868) (1,895,868) (1,895,868) 4,299,030 (123,114) 172,831 158,472 17,356 (10,683) (10,683) 102,403 (1,505,726) (1,505,726) (1,339,550) 134,025 7,358 195,817 7,041 760 (6,364) 345,562 2,120

2008 Annual Report IMPREGILO Intragroup transactions

(Euro) RECEIVABLES

trade financial other Total receivables trade 12064 - Grupo Empresas Italianas - GEI 2,758,328 2,758,328 14023 - Groupement Hydrocastoro 18,267 18,267 16247 - Consorcio Imigrantes 16555 - Impregilo - Ebasco-Losinger J.V. 42,907 42,907 (228,837) 17258 - Consorzio Iricav Due 8,945 8,945 (5,732,075) 20109 - Line 3 Metro Stations 178,918 175,895 354,813 22130 - Consorzio MARC 13,659 13,659 (4,139) 22232 - Metropolitana di Napoli S.p.A. 85,245 85,245 (61,431) 22247 - M.N. 6 S.c.r.l. (26,057) 24073 - Consorzio RCPS Nuova Romea 5,834 16,903 22,737 (34,778) 24126 - Consorcio Cigla-Sade 148,076 1,078,813 1,226,889 25880 - Consorcio OIV-TOCOMA 4,111,931 40,355,822 4,267,456 48,735,209 28027 - Consorzio Paleuropa (11,602) 204 32115 - Consorcio Rio Tocantinis 236 236 32127 - Riviera S.c.r.l. 32,458 32,458 (1,016,379) 34310 - Consorzio San Cristoforo 201,755 201,755 (7,332) 34340 - Sarmento S.c.r.l. 7,800 358,900 366,700 34493 - Consorcio Serra do Mar 578,898 1,425,684 2,004,582 34680 - S.I.MA. GEST 3 S.c.r.l. (183,720) 35398 - Arge Stollen Chatzuhus 190,478 80,808 271,286 36090 - Consorzio TAT-Tunnel Alp Transit Ticino 2,283,527 301,204 2,584,731 (22,154) 36275 - Techint S.A.C.I.- Hochtief A.G.- Impregilo S.p.A 9,905 29,716 5,257,072 5,296,693 36281 - Thessaloniki Metro 119,417 119,417 36282 - Thessaloniki Metro CW 898,940 1,165,555 2,064,495 (2,406) 36376 - Consorzio TRA.DE.CI.V. 1,190,157 1,190,157 (237,158) 36440 - Consorzio Tre Esse 1,934,825 1,934,825 (2,479,223) 36452 - Consorzio Trevi - S.G.F. INC per Napoli 2,544,198 2,544,198 (857,149) 37023 - Arge Uetlibergtunnel 11,468 11,468 40025 - Consorzio Venezia Nuova 20,066,149 20,066,149 (328,606) 40147 - Consorzio VIT Caroni Tocoma 10,995,116 4,919 11,000,035 (19,474) 40148 - Consorcio VIT Tocoma 9,675,609 8,371 9,683,980 (33,495) 40440 - Consorcio V.S.T. Tocoma 12,147 225,303 281,240 518,690 (135,991) 43295 - Yellow River Contractors J.V. 18,562 894,781 913,343 43295H - Yellow River Contractor H.O. 21,600 21,600 Total construction 39,633,529 77,467,489 14,161,450 131,262,468 (14,355,884)

IMPREPAR 00040 - Consorzio del Sinni 04232 - Consorzio Edilizia Sociale Industralizzata Lazio 118,802 70,417 189,219 (16,238) 04336 - Consorzio Cogefar/Italstrade/Recchi/CMC - CIRC 154,541 154,541 (94,107) 04502 - Iglys SA-Iecsa SA-Dragados Obras y Proyectos UTE PAYABLES NET Revenue from Costs for Financial Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsorship fees income expense 2,758,328 18,267 (178,292) (178,292) (178,292) (228,837) (185,930) (5,732,075) (5,723,130) (117,135) (117,135) 237,678 (4,139) 9,520 (61,431) 23,814 (26,057) (26,057) (34,778) (12,041) (905,668) (905,668) 321,221 55,668 48,735,209 (11,602) (11,602) 236 205 (1,016,379) (983,921) 731 (7,332) 194,423 366,700 18,516 (846,786) (846,786) 1,157,796 (183,720) (183,720) 271,286 59,532 (1,587,446) (1,609,600) 975,131 1,443,675 115,089 5,296,693 (2,940,030) (2,940,030) (2,820,613) (2,406) 2,062,089 (237,158) 952,999 (2,479,223) (544,398) (857,149) 1,687,049 24,447 (202,020) (202,020) (190,552) 55,888 (328,606) 19,737,543 (6,343,137) (6,362,611) 4,637,424 (6,122,560) (6,156,055) 3,527,925 (135,991) 382,699 (175,087) (175,087) 738,256 21,600 (4,258,437) (23,446,484) (42,060,805) 104,676,208 (15,474,545) 2,727,430 318,000 197,674

(12,389) (12,389) (12,389) (16,238) 172,981 (94,107) 60,434 (77,004) (77,004) (77,004)

2008 Annual Report IMPREGILO Intragroup transactions

(Euro) RECEIVABLES

trade financial other Total receivables trade 08009 - Consorzio Eastital Costruzioni (95,028) 10070 - Consorcio Federici/Impresit/Ice Cochabamba 600,000 600,000 10115 - Consorzio Imprese Lavori FF.SS. di Saline - FEIC 7,943 7,943 (13,538) 10135 - Consorzio Ferrofir 641,140 641,140 (600,089) 12054 - GE.A.C. S.r.l. 173,116 173,116 16730 - IGL-Stfa - Impregilo Sezai Turkes Feyzi Akkaya J.V 710,666 710,666 17150 - Consorzio Iniziative Ferroviarie - INFER 339,319 339,319 (607,418) 22180 - Matsoku Civil Contractor (MMC) J.V. 22207 - Consorzio infrastruttura area metropolitana (15,976) 22210 - Consorzio Metropolitane 22400 - Salini - Impregilo Joint Venture for Mukorsi 7,522 7,522 24136 - Consorzio per il Nucleo di Balvano 317,832 180,889 498,721 27070 - Salini - Cogefar Impresit Osborne Dam J.V. (2,609) 206 27370 - Impregilo - Salini Joint Venture for Owen Falls 27370H - Impregilo - Salini for Owen Falls H.O. (2,335) 34032 - Consorzio Sarda Costruzioni Generali 7,549 7,549 (29,024) 34235 - J.V. Salini Impregilo (Sudan) 139,150 139,150 34333 - Consorzio Sardo d'Imprese (5,501) 34937 - SO.C.E.T. Societa' Costruttori Edili Toscani 1 1 (106,287) 35202 - S.P.P.C.A.C. S.c.r.l. 25,077 25,077 35227 - Strade e Depuratori Palermo S.c.r.l. (184,950) 35415 - Consorzio Suburbia 7,845 7,845 40010 - Valtellina S.c.r.l. 4,920 4,920 Total Imprepar 2,864,234 1,281,787 4,146,021 (2,855,488) Total other 42,556,599 79,001,273 14,161,450 135,719,322 (17,256,207)

Associates ENGINEERING & PLANT CONSTRUCTION 24050 - Nautilus S.c.p.a. (50,619) 28585 - Pertusola Sud S.c.r.l. 96,610 96,610 40090 - Villagest S.c.r.l. 247,034 247,034 (99,362) Total engineering & plant construction 247,034 96,610 343,644 (149,981)

CONCESSIONS 01060 - Consorcio Agua Azul S.A. 16,535 16,535 (6,127) 01070 - Aguas del Gran Buenos Aires S.A. 11,170 13 11,183 (11,253) 04553 - Impregilo Wolverhampton Ltd 219,173 219,173 25853 - Ochre Holdings Solutions Ltd 1,792 1,792 28435 - Puentes del Litoral S.A. 1,345 1,345 (693) 34747 - Sistranyac S.A. 2,027 2,027 43290 - Yacylec S.A. 38,675 38,675 Total concessions 290,717 13 290,730 (18,073) PAYABLES NET Revenue from Costs for Financial Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsorship fees income expense (35,151) (130,179) (130,179) (101,197) (101,197) 498,803 (13,538) (5,595) (600,089) 41,051 173,116 710,666 (607,418) (268,099) (972) (972) (972) (15,976) (15,976) (10,846) (10,846) (10,846) 7,522 498,721 (2,609) (2,609) (2,716) (2,716) (2,716) 207 (2,335) (2,335) (29,024) (21,475) 139,150 (5,501) (5,501) (106,287) (106,286) (16,835) (16,835) 8,242 (184,950) (184,950) 7,845 4,920 (257,110) (3,112,598) 2,323,451 (1,290,028) (4,518,323) (23,446,484) (45,221,014) 107,274,784 (16,776,476) 2,727,430 318,000 197,674

(50,619) (50,619) 96,610 (99,362) 147,672 (149,981) 244,282 (50,619)

(6,127) 10,408 (11,253) (70) 219,173 1,792 400,168 (10,491) (11,184) (9,839) (284,183) (284,183) (282,156) 35,047 38,675 (284,183) (10,491) (312,747) 270,048 (292,065) 400,168 35,047

2008 Annual Report IMPREGILO Intragroup transactions

((Euro) RECEIVABLES

trade financial other Total receivables trade CONSTRUCTION 00233 - Anagnina 2000 S.c.r.l. 389,450 666 390,116 00316 - Aurelia 98 S.c.r.l. 27,820 27,820 (3,419) 02195 - B.O.B.A.C. S.c.a.r.l. (1,343) 04233 - CE.S.I.F. S.c.p.a. (1,824) 16960 - Impresit Bakolori 2,157 2,157 (7,810) 22208 - Metrogenova S.c.r.l. 275,434 275,434 (5,061,142) 29030 - Quattro Venti S.c.r.l. 958,522 958,522 (562,757) 34955 - SO.CO.TAU. S.c.r.l. 28,422 28,422 40012 - VE.CO. S.c.r.l. (138,527) 40035 - Versilia S.c.r.l. 40041 - Versilia Servizi S.c.a.r.l. 78,552 78,552 Total construction 1,704,115 56,908 1,761,023 (5,776,822) 208 IMPREPAR 00055 - Adduttore Ponte Barca S.c.r.l. (72,800) 00223 - Diga Ancipa S.c.r.l. 120,221 77,436 197,657 (156,106) 00234 - ANBAFER S.c.r.l. 10,913 119,249 130,162 (106) 00235 - Ancipa S.c.r.l. 491,127 767,567 1,258,694 00240 - Antignano S.c.r.l. 520,225 520,225 04025 - Cagliari 89 S.c.r.l. 1,508,554 561,692 2,371 2,072,617 (1,829,584) 04034 - Cannatello S.c.r.l. (9,455) 04058 - Consorzio Carnia S.c.r.l. 4,145 4,145 04449 - Consorzio Lavori Interventi Straordinari Palermo 105,161 105,161 (87,424) 04650 - Consorzio Consavia S.c.n.c. 9,611 9,611 04744 - Corso Malta S.c.r.l. 182,923 500 183,423 (46,156) 04745 - Costruttori Riuniti per la Valtellina 29,449 87,497 116,946 06055 - Depurazione Palermo S.c.r.l. (13,302) 06130 - A.T.I. Girola-Romagnoli-Poscio - Domo II S.c.r.l. 216,867 216,867 (48,696) 08052 - Edificatrice Sarda S.r.l. 447,790 447,790 08056 - Edil.Gi. S.c.r.l. 6,616 6,616 08074 - Edilizia Giudiziaria S.c.r.l. 1,256,150 1,697,606 2,953,756 (2,949,624) 10119 - FE.LO.VI. S.c.n.c. (609) 12015 - Galliera 2000 S.c.r.l. 32,406 32,406 12074 - Imprese Riunite Genova Irg S.c.r.l. 69,401 69,401 (598,910) 12076 - Imprese Riunite Genova Seconda S.c.r.l. 1,211,038 1,211,038 (585,430) 12110 - Gestioni Sanitarie Toscane S.c.r.l. 32,786 5,416 38,202 (6,197) 12235 - Grandi Uffizi S.c.r.l. 865 46,057 46,922 22168 - Marsico Nuovo S.c.r.l. 11,362 29,497 40,859 22240 - Milano Sviluppo S.p.A. 3,721 112,754 116,475 24250 - Nuovi Mercati S.c.r.l. 1,452 1,452 PAYABLES NET Revenue from Costs for Financial Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsorship fees income expense

(3,615) (3,615) 386,501 (3,419) 24,401 (1,343) (1,343) (1,824) (1,824) (7,810) (5,653) (40,413) (5,101,555) (4,826,121) 435,558 (562,757) 395,765 28,422 (138,527) (138,527) (37) (37) (37) 78,552 19,757 (3,615) (40,450) (5,820,887) 913,641 (4,973,505) 455,315 209

(4,881) (77,681) (77,681) (3,615) (159,721) 37,936 (106) 130,056 1,258,694 520,225 (5,165) (1,834,749) 237,868 (9,455) (9,455) 4,145 (87,424) 17,737 9,611 (46,156) 137,267 116,946 (3,615) (16,917) (16,917) (48,696) 168,171 447,790 6,616 (2,949,624) 4,132 (3,706) (4,315) (4,315) 32,406 (598,910) (529,509) (585,430) 625,608 (6,197) 32,005 46,922 40,859 116,475 1,452

2008 Annual Report IMPREGILO Intragroup transactions

(Euro) RECEIVABLES

trade financial other Total receivables trade 26031 - Olbia 90 S.c.r.l. 117,471 36,412 153,883 (101,529) 28085 - Paullese S.c.r.l. 2,750 2,750 28175 - Pietrarossa S.c.r.l. 632,142 632,142 (258) 28212 - Platano S.c.n.c. (12,288) 28333 - Associazione Temporanea Priolo Siracusa S.c.r.l. 79,412 79,412 (50,040) 32045 - RCCF Nodo di Torino S.c.p.a. 96,342 96,342 (30,722) 34010 - Saces S.r.l. 34315 - San Giorgio Caltagirone S.c.r.l. 46,633 46,633 34425 - Scafani S.c.r.l. 208,706 208,706 34731 - Sistema Sinni S.c.r.l. 34988 - Soingit S.c.r.l. 212,292 212,292 (70,246) 35085 - Cogefar/C.I.S.A./Icla/Fondedile (6,269) 40040 - Monte Vesuvio S.c.r.l. 49,479 384,537 434,016 210 Total Imprepar 5,743,540 5,899,238 3,823 11,646,601 (6,675,751) Total associates 7,985,406 6,052,769 3,823 14,041,998 (12,620,627)

Subsidiaries CONCESSIONS 08053 - Concessionaria Ecovias Dos Imigrantes S.A. 18,082 18,082 Total concessions 18,082 18,082

CONSTRUCTION 00312 - Auditorium Roma S.c.r.l. 69,367 69,367 (24,416) 18009 - Collegamento Ferroviario Genova-Milano 33001 - S. Anna Palermo S.c.r.l. 70,371 70,371 34503 - SGF Inc filiale Ecuador 285,078 285,078 (366,029) 34509 - S.G.F. I.N.C. S.p.A. - filiale Venezuela 2,926,220 4,129,989 7,056,209 (9,512,926) 37032 - Unicatanzaro S.c.r.l. 103,169 103,169 Total construction 3,384,838 69,367 4,129,989 7,584,194 (9,903,371)

IMPREPAR 33010 - San Benedetto S.c.r.l. (45,521) Total Imprepar (45,521) Total subsidiaries 3,402,920 69,367 4,129,989 7,602,276 (9,948,892)

TOTAL CURRENT 53,944,925 85,123,409 18,295,262 157,363,596 (39,825,726) PAYABLES NET Revenue from Costs for Financial Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsorship fees income expense (101,529) 52,354 2,750 (258) 631,884 (114) (12,402) (12,402) (50,040) 29,372 (30,722) 65,620 (1,071,339) (1,071,339) (1,071,339) 46,633 208,706 (1,260) (1,260) (1,260) (142,374) (212,620) (328) (6,269) (6,269) (16,268) (16,268) 417,748 (1,247,172) (5,165) (7,928,088) 5,447,988 (1,729,475) 211 (1,534,970) (56,106) (14,211,703) 6,875,959 (7,045,664) 455,315 400,168 35,047

18,082 18,082

(24,416) 44,951 (54,360) (54,360) (54,360) 70,371 (366,029) (80,951) (9,512,926) (2,456,717) (930) (930) 102,239 (55,290) (9,958,661) 217,561 (2,592,028)

(26) (45,547) (45,547) (26) (45,547) (45,547) (55,316) (10,004,208) 235,643 (2,637,575)

(6,108,609) (23,502,590) (69,436,925) 114,386,386 (26,459,715) 3,182,745 718,168 232,721

2008 Annual Report IMPREGILO Intragroup transactions

(Euro) RECEIVABLES

trade financial other Total receivables trade Other CONSTRUCTION 00309 - Arbeitsgemeinschaft tunnel (ATUS) 1,723,906 1,723,906 04372 - CMC Consorzio Monte Ceneri lotto 851 4,471,380 4,471,380 16565 - Executive J.V. Impregilo S.p.A. Terna S.A. 3,683,076 3,683,076 20109 - Line 3 Metro Stations 1,280,000 1,280,000 36090 - Consorzio TAT-Tunnel Alp Transit Ticino 116,421 116,421 36282 - Thessaloniki Metro CW 255,000 255,000 Total Construction 11,529,783 11,529,783 Total 11,529,783 11,529,783

Associates CONCESSIONS 212 04553 - Impregilo Wolverhampton Ltd 495,328 495,328 25853 - Ochre Holdings Solutions Ltd 5,675,238 5,675,238 Total Concessions 6,170,566 6,170,566 Total 6,170,566 6,170,566 TOTAL NON-CURRENT 17,700,349 17,700,349

TOTAL 53,944,925 102,823,758 18,295,262 175,063,945 (39,825,726) PAYABLES NET Revenue from Costs for Financial Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsorship fees income expense

1,723,906 4,471,380 3,683,076 1,280,000 116,421 255,000 11,529,783 11,529,783

495,328 213 5,675,238 6,170,566 6,170,566 17,700,349

(6,108,609) (23,502,590) (69,436,925) 132,086,735 (26,459,715) 3,182,745 718,168 232,721

2008 Annual Report IMPREGILO

CONSOLIDATED FINANCIAL STATEMENTS 215 OF IMPREGILO GROUP – EQUITY INVESTMENTS

2008 Annual Report IMPREGILO Equity investments

CONSOLIDATED FINANCIAL STATEMENTS OF IMPREGILO GROUP EQUITY INVESTMENTS

Name 31 December 2007 Change in New Share of consolidation acquisitions and profit or loss scope disinvestments of associates (Euro/000) Consorzio Acqua Blu 50 (47) (1) Consorzio del Sinni 12 Adduttore Ponte Barca S.c.r.l. 7 Consorzio Agenzia del Mare 34 Anagnina 2000 S.c.r.l. 5 Ancipa S.c.r.l. 5 Antignano S.c.r.l. 5 Consorzio Aree Industriali Potentine (1) Auditorium Roma S.c.r.l. 54 Aurelia 98 S.c.r.l. 4 Consorzio Agrital Ricerche (100) Consorcio Agua Azul S.A. 5,173 252 Autostrada Estense S.c.p.a. 180 216 B.O.B.A.C. S.c.a.r.l. 5 Calpark S.p.A. 9 Consorzio Casale Nei 1 Consorzio Edilizia Sociale Industralizzata Lazio 8 CE.S.I.F. S.c.p.a. 63 CGMP - Centro de Gestao De Meios de Pagamento S.A. 650 (650) J.Cartellone C.C. S.A.-Igl S.p.A - (Casisa UTE) 3 Consorzio Cogefar/Italstrade/Recchi/CMC - CIRC 13 Coincar S.A. 3,595 200 Impregilo Lidco Co 1,758 (1,748) Impregilo Arabia Ltd - 4,164 Impresit Bakolori Plc - 9,877 (9,877) Impregilo Wolverhampton Ltd (443) Consorzio Ferroviario Milanese 28 Consorzio Consavia S.c.n.c. 7 Consorzio CON.SI 1 Consorzio Volgograd Opere Civili 2 (2) Consorzio CO.RI.TECNO 11 Consorzio CPS Pedemontana 35 Costruttori Romani Riuniti Grandi Opere 94 Depurazione Palermo S.c.r.l. 5 A.T.I. Girola-Romagnoli-Poscio - Domo II S.c.r.l. 4 Consorzio Eastital Costruzioni 68 Ecologia Montana S.p.A. 231 EDIL.CRO S.c.r.l. 2 Edil.Gi. S.c.r.l. 3 Capital Impairment Dividends Change due to Other 31 December 2008 reimbursement losses exchange rate changes recognised fluctuations in equity (2) - 12 7 34 5 5 5 (1) 54 4 (100) (507) 39 4,957 180 5 217 9 1 8 63 - 3 13 (132) 3,663 10 4,164 - 443 - 28 7 1 - 11 35 94 5 4 68 231 2 3

2008 Annual Report IMPREGILO Equity investments

Name 31 December 2007 Change in New Share of consolidation acquisitions and profit or loss scope disinvestments of associates (Euro/000) Emittenti Titoli S.p.A. 11 Acqua Campania S.p.A. 10 Sep Eole 1 E.R. Impregilo/Dumez y Asociados para Yaciretê (167) Fedco J.V. 14 Consorcio Federici/Impresit/Ice Cochabamba 16 Consorzio Imprese Lavori FF.SS. di Saline - FEIC 5 FE.LO.VI. S.c.n.c. 8 Consorzio Ferrofir 178 Fox Valley West Properties JV 42 Galliera 2000 S.c.r.l. 6 Imprese Riunite Genova Irg S.c.r.l. 7 Gestioni Sanitarie Toscane S.c.r.l. 31 218 Grassetto S.p.A. 8 G.T.B. S.c.r.l. 12 Healy-Yonkers-Atlas-Gest J.V. 12 I_Faber S.p.A. 583 Immobiliare Golf Club Castel D'Aviano S.r.l. 63 Impregilo - Ebasco-Losinger J.V. 118 Executive J.V. Impregilo S.p.A. Terna S.A. 440 Impretech S.A. 356 (356) Consorzio Iniziative Ferroviarie - INFER 14 Centro Merci Lazio S.p.A. 12 (12) Consorzio Iricav Due 62 Isibari S.c.r.l. 8 Istituto per lo Sviluppo Edilizio ed Urbanistico 25 Collegamento Ferroviario Genova-Milano 72 Libyan Italian Joint Company 49 Consorzio Macopsissa Ambiente 14 Malpensa 2000 S.c.r.l. 1 Consorzio MARC 3 Markland S.r.l. 1 Consorzio infrastruttura area metropolitana 8 Metrogenova S.c.r.l. 8 Consorzio Metropolitane 13 Consorzio Metrofer 4 Metropolitana di Napoli S.p.A. 314 M.N. 6 S.c.r.l. 1 A.T.I. Monte Bianco S.c.r.l. 3 (3) Morrison Impregilo Coventry Construction J.V. 1 Nautilus S.c.p.a. 83 (4) Capital Impairment Dividends Change due to Other 31 December 2008 reimbursement losses exchange rate changes recognised fluctuations in equity 11 10 1 (76) (243) 14 16 5 8 178 (42) - 6 7 31 8 219 12 12 583 63 11 129 440 - 14 - 62 8 25 6 78 49 14 1 3 1 8 8 13 4 314 1 - 1 79

2008 Annual Report IMPREGILO Equity investments

Name 31 December 2007 Change in New Share of consolidation acquisitions and profit or loss scope disinvestments of associates (Euro/000) Newco Nuova Romea S.p.A. 18 Consorzio RCPS Nuova Romea 6 Nuovi Mercati S.c.r.l. 3 (3) Ochre Holdings Solutions Ltd 12 Olbia 90 S.c.r.l. 3 Salini - Cogefar Impresit Osborne Dam J.V. 4 Pedemontana Veneta S.p.A. 570 Platano S.c.n.c. 5 Associazione Temporanea Priolo Siracusa S.c.r.l. 2 Parco Scientifico e Tecnologico della Sicilia 5 Pertusola Sud S.c.r.l. 5 Quattro Venti S.c.r.l. 21 Consorzio Ramsar Molentargius 3 220 RCCF Nodo di Torino S.c.p.a. 27 Rimini Fiera S.p.A. 3,438 Riviera S.c.r.l. - 5 Rodoconsult Assessoria L.t.d. 50 (1) (49) S. Anna Palermo S.c.r.l. 19 San Benedetto S.c.r.l. 10 Consorzio Sarda Costruzioni Generali 3 Consorzio San Cristoforo 25 Consorzio Sardo d'Imprese 1 Sistema Sinni S.c.r.l. 10 Sistranyac S.A. 513 Società Autostrada Broni-Mortara S.p.A. - 1,000 Societê Italiana per il Traforo del Ciriegia 245 SO.CO.TAU. S.c.r.l. 2 Soingit S.c.r.l. 3 Cogefar/C.I.S.A./Icla/Fondedile 12 Skiarea Valchiavenna S.p.A. 100 S.P.P.C.A.C. S.c.r.l. 1 Strade e Depuratori Palermo S.c.r.l. 2 Consorzio Suburbia 3 Taormina S.c.r.l. 13 (13) Techint S.A.C.I.- Hochtief A.G.- Impregilo S.p.A 2,478 Torino Parcheggi S.r.l. 3 Consorzio TRA.DE.CI.V. 13 Consorzio Tre Esse 20 Trevi S.G.F. S.c.r.l. 23 (23) Consorzio Trevi - S.G.F. INC per Napoli 5 Capital Impairment Dividends Change due to Other 31 December 2008 reimbursement losses exchange rate changes recognised fluctuations in equity 18 6 22 (4) 8 3 4 570 5 2 5 5 21 3 27 221 3,438 5 - 19 10 3 25 1 10 (361) (2) 150 1,000 245 2 3 12 100 1 2 3 - (2,478) - 3 13 20 - 5

2008 Annual Report IMPREGILO Equity investments

Name 31 December 2007 Change in New Share of consolidation acquisitions and profit or loss scope disinvestments of associates (Euro/000) Consorzio Unitam 6 Valtellina S.c.r.l. 2 VE.CO. S.c.r.l. 2 Consorzio Venezia Nuova 52 Versilia S.c.r.l. 3 Monte Vesuvio S.c.r.l. 22 Versilia Servizi S.c.a.r.l. 6 Villagest S.c.r.l. 6 Yacylec S.A. 3,152 1,385 Total 24,966 7,479 4,712 (8,097)

Ponte de Pedra Energetica S.A. 52,428 (52,428) Total investments held for sale 52,428 - (52,428) - 222 Mediterranea delle Acque S.p.A. 16,506 Available-for-sale financial assets 16,506 - - -

Total investments 93,900 7,479 (47,716) (8,097) Capital Impairment Dividends Change due to Other 31 December 2008 reimbursement losses exchange rate changes recognised fluctuations in equity 6 2 2 52 3 22 6 6 (1,880) (120) 2,537 (355) - (2,387) (326) (2,035) 23,957

------223 (7,562) 8,944 - (7,562) - - - 8,944

(355) (7,562) (2,387) (326) (2,035) 32,901

2008 Annual Report IMPREGILO Equity investments

INVESTMENTS WITH A NEGATIVE CARRYING AMOUNT

Name 31 December 2007 Accrual to Utilisation of provisions for risks provisions for risks (Euro/000) for investments for investments Adduttore Ponte Barca S.c.r.l. 55 (25) ANBAFER S.c.r.l. 85 Ancipa S.c.r.l. 1,376 788 Consorzio Carnia S.c.r.l. 130 (130) Consorzio per il Nucleo di Balvano 361 20 Corso Malta S.c.r.l. 65 Costruttori Riuniti per la Valtellina 34 12 Diga Ancipa S.c.r.l. 60 14 Groupement Hydrocastoro - Imprese Riunite Genova Seconda S.c.r.l. 135 2,800 Lambro S.c.r.l. (1) Livorno Due S.c.r.l. 253 (253) Marsico Nuovo S.c.r.l. 70 Milano Sviluppo S.p.A. 53 10 224 Monte Mario S.c.r.l. 112 (112) Monte Vesuvio S.c.r.l. 326 (61) Paullese S.c.r.l. 5 2 Pietrarossa S.c.r.l. 2,087 491 Puentes de Litoral S.A. (Iglys) 28 Puentes de Litoral S.A. (Impregilo S.p.A.) 3,014 Saces S.r.l. 1,206 Sclafani S.c.r.l. 254 (189) Sep Eole 1,083 546 Soingit S.c.r.l. 180 Impregilo Wolverhampton Ltd - Altre (Imprepar) 49 72 (13) Total provisions for risks for investments 11,020 4,755 (783) Release of Exchange Change in Reclassifications Other 31 December 2008 provisions for risks rate gains consolidation changes on investments (losses) scope 30 85 2,164 - 381 65 46 74 274 274 2,935 1- - 70 63 225 - 265 7 2,578 (1) 27 3,014 1,206 65 1,629 180 (140) 323 510 693 524 9 641 (140) - 323 1,033 284 16,492

2008 Annual Report IMPREGILO

CONSOLIDATION SCOPE 227

2008 Annual Report IMPREGILO Consolidation scope

CONSOLIDATION SCOPE

Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct CONSTRUCTION Impregilo S.p.A. Italy Euro 718,364,457 100 100 More than one line-by-line Bocoge S.p.A. - Costruzioni Generali Italy Euro 1,702,720 100 100 line-by-line Campione S.c.r.l. (in liq.) Italy Euro 11,000 99.9 99.9 line-by-line Consorzio CCTE (in liq.) Italy Euro 41,315 100 60 40 ILIM S.r.l. line-by-line Consorzio Cogefar-Impresit Cariboni per la Frana di Spriana S.c.r.l. (in liq.) Italy Euro 45,900 100 100 line-by-line Consorzio tra le Società Cogefar/Bordin/Coppetti/Icep - CORAV Italy Euro 51,129 96.97 96.97 line-by-line Construtora Impregilo y Associados S.A.-CIGLA S.A. Brazil BRL 7,641,014 100 100 line-by-line CSC Impresa Costruzioni S.A. Switzerland CHF 2,000,000 100 100 line-by-line Effepi - Finanza e Progetti S.r.l. (in liq.) Italy Euro 78,000 100 100 SGF INC S.p.A. line-by-line Fisia Babcock Engineering CO. Ltd China Euro 140,000 100 100 Fisia Babcock Gmbh line-by-line I.L.IM. - Iniziative Lombarde Immobiliari S.r.l. (in liq.) Italy Euro 3,100,000 100 100 line-by-line Impregilo Healy Joint Venture USA 100 15 85 Healy S.A. line-by-line Impregilo Lidco Libya Co Libya DL 5,000,000 60 60 line-by-line 228 INC - Algerie S.a.r.l. Algeria DZD 57,360,000 99.97 99.97 SGF INC S.p.A. line-by-line Joint Venture Impregilo S.p.A. - S.G.F. INC S.p.A. Greece 100 99 1 SGF INC S.p.A. line-by-line Lavori Lingotto S.c.r.l. (in liq.) Italy Euro 25,000 100 100 line-by-line Nuovo Dolonne S.c.r.l. (in liq.) Italy Euro 50,000 100 100 line-by-line PGH Ltd Nigeria NGN 52,000,000 100 100 line-by-line Rivigo J.V. (Nigeria) Ltd Nigeria NGN 25,000,000 70 70 PGH Ltd line-by-line S.A. Healy Company USA USD 11,320,863 100 100 line-by-line S.G.F. - I.N.C. S.p.A. Italy Euro 3,859,680 100 100 line-by-line Società Industriale Prefabbricazione Edilizia del Mediterraneo - S.I.P.E.M. S.p.A. (in liq.) Italy Euro 438,546 100 100 line-by-line Suramericana de Obras Publicas C.A.- Suropca C.A. Venezuela VEB 2,874,118,000 100 99 1 CSC S.A. line-by-line Vegas Tunnel Constructors USA 100 40 60 Healy S.A. line-by-line B.B.A. S.c.r.l. (in liq.) Italy Euro 10,000 80 80 SGF INC S.p.A. proportionate Consorcio Acueducto Oriental Dom. Republic 67 67 proportionate Consorcio Central Hidroelectrica Daule Peripa Division Obras Civiles Ecuador 90 85 5 Imprepar S.p.A. proportionate Consorcio Contuy Medio Grupo A C.I. S.p.A. Ghella Sogene C.A., Otaola C.A. Venezuela 36.4 36.4 proportionate Consorcio Impregilo - Ingco Dom. Republic 70 70 proportionate Consorcio Impregilo Yarull Dom. Republic 70 70 proportionate Consorzio Alta Velocità Torino/Milano - C.A.V.TO.MI. Italy Euro 5,000,000 74.69 74.69 proportionate Consorzio Autosilo Vico Morcote Switzerland 70 70 CSC S.A. proportionate Consorzio C.A.V.E.T. - Consorzio Alta Velocità Emilia/Toscana Italy Euro 5,422,797 75.98 75.98 proportionate Consorzio Camaiore Impianti Italy Euro 25,500 55 55 proportionate Consorzio Caserma Donati Italy Euro 300,000 84.2 84.2 proportionate Consorzio Cociv Italy Euro 516,457 94.5 94.5 proportionate Consorzio Scilla Italy Euro 1,000 51 51 proportionate Consorzio Torre Italy Euro 5,000,000 94.6 94.6 proportionate Consorzio Venice Link Italy Euro 1,000 61 61 proportionate Constructora Mazar Impregilo-Herdoiza Crespo Ecuador 70 70 proportionate Empresa Constructora Costanera Norte Ltda Chile CLP 10,000,000 77.78 77.78 proportionate Eurolink S.c.p.a. Italy Euro 150,000,000 45 45 proportionate Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct Ghazi-Barotha Contractors J.V. Switzerland 57.8 57.8 proportionate Nathpa Jhakri J.V. India USD 1,000,000 60 60 proportionate Opere Speciali Passante S.c.a.r.l. (in liq.) Italy 10,000 62 62 SGF INC S.p.A. proportionate OR.MA - S.c.r.l. (in liq.) Italy Euro 10,000 55 55 SGF INC S.p.A. proportionate Passante di Mestre S.c.p.A. Italy Euro 50,000,000 42 42 proportionate Pedelombarda S.c.p.a. Italy Euro 80,000,000 47 47 proportionate Reggio Calabria - Scilla S.c.p.a. Italy Euro 35,000,000 51 51 proportionate Salerno-Reggio Calabria S.c.p.a. Italy Euro 50,000,000 51 51 proportionate Val Viola S.c.r.l. (in liq.) Italy Euro 10,200 60 60 proportionate A.T.I. Monte Bianco S.c.r.l. (in liq.) Italy Euro 10,329 33.33 33.33 SGF INC S.p.A. equity Aegek-Impregilo-Aslom J.V. Greece 45.8 45.8 equity Anagnina 2000 S.c.r.l. Italy Euro 10,329 50 50 equity Arbeitsgemeinschaft Tunnel Umfahrung Saas (ATUS) Switzerland 32 32 CSC S.A. equity Arge Haupttunnel Eyholz Switzerland 36 36 CSC S.A. equity Arge Stollen Chatzuhus Switzerland 40 40 CSC S.A. equity 229 Asociacion Costanera Norte Ltda-Igl filiale Cile Chile 77.78 77 0.78 Costanera Norte Ltda equity Auditorium Roma S.c.r.l. (in liq.) Italy Euro 90,000 60 60 equity Aurelia 98 S.c.r.l. (in liq.) Italy Euro 10,000 40 40 equity B.O.B.A.C. S.c.a.r.l. Italy Euro 10,200 50 50 SGF INC S.p.A. equity C.B.N. Chiasso consorzio Switzerland 34 34 CSC S.A. equity CASV Consorzio Allargamento Strada Vogorno Switzerland 50 50 CSC S.A. equity CCB Consorzio Centro Balneare Switzerland 40 40 CSC S.A. equity CE.S.I.F. S.c.p.a. Italy Euro 250,000 24.18 24.18 equity Churchill Construction Consortium Great Britain 30 30 Impregilo New Cross Ltd equity Churchill Hospital J.V. Great Britain 50 50 Impregilo New Cross Ltd equity CMC - Consorzio Monte Ceneri lotto 851 Switzerland 40 40 CSC S.A. equity Collegamento Ferroviario Genova-Milano S.p.A. Italy Euro 120,000 60.4 60.4 equity Consorcio Cigla-Sade Brazil 50 50 Cigla S.A. equity Consorcio Contuy Medio Venezuela 29.04 29.04 equity Consorcio Grupo Contuy-Proyectos y Obras de Ferrocarriles Venezuela 33.33 33.33 equity Consorcio Imigrantes Brazil 50 50 Cigla S.A. equity Consorcio Impregilo Cosapi Peru 55 55 equity Consorcio OIV-TOCOMA Venezuela 20 20 equity Consorcio Serra do Mar Brazil 50 25 25 Cigla S.A. equity Consorcio V.I.T. - Tocoma Venezuela 35 35 equity Consorcio V.I.T. Caroni - Tocoma Venezuela 35 35 equity Consorcio V.S.T. Venezuela 35 35 Suropca C.A. equity Consorcio V.S.T. Tocoma Venezuela 30 30 equity Consorzio CECB Switzerland 50 50 CSC S.A. equity Consorzio CPS Pedemontana Veneta Costruttori Progettisti e Servizi Italy Euro 100,000 35 35 equity Consorzio Edile Palazzo Mantegazza Switzerland 45 45 CSC S.A. equity Consorzio Felce Switzerland 25 25 CSC S.A. equity Consorzio FLP Switzerland 30 30 CSC S.A. equity Consorzio FLP II Switzerland 33.33 33.33 CSC S.A. equity Consorzio Galleria Maroggia Switzerland 25 25 CSC S.A. equity Consorzio Galleria Scaglioni CGS Switzerland 50 50 CSC S.A. equity

2008 Annual Report IMPREGILO Consolidation scope

Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct (continued) CONSTRUCTION Consorzio Paleuropa Italy Euro 10,000 60 60 equity Consorzio RCPS Nuova Romea Italy Euro 20,000 30.6 30.6 equity Consorzio San Cristoforo (in liq.) Italy Euro 51,645 48 48 equity Consorzio TAT-Tunnel Alp Transit Ticino, Arge Switzerland 25 17.5 7.5 CSC S.A. equity Consorzio Tre Esse Italy Euro 51,646 38 38 SGF INC S.p.A. equity Consorzio Trevi - S.G.F. INC per Napoli Italy Euro 10,000 45 45 SGF INC S.p.A. equity CRA Consorzio Realizzazione Arca Switzerland 40 40 CSC S.A. equity CSLN Consorzio Switzerland 28 28 CSC S.A. equity E.R. Impregilo/Dumez y Asociados para Yaciretê - ERIDAY Argentina USD 539,400 20.75 18.75 2 Iglys S.A. equity Executive J.V. Impregilo S.p.A. Terna S.A. - Iris S.A. (in liq.) Greece 33.33 33.33 equity Fox Valley West Properties JV USA 50 50 Healy S.A. equity G.T.B. S.c.r.l. Italy Euro 51,000 24.17 24.17 equity Groupement Hydrocastoro Algeria DZD 2,000,000 49.5 49.5 INC Algerie Sarl equity 230 Grupo Empresas Italianas - GEI Venezuela VEB 10,000,000 33.33 33.33 equity Healy-Yonkers-Atlas-Gest J.V. USA 45 45 Healy S.A. equity Impregilo Arabia Ltd Arabia RSA 40,000,000 50 50 equity Impregilo - Ebasco-Losinger J.V. USA 75 18.75 56.25 Healy S.A. equity Impregilo - Rizzani de Eccher J.V. Switzerland 67 67 equity Impregilo SpA-Iglys SA-Hochtief AG-Hochtief C-Roggio-Iecsa-Sideco-Techint, UTE Argentina 26 26 equity Isibari S.c.r.l. Italy Euro 15,300 55 55 Bocoge S.p.A. equity J.Cartellone C.C. S.A.-Igl S.p.A.-Iglys S.A.-Codi S.A.- EC Delta S.A.-Caruso S.A.- (Casisa UTE) Argentina ARS 10,000 39.1 29.1 10 Iglys S.A. equity Joint Venture Aegek-Impregilo-Ansaldo-Seli-Ansaldobreda Greece 26.71 26.71 equity Joint Venture Aktor Ate - Impregilo S.p.A. (Constantinos) Greece 40 40 equity Joint Venture Terna - Impregilo Greece 45 45 equity Joint Venture Impregilo S.p.A. - Empedos S.A. - Aktor A.T.E. Greece 66 66 equity Line 3 Metro Stations Greece 50 50 equity Metrogenova S.c.r.l. Italy Euro 25,500 35.63 35.63 equity Mohale Dam Contractors (MDC) J.V. Lesotho 50 50 equity Mohale Tunnel Contractors (MTC) J.V. Lesotho 35 35 equity Monte Mario S.c.r.l. (in liq.) Italy Euro 10,328 50 50 Bocoge S.p.A. equity Proyecto La Yesca (in liq.) Mexico PSM 50,000 44.2 44.2 equity Quattro Venti S.c.r.l. Italy Euro 51,000 40 40 equity S. Anna Palermo S.c.r.l. (in liq.) Italy Euro 40,800 71.6 71.6 equity SO.CO.TAU. S.c.r.l. (in liq.) Italy Euro 10,200 20.27 20.27 Bocoge S.p.A. equity Società Autostrada Broni - Mortara S.p.A. Italy Euro 2,500,000 40 40 equity Techint S.A.C.I.- Hochtief A.G.- Impregilo S.p.A.-Iglys S.A. UTE Argentina 35 26.25 8.75 Iglys S.A. equity Thessaloniki Metro CW J.V. Greece 42.5 42.5 equity Unicatanzaro S.c.r.l. (in liq.) Italy Euro 15,300 56 56 Bocoge S.p.A. equity VE.CO. S.c.r.l. Italy Euro 10,200 25 25 equity Versilia S.c.r.l. (in liq.) Italy Euro 10,200 34 34 equity Versilia Servizi S.c.a.r.l. (in liq.) Italy Euro 20,000 34 34 equity Yellow River Contractors J.V. China 36.5 36.5 equity Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct ENGINEERING & PLANT CONSTRUCTION FISIA Italimpianti S.p.A. Italy Euro 10,000,000 100 100 line-by-line FISIA Babcock Environment Gmbh Germany Euro 10,000,000 100 100 Impregilo Intern. Infrastruc. N.V. line-by-line Gestione Napoli S.p.A. (in liq.) Italy Euro 100,000 99 24 54 Fisia Italimpianti S.p.A. line-by-line 21 Fisia Babcock Gmbh Steinmuller International Gmbh Germany Euro 25,000 100 100 Fisia Babcock Gmbh line-by-line Società Italiana per l'Ecologia Marina Castalia Ecolmar S.c.p.a. Italy Euro 102,000 49.9 49.9 Fisia Italimpianti S.p.A. proportionate Consorzio Agenzia del Mare (in liq.) Italy Lit 300,000,000 25 25 Fisia Italimpianti S.p.A. equity Consorzio Agrital Ricerche (in liq.) Italy Euro 138,405 20 20 Fisia Italimpianti S.p.A. equity Consorzio Macopsissa Ambiente Italy Euro 30,987 45.12 45.12 Fisia Italimpianti S.p.A. equity Nautilus S.c.p.a. (in liq.) Italy Euro 479,880 34.41 34.41 Fisia Italimpianti S.p.A. equity Pertusola Sud S.c.r.l. (in liq.) Italy Euro 10,000 50 50 Fisia Italimpianti S.p.A. equity Villagest S.c.r.l. (in liq.) Italy Euro 13,944 50 50 Fisia Italimpianti S.p.A. equity USW CAMPANIA PROJECTS 231 FIBE Campania S.p.A. Italy Euro 1,500,000 99.994 99.973 0.007 Impregilo Intern. Infrastruc. N.V. line-by-line 0.007 Fisia Babcock Gmbh 0.007 Fisia Italimpianti S.p.A. FIBE S.p.A. Italy Euro 3,500,000 99.998 99.989 0.003 Impregilo Intern. Infrastruc. N.V. line-by-line 0.003 Fisia Babcock Gmbh 0.003 Fisia Italimpianti S.p.A. CONCESSIONS Impregilo International Infrastructures N.V. Netherlands Euro 50,000,000 100 100 line-by-line Caminos de las Sierras S.A. Argentina ARS 120,000,000 90.52 90.52 Impregilo Intern. Infrastruc. N.V. line-by-line IGLYS S.A. Argentina ARS 17,000,000 100 98 Impregilo Intern. Infrastruc. N.V. line-by-line 2 INCAVE S.r.l. (*) Impregilo New Cross Ltd Great Britain GBP 2 100 100 Impregilo Intern. Infrastruc. N.V. line-by-line Impregilo Parking Glasgow Ltd Great Britain GBP 1 100 100 Impregilo Intern. Infrastruc. N.V. line-by-line Mercovia S.A. Argentina ARS 10,000,000 60 60 Impregilo Intern. Infrastruc. N.V. line-by-line Primav Ecorodovias S.A. Brazil BRL 466,699,080 35 35 Impregilo Intern. Infrastruc. N.V. proportionate Shangai Pucheng Thermal Power Energy Co. L.t.d. China RMB 200,000,000 50 50 Fisia Babcock Gmbh proportionate Concessionaria Ecovia Caminho do Mar S.A. Brazil BRL 15,600,000 35 35 Primav Ecorodovias S.A. proportionate Concessionaria Ecovias dos Imigrantes S.A. Brazil BRL 302,547,396 35 35 Primav Ecorodovias S.A. proportionate Ecopatio Logistica L.t.d.a. Brazil BRL 28,954,666 35 35 Primav Ecorodovias S.A. proportionate Ecosul Partipacoes L.t.d.a. Brazil BRL 48,285,560 31.5 31.5 Primav Ecorodovias S.A. proportionate ECSC Centro de Servicos Corporativos L.t.d.a. Brazil BRL 2,794,926 35 35 Primav Ecorodovias S.A. proportionate ECSE Centro de Servicos de Engenharia L.t.d.a. Brazil BRL 1,000 34.97 34.97 Primav Ecorodovias S.A. proportionate Elog Participacoes L.t.d.a. Brazil BRL 7,900,452 35 35 Primav Ecorodovias S.A. proportionate Rodovia Das Cataratas S.A. Ecocataratas Brazil BRL 41,849,000 35 35 Primav Ecorodovias S.A. proportionate

2008 Annual Report IMPREGILO Consolidation scope

Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct (continued) CONCESSIONS Empr.Concess. de Rodovias do Sul S.A.-Ecosul Brazil BRL 17,755,000 31.5 31.5 Primav Ecorodovias S.A. proportionate Aguas del Gran Buenos Aires S.A. (in liq.) Argentina ARS 45,000,000 42.59 16.5 23.73 Impregilo Intern. Infrastruc. N.V. equity 2.36 Iglys S.A. Aguas del Oeste S.A. Argentina ARS 170,000 33.33 33.33 Iglys S.A. equity Consorcio Agua Azul S.A. Peru PEN 69,001,000 25.5 25.5 Impregilo Intern. Infrastruc. N.V. equity Enecor S.A. Argentina ARS 20,250,740 30 30 Impregilo Intern. Infrastruc. N.V. equity Ecologia Montana S.p.A. Italy Euro 548,069 49 49 Impregilo Intern. Infrastruc. N.V. equity Coincar S.A. Argentina ARS 40,465,122 35 26.25 8.75 Iglys S.A. equity Iglys SA-Iecsa SA-Dragados Obras y Proyectos SA- Dycasa SA, UTE Argentina 33.33 33.33 Iglys S.A. equity Impregilo Wolverhampton Ltd Great Britain GBP 1,000 20 20 Impregilo Intern. Infrastruc. N.V. equity Nuova Romea S.p.A. Italy Euro 3,800,000 22.28 22.28 Impregilo Intern. Infrastruc. N.V. equity Ochre Solutions Holdings Ltd Great Britain GBP 20,000 40 40 Impregilo Intern. Infrastruc. N.V. equity Puentes del Litoral S.A. Argentina ARS 43,650,000 26 22 4 Iglys S.A. equity 232 Sistranyac S.A. Argentina ARS 12,040,465 20.1 20.1 Impregilo Intern. Infrastruc. N.V. equity Yacylec S.A. Argentina ARS 20,000,000 18.67 18.67 Impregilo Intern. Infrastruc. N.V. equity IMPREPAR Imprepar - Impregilo Partecipazioni S.p.A. (in liq.) Italy Euro 3,100,000 100 100 line-by-line Alia S.c.r.l. (in liq.) Italy Euro 10,200 100 100 Imprepar S.p.A. line-by-line BATA S.r.l. (in liq.) Italy Euro 102,000 50.69 50.69 Imprepar S.p.A. line-by-line CIS Divisione Prefabbricati Vibrocesa Scac - C.V.S. S.r.l. (in liq.) Italy Euro 10,000 100 100 INCAVE S.r.l. line-by-line Cogefar Cameroun S.A. (in liq.) Cameroun XAF 1,260,000,000 99.97 99.97 Imprepar S.p.A. line-by-line Congressi 91 S.c.r.l. (in liq.) Italy Euro 25,000 100 80 Impresa Castelli S.r.l. line-by-line 20 Bocoge S.p.A. (*) Consorzio Pielle (in liq.) Italy Euro 15,493 100 33.33 Imprepar S.p.A. line-by-line 66.67 Incave S.r.l. Costruzioni Ferroviarie Torinesi Duemila S.c.r.l. Italy Euro 10,328 100 100 INCAVE S.r.l. line-by-line Edilizia Militare Reggio Calabria S.c.r.l. (in liq.) Italy Euro 45,900 100 85 Imprepar S.p.A.. line-by-line 15 Sapin S.r.l. Engeco France S.a.r.l. France Euro 15,470 100 99.67 Imprepar S.p.A. line-by-line 0.33 Incave S.r.l. Eurotechno S.r.l. (in liq.) Italy Euro 26,245 100 100 Imprepar S.p.A. line-by-line Imprefeal S.p.A. Italy Euro 2,580,000 100 100 Imprepar S.p.A. line-by-line Impregilo U.K. Ltd (in liq.) Great Britain GBP 1,500,000 100 100 Imprepar S.p.A. line-by-line Impresa Castelli S.r.l. (in liq.) Italy Euro 10,000 100 100 Imprepar S.p.A. line-by-line Impresit del Pacifico S.A. Peru PEN 35,000 100 100 Imprepar S.p.A. line-by-line INCAVE S.r.l. Italy Euro 90,000 100 100 Imprepar S.p.A. line-by-line S. Leonardo S.c.r.l. (in liq.) Italy Euro 25,500 99.99 99.99 Imprepar S.p.A. line-by-line San Martino Prefabbricati S.p.A. (in liq.) Italy Euro 510,000 100 100 Impresa Castelli S.r.l. line-by-line Savico S.c.r.l. (in liq.) Italy Euro 10,200 100 81 Imprepar S.p.A. line-by-line 19 Sapin S.r.l. Sviluppo Applicazioni Industriali - SAPIN S.r.l. (in liq.) Italy Euro 51,480 100 100 Imprepar S.p.A. line-by-line Watis Bau GmbH (in liq.) Germany Euro 2,046,000 100 100 Imprepar S.p.A. line-by-line Aquilgest S.c.r.l. (in liq.) Italy Euro 10,000 51 51 Imprepar S.p.A. proportionate Aquilpark S.c.r.l. (in liq.) Italy Euro 10,000 51 51 Imprepar S.p.A. proportionate BA.TA. 91 S.c.r.l. (in liq.) Italy Euro 50,000 50.69 50.69 Imprepar S.p.A. proportionate Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct CO. MAR. S.c.r.l. (in liq.) Italy Euro 10,200 84.99 84.99 Imprepar S.p.A. proportionate Consorzio/Vianini lavori/Impresit/Dal Canton/Icis/Siderbeton - VIDIS (in liq.) Italy Euro 25,822 60 60 Imprepar S.p.A. proportionate Constuct. Embalse Casa de Piedra S.A. (in liq.) Argentina ARS 821 72.93 72.93 Imprepar S.p.A. proportionate Gesuati S.c.r.l. (in liq.) Italy Euro 10,300 80 80 Impresa Castelli S.r.l. proportionate La Fenice S.c.r.l. (in liq.) Italy Euro 51,646 57.39 57.39 Imprepar S.p.A. proportionate Librino S.c.r.l. (in liq.) Italy Euro 45,900 66 66 Imprepar S.p.A. proportionate Melito S.c.r.l. (in liq.) Italy Euro 77,400 66.67 66.67 Imprepar S.p.A. proportionate Montenero S.c.r.l. (in liq.) Italy Euro 10,400 61.11 61.11 Imprepar S.p.A. proportionate OS.A.V.E. S.c.r.l. (in liq.) Italy Euro 10,199 66.15 66.15 Imprepar S.p.A. proportionate S. Leonardo Due S.c.r.l. (in liq.) Italy Euro 40,800 60 60 Imprepar S.p.A. proportionate Stelvio 91 S.c.r.l. (in liq.) Italy Euro 45,900 62 62 Imprepar S.p.A. proportionate Trincerone Ferroviario S.c.r.l. (in liq.) Italy Euro 45,900 60 60 Imprepar S.p.A. proportionate Vittoria S.c.r.l. (in liq.) Italy Euro 20,400 58 58 Imprepar S.p.A. proportionate A.T.I. Girola-Romagnoli-Poscio - Domo II S.c.r.l. (in liq.) Italy Euro 10,200 40 40 Imprepar S.p.A. equity Adduttore Ponte Barca S.c.r.l. (in liq.) Italy Euro 45,900 24.33 24.33 Imprepar S.p.A. equity 233 ANBAFER S.c.r.l. (in liq.) Italy Euro 25,500 50 50 Imprepar S.p.A. equity Ancipa S.c.r.l. (in liq.) Italy Euro 10,200 50 50 Imprepar S.p.A. equity Antignano S.c.r.l. (in liq.) Italy Euro 10,200 47.37 47.37 Imprepar S.p.A. equity Associazione Temporanea Priolo Siracusa S.c.r.l. (in liq.) Italy Euro 11,000 20 20 Imprepar S.p.A. equity Cagliari 89 S.c.r.l. (in liq.) Italy Euro 10,200 49 49 Sapin S.r.l. equity Cannatello S.c.r.l. (in liq.) Italy Euro 20,400 40 40 Imprepar S.p.A. equity Cogefar/C.I.S.A./Icla/Fondedile - Sorrentina S.c.r.l. (in liq.) Italy Euro 46,480 25 25 Imprepar S.p.A. equity Consorcio Federici/Impresit/Ice Cochabamba Bolivia USD 100,000 25 25 Imprepar S.p.A. equity Consorzio Carnia S.c.r.l. (in liq.) Italy Euro 45,900 50 50 Imprepar S.p.A. equity Consorzio CO.RI.TECNO Italy Euro 51,646 50 50 Imprepar S.p.A. equity Consorzio Cogefar/Italstrade/Recchi/CMC - CIRC (in liq.) Italy Euro 51,000 25 25 Imprepar S.p.A. equity Consorzio Consavia S.c.n.c. (in liq.) Italy Euro 20,658 50 50 Imprepar S.p.A. equity Consorzio del Sinni Italy Euro 51,646 43.16 43.16 Imprepar S.p.A. equity Consorzio Ferrofir (in liq.) Italy Euro 30,987 33.33 33.33 Imprepar S.p.A. equity Consorzio Imprese Lavori FF.SS. di Saline - FEIC Italy Euro 15,494 33.33 33.33 Imprepar S.p.A. equity Consorzio Iniziative Ferroviarie - INFER Italy Euro 41,316 35 35 Imprepar S.p.A. equity Consorzio Lavori Interventi Straordinari Palermo - Colispa S.c.r.l. (in liq.) Italy Euro 21,420 29.76 29.76 Imprepar S.p.A. equity Consorzio Metropolitane Italy Lit 100,000,000 25 25 Imprepar S.p.A. equity Consorzio per il Nucleo di Balvano (in liq.) Italy Euro 51,645 40.26 40.26 Imprepar S.p.A. equity Consorzio Sarda Costruzioni Generali - SACOGEN Italy Lit 20,000,000 25 25 Sapin S.r.l. equity Consorzio Sardo d'Imprese Italy Euro 103,291 34.38 34.38 Sapin S.r.l.. equity Consorzio Suburbia (in liq.) Italy Euro 15,494 33.33 33.33 Impresa Castelli S.r.l. equity Consorzio Volgograd Opere Civili - CONVOLCI S.c.n.c. (in liq.) Italy Euro 5,165 45.26 45.26 Imprepar S.p.A. equity Corso Malta S.c.r.l. (in liq.) Italy Euro 40,800 42.5 42.5 Imprepar S.p.A. equity Costruttori Riuniti per la Valtellina - CORIVALT S.c.r.l. (in liq.) Italy Euro 10,200 42.5 42.5 Imprepar S.p.A. equity Depurazione Palermo S.c.r.l. (in liq.) Italy Lit 20,000,000 50 50 Imprepar S.p.A. equity Diga Ancipa S.c.r.l. (in liq.) Italy Euro 10,200 50 50 Imprepar S.p.A. equity Edificatrice Sarda S.r.l. (in liq.) Italy Euro 10,328 25 25 Sapin S.r.l. equity Edil.Gi. S.c.r.l. (in liq.) Italy Lit 20,000,000 50 50 Imprepar S.p.A. equity Edilizia Giudiziaria S.c.r.l. (in liq.) Italy Euro 10,200 26.66 26.66 Imprepar S.p.A. equity FE.LO.VI. S.c.n.c. (in liq.) Italy Euro 25,822 32.5 32.5 Imprepar S.p.A. equity

2008 Annual Report IMPREGILO Consolidation scope

Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct (continued) IMPREPAR Fedco J.V. Malta 33.33 33.33 Imprepar S.p.A. equity Galliera 2000 S.c.r.l. (in liq.) Italy Euro 25,500 25 25 Impresa Castelli S.r.l. equity Gestioni Sanitarie Toscane S.c.r.l. (in liq.) Italy Euro 103,290 30 30 Imprepar S.p.A. equity Grandi Uffizi S.c.r.l. (in liq.) Italy Euro 10,200 31.46 31.46 Imprepar S.p.A. equity Groupement SNCE/Girola S.p.A. Canal T II - Lot. 1/B Morocco Lit 3,176,144,444 70 70 Imprepar S.p.A. equity Groupement SNCE/Girola S.p.A. Canal T II - Lot. 4 Morocco Lit 3,176,144,444 50 50 Imprepar S.p.A. equity IGL-Stfa - Impregilo Sezai Turkes Feyzi Akkaya J.V. (Bosforo) Turkey USD 1,000,000 50 50 Imprepar S.p.A. equity Impregilo Cogefar New Esna Barrage J.V. (in liq.) Egypt Euro 51,645 100 99 Imprepar S.p.A. equity 1 INCAVE S.r.l. Impregilo - Salini Joint Venture for Kapichira Malawi 50 50 Imprepar S.p.A. equity Impregilo - Salini Joint Venture for Owen Falls Uganda 50 50 Imprepar S.p.A. equity Imprese Riunite Genova Irg S.c.r.l. (in liq.) Italy Euro 25,500 26.3 26.3 Imprepar S.p.A. equity Imprese Riunite Genova Seconda S.c.r.l. (in liq.) Italy Euro 25,000 26.3 26.3 Imprepar S.p.A. equity Italsagi SP. ZO.O Poland PLN 10,000 33 33 Imprepar S.p.A. equity 234 J.V. Salini Impregilo (Sudan) Sudan USD 20,000 50 50 Imprepar S.p.A. equity Lodigiani-Pgel J.V. Pakistan 100 100 Imprepar S.p.A. equity Matsoku Civil Contractor (MMC) J.V. Lesotho 30 30 Imprepar S.p.A. equity Marsico Nuovo S.c.r.l. (in liq.) Italy Euro 10,200 25 25 Imprepar S.p.A. equity Milano Sviluppo S.p.A. (in liq.) Italy Euro 10,000 33.33 33.33 Impresa Castelli S.r.l. equity Monte Vesuvio S.c.r.l. (in liq.) Italy Euro 45,900 50 50 Imprepar S.p.A. equity Olbia 90 S.c.r.l. (in liq.) Italy Euro 10,200 24.5 24.5 Sapin S.r.l. equity Paullese S.c.r.l. (in liq.) Italy Euro 25,500 50 50 Impresa Castelli S.r.l. equity Pietrarossa S.c.r.l. (in liq.) Italy Euro 10,200 50 50 Imprepar S.p.A. equity Pisogne S.c.r.l. (in liq.) Italy Euro 25,000 40 40 Imprepar S.p.A. equity Platano S.c.n.c. (in liq.) Italy Euro 30,987 33.33 33.33 Imprepar S.p.A. equity RCCF Nodo di Torino S.c.p.a. Italy Euro 102,000 26 26 INCAVE S.r.l. equity Saces S.r.l. (in liq.) Italy Euro 26,000 37 37 Imprepar S.p.A. equity Salini - Cogefar Impresit Osborne Dam J.V. Zimbabwe 50 50 Imprepar S.p.A. equity Salini - Cogefar Impresit Zhovhe Dam J.V. Zimbabwe 50 50 Imprepar S.p.A. equity San Benedetto S.c.r.l. (in liq.) Italy Euro 25,823 57 57 Imprepar S.p.A. equity San Giorgio Caltagirone S.c.r.l. (in liq.) Italy Euro 25,500 33 33 Imprepar S.p.A. equity Sclafani S.c.r.l. (in liq.) Italy Euro 10,400 41 41 Imprepar S.p.A. equity Sep Eole France FF 10,000 50 50 Imprepar S.p.A. equity Sincat S.c.r.l. (in liq.) Italy Lit 80,000,000 28.57 28.57 Imprepar S.p.A. equity Sistema Sinni S.c.r.l. (in liq.) Italy Euro 30,600 31.25 31.25 Imprepar S.p.A. equity Soingit S.c.r.l. (in liq.) Italy Lit 80,000,000 29.49 29.49 Imprepar S.p.A. equity Taormina S.c.r.l. (in liq.) Italy Euro 49,579 33.75 33.75 Imprepar S.p.A. equity Wohnanlage Hohenstaufenstrasse Wiesbaden Germany 62.7 62.7 Imprepar S.p.A. equity The following companies have been excluded from the consolidation scope compared to 31 December 2007:

Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2007 subscribed ment direct paid-up CONSTRUCTION Impresit Bakolori Plc Nigeria NGN 100,800,000 50.71 50.71 line-by-line Castello 99 S.c.r.l. Italy Euro 11,000 60 60 proportionate Consorcio Rio Tocantins Brazil 50 50 equity Impretech Infraestructura S.A. Mexico 49 49 equity Trevi S.G.F. S.c.r.l. Italy Euro 51,000 45 45 SGF INC S.p.A. equity CONCESSIONS Ponte de Pedra Energetica S.A. Brazil BRL 219,770,000 50 50 Impregilo Intern. Infrastruc. N.V. equity Rodoconsult Assessoria L.t.d. Brazil BRL 25,000 20 20 Impregilo Intern. Infrastruc. N.V. equity IMPREPAR Entreprises et Travaux de Construction S.A. Switzerland CHF 50,000 100 100 Imprepar S.p.A. line-by-line Saalp S.c.n.c. Italy Euro 51,600 69.9 69.9 Imprepar S.p.A. proportionate Highlands Water Venture J.V. Lesotho 30 30 Imprepar S.p.A. equity 235 Borini Prono & Co Ghana Ltd Ghana GHC 95,000 50 50 Imprepar S.p.A. equity Centro Merci Lazio S.p.A. Italy Euro 234,000 5 5 Imprepar S.p.A. equity Consorzio Ferrovie Sarde - COFESAR S.c.r.l. Italy Euro 45,900 34 34 Imprepar S.p.A. equity German/Italian/Mosul/Dam - GIMOD J.V. Iraq IQD 150,000,000 20 20 Imprepar S.p.A. equity Livorno Due S.c.r.l. Italy Euro 40,800 45 45 Imprepar S.p.A. equity MS Villa Fiorita S.c.r.l. Italy Euro 35,700 50 33.33 Impresa Castelli S.r.l. equity 16.67 Imprepar S.p.A. Napoli Porto S.c.r.l. Italy Euro 10,329 35 35 Imprepar S.p.A. equity Nuovi Mercati S.c.r.l. Italy Lit 20,000,000 49 30 Imprepar S.p.A. equity 19 Sapin S.r.l. Ripristino Beni Culturali - RIBEC S.c.r.l. Italy Euro 10,200 40 40 Imprepar S.p.A. equity Societê Gestione Depuratore - SOGEDEP S.r.l. Italy Euro 20,400 22.84 22.84 Imprepar S.p.A. equity Songkla Stadium Thai - Italian J.V. Thailand 100 100 Imprepar S.p.A. equity

The consolidation scope has been enlarged compared to 31 December 2007 by the following companies:

Name Country Currency Share/quota % of % % Indirectly Method capital invest- direct in- held by 31.12.2008 subscribed ment direct paid-up CONSTRUCTION Vegas Tunnel Constructors USA 100 40 60 Healy S.A. line-by-line Pedelombarda S.c.p.a. Italy Euro 80,000,000 47 47 proportionate Arge Haupttunnel Eyholz Switzerland 36 36 CSC S.A. equity CCB Consorzio Centro Balneare Switzerland 40 40 CSC S.A. equity Consorzio Felce Switzerland 25 25 CSC S.A. equity CRA Consorzio Realizzazione Arca Switzerland 40 40 CSC S.A. equity Impregilo Arabia Ltd Arabia RSA 40,000,000 50 50 equity Società Autostrada Broni - Mortara S.p.A. Italy Euro 2,500,000 40 40 equity CONCESSIONS Rodovia Das Cataratas S.A. - Ecocataratas Brazil BRL 41,849,000 35 35 Primav Ecorodovias S.A. proportionate

Note:Companies in which the group ha san investment of less than 20% are not consolidated.

2008 Annual Report IMPREGILO

STATEMENT ON THE CONSOLIDATED 237 FINANCIAL STATEMENTS

2008 Annual Report IMPREGILO

Statement on the consolidated financial statements pursuant to article 81-ter of Consob resolution no. 11971 of 14 May 1999 and subsequent amendments and integrations

1 Alberto Rubegni, as chief executive officer, and Rosario Fiumara, as manager in charge of financial reporting, of Impregilo S.p.A. state, considering the provisions of paragraphs 3 and 4 of article 154-bis of Legislative decree no. 58 of 24 February 1998: • the adequacy of the administrative and accounting procedures given the group’s characteristics; and • their effective application during 2008 to prepare the consolidated financial statements.

2 No significant issues arose.

3 Moreover, they state that:

3.1 the consolidated financial statements: 239 a) comply with the accounting records and entries; b) have been prepared in accordance with the IFRS, published by the International Accounting Standards Board (IASB) and endorsed by the European Union, pursuant to Regulation no. 1606/2002 issued by the European Parliament and Council implemented in Italy by Legislative decree no. 38/2005, and that they are suitable to give a true and fair view of the financial position at 31 December 2008 and results of operations for the year then ended of the Issuer. 3.2 the directors’ report includes a description of the important events that took place during the year and their impact on the consolidated financial statements, together with information about the key risks and uncertainties to which the Issuer and the consolidated companies are exposed.

Sesto San Giovanni, 25 March 2009

Chief executive officer Manager in charge of (signed on the original) financial reporting (signed on the original)

2008 Annual Report IMPREGILO

SEPARATE FINANCIAL STATEMENTS 241 OF IMPREGILO S.P.A. AS AT AND FOR THE YEAR ENDED 31 DECEMBER 2008

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

SEPARATE BALANCE SHEET

(Euro) ASSETS Note 31 December 2008 31 December 2007 Non-current assets Property, plant and equipment 1.1 57,689,530 69,836,458 Intangible assets 1.2 49,603,228 52,420,801 Equity investments 1.3 356,819,456 311,932,169 Non-current receivables due from group companies 4 309,784,789 357,186,373 Other non-current assets 4 400,286 752,350 Deferred tax assets 5 22,677,172 32,679,911 Total non-current assets 796,974,461 824,808,062

Current assets Inventories 6.1 29,947,013 31,287,765 Contract work in progress 6.2 316,200,968 239,395,777 Trade receivables 6.4 200,411,838 167,847,902 242 Current receivables due from group companies 6.4 612,652,827 580,607,991 Derivatives and other current financial assets (*) 8.1-8.5 8,972,339 2,346,756 Current tax assets 5 161,906,385 159,255,014 Other current assets 6.6 36,777,623 39,226,780 Cash and cash equivalents (*) 8.2 128,692,117 233,445,603 Total current assets 1,495,561,110 1,453,413,588 Total assets 2,292,535,571 2,278,221,650

(*) Items included in net financial position (Euro) EQUITY AND LIABILITIES Note 31 December 2008 31 December 2007 Equity Share capital 718,364,457 716,614,496 Share premium reserve 1,222,023 13,310,015 Other reserves 4,268,085 10,609,001 Retained earnings (losses) carried forward - (13,987,660) Profit (loss) for the year 83,039,554 (1,880,487) Total equity 7 806,894,119 724,665,365

Non-current liabilities Bank and other loans (*) 8.3 190,582,991 235,808,419 Finance lease payables (*) 8.4 - 23,642 Post-employment benefits and employee benefits 3 18,233,858 15,602,740 Deferred tax liabilities 5 46,091,760 5,984,963 Provisions for risks and charges 2 108,915,182 156,485,283 243 Total non-current liabilities 363,823,791 413,905,047

Current liabilities Current portion of bank loans and current account facilities (*) 8.3-8.6 420,404,692 397,470,066 Current portion of finance lease payables (*) 8.4 23,642 445,393 Derivatives and other current financial liabilities (*) 8.5 1,623,267 121,051 Advances on contract work in progress 6.3 200,952,915 263,982,294 Trade payables 6.5 63,716,980 69,988,825 Current payables due to group companies 6.5 340,863,158 309,063,154 Current tax liabilities 5 26,909,063 30,286,716 Other current liabilities 6.7 67,323,944 68,293,739 of which: from related parties 15 17,666,518 17,666,518 Total current liabilities 1,121,817,661 1,139,651,238 Total equity and liabilities 2,292,535,571 2,278,221,650

(*) Items included in net financial position

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

SEPARATE INCOME STATEMENT

(Euro) Note 2008 2007 Revenue Revenue 11 1,617,173,121 1,429,055,619 Other revenue 11 49,803,511 42,263,915 Total revenue 1,666,976,632 1,471,319,534 Costs Raw materials and consumables 12.1 (41,017,780) (58,069,402) Subcontracts 12.2 (49,267,545) (42,697,944) Other operating expenses 12.3 (1,302,321,316) (1,156,254,522) Personnel expenses 12.4 (120,475,035) (131,842,611) Amortisation, depreciation, provisions and impairment losses 12.5 (15,029,874) (54,956,215) of which: provision for USW Campania projects - (50,000,000) Total costs (1,528,111,550) (1,443,820,694) Operating profit 138,865,082 27,498,840 244 Financing income (costs) and gains (losses) on investments Net financing income 13.1 10,063,650 36,266,201 Net losses on investments 13.2 (2,916,537) (28,659,931) Net financing income and net losses on investments 7,147,113 7,606,270 Profit before tax 146,012,195 35,105,110 Income tax expense 14 (62,972,641) (36,985,597) Profit (loss) from continuing operations 83,039,554 (1,880,487) Profits (losses) from discontinued operations Profit (loss) for the year 83,039,554 (1,880,487) SEPARATE CASH FLOW STATEMENT

(Euro/000) Note 2008 2007 Cash and cash equivalents 8.2 233,446 298,568 Current account facilities 8.3 (65,003) (49,892) Total cash and cash equivalents at the beginning of the year 168,443 248,676 Operating activities Profit (loss) for the year 83,040 (1,880) Amortisation 12.5 2,818 4,649 Depreciation 12.5 16,284 17,642 Impairment losses and provisions 12.5 (4,072) 34,078 Accrual for post-employement benefits and employee benefits 12.4 9,912 5,593 Gains on the sale of assets 11 - 13.4 (4,373) (14,853) Deferred taxes and national consolidated tax system 5-14 50,111 12,434 Impairment losses on investments 13 2,917 38,773 Other non-monetary items 14,235 973 Total income statement 170,872 97,409 Decrease (increase) in inventories (75,464) 3,972 245 Decrease (increase) in trade receivables (60,359) 113,395 (Decrease) increase in advances from customers (63,029) 10,398 (Decrease) increase in trade payables 25,528 (33,754) Decrease (increase) in other assets and liabilities (11,476) (158,305) Total operating cash flows (184,800) (64,294) Cash flows from (used in) operating activities (13,928) 33,115 Investing activities Investments in property, plant and equipment 1.1 (17,997) (44,854) Proceeds from the sale of or reimbursement value of property, plant and equipment 12,303 17,392 Investments in non-current financial assets (42,771) (5,573) Dividends from group companies - 2,550 Proceeds from the sale of or reimbursement value of non-current financial assets 543 11,007 Cash flows used in investing activities (47,922) (19,478) Financing activities Share capital increase 7 2,972 12,938 Increase in bank and other loans 20,000 157,780 Repayment of bank and other loans (125,826) (260,336) Change in other financial assets/liabilities (9,351) (6,653) Cash flows used in financing activities (112,205) (96,271) Other changes due to non-recurring transactions - 2,401 Decrease in cash and cash equivalents (174,055) (80,233) Cash and cash equivalents 8.2 128,692 233,446 Current account facilities 8.3 (134,304) (65,003) Total cash and cash equivalents at the end of the year (5,612) 168,443 Other information Income taxes paid during the year (1,123) (7,518) Net interest paid during the year (30,481) (24,496)

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

STATEMENT OF CHANGES IN EQUITY

Other reserves

Share Share Legal Stock option capital premium reserve reserve reserve (Euro/000) As at 31 December 2006 708,996 7,990 23,560 4,805 Share capital increase 7,618 5,320 - - Allocation of loss - - 162 - Assignment of stock options - - - 208 Net fair value gains (losses) - - - - Negative goodwill - - - - Loss for the year - - - - As at 31 December 2007 716,614 13,310 23,722 5,013 Share capital increase 1,750 1,222 - - Allocation of loss - (13,310) (17,871) (5,013) 246 Assignment of stock options - - - - Net fair value gains (losses) - - - - Negative goodwill - - - - Profit for the year - - - - As at 31 December 2008 718,364 1,222 5,851 - Other reserves

Negative Hedging Share Capital Total Retained Profit TOTAL goodwill reserve increase related other earnings (loss) for charges reserves (losses) carried the year forward 4,059 1,642 (25,394) 8,672 (17,060) 3,234 711,832 ------12,938 - - - 162 3,072 (3,234) - - - - 208 - - 208 - 558 - 558 - - 558 1,009 - - 1,009 - - 1,009 - - - - - (1,880) (1,880) 5,068 2,200 (25,394) 10,609 (13,988) (1,880) 724,665 ------2,972 (5,068) - 25,394 (2,558) 13,988 1,880 ------247 - (3,783) - (3,783) - - (3,783) ------83,040 83,040 - (1,583) - 4,268 - 83,040 806,894

247

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Revenue in the year by geographical segment:

(euro/m) Italy Other EU Other European North countries (Non-EU) America countries Revenue by geographical segment 988.8 50.8 94.2 14.2

Balance sheet as at 31 December 2008 by geographical segment:

(euro/m) Italy Other EU Other European North countries (Non-EU) America countries Non-current assets, net 344.4 39.6 8.6 8.5 Total non-current assets 344.4 39.6 8.6 8.5 248

Provision for contingencies and charges, post-employment benefits, employee benefits, other non-current assets (liabilities) 215.2 (0.3) (0.9) - Net tax assets

Working capital 72.9 240.7 6.7 (2.5) Total working capital 72.9 240.7 6.7 (2.5) Net invested capital 632.5 280.0 14.4 6.0 Equity Net financial position Total financial resources Central and Middle East Rest of Eliminations Total South America and Asia the World Impregilo S.p.A. 499.7 0.3 19.0 1,667.0

Central and Middle East Rest of Eliminations Total South America and Asia the World Impregilo S.p.A. 56.0 5.2 1.8 - 464.1 56.0 5.2 1.8 - 464.1 249

(24.2) (4.9) (1.8) - 183.1 111.6

184.1 18.0 3.2 - 523.1 184.1 18.0 3.2 - 523.1 215.9 18.3 3.2 - 1,281.9 806.9 475.0 1,281.9

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

NOTES TO THE SEPARATE FINANCIAL STATEMENTS OF IMPREGILO S.p.A.

INTRODUCTION Impregilo S.p.A. has prepared its 2008 separate financial statements on a going concern basis. As required by Regulation no. 1606/2002 issued by the European Parliament and Council, implemented in Italy by Legislative decree no. 38/2005, the separate financial statements of Impregilo S.p.A. have been prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and endorsed by the European Union up to 31 December 2008. They comprise a balance sheet, income statement, cash flow statement, statement of changes in equity and these notes. The separate financial statements have been prepared using the historical cost principle, except for those items which are recognised at fair value in accordance with IFRS, as described in the section on “Accounting policies”. The carrying amounts of assets and liabilities, hedged with transactions which qualify for hedge accounting, are adjusted to reflect changes in fair value related to the hedged risks. The balance sheet and income statement are presented in Euros, whereas the amounts in the cash flow statement, statement of changes in equity and these notes are shown in thousands of Euros, unless stated otherwise.

CHANGES IN ACCOUNTING STANDARDS 250 The European Union endorsed IFRIC 11 (IFRS 2 - Group and Treasury Share Transactions), applicable from 1 January 2008. This interpretation has not affected the company’s 2008 separate financial statements. On 13 October 2008, the IASB issued an amendment to IAS 39 - Financial instruments: recognition and measurement - and to IFRS 7 - Financial instruments: disclosures - applicable from 1 July 2008. This allows in special circumstances: (i) reclassification of non-derivative financial assets belonging to the category “at fair value through profit or loss”; (ii) transfer of loans and receivables classified as “held for sale” to “held to maturity”, if the company has the intention and ability to hold such instruments for a foreseeable future period or until maturity. Adoption of the above amendment has not affected the parent’s separate financial statements at 31 December 2008 as, due to the type and limited materiality of the above categories of financial instruments held by the group, it has not made the related reclassifications.

FORMAT AND CONTENT OF THE SEPARATE FINANCIAL STATEMENTS Format of financial statements Impregilo S.p.A. opted to present its separate financial statements at 31 December 2008 as follows: • Current and non-current assets and current and non-current liabilities are presented separately in the balance sheet. Current assets that include cash and cash equivalents are those expected to be realised, sold or used in the company’s normal operating cycle. Non- current assets include positive balances expected to be realised more than twelve months after the balance sheet date, including property, plant and equipment, intangible assets, financial assets and deferred tax assets. Current liabilities include payables expected to be settled no more than twelve months after the balance sheet date, including the current part of medium/long-term loans. Non- current liabilities include payables expected to be settled more than twelve months after the balance sheet date, such as financial payables, personnel-related provisions and deferred tax liabilities. • The income statement gives a classification of costs by nature and shows the profit or loss before “Financing income (costs) and gains (losses) on investments” and income taxes. The profit or loss from continuing operations and the profits or losses from discontinued operations are also disclosed. • The consolidated cash flow statement presents the cash flows from operating, investing and financing activities separately. The indirect method is used.

ACCOUNTING POLICIES The key accounting policies adopted to draw up the separate financial statements are described below.

Property, plant and equipment Property, plant and equipment are recognised at purchase or production cost, net of accumulated depreciation and any impairment losses. Depreciation is calculated on a straight-line basis using rates determined based on the assets’ residual possible use. The annual rates are as follows: 251

Category Depreciation rate Land - Buildings 3% Plant and machinery from 10% to 20% Industrial and commercial equipment from 25% to 40% Other assets from 12% to 25%

Land and buildings and plant and machinery held for sale are measured at the lower of their carrying amount and fair value less costs to sell. The carrying amount of property, plant and equipment is tested for impairment using the methods set out in the section on “Impairment of assets”. The company has adopted the alternative method to recognise borrowing costs directly related to the acquisition or construction of an asset that provides for their capitalisation as part of the cost of the asset, to the extent of its recoverable amount. As established by IAS 23 - Borrowing costs, the group has applied this method to all qualifying assets. Borrowing costs are capitalised when the costs of the acquisition of the asset and borrowing costs are incurred, and the activities necessary to bring the asset into a condition for its use have been started. Costs incurred after the purchase are only capitalised if they increase the future economic benefits of the related asset. All other costs are expensed when incurred. Ordinary maintenance costs are fully expensed when incurred. Those that increase the carrying amount of assets are allocated thereto and depreciated over their residual economic lives. Leasehold improvements are classified in the different items of property, plant and equipment on the basis of their nature. They are depreciated over the shorter of the estimated useful life of the relevant asset and the residual term of the lease.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Leased property, plant and equipment Assets held under finance leases whereby all the risks and rewards of ownership are substantially transferred to the company are recognised as company assets and classified as property, plant and equipment. The related payable to the lessor is shown under financial payables. The lease payment is split into the financial expense, taken to the income statement, and the principal repayment, offset against the financial payable. The carrying amount of the leased asset is determined considering its fair value or, if lower, the present value of the lease payments. Capitalised leased assets are depreciated over the shorter of the asset’s estimated useful life and the lease term. Leases where the lessor retains all the risks and rewards of ownership are treated as operating leases. The initial negotiation costs incurred for this type of lease increase the value of the related lease and are recognised over the lease term netted against the revenue generated by the lease. Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the lease term.

Other intangible assets Other intangible assets purchased or generated internally are recognised under assets in accordance with IAS 38 - Intangible assets when 252 it is probable that the use of the asset will generate future economic benefits and the cost of the asset can be measured reliably. Those assets with finite useful lives are measured at purchase or development cost and amortised on a straight-line basis over their estimated useful lives. Recoverability of their carrying amount is checked by using the criteria set out in the section on “Impairment of assets”. The excess of the purchase cost compared to the company’s share of the net fair value of the high capacity business units acquired in the past is classified as other intangible assets and mainly refers to acquisition costs of the business units purchased. The related amortisation is calculated in line with the stage of completion of the work. Ancillary charges for share capital increases are recorded in equity as a decrease in the related reserve, net of deferred taxes. Ancillary charges for financing transactions are recognised under liabilities against the disbursed loan as per the criteria given in the section on “Loans and bond issues”.

Equity investments Investments in subsidiaries and associates and interests in joint ventures are measured at cost and tested regularly for impairment. This test is carried out whenever there is an indication that the investment may be impaired. The method used is described in the section on “Impairment of assets”. When an impairment loss is required, this is recognised immediately in profit or loss. When the reasons for a previous impairment loss no longer exist, the carrying amount of the investment is restated to the extent of its original cost. Reversals of impairment losses are recognised in profit or loss.

Impairment of assets If there is any indication that an intangible asset or an item of property, plant and equipment is impaired, the recoverable amount of the asset is estimated to determine the amount of the impairment loss. Goodwill and other intangible assets with indefinite lives are tested annually for impairment. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. If a binding sales agreement does not exist, fair value is estimated using the observable prices of an active market, recent transactions or the best information available to reflect the amount the entity could obtain by disposing of the asset. Value in use is determined by discounting to present value the estimated future cash flows expected to arise from the continuing use of an asset, gross of taxes, and, if reasonably determinable, from its disposal at the end of its useful life. Discounting is applied by using a pre- tax discount rate which reflects the present market value of the time value of money and specific risks. The assessment is made for individual assets or the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets from its continuing use (cash-generating unit). An impairment loss is recognised when the recoverable amount is lower than the carrying amount. If the reasons for the impairment loss are no longer valid, the impairment loss (except in the case of goodwill) is reversed and the adjustment is taken to profit or loss as a reversal of impairment losses. A reversal of impairment losses is recognised to the extent of the lower of the recoverable amount and original carrying amount gross of previously recognised adjustments less depreciation/amortisation that would have been recognised had the impairment loss not been recognised.

Inventories of goods 253 Inventories of goods are measured at the lower of average purchase cost and net realisable value. Cost includes the directly related costs and estimated realisable value is determined using the replacement cost of the assets or similar assets. Any write-downs are eliminated in subsequent years when the reasons therefor are no longer valid.

Contract work in progress and revenue from construction contracts Contract work in progress consists of work performed net of progress billings issued to customers. When payment of the consideration is completed, the related turnover, including the advances, is recognised under “Revenue - goods and services” in the income statement with the related variation in inventories. The provision for contractual risks is directly offset against inventories and is set up to cover possible charges and losses on contracts performed either directly by the company or as part of a joint venture. Contract work in progress is measured considering the consideration agreed with the customer and the stage of completion of the work. Revenue related to contract work in progress is recognised using the stage of completion method. The stage of completion is determined using the cost to cost method whereby the percentage of completion (the ratio between costs incurred and total estimated costs) is applied to the total estimated revenue. Given the technical complexity, size and length of time involved in completing contracts, the additional considerations are measured before an agreement is reached with the customer. Claims for additional considerations are considered when measuring contract work in progress when they can be quantified and they are reasonably certain to be made. In the case of events that take place after the balance sheet date but before the financial statements are approved, which provide additional information about expected profits or losses on the contract, this additional information is considered when determining the contractual revenue or costs to be incurred to complete the contract and for the recognition of any profits or losses. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

The contract costs, included in the cost to cost calculation, may be classified as: • pre-operating costs, which include costs incurred during the start-up stage of the contract, before construction starts, such as the costs of design and specific studies carried out for the contract; organisation and production start-up costs and building site start-up costs. These pre-operating costs are included in the stage of completion calculation and in the cost to cost calculation once they have been incurred. During the initial stage of the contract, they are included in the carrying amount of work in progress, if recoverable, without recognising any profit margin when the profit or loss cannot be reliably determined; • contract operating costs, which include those directly attributable to the contract (eg, materials, subcontracting, labour, amortisation and depreciation, expropriation costs, etc.). They are recognised on an accruals basis and included in the calculation of the stage of completion; • post-operating costs: this category includes site dismantlement costs generally incurred after the contract has been closed to remove the installations (or entire sites) and to return the machinery or plant to the company’s premises or transfer them to another site. This category also includes losses on abandoned materials and the cost of transporting unused materials. They are included in the contract estimate and, therefore, if incurred during the contract term, they are comprised in the calculation of the stage of completion. Therefore, 254 no specific accruals are made to the income statement; • costs for services to be rendered after completion of the contract: when provided for in the contract, these costs mainly relate to services rendered after the contract has been completed. They may include assistance and supervision provided in the early stages of use of the plant or scheduled maintenance. If the contract does not include specific additional considerations for these services and the contact may be “closed” for accounting purposes (contracts are usually closed once work is completed and the customer has accepted the end result), the costs to be incurred to render these services when the contract is closed in the accounting records should be estimated and provided for in the specific items. These costs are included in the calculation to determine the contract revenue.

Real estate projects Real estate projects, included in inventories, are measured at the lower of cost, increased by additional charges incurred, and estimated realisable value. Costs incurred consist of the consideration paid for purchasing the areas and related charges, construction costs and borrowing costs related to the project up to and not exceeding its completion.

Financial assets and liabilities Measurement and presentation of financial instruments are covered by IAS 39 and IAS 32. The company has introduced the disclosure required by IFRS 7 from 2007. The financial instruments used by the company are classified as follows: financial assets or financial liabilities at fair value through profit or loss, loans and receivables, held-to-maturity investments and available-for-sale financial assets.

Financial assets or financial liabilities at fair value through profit or loss This category also includes derivatives that do not meet hedge accounting requirements. Fair value gains or losses on derivatives in this category are recognised as “Financing income (costs)” in profit or loss when they arise. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted on an active market. They are measured at amortised cost, as detailed further on, and any gains or losses arising therefrom are recognised as “Financing income (costs)” in profit or loss under the amortised cost method. This category includes the following items: • Trade receivables and payables and other receivables and payables Trade and other receivables are recognised at amortised cost, net of impairment losses determined on the basis of their estimated recoverable amount calculated by analysing each position and the total non-collection risk. If the collection date is postponed and exceeds normal collection times for the sector, these receivables are discounted. All factored receivables that do not meet the requirements for derecognition under IAS 39 continue to be recognised in the company’s financial statements even when they have been legally transferred. They are thus included as assets and a financial liability of the same amount is recognised. Trade and other payables are recognised at amortised cost allocating the effective interest rate to the income statement, being the rate 255 that exactly discounts estimated future cash payments through to the carrying amount of the financial asset.

Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity that the company has the positive intention and ability to hold to maturity. They are recognised at amortised cost, and interest accrued thereon is taken to profit or loss under “Financial income” using the effective interest method.

Available-for-sale financial assets Available-for-sale financial assets are non-derivatives that are not classified in the other categories. They mainly relate to consortia and consortium companies of which the company holds less than 20%. In accordance with IAS 39, such investments are stated as non-current assets measured at cost, adjusted for impairment, since their fair value cannot be determined. Dividend income from such financial instruments is recognised in profit or loss under financial income when the company is given the right to such dividend.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Fair value of financial instruments The fair value of financial instruments has been estimated as follows: • The fair value of financial instruments traded on an active market is based on the market price at the reporting date or, where more significant, the average price of the last month of the year. This method has been applied especially to listed financial instruments classified as “Available-for-sale financial assets” and financial instruments classified as “Held-to-maturity investments”. • The fair value of the derivatives classified as “Hedging derivatives” and “Financial assets and financial liabilities at fair value through profit or loss” has been measured based on the Discounted Cash Flow Model. With respect to interest rate swaps, discounted cash flows have been estimated using the implicit forward rate of the market Euro curve at 31 December 2008 and 2007, while the forward exchange rate market prices at the relevant reporting date have been used for currency forward transactions. • The fair value of loans and receivables has been determined on the basis of the present value of their future cash flows discounted at a rate equal to the current interest rates applicable in the relevant markets and the average spread agreed by the company.

Derecognition of financial assets and liabilities 256 (a) Financial assets A financial asset (or, where applicable, part of a financial asset or parts of a group of similar financial assets) is derecognised when: (i) the contractual rights to the cash flows from the financial asset expire; (ii) the company retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients in full and immediately; (iii) the company transfers the contractual rights to receive the cash flows of the asset and: (a) has transferred substantially all the risks and rewards of ownership of the financial asset; or (b) neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset but has transferred control. When the company has transferred the contractual rights to receive the cash flows of the financial asset and has neither transferred nor retained substantially all the risks and rewards or has retained control, it continues to recognise the asset to the extent of its continuing involvement in the asset. Continuing involvement that takes the form of guaranteeing the transferred asset is measured at the lower of the initial carrying amount of the asset and the maximum amount of the consideration that the company could be required to pay. When the company’s continuing involvement takes the form of a written and/or purchased option on the transferred asset (including options settled in cash or similar options), the extent of the company’s continuing involvement is the amount of the transferred asset that it may repurchase. However, in the case of a written put option on an asset that is measured at fair value (including the options settled in cash or similarly), the extent of the company’s continuing involvement is limited to the lower of the fair value of the transferred asset and the option exercise price.

Derivatives and hedging transactions Impregilo S.p.A. has derivatives recognised at fair value when the related agreement is signed and for subsequent fair value changes. The treatment of the related fair value gains or losses changes depending on whether the conditions for hedge accounting are met, as described below. The company has derivatives to hedge currency and financial risks. At the inception of the transaction, it documents the hedging transaction, its risk management and strategy objectives in entering into the transaction, the hedging instrument and hedged item or transaction and the nature of the hedged risk. Moreover, at the inception of the transaction and thereafter on an ongoing basis, the company documents whether or not the hedge meets the effectiveness requirements to offset its exposure to changes in the fair value of the hedged item or cash flows attributable to the hedged risk. 257 Based on the above-mentioned documentation, derivatives used for specific hedging purposes are classified and recognised as follows:

(a) Fair value hedge - If a derivative is designated as a hedge of exposure to changes in the fair value of an asset or liability due to a specific risk that may affect profit or loss, the gain or loss deriving from the subsequent measurement of the fair value of the hedging instrument is taken to profit or loss. The gain or loss on the hedged item, related to the hedged risk, changes the carrying amount of this item and is taken to profit or loss.

(b) Cash flow hedge - If a derivative is designated as a hedge of exposure to changes in cash flows of an asset or liability or a highly probable transaction and could affect profit or loss, the effective part of the gains or losses on the financial instrument is taken to equity. The cumulative gain or loss is derecognised from equity and taken to profit or loss in the same period in which the hedged transaction is recognised. The gain or loss related to a hedge or part of a hedge which has become ineffective is taken to profit or loss immediately. If a hedging instrument or a hedging relationship is closed, but the hedged transaction has not yet taken place, the cumulative gains and losses, recognised in equity up to then, are reclassified to profit or loss when the transaction takes place. If it is unlikely the hedged transaction will take place, the unrealised gains and losses recognised in equity are immediately recognised in profit or loss. The scope of the hedge is assessed in strategic terms. When they do not meet the requirements of IAS 39 for hedge accounting, the derivatives are classified as “Financial assets or financial liabilities at fair value through profit or loss”.

Employee benefits Post-employment benefits Post-employment benefits are recognised at the actuarial value of the Impregilo’s payable determined in line with ruling legislation and national and in-house labour agreements. The actuarial method, based on demographic, financial and turnover assumptions, is applied by independent actuaries. The related gains and losses are taken to profit or loss as costs or revenue. The 2007 finance act and related implementing decrees have introduced significant changes to legislation governing Italian post-

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

employment benefits, effective as from 1 January 2007. These include the option given to employees, to be exercised before 30 June 2007, of where to allocate their future benefits. Specifically, employees could opt to allocate them to selected pension funds or maintain them with the company, in which case, the latter shall pay the entitlements to the treasury fund of the Italian Social Security Institution (“INPS”). Following these changes, the Italian post-employment benefits vested up to the date the employees’ decision are considered part of a defined benefit plan and, as such, have been subjected to a new actuarial calculation by an independent expert, to exclude the future salary increase factor. Post-employment benefits accruing thereafter, and, in any case, after 30 June 2007, are considered part of a defined contribution plan and treated like all other social security contributions.

Share-based payments The company has applied the standards set out in IFRS 2 - Share-based payment. In line with the treatments for first-time adoption, IFRS 2 has been applied to all stock options assigned after 7 November 2002 and not yet vested at 1 January 2005. Stock option plans for the subscription of new shares of the company only cover the physical delivery of the shares issued for the related share capital increase at 258 the exercise date in exchange for payment by the beneficiaries of the exercise price. Share-based payments are measured at fair value of the option at the grant date. This amount is recognised in the income statement on a straight-line basis over the vesting period. This treatment is based on an assessment of the stock options that will effectively vest in favour of the qualifying employees. Determination of fair value is based on the binomial method for the measurement of options. The useful life used in the model was adjusted in line with the measurement of the effects of the non-transferability of shares, restrictions to exercise rights and considerations about employee behaviour.

Revenue recognition Revenue is measured to the extent it is probable that the economic benefits will flow to the company and the related amount can be reliably determined. Revenue from the sale of goods is recognised when the company has shipped the goods and has transferred all the material risks and rewards of ownership to the buyer. Revenue from construction contracts is recognised as provided for in the related Standard, described below. When the outcome of a construction contract can be estimated reliably, contract revenue and contract costs associated with the construction contract are recognised as revenue and expenses, respectively, by reference to the stage of completion of the contract activity at the balance sheet date based on the ratio between the costs incurred up to the balance sheet date and the total estimated contract costs, unless this is not held to represent the stage of completion of the contract. Changes in the contract, claims and incentive payments are recognised to the extent that they are reasonably certain. Revenue is recognised only to the extent of contract costs incurred that it is probable will be recoverable. Contract costs are recognised as an expense in the period in which they are incurred. Interest income Interest income is recognised on an accruals basis, considering the financed amount and applicable effective interest rate, ie, the rate that discounts the estimated future inflows over the expected life of the financial asset to return it to its carrying amount.

Dividends Dividends are recognised when the shareholders’ right to receive payment arises in line with local ruling legislation.

Income taxes Current taxes are provided for using the tax rates and applying the tax laws ruling in Italy and other countries in which the company operates, based on the best estimate of the taxable profit for the year. Beginning from 2004, the company has joined the national tax consolidation system, as the consolidating party, which is regulated by the conditions set out in agreements drawn up by the participating companies. The group policies provide that tax losses transferred by the subsidiaries give rise to a benefit for them to the extent to which they could 259 have been used had the national tax consolidation system not existed. Otherwise, the parent benefits, except for a partial payment to the companies transferring the losses, in proportion to the effective use in the national tax consolidation system. Moreover, the smaller taxes paid by Impregilo following the national tax consolidation system are prudently provided for when it is probable that the tax losses will be paid in the future to the subsidiaries that transferred them. Deferred tax assets and liabilities are calculated on the basis of the temporary differences between the tax base of an asset or liability and their carrying amount in the balance sheet. Deferred tax assets are recognised when the company holds their recovery to be probable. The carrying amount of deferred tax assets is reviewed at each year end and, to the extent necessary, is decreased when it is no longer probable that sufficient taxable profits will be available in the future to use all or part of the related benefit. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates that have been enacted or substantially enacted by the balance sheet date. Deferred tax assets and liabilities are classified as non-current assets and liabilities, respectively. In the case of transactions recognised directly in equity, the related deferred tax asset or liability also affects equity.

Provisions for contingencies and charges In accordance with IAS 37, the company makes accruals to provisions for risks and charges when the following conditions exist:

• the company has a present obligation (legal or constructive) at the balance sheet date as a result of a past event where an outflow of resources embodying economic benefits will be required to settle the obligation;

• it is probable that the obligation (through an outflow of resources) will have to be settled;

• a reliable estimate can be made of the amount of the obligation.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

When the time value is material and the obligation payment dates can be estimated reliably, the amount recognised as the provision equals the pre-tax future cash flows (ie, forecast outflows) discounted at a rate that reflects the present market value and risks specific to the liability. The increase in the provision over time is taken to the income statement as a financial expense. When the expected cash flows are included in an estimate range with the same probability of occurrence, the median value is discounted to measure the liability. Provision for restructuring costs is made when the company has approved a detailed formal plan that has been implemented and communicated to the third parties involved.

Translation criteria for foreign currency items The translation criteria for foreign currency items adopted by the company are as follows: • foreign currency monetary assets and liabilities, excluding property, plant and equipment, intangible assets and equity investments measured at cost, are measured at the closing spot rate with any exchange rate gains or losses taken to the income statement; 260 • property, plant and equipment and intangible assets (non-monetary assets) are recognised at historic cost denominated in the foreign currency and translated using the historic exchange rate; • revenue and costs related to foreign currency transactions are recognised in profit or loss at the exchange rate ruling on the date of the transaction; • any material effects deriving from changes in exchange rates after the balance sheet date are disclosed in the notes.

Non-current assets held for sale and discontinued operations Non-current assets (and disposal groups) are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. Assets held for sale are recognised as such when one of the following events takes place: • signing of a binding sales agreement; • approval and communication of a formal sales plan by directors. In order to be correctly measured, the assets shall be: • available for immediate sale in their present condition, • subject only to terms that are usual and customary for sales of such assets, and • the sale must be highly probable and expected to take place within twelve months. Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell. The results of discontinued operations are disclosed separately in the income statement. As required by IFRS 5.34 - Non-current assets held for sale and discontinued operations, the corresponding income statement figures presented for comparative purposes are restated accordingly. Risks relating to customers and the countries in which Impregilo S.p.A. operates The company is active in segments where most of the contracts are with state-owned customers. Therefore, its results are strictly related to the amount and term of investments in large-scale infrastructure works scheduled and awarded by governments or public bodies of the countries in which the company carries out its ongoing activities. Impregilo is also exposed to a series of country risks, such as changes in political or social conditions and the development of economic policies.

Significant accounting estimates Preparation of financial statements and the related notes in accordance with the IFRS requires management to make judgements and estimates that affect the carrying amount of assets and liabilities and financial statements disclosures. The estimates are used to determine impairment of assets, amortisation and depreciation, employee benefits, taxes and provisions for risks and charges as well as to determine total contract costs and the related stage of completion. The actual results may differ from those estimated due to uncertainties underlying the assumptions and the conditions on which the estimates are based.

A significant part of the company’s activities is typically performed on the basis of contracts which provide that a specific consideration is 261 agreed when the contract is awarded. This implies that the profits on these contracts may undergo change compared to the original estimates depending on the recoverability of greater expenses and/or costs the company may incur during performance of such contracts. Fundamental assumptions about the future and other reasons for uncertainty when making the estimates at the balance sheet date that may lead to material adjustments to the carrying amount of the assets and liabilities are described in the specific section of the directors’ report which gives an analysis of the risk areas of each segment.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

BALANCE SHEET

Net invested capital

1 Net non-current assets Net non-current assets are as follows:

(Euro/000) Note 31 December 2008 31 December 2007 Change Property, plant and equipment 1.1 57,690 69,836 (12,146) Intangible assets 1.2 49,603 52,421 (2,818) Equity investments 1.3 356,819 311,932 44,887 Total 464,112 434,189 29,923

262 1.1 Property, plant and equipment Property, plant and equipment amount to euro 57.7 million, down from the 31 December 2007 figure by euro 12.1 million. The historical cost and carrying amounts are given in the following table:

31 December 2008 31 December 2007 Cost Acc. Carrying Cost Acc. Carrying (Euro/000) depreciation amount depreciation amount Land 259 - 259 259 - 259 Buildings 3,370 (640) 2,730 3,370 (539) 2,831 Plant and machinery 67,607 (31,505) 36,102 72,797 (26,495) 46,302 Industrial and commercial equipment 9,889 (7,519) 2,370 8,255 (6,834) 1,421 Other assets 30,000 (13,771) 16,229 32,837 (13,814) 19,023 Total 111,125 (53,435) 57,690 117,518 (47,682) 69,836

Changes during the year are summarised below:

31 December Increases Depreciation Impairment Reclassifications Disposals 31 December (Euro/000) 2007 losses 2008 Land 259 - - - - 259 Buildings 2,831 - (101) - - - 2,730 Plant and machinery 46,302 13,094 (9,878) (5,886) 200 (7,730) 36,102 Industrial and commercial equipment 1,421 2,062 (1,053) (58) - (2) 2,370 Other assets 19,023 2,841 (5,252) (216) 31 (198) 16,229 Total 69,836 17,997 (16,284) (6,160) 231 (7,930) 57,690 The most significant changes include: • increases of roughly euro 18.0 million, mainly due to the investments made for contracts in Venezuela; • depreciation for the year of euro 16.3 million, calculated as described in the section on “Accounting policies”; • impairment losses of euro 6.2 million, relating mainly to the Icelandic branch’s assets which cannot be used for other group projects since their wear and tear exceeded expectations; • disposals of euro 7.9 million, referring to the disposal of assets related to contracts being wound up, principally in Italy and Iceland.

1.2 Intangible assets Intangible assets amount to euro 49.6 million, down from the 31 December 2007 figure by euro 2.8 million due to amortisation for the year. This item only relates to contract acquisition costs and includes considerations paid to purchase the railway high speed/capacity business units. These assets have a finite life and are amortised in line with the stage of completion of the related contracts. The year-end balance is as follows:

(Euro/000) 31 December 2007 Increases Amortisation 31 December 2008 263 Cavet (Florence - Bologna railway line) 517 - (301) 216 Cavtomi (Turin - Milan railway line) 5,430 - (2,517) 2,913 Cociv (Milan-Genoa railway line) 46,474 - - 46,474 Total 52,421 - (2,818) 49,603

Amortisation of the contract acquisition costs for the high speed/capacity business units is calculated using the stage of completion of the contracts based on the cost to cost method and considering the related purchase dates. Amortisation of the acquisition costs for the Milan-Genoa railway line contract has not yet started as the related works have not commenced. Assets recognised in the balance sheet at year end are deemed to be recoverable either through the ongoing arbitration proceeding for the customer’s contractual non-compliance or re-commencement of the related works. Reference should be made to the directors’ report for more information on Consorzio Cociv’s specific position.

1.3 Equity investments Equity investments increased by euro 44.9 million to euro 356.8 million, as shown in the following table.

(Euro/000) 31 December 2008 31 December 2007 Change Subsidiaries 341,282 299,427 41,855 Associates and other companies 15,537 12,505 3,032 Total 356,819 311,932 44,887

“Subsidiaries” include interests in jointly-controlled companies/consortia/joint ventures.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Changes during the year are summarised below:

Acquisitions 42,770 Disinvestments (543) Waiver of receivables and share capital increases 37,774 Impairment losses (1,505) Other changes (33,609) Total 44,887

Acquisitions of new investments mainly relate to the euro 37.6 million stake in Pedemontana Lombarda, which was awarded the tender for the definitive project, executive plan and construction of the first section of the Como and Varese ring roads and the connector road between the A8 and the A9 motorways (from Cassano Magnago to Lomazzo), and the euro 4.2 million investment in Impregilo Arabia Ltd.. Neither of these two companies was active at year end. Disinvestments relate to companies in liquidation. 264 The waiver of receivables and share capital increases totalling euro 37.8 million is mainly due to the company’s waver of receivables due from FIBE and FIBE Campania (euro 33.6 million) and the subsidiary Sgf Inc. (euro 2.0 million) to cover their losses. The company set up a specific provision for risks for FIBE’s losses in 2007 and its entire utilisation is shown in the item “Other changes” in the previous table. Reference should be made to the annex “Equity investments” for the list of investments in subsidiaries, associates and other companies.

2. Provisions for risks and charges These provisions amount to euro 108.9 million at year end. Changes of the year are as follows:

31 December Accruals Utilisation Reversals Other 31 December (Euro/000) 2007 changes 2008 Provision for risks on investments 55,006 8,100 (6,685) (33,609) 22,812 Other provisions 101,479 1,049 (11,030) (5,395) - 86,103 Total 156,485 9,149 (17,715) (5,395) (33,609) 108,915

The provision for risks on investments decreased by an overall euro 32.2 million, mainly due to the following: • impairment losses recognised on the investments in the subsidiaries FIBE and FIBE Campania (euro 8.1 million) and their recapitalisation (euro 33.6 million - other changes), which had already affected profit or loss in 2007; • utilisation of euro 6.7 million of the provision set up in previous years in the separate financial statements for the company’s investment in Impresit Bakolori, which was released following the group’s decision to exit the partnership with the Nigerian partners following the significant worsening of the general stability in Nigeria and the fact that the company was no longer able to manage the subsidiary in strategic and management terms. The provision for risks made in previous years for this subsidiary reflected the company’s measurement of the contingent liability of restructuring the subsidiary’s operations. This restructuring did not go ahead due to the changed local situation. In previous years, the company had already fully impaired its receivables from Impresit Bakolari and, therefore, it did not have risk positions in this respect at year end. This provision may be analysed as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Subsidiaries 19,798 51,992 (32,194) Associates and other companies 3,014 3,014 - Total 22,812 55,006 (32,194)

The other provisions decreased by a net euro 15.4 million, mainly due to settlement of certain disputes or adjustments made to reflect the actual risk of losing the cases as assessed at the reporting date. The other accruals of euro 1.0 million mainly relate to estimates for litigation involving the company’s foreign branches. Utilisations related to the occurrence of the risks originally provided for, especially for the Ghazi Barotha (Pakistan) contract of euro 6.9 million, litigation related to the contracts in Lesotho and Ecuador of euro 2.7 million, settlement of the ongoing litigation with the Icelandic tax authorities of euro 2.5 million, the T.A.T. (Switzerland) contract of euro 0.7 million, the Malpensa Business Park contract of euro 0.4 million and other contracts of euro 3.1 million. 265 Other provisions include the following:

(Euro/000) 31 December 2008 31 December 2007 Change Contract completion costs 13,429 14,152 (723) Ongoing litigation 3,387 5,391 (2,004) Building segment litigation 9,443 12,730 (3,287) Tax and social security litigation 616 3,100 (2,484) Personnel litigation 1,068 1,020 48 USW Campania projects litigation 50,000 50,000 - Other 8,160 15,086 (6,926) Total 86,103 101,479 (15,376)

Contract completion costs mainly include the accruals for the outstanding future charges to complete the Tunnel Alp Transit (T.A.T.) contract in Switzerland. Provisions related to the Building segment litigation refer to provisions for risks and charges previously accrued by Impregilo Edilizia e Servizi, which was merged into Impregilo S.p.A. in 2007. The utilisations for the year principally relate to a number of disputes nearing settlement for the Greek and Arabian branches. The other provisions mainly comprise amounts accrued in 2007 for certain foreign contracts completed in previous years for which disputes are ongoing with the customers. Relationships with these customers are difficult and, therefore, the company is unable to estimate when exactly the related receivables will be collected. During 2008, the parent commenced a dispute with the Milan tax office about an assessment challenging the tax treatment of impairment losses and losses in 2003 of certain investments held by the parent in that year. The most significant issue relates to the parent’s sale of its entire investment in the Chilean concession company Costanera Norte S.A. to Impregilo International Infrastructures N.V. in 2003. The company has challenged the unlawfulness of the criteria adopted by the tax office to determine the “normal value” of the sale. The office redetermined the alleged transfer value using the consideration paid by third parties which acquired the concession company in 2006 as a

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

base, limiting itself to discounting this consideration over the period from the sale date in 2006 to the date of the previous transfer from Impregilo to Impregilo International Infrastructures. This is to demonstrate the greater tax that it claims should have been paid. Before the dispute was commenced, Impregilo had fully demonstrated with the related documentation the correctness of the method adopted in 2003, which had, moreover, been approved by an independent appraisal at the time of the sale. However, the tax office had not considered this documentation. At the date of the original sale, the Chilean concession company was still “constructing” its infrastructure and had only just commenced (without having completed) the activities aimed at obtaining financing to complete these works. During the preliminary stage of the dispute, Impregilo obtained a new, independent appraisal of the disputed transfer price to support its calculation. This was prepared by a leading international advisory firm. It also informed the tax office that another investment in the Chilean concession company then held by SIMEST S.p.A., a state-owned company, had also been transferred to Impregilo International Infrastructures in April 2004 for a substantially equal consideration (given the different investment percentages) to that being disputed. Despite these arguments, the local commission (first level) rejected Impregilo’s case without specifying why, fully accepting the tax office’s claims and ordering the company to pay the assessed tax, interest and fines of approximately euro 52 million. This measure was appealed against before the second level court. The lawyers assisting the company agree with it that there are valid reasons to hold that the greater tax imposed by the tax office is unlawful, deeming that the unfavourable first level ruling was deficient in terms of the reasoning, based moreover on illegitimate arguments and without objective grounds. Therefore, Impregilo has not made any provision therefor either in its separate or consolidated financial statements. 266 Reference should be made to the directors’ report for information on the accrual for the USW Campania projects.

3. Post-employment benefits and employee benefits At 31 December 2008, the present value of the company’s actual liability due to all its employees determined using the criteria set out in IAS 19 is euro 18.2 million, up euro 2.6 million on the previous year. An independent actuary performed the actuarial valuation of the post- employment benefits, which are the largest component of this item. The actuarial valuation was based on the following rates: • turnover rate 8%; • discount rate 4.5%; • advance payment rate 2%; • inflation rate 2%.

Changes in the provision are as follows:

31 December Accrual Payments Contributions paid Other 31 December 2007 to INPS treasury changes 2008 (Euro/000) and other funds Post-employment benefits and employee benefits 15,603 9,912 (4,492) (1,145) (1,644) 18,234

4. Other non-current assets and non-current receivables due from group companies The items amount to euro 310.2 million (31 December 2007: euro 357.9 million) as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current receivables due from group companies 309,785 357,186 (47,401) Other non-current assets 400 752 (352) Total 310,185 357,938 (47,753) Non-current receivables due from group companies of euro 309.8 million mainly relate to subsidiaries, including: • Receivable due from Imprepar - Impregilo Partecipazioni S.p.A. in liquidation of euro 160.6 million. This receivable is subordinated pursuant to article 2497-quinquies of the Italian Civil Code and is unchanged from the previous year. It is shown net of the provision for bad debts of euro 175.7 million, set up to cover the deficit shown in the subsidiary’s interim liquidation financial statements at 31 December 2007.

Current payables due to group companies include euro 2.6 million for Imprepar, which can be analysed as follows:

(Euro/000) 31 December 2007 Change 31 December 2008 Due to Imprepar (4,767) 2,206 (2,561)

The net total receivable due from Imprepar amounts to euro 158.0 million, which is in line with the subsidiary’s liquidation plan and the present value of discounted future cash flows, net of payments to banks and suppliers after having repaid future operating costs incurred as part of the liquidation procedure. The receivable does not bear interest and is comparable to an equity instrument or an 267 endowment fund. • Financial receivable due from FIBE S.p.A. of euro 144.0 million, arising from the granting of liquidity thereto to settle the subsidiary’s debt with banks. The receivable decreased by euro 28.9 million due to the company’s waiver of receivables during the year to cover the subsidiary’s losses. The loan agreement between Impregilo S.p.A. and FIBE S.p.A., entered into in 2006, provides that the loan shall be repaid at least 24 months after the agreement date. Given the subsidiary’s financial position and the commitments taken on by Impregilo to support it, the receivable has not borne interest since the end of 2006. Reference should be made to the Annex “Intragroup transactions” for a breakdown of such receivable shown as a gross balance and net of the related payables. Other non-current assets amount to euro 0.4 million and include tax receivables for the substitute tax on post-employment benefits (euro 0.1 million) and guarantee deposits.

5. Net tax assets Net tax assets total euro 111.6 million at 31 December 2008, down on 31 December 2007, as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Deferred tax assets 22,677 32,680 (10,003) Current tax assets 161,906 159,255 2,651 Liabilities for national consolidated tax system (46,092) (5,985) (40,107) Current tax liabilities (26,909) (30,287) 3,378 Total 111,582 155,663 (44,081)

Net deferred tax assets amount to euro 22.7 million at year end, down euro 10.0 million on 31 December 2007. Details on the related changes are given in note 14.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Current tax assets amount to euro 161.9 million as follows:

(Euro/000) 31 December 2008 31 December 2007 Change VAT 60,266 59,973 293 Other Italian indirect taxes 8,655 1,309 7,346 Foreign indirect taxes 716 98 618 Direct taxes 83,254 70,853 12,401 IRAP 1 1,443 (1,442) Other Italian direct taxes 2,261 14,652 (12,391) Foreign direct taxes 5,771 9,711 (3,940) Tax credits and withholdings 982 1,216 (234) Total 161,906 159,255 2,651

Impregilo factored part of its VAT and IRPEG receivables (shown in the above table) with recourse to leading factoring companies in 2007. The amount involved totalled euro 52.9 million (including VAT and IRPEG receivables of euro 12.8 million and euro 40.1 million, respectively). According to the communication from the tax authorities, the factored VAT receivables should be collected within 2009. 268 Liabilities for the national consolidated tax system of euro 46.1 million at year end relate to the company’s potential payable to group companies participating in the system with respect to their losses transferred and not recognised in accordance with the ruling tax contract (see the paragraph on “Income taxes” in the “Accounting policies” section). Current tax liabilities of euro 26.9 million decreased by euro 3.4 million over 31 December 2007. They may be analysed as follows:

(Euro/000) 31 December 2008 31 December 2007 Change IRES 1,432 - 1,432 IRAP 8,432 23,887 (15,455) VAT 12,460 3,684 8,776 Foreign indirect taxes 59 100 (41) Withholdings applied in Italy 1,834 2,237 (403) Other 2,692 379 2,313 Total 26,909 30,287 (3,378)

6. Working capital Working capital at 31 December 2008 amounts to euro 523.1 million (31 December 2007: euro 347.0 million) and is made up as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Inventories 6.1 29,947 31,288 (1,341) Contract work in progress 6.2 316,201 239,396 76,805 Advances on contract work in progress 6.3 (200,953) (263,982) 63,029 Receivables 6.4 813,065 748,455 64,610 Payables 6.5 (404,580) (379,052) (25,528) Other current assets 6.6 36,778 39,227 (2,449) Other current liabilities 6.7 (67,323) (68,294) 971 Total 523,135 347,038 176,097 In order to more clearly present the company’s financial position, receivables and payables due to and from group companies are shown, as in the past, at the net balances due to/from each counterpart. A breakdown of these positions is given in the annex “Intragroup transactions”.

6.1 Inventories This item is analysed in the following table:

31 December 2008 31 December 2007 Gross carrying Provision Carrying Gross carrying Provision Carrying Change (Euro/000) amount amount amount Real estate projects 21,786 (7,772) 14,014 21,800 (7,772) 14,028 (14) Finished products and goods 1,009 - 1,009 627 - 627 382 Raw materials, consumables and supplies 19,424 (4,500) 14,924 16,633 - 16,633 (1,709) Total 42,219 (12,272) 29,947 39,060 (7,772) 31,288 (1,341)

269 6.1.1 Real estate projects Real estate projects amount to euro 14.0 million in line with the previous year. They mainly relate to the Malpensa Business Park project in Gallarate of euro 11.5 million (net of the related provision of euro 7.8 million) to build a factory outlet. This project has been delayed since the relevant municipality has not yet implemented the measures necessary to start the works.

6.1.2 Finished products and goods and Raw materials, consumables and supplies Finished products of euro 1.0 million (2007: euro 0.6 million) mainly comprise materials for resale, principally for the Icelandic and Venezuelan contracts. Raw materials, consumables and supplies of euro 14.9 million (2007: euro 16.6 million) relate to items used at the Icelandic and Venezuelan building sites. They did not change significantly during the year.

6.2 Contract work in progress Contract work in progress amounts to euro 316.2 million at year end, up on the previous year-end figure of euro 239.4 million. The following table shows contract work in progress calculated using the stage of completion method net of losses realised or estimated at the reporting date and progress billings:

(Euro/000) 31 December 2008 31 December 2007 Change Contract work in progress 5,876,821 5,197,078 679,743 Advances received (on approved work) (5,455,863) (4,856,049) (599,814) Provision for contractual risks (104,757) (101,633) (3,124) Total 316,201 239,396 76,805

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

The key contracts making up contract work in progress at year end and the related works performed during the year are summarised below:

Contract work in progress 2008 (Euro/000) 31 December 2008 31 December 2007 Change production High speed/capacity 60,846 102,360 (41,514) 324,475 Iceland - 32,173 (32,173) (703,148) Venezuela 132,664 45,910 86,754 214,733 Salerno - Reggio Calabria 63,941 28,067 35,874 122,309 Passante di Mestre 2,836 2,185 651 137,367 Consorzio Torre 12,027 - 12,027 62,384 Pedelombarda 2,448 - 2,448 2,448 Other 41,439 28,701 12,738 38,012 Total 316,201 239,396 76,805 198,579

The increase is due to progress on the contracts carried out by the Venezuelan branch and the decrease in the high speed/capacity and 270 Icelandic projects, principally due to the performance of the contracts in terms of production made during the year and approvals thereof.

6.3 Advances on contract work in progress The item “Advances on contract work in progress” included in “Current liabilities”, amounts to euro 201.0 million, down euro 63.0 million on the figure at 31 December 2007. It comprises:

(Euro/000) 31 December 2008 31 December 2007 Change Contract work in progress (4,762,816) (5,183,984) 421,168 Advances received (on approved work) 4,902,471 5,389,820 (487,349) Contractual advances 61,298 58,146 3,152 Total 200,953 263,982 (63,029)

Contract work in progress, recognised under liabilities (negative WIP), is the negative net balance, for each contract, of work performed to date, the provision for contractual risks and progress billings. Advances received include the amounts recognised by customers as per the related contract and recovered over the contract term. The following table shows the contribution by contract:

31 December 2008 31 December 2007 (Euro/000) Negative WIP Advances Total Negative WIP Advances Total High capacity 131,080 - 131,080 191,800 - 191,800 Venezuela 4,652 55,660 60,312 6,694 47,437 54,131 Consorzio Torre - - - 3,993 - 3,993 Other 3,923 5,638 9,561 3,349 10,709 14,058 Total 139,655 61,298 200,953 205,836 58,146 263,982

“Other” includes certain Italian direct contracts. 6.4 Receivables At 31 December 2008, receivables show a net increase of euro 64.6 million at euro 813.1 million. They may be broken down as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Trade receivables 211,367 180,038 31,329 Provision for bad debts (10,955) (12,190) 1,235 Total net trade receivables 200,412 167,848 32,564 Current receivables due from group companies 612,653 580,607 32,046 Total 813,065 748,455 64,610

6.4.1 Trade receivables The balance of euro 200.4 million, net of the provision for bad debts (euro 11.0 million), shows a net increase of euro 32.6 million, mainly due to the greater activities carried out by the Venezuelan branch.

Changes in the provision for bad debts are shown in the following table: 271

(Euro/000) 31 December 2007 Accrual Utilisations Reversals 31 December 2008 Provision for bad debts 12,043 - (17) (1,093) 10,933 Provision for default interest 147 - (125) - 22 Total 12,190 - (142) (1,093) 10,955

“Utilisations” mainly refer to the settlement of certain disputes with customers, for which the provision had been set up in previous years.

6.4.2 Current receivables due from group companies This item amounts to euro 612.7 million compared to euro 580.6 million at the end of 2007. It mainly comprises trade receivables, receivables for services and of a financial nature.

A breakdown of receivables due from group companies is as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Subsidiaries 313,622 339,170 (25,548) Associates 36,136 35,046 1,090 Other 315,605 253,486 62,119 Provision for bad debts - financial (51,195) (45,354) (5,841) Provision for bad debts - trade (1,515) (1,741) 226 Total 612,653 580,607 32,046

The euro 51.2 million provision for bad debts from financial receivables relates to the subsidiary Impresit Bakolori (euro 21.0 million) and the associate Puentes del Litoral (euro 30.2 million).

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

The following table shows the companies from which the main net receivables are due at year end:

(Euro/000) 31 December 2008 31 December 2007 Change Impregilo International Infrastructures N.V. 238,454 265,725 (27,271) Consorzio Cavtomi 118,912 144,218 (25,306) SGF - INC S.p.A. 20,639 22,997 (2,358) Consorzio Acueducto Oriental 7,467 4,084 3,383 Consorzio Contuy Medio 29,006 16,542 12,464 Costrutora Impregilo y Asociados 14,654 15,837 (1,183) Other 183,521 111,203 72,318 Total 612,653 580,607 32,046

Reference should be made to the annex “Intragroup transactions” for details of this balance and the related payables.

272 6.5 Payables At 31 December 2008, payables show an increase of euro 25.5 million at euro 404.6 million. They may be broken down as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Trade payables 63,717 69,989 (6,272) Current payables to group companies 340,863 309,063 31,800 Total 404,580 379,052 25,528

6.5.1 Trade payables Trade payables decreased by euro 6.3 million to euro 63.7 million, due to both the decrease in payables due to corporate suppliers (euro 15.5 million) and the Icelandic branch (euro 4.4 million) and the increase related to the Venezuelan branch (euro 13.0 million) following continuation of work on the contracts.

6.5.2 Current payables due to group companies This item amounts to euro 340.9 million, up euro 31.8 million, as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Subsidiaries 117,904 155,168 (37,264) Associates 86,004 58,219 27,785 Other companies 136,955 95,676 41,279 Total 340,863 309,063 31,800

Gross payables to group companies and related nettable amounts against receivables due from the same companies are shown in the following table. Reference should be made to the annex “Intragroup transactions” to these notes for further details on such amounts. 31 December 2008 31 December 2007 (Euro/000) Gross payables Nettable amounts Net payables Gross payables Nettable amounts Net payables Subsidiaries 173,591 (55,687) 117,904 187,078 (31,910) 155,168 Associates 154,153 (68,149) 86,004 102,029 (43,810) 58,219 Other companies 578,429 (441,474) 136,955 630,872 (535,196) 95,676 Total 906,173 (565,310) 340,863 919,979 (610,916) 309,063

The key creditors of the above net payables are summarised below:

(Euro/000) 31 December 2008 31 December 2007 Change Consorzio Cociv 67,249 63,644 3,605 Eurolink S.c.p.a. 50,560 50,777 (217) Salerno Reggio Calabria S.c.p.a. 55,689 58,804 (3,115) Reggio Calabria - Scilla S.c.p.a. 32,211 23,959 8,252 Ghazi Barotha Contractors JV - 354 (354) 273 Consorzio Torre 43,652 - 43,652 Pedelombarda 30,441 - 30,441 FISIA Italimpianti - 18,336 (18,336) FIBE S.p.A. 12,842 20,943 (8,101) FIBE Campania S.p.A. 1,678 16,439 (14,761) Other 46,541 55,807 (9,266) Total 340,863 309,063 31,800

6.6 Other current assets Other assets of euro 36.8 million show a decrease of euro 2.4 million on the previous year end and may be analysed as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Financial receivables 6,791 8,368 (1,577) Advances to suppliers 15,281 19,776 (4,495) Other receivables 4,130 6,684 (2,554) Prepayments and accrued income 10,576 4,399 6,177 Total 36,778 39,227 (2,449)

Financial receivables amount to euro 6.8 million, showing a euro 1.6 million decrease on 31 December 2007, mainly due to a reduction in the receivable of euro 3.0 million due to the Greek branch by its partner Aktor and the euro 1.2 million increase in the receivable due to the Venezuelan branch from its foreign partner (with which Impregilo works in this country). Advances to suppliers decreased to euro 15.3 million due to utilisation thereof by the Venezuelan branch in connection with its projects. Other receivables of euro 4.1 million decreased by euro 2.6 million following amounts collected during the year.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Prepayments and accrued income increased to euro 10.6 million as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Accrued income: - Other - - - Total accrued income - - - Prepayments: - Insurance 6,754 1,096 5,658 - Commissions on sureties 901 148 753 - Costs recognised in line with stage of completion of contracts 2,738 2,694 44 - Other 183 461 (278) Total prepayments 10,576 4,399 6,177 Total 10,576 4,399 6,177

The increase in prepayments is due to insurance costs for the Venezuelan branch’s contracts relating to 2009.

274 6.7 Other current liabilities Other current liabilities of euro 67.3 million (euro 68.3 million) comprise:

(Euro/000) 31 December 2008 31 December 2007 Change Social security institutions 4,894 4,325 569 Personnel 10,640 10,536 104 Other payables 47,678 45,546 2,132 Accrued expenses and deferred income 4,111 7,887 (3,776) Total 67,323 68,294 (971)

They comprise: • payables due to employees, relating to matured holiday pay; • other payables of euro 47.7 million (euro 45.5 million), mainly relating to sums due for the acquisition of business units and to partners of foreign joint ventures; • accrued expenses and deferred income of euro 4.1 million, which refer to the following items:

(Euro/000) 31 December 2008 31 December 2007 Change Accrued expenses: - Commissions on sureties 860 1,400 (540) - Other accrued expenses 3,237 1,195 2,042 Total accrued expenses 4,097 2,595 1,502 Deferred income: - Other deferred income 14 5,292 (5,278) Total deferred income 14 5,292 (5,278) Total 4,111 7,887 (3,776)

Other accrued expenses are matched to the related portion of costs not yet paid for contract work in progress. The decrease in other deferred income is mainly due to the release to profit or loss of amounts deferred until the end of the previous year due to finalisation of the previously agreed contract. 7. Equity Equity amounts to euro 806.9 million at 31 December 2008 compared to euro 724.7 million at the end of 2007. Changes of the year in the different equity items are summarised in the schedule attached to the separate financial statements.

The company’s equity at 31 December 2007 was as follows:

Unavailable hedging reserve 2,200,055 275 Negative components: Share capital increase related charges (25,394,224) Losses carried forward (13,987,660) Total (39,381,884) Loss for the year (1,880,487)

In their meeting held on 7 May 2008, the shareholders resolved to cover the loss for the year for the year of euro 1.9 million and the other negative components of euro 39.4 million giving a total of euro 41.3 million, by using: • the entire negative goodwill of euro 5.1 million; • the entire stock option reserve of euro 5.0 million; • the entire share premium reserve of euro 13.3 million; • part of the legal reserve of euro 17.9 million. Disclosures about the individual items are set out below.

Share capital The company’s share capital of euro 718.4 million increased by euro 1.7 million over 31 December 2007 due to a share capital increase carried out for the purposes of the stock option plan, as detailed below:

(Euro/000) Share capital 31 December 2007 716,614 Share capital increase 1,750 31 December 2008 718,364

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

A breakdown of the item at year end is as follows:

(Euros) No. of ordinary shares No. of savings shares Total shares Share capital Number of shares and share capital at 31 December 2008 402,457,937 1,615,491 404,073,428 718,364,457

A statement of capital increase to euro 718,364,456.72 was filed with the Milan Company Registrar on 9 July 2008, following the subscription of newly-issued shares by those benefiting from the stock option plan approved by the shareholders of Impregilo S.p.A. in the extraordinary meeting of 26 September 2005.

As a result, the company’s share capital amounts to euro 718,364,456.72 at 31 December 2008, split into 404,073,428 shares, including 402,457,937 ordinary shares and 1,615,491 savings shares.

Savings shares issued pursuant to the law do not carry voting rights, have preference dividend and capital repayment rights and can be bearer shares, subject to the provisions of point 2, article 2354 of the Italian Civil Code. Upon the shareholder’s request and at his/her own expense, they can be converted into registered shares and vice versa. Savings shares held by directors, statutory auditors and CEOs 276 are registered. Except when the company’s by-laws or relevant legislation provide for otherwise, savings shares give the holders the same rights as those of ordinary shares.

Holders of savings shares do not have the right to attend the company’s shareholders’ meetings or to request that they are called. The special savings shareholders’ meeting is regulated by law. When reserves are distributed, the savings shares have the same rights as ordinary shares.

Upon dissolution of the company, savings shares bear preference rights to capital repayment, up to euro 5.2 per share. When shares are grouped or split (as well as when capital transactions are carried out and as necessary in order to protect the savings shareholders’ rights in the case the shares have nominal value), the above fixed amount shall be adjusted accordingly.

Profit for the year as per the annual financial statements is allocated as follows:

a) 5% to the legal reserve, up to the legally-required amount;

b) to savings shares, to the extent of 5% of euro 5.2 per share (ie, euro 0.26 per share). If a dividend lower than 5% of euro 5.2 per share (ie, euro 0.26 per share) is paid one year, the difference is taken as an increase in the preferred dividend of the following two years;

c) the residual amount, to all shareholders in such a way as to allocate to savings shares a total dividend which is 2% of euro 5.2 per share (ie, euro 0.104 per share) greater than that distributed to ordinary shares, except when the shareholders decide to allocate an amount to the extraordinary reserves or for other uses. Details on the possible use of equity items and uses in prior years are summarised below:

(Euro/000) Summary of use Nature/description Amount Possible use Available To cover Other (A, B, C) portion losses Share capital 718,364 Equity-related reserves: Share premium reserve 1,222 A,B 1,222 332,272 Other reserves: Legal reserve 5,851 B 5,851 17,870 Stock option reserve - 5,013 Unavailable hedging reserve (1,583) B Negative goodwill - 5,068 Share capital increase related charges - Total other reserves 4,268 5,851 27,951 Retained earnings (losses) carried forward - 277 Total 7,073 360,223 - Non-distributable portion 7,073 Residual distributable portion -

A: share capital increase B: to cover losses C: dividends

Available reserves cannot be distributed until the legal reserve reaches 20% of the share capital. Amounts used to cover losses were earmarked by the shareholders’ resolutions of 3 May 2006 and 7 May 2008.

Share premium reserve This reserve underwent the following changes:

(Euro/000) Share premium reserve 31 December 2007 13,310 Coverage of losses and negative reserves (13,310) Share capital increase 1,222 31 December 2008 1,222

The increase was due to the share capital increase carried out during the year for the purposes of the stock option plan and exercise by the related beneficiaries of their options.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Other reserves This item is broken down as follows:

(Euro/000) 31 December 2008 31 December 2007 Change Legal reserve 5,851 23,722 (17,871) Stock option reserve - 5,013 (5,013) Hedging reserve (1,583) 2,200 (3,783) Share capital increase related charges - (25,394) 25,394 Negative goodwill - 5,068 (5,068) Total 4,268 10,609 (6,341)

• Legal reserve This reserve underwent the following changes:

(Euro/000) Legal reserve 278 31 December 2007 23,722 Coverage of losses and negative reserves (17,871) 31 December 2008 5,851

• Stock option reserve This reserve included the vested options granted to employees and directors at 31 December 2007 at fair value. As the related stock option plan was completely vested during 2007, the reserve became available and was, therefore, fully used to cover the losses and existing negative reserves, in accordance with the shareholders’ resolution of 7 May 2008, as disclosed earlier.

• Hedging reserve The company has agreed interest rate swaps to hedge existing loans. These derivative instruments meet the requirements of IAS 39 for designation as cash flow hedge financial instruments. Under Legislative decree no. 38 of 29 February 2005, this reserve is not available. Changes in the reserve that includes their fair value gains or losses are as follows:

(Euro/000) Hedging reserve 31 December 2007 2,200 Reclassification of fair value gains/losses on settled transactions to profit or loss (1,592) Fair value gains/losses (2,191) 31 December 2008 (1,583)

Changes in this reserve during 2007 are set out below for comparative purposes:

(Euro/000) Hedging reserve 31 December 2006 1,642 Reclassification of fair value gains/losses on settled transactions to profit or loss (646) Fair value gains/losses 1,204 31 December 2007 2,200 The conditions for maintaining this reserve are commented on in the notes to the specific items which generated them.

• Share capital increase related charges The shareholders met on second call on 7 May 2008 to resolve the covering of this reserve and decreased it to zero. It included all the charges related to the share capital increase which took place in 2005 net of the related tax effect.

• Negative goodwill

(Euro/000) Negative goodwill 31 December 2007 5,068 Use to cover losses and negative reserves (5,068) 31 December 2008 -

The variation is due to the aforesaid resolution. 279

8. Net financial position Net financial indebtedness increased by euro 76.9 million to euro 475.0 million, showing a decrease in cash and cash equivalents of euro 104.8 million and a decrease in the gross bank debt of euro 20.5 million.

The following table shows the company’s net financial indebtedness and changes therein:

(Euro/000) Note 31 December 2008 31 December 2007 Change Other current financial assets 8.1 4,820 147 4,673 Cash and cash equivalents 8.2 128,692 233,446 (104,754) Total cash and other financial assets 133,512 233,593 (100,081) Medium/long-term bank and other loans 8.3 (190,583) (235,808) 45,225 Finance lease payables 8.4 - (24) 24 Total medium/long-term financial indebtedness (190,583) (235,832) 45,249 Current portion of bank loans and current account facilities 8.3 (369,197) (344,506) (24,691) Current portion of finance lease payables 8.4 (24) (445) 421 Total short-term financial indebtedness (369,221) (344,951) (24,270) Derivatives (with positive fair value) 8.5 4,152 2,200 1,952 Derivatives (with negative fair value) 8.5 (1,623) (121) (1,502) Other financial payables 8.6 (51,208) (52,964) 1,756 Total other items in net financial position (48,679) (50,885) 2,206 Net financial indebtedness (474,971) (398,075) (76,896)

There are no financial receivables/payables due from/to related parties at year end.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

8.1 Other current financial assets Changes in this item, which includes Venezuelan treasury bonds and financial receivables due from third parties, were as follows during the year:

(Euro/000) 31 December 2008 31 December 2007 Change Total other current financial assets 4,820 147 4,673

The fair value of the above treasury bonds is in line with their carrying amount. The caption includes euro 3.5 million for Venezuelan treasury bonds held at year end by the Venezuelan branch, redeemed immediately after year end for an amount equal to their carrying amount.

8.2 Cash and cash equivalents At 31 December 2008, cash and cash equivalents amounted to euro 128.7 million, down by euro 104.8 million on 31 December 2007.

280 (Euro/000) 31 December 2008 31 December 2007 Change Cash and cash equivalents 128,692 233,446 (104,754)

The cash flow statement shows the reasons for this decrease and changes in current account facilities (note 8.3).

A breakdown of this item by geographical segment is as follows:

(Euro/000) Italy 13,316 Abroad 115,376 Total 128,692

8.3 Bank and other loans Bank and other loans decreased by euro 20.5 million over 31 December 2007 to euro 559.8 million at year end, as summarised below:

(Euro/000) 31 December 2008 31 December 2007 Change Non-current 190,583 235,808 (45,225) Current 369,197 344,506 24,691 Total 559,780 580,314 (20,534)

The company’s financial indebtedness is broken down by loan type in the following table:

31 December 2008 31 December 2007 (Euro/000) Non-current Current Total Non-current Current Total Bank corporate loans 190,583 234,893 425,476 235,808 279,503 515,311 Current account facilities 134,304 134,304 65,003 65,003 Total 190,583 369,197 559,780 235,808 344,506 580,314 Bank loans Bank loans include:

31 December 2008 31 December 2007 Company Country Total Current Non- Total Current Non- financial portion current passività portion current (Euro/000) liabilities portion liabilities portion Banca Intesa Impregilo Italy 235,956 111,541 124,415 192,331 83,473 108,858 MCC Impregilo Italy 106,690 106,690 - 106,408 106,408 - Popolare dell'Emilia Impregilo Italy 15,007 15,007 - - - - OPI/West LB Impregilo Italy 154,659 46,265 108,394 106,709 24,984 81,725 Royal Bank of Scotland Impregilo Italy - - - 20,028 20,028 - Total 512,312 279,503 232,809 425,476 234,893 190,583

The main conditions of the loans in place at 31 December 2008 are as follows:

Company Interest rate Expiry date 281 Banca Intesa Impregilo Euribor 1M 2011 MCC Impregilo Euribor 1M 2009 OPI/West LB Impregilo Euribor 6M 2012 Royal Bank of Scotland Impregilo Euribor 1M 2009

In addition, variable spreads are applicable to the interest rates set out above, based on the term and conditions of the loan. The loans from Banca Intesa, MCC and OPI/West LB have covenants ie, the obligation to maintain certain financial and equity ratios. At the reporting date, no indications of non-compliance with such covenants were noted. The company entered into interest rate hedges for the OPI/West LB loan. These derivatives are described in note 8.5.

The non-current portion of the above loans will be repaid at their contractual maturity, based on the following time bands:

Company Country Total Due after Due after Due after non-current 13 months 25 months 60 months portion but within but within (Euro/000) 24 months 60 months Banca Intesa Impregilo Italy 108,858 82,139 26,719 - OPI/West LB Impregilo Italy 81,725 28,801 52,924 - Total 190,583 110,940 79,643 -

The fair value of the non-current loans, measured as set out in the accounting policy section, is euro 186.1 million.

Current account facilities Current account facilities total euro 134.3 million. This item mainly relates to the Venezuelan branch which, in addition to representing an important source of funding for its contracts, is a hedge against local currency exchange rate fluctuations.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

8.4 Finance lease payables Finance lease payables at 31 December 2008 relate to the leases existing at such date and arising from the merger of Tesco S.r.l. in previous years with a remaining value of euro 24 thousand. The fair values of leased assets approximate their carrying amounts. Leased assets have been charged as guarantee for lease payables.

8.5 Derivatives Derivatives recognised under assets and liabilities amount to euro 4.2 million and euro 1.6 million at year end, up by euro 2.0 million and euro 1.5 million, respectively, on 31 December 2007. These items include the agreements hedging currency and interest rate risks.

31 December 2008 31 December 2007 (Euro/000) Assets Liabilities Assets Liabilities Interest rate swaps - cash flow hedge 1.582 2.200 - Currency swaps - FVTPL 4.152 41 - 121 Total 4.152 1.623 2.200 121

282 The following table sets out the characteristics of the derivatives existing at year end showing the related fair value at the reporting date:

INTEREST RATE SWAP - Cash flow hedges Negative fair value Company Agreement date Expiry date Currency Notional amount Fair value (Euro) Impregilo S.p.A. 1-02-2006 31-12-2011 Euro 49,829,500 (791,365) Impregilo S.p.A. 1-02-2006 31-12-2011 Euro 49,829,500 (791,365) Total (1,582,730)

This category includes derivatives that have been entered into to hedge the company against interest rate risks and that meet hedge accounting requirements. To check compliance with these requirements, the effectiveness of the hedges has been verified and confirmed and therefore, the hedging reserve (see note 7) has been recognised in equity.

EXCHANGE RATE DERIVATIVES - FVTPL Positive fair value Company Agreement date Expiry date Currency Notional amount Fair value (Euro) Impregilo S.p.A. 1-12-2008 9-01-2009 USD 8,000,000 716,811 Impregilo S.p.A. 26-11-2008 12-01-2009 USD 6,400,000 432,225 Impregilo S.p.A. 6-12-2008 12-01-2009 USD 6,176,729 461,755 Impregilo S.p.A. 10-10-2008 14-01-2009 USD 3,700,000 114,089 Impregilo S.p.A. 11-12-2008 20-01-2009 USD 3,500,000 181,111 Impregilo S.p.A. 24-10-2008 26-01-2009 USD 4,000,000 357,829 Impregilo S.p.A. 28-10-2008 30-01-2009 USD 5,000,000 489,936 Impregilo S.p.A. 3-12-2008 5-02-2009 USD 4,000,000 357,931 Impregilo S.p.A. 9-11-2008 11-02-2009 USD 6,000,000 454,113 Impregilo S.p.A. 13-11-2008 17-02-2009 USD 6,000,000 586,352 Total 4,152,153 Negative fair value

Company Agreement date Expiry date Currency Notional amount Fair value (Euro) Impregilo S.p.A. 18-12-2008 23-03-2009 USD 8,000,000 (40,537) Total (40,537)

This category includes derivatives that have been entered into to hedge the company against currency risks but that do not meet (or no longer meet and the situation has not yet been resolved) hedge accounting requirements for cash flows hedges.

8.6 Other financial payables The company factored tax receivables of euro 53.0 million with recourse in 2007. At year end, the factoring related to:

(i) VAT receivables of euro 11.0 million factored in previous years;

(ii) IRPEG receivables of euro 40.2 million factored in 2007.

283 The company collected VAT receivables of euro 1.8 million in 2008. They had been previously factored without recourse to factoring companies. As already mentioned and based on the communication received from the tax authorities, the factored VAT receivables should be collected within 2009.

9. Guarantees and commitments The key guarantees given by the company are set out below:

• Contractual sureties: these total euro 3,221,9 million and are given to customers as performance bonds, to guarantee advances, withholdings and involvement in tenders for all ongoing contracts. In turn, the company has guarantees given by its subcontractors that partly cover the contractual sureties given.

• Sureties for credit: they amount to euro 756.2 million and relate to subsidiaries (euro 272.3 million), associates (euro 83.0 million) and other group companies (euro 249.2 million). The residual amount relates to sureties granted on behalf of Impregilo S.p.A..

• Sureties granted to Sace for export credit of euro 56.5 million.

• Other personal guarantees of euro 176.0 million consisting of guarantees related to customs and tax obligations.

• Collateral related to:

a) liens on shares of the consortium companies Salerno Reggio Calabria S.c.p.a. and Reggio Calabria-Scilla S.c.p.a. given to guarantee a loan of euro 43.4 million;

b) lien on shares of the consortium company Passante di Mestre S.c.p.a. given to guarantee a loan of euro 21.0 million;

Commitments mainly comprise: • sales commitment for investments in consortia (euro 21.7 million);

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

10. Financial instruments and risk management

Classes of financial instruments The company’s financial instruments are broken down by class in the following table, which also shows their fair value:

31 December 2008 Note Loans and Financial assets Hedging Held-to- Available-for- Total Fair Value receivables at fair value through derivatives maturity sale financial (Euro/000) profit or loss investments assets Financial assets Non-current receivables from group companies 4 309,785 309,785 309,785 Trade receivables 6.4 200,412 200,412 200,412 Current receivables from group companies 6.4 612,653 612,653 612,653 Other current financial assets 8.1 4,820 4,820 4,820 284 Derivatives 8.5 4,152 4,152 4,152 Cash and cash equivalents 8.2 128,692 128,692 128,692 Total financial assets 1,251,542 4,152 4,820 1,260,514 1,260,514

31 December 2008 Other liabilities to Financial liabilities amortized cost at fair value through Hedging Total Fair Value (Euro/000) profit or loss derivatives Financial liabilities Bank and other loans 8.3 559,780 559,780 555,345 Other financial liabilities 8.6 51,208 51,208 51,208 Derivatives 8.5 41 1,582 1,623 1,623 Trade payables 6.5 63,717 63,717 63,717 Current payables to group companies 6.5 340,863 340,863 340,863 Total financial liabilities 1,015,568 41 1,582 1,017,191 1,012,756 31 December 2007 Note Loans and Financial assets Hedging Held-to- Available-for- Total Fair Value receivables at fair value through derivatives maturity sale financial (Euro/000) profit or loss investments assets Financial assets Non-current receivables from group companies 4 357,186 357,186 357,186 Trade receivables 6.4 167,848 167,848 167,848 Current receivables from group companies 6.4 580,607 580,607 580,607 Other current financial assets 8.1 147 147 147 Derivatives 8.5 2,200 2,200 2,200 Cash and cash equivalents 8.2 233,446 233,446 233,446 Total financial assets 1,339,087 2,200 147 1,341,434 1,341,434

285

31 December 2007 Other liabilities to Financial liabilities amortized cost at fair value through Hedging Total Fair Value (Euro/000) profit or loss derivatives Financial liabilities Bank and other loans 8.3 633,278 633,278 633,491 Derivatives 8.5 121 121 121 Trade payables 6.5 69,989 69,989 69,989 Current payables to group companies 6.5 309,062 309,062 309,062 Total financial liabilities 1,012,329 121 1,012,450 1,012,663

The note column gives the section in which the relevant item is described.

Reference should be made to the section on accounting policies for information on the fair value measurement of these items. Specifically, the fair value of the above items is based on the present value of forecast future cash flows.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Risk management Impregilo is exposed to financial risks, including the following: • market risk deriving from the company’s exposure to interest rate fluctuations and exchange rate fluctuations; • credit risk deriving from the company’s exposure to potential losses arising from the customers’ non-compliance with their obligations; • liquidity risk deriving from the risk that the financial resources necessary to meet obligations may not be available at the agreed terms and deadlines.

Currency risk

286 Impregilo’s international presence entails its exposure to the risk of fluctuations in exchange rates of the Euro and the currencies of the various countries in which it operates. Currency risk at 31 December 2008 mainly related to the following currencies: • Dollar (United States) • Real (Brazil) • Krona (Iceland) • Peso (Argentina) • Peso (Santo Domingo) • Bolivar (Venezuela) The company’s currency risk management strategy is essentially based on the following policies: • agreement of contractual considerations for works and projects in countries with weak currencies using a primarily multi-currency format, in which only a portion of the consideration is expressed in local currency; • use of portions of the contractual considerations in local currency mainly to cover project expenses to be incurred in that currency; • analysis of exposure in US dollars on a cumulative and prospective basis with consistent deadlines and setting up forward transactions in the same currency to hedge the company’s net exposure at those deadlines. Adoption of the above-mentioned policies has contained the company’s exposure to currency risk, which only relates to the USD and VEB. Had the Euro appreciated or depreciated by 5% against the USD at year end, the profit for the year would have been respectively lower or greater by euro 1.5 million, assuming that all other variables remained constant, mainly due to exchange rate losses (gains) arising from the adjustment of net assets in USD. A similar change at the end of the previous year would have led to a euro 0.2 million decrease (increase in the case of depreciation) in the loss for the year. Had the Euro appreciated or depreciated by 5% against the VEB at year end, the profit for the year would have been respectively lower or greater by euro 2.7 million, assuming that all other variables remained constant, mainly due to exchange rate losses (gains) arising from the adjustment of net assets in VEB. A similar change at the end of the previous year would have led to a euro 0.9 million decrease (increase in the case of depreciation) in the loss for the year.

Interest rate risk Impregilo has adopted a combined strategy of streamlining group operations by disposing of non-strategic assets, containing debt and hedging interest rate risks on a portion of the medium/long-term structured loans through interest rate swaps (IRSs). The financial risks arising from market interest rate fluctuations to which the company is potentially exposed and which are monitored by the relevant company personnel relate to medium/long-term financial payables bearing variable rates. Such risk is mitigated by interest accrued on short-term investments of liquidity available at the Italian-based consortia and consortium companies and foreign subsidiaries, which are used to support the company’s operations. Had interest rates increased (or decreased) by 50 basic points at year end, the profit for the year would have been respectively greater or lower by euro 1.0 million and equity would have been respectively greater or lower by euro 1.6 million, assuming that all other variables remained constant. A similar change at the end of the previous year would have led to a euro 1.4 million increase (or decrease of euro 1,6 million) in equity, assuming that all other variables remained constant. 287

Credit risk The credit risk is that deriving from the company’s exposure to potential losses arising from the customers’ (which are mostly governments or state bodies) non-compliance with their obligations. Management of this risk is complex, starting as early as the assessment of offers, through a careful analysis of the characteristics of the countries in which the company’s activities should be carried out and the customers requesting an offer, which are usually state or similar bodies. Therefore, this risk can be essentially assimilated to country risk. An analysis of this risk based on the age of the outstanding amounts is not very meaningful, since the receivables should be assessed together with the related working capital items, especially those reflecting the net exposure to customers (positive and negative work in progress, advances and payments on account) in relation to contract work in progress as a whole.

A breakdown of working capital by country, as shown in the section on segment reporting, is set out below:

(Euro/000) Working capital by country 31 December 2008 31 December 2007 Italy 72,914 (161,472) Other EU countries 240,638 362,875 Other European non-EU countries 6,741 (40,467) Central and South America 184,150 209,408 Other and eliminations 18,692 (23,306) Total 523,135 347,038

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Impregilo’s exposure to customers, broken down by contract location, is analysed below:

Exposure to customers by country Receivables Positive WIP Negative WIP Total (Euro/000) and advances 31 December 2008 Italy 10,953 182,054 (140,640) 52,367 Other EU countries 2,647 - - 2,647 Other European non-EU countries 4,096 - - 4,096 Central and South America 182,716 134,147 (60,313) 256,550 Other and eliminations - - - - Total 200,412 316,201 (200,953) 315,660 31 December 2007 Italy 4,048 161,313 (209,851) (44,490) Other EU countries 176 - - 176 Other European non-EU countries 21,432 32,173 - 53,605 288 Central and South America 137,570 45,910 (54,131) 129,349 Other and eliminations 4,622 - - 4,622 Total 167,848 239,396 (263,982) 143,262

Liquidity risk Liquidity risk derives from the risk that the financial resources necessary to meet obligations may not be available to the company at the agreed terms and deadlines. The company’s strategy aims at ensuring that each ongoing contract is financially independent. This strategy is strictly monitored centrally. A breakdown of financial liabilities by due date (based on undiscounted future cash flows) is set out below:

(Euro/000) 31-12-2009 31-12-2010 31-12-2013 After Total Current account facilities 134,303 134,303 Bank and other loans 243,057 117,833 82,247 765 443,902 Other financial liabilities 51,208 51,208 Finance lease payables 24 24 Derivatives 1,623 1,623 Gross financial liabilities 430,215 117,833 82,247 765 631,060 Trade payables 63,717 63,717 Total payables 493,932 117,833 82,247 765 694,777

Future interest has been estimated based on the market interest rates at the date of preparation of these financial statements summarised in the notes. The prior year figures are given below for comparative purposes:

(Euro/000) 31-12-2008 31-12-2010 31-12-2012 After Total Current account facilities 65,002 - 65,002 Bank and other loans 344,172 197,012 56,497 - 597,681 Finance lease payables 445 24 469 Derivatives 121 121 Gross financial liabilities 409,740 197,036 56,497 - 663,273 Trade payables 69,989 - 69,989 Total payables 479,729 197,036 56,497 - 733,262

Liquidity risk management is mainly based on containing debt and maintaining a balanced financial position.

Financial and trade payables (net of advances to suppliers) falling due before 31 March 2009 are compared with the cash and cash equivalents that can be used to meet such obligations in the table below. 289

(Euro/000) Total current financial commitments 306,774 Due before 31 March 2009 245,628 Cash and cash equivalents 128,692 Difference 116,936

The difference shown above is the “worse case scenario” occurring should all short-term credit lines without due dates be requested for repayment by lenders. In this respect: • at the date of preparation of these financial statements, the company has received no requests for early termination or immediate repayment of the above credit lines, nor are such requests expected in the next few months; • current financial receivables due from certain subsidiaries, consortia and joint ventures are adequately supported by their cash and cash equivalents, which have no particular restrictions and are readily collectible.

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Income Statement

11. Revenue Revenue for 2008 amounts to euro 1,667.0 million, up euro 195.7 million on the previous year:

(Euro/000) 2008 2007 Change Change % Revenue - goods and services 1,368,563 364,300 1,004,263 275.7% Change in work in progress, semi-finished products, finished products and real estate projects (25) (2,400) 2,375 (99.0%) Change in contract work in progress 248,635 1,067,156 (818,521) (76.7%) Other revenue and income 49,804 42,264 7,540 17.8% Total 1,666,977 1,471,320 195,657 13.3%

The 13.3% increase on 2007 is due to works on large contracts, mainly abroad (railway works in Venezuela and Greece) and the completion 290 of other contracts, such as the hydroelectric plant in Iceland and other works in Italy. Revenue - goods and services includes contractual revenue, deriving from production carried out during the year, measured using the cost to cost method, and the invoicing of services provided to group companies. It may be analysed as follows:

(Euro/000) 2008 2007 Change Change % Work invoiced to customers 977,303 134,608 842,695 626.0% Services 44,088 38,731 5,357 13.8% Gains on real estate projects 103 2,254 (2,151) (95.4%) Sales of materials 4,815 10,717 (5,902) (55.1%) Allocation of revenue from group companies 342,254 177,990 164,264 92.3% Total 1,368,563 364,300 1,004,263 275.7%

The increase in work invoiced to customers is due to the delivery of the works in Iceland (euro 752.0 million). “Allocation of revenue from group companies” relates to the portion of revenue earned by joint ventures pertaining to Impregilo. This caption relates to the Tunnel Alp Transit (T.A.T.) contract (euro 30.0 million), Costructora Mazar (euro 61.5 million), the Venezuelan joint ventures (euro 146.5 million), the Greek contracts (euro 46.7 million), the new Brazilian contracts (euro 41.4 million), the Vegas Tunnel (euro 9.8 million) and other minor contracts (euro 6.0 million). The increase is mainly due to Consorzio OIV Tocoma in Venezuela, the Brazilian contracts (Rio Tocantis and Serra do Mar) and the Vegas Tunnel contract. Work had not started on the latter contracts in 2007. Services mainly relate to sponsorship fees and services provided to group companies. Reference should be made to the note on work in progress for a breakdown of contract work in progress and related changes during the year. A breakdown of other revenue is given in the following table:

(Euro/000) 2008 2007 Change Change % Cost recoveries 22,245 17,178 5,067 29.5% Rent and leases 736 3,079 (2,343) (76.1%) Gains on the sale of property, plant and equipment 4,373 7,544 (3,171) (42.0%) Prior year income 15,465 14,112 1,353 9.6% Utilisations of provisions for risks - 292 (292) (100.0%) Other 6,985 59 6,926 1,1739.0% Total 49,804 42,264 7,540 17.8%

Cost recoveries relate to the portion of costs (insurance, technical and administrative services and sponsorship fees) incurred by the company on behalf of other group companies. The balance is in line with the previous year.

Prior year income of euro 15.5 million includes euro 9.7 million relating to the Icelandic branch for the settlement of the claim with the 291 Icelandic tax authorities and euro 5.0 million to the headquarters for the settlement of claims with suppliers.

“Other” relates to compensation and recognition of costs following the winding up of a joint venture in Brazil.

12. Costs

12.1 Raw materials and consumables The cost of raw materials and consumables incurred in 2008 decreased by euro 17.1 million to euro 41.0 million compared to the corresponding figure of the previous year:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Purchases of raw materials and consumables 39,192 2.4% 58,206 4.0% (19,014) Change in raw materials and consumables 1,826 0.1% (137) - 1,963 Total 41,018 2.5% 58,069 4.0% (17,051)

12.2 Subcontracts Costs of subcontracts increased to euro 49.3 million, up euro 6.6 million on the corresponding figure of the previous year. The increase is mainly due to the rise for the contracts of the Venezuelan branch (euro 7.2 million), the decrease related to the Icelandic branch, the contract of which is nearing completion (euro 3.9 million) and the direct contracts (euro 2.5 million).

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

12.3 Other operating expenses Other operating expenses totalled euro 1,302.3 million in 2008, up euro 146.1 million on 2007, mainly due to the rise in other operating costs.

This item is made up as follows:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Consultancy and technical services 55,071 3.3% 56,832 3.9% (1,761) Fees to directors, statutory auditors and independent auditors 2,728 0.2% 5,822 0.4% (3,094) Maintenance 2,189 0.1% 1,671 0.1% 518 Transportation and freight 13,159 0.8% 10,163 0.7% 2,996 Insurance 8,245 0.5% 4,975 0.3% 3,270 Recharges and allocation of costs from consortia and joint ventures 1,172,811 70.4% 1,020,183 69.3% 152,628 Rent and leases 13,487 0.8% 21,756 1.5% (8,269) Other operating expenses 28,597 1.7% 28,070 1.9% 527 Prior year expense 3,820 0.2% 4,881 0.3% (1,061) 292 Losses 2,214 0.1% 1,902 0.1% 312 Total 1,302,321 78.1% 1,156,255 78.6% 146,066

The difference in “Other operating expenses” is mainly due to the rise in costs allocated to consortia and joint ventures. This rise is principally attributable to Consorzio OIV Tocoma in Venezuela and the Brazilian contracts (Rio Tocantis and Serra do Mar) and the Vegas Tunnel contract. Work on the latter contracts had not started in 2007.

“Consultancy and technical services” mainly consist of costs for the design and construction work carried out by the special purpose entities. These costs are broken down in the following table:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Design and engineering services 46,868 2.8% 43,034 2.9% 3,834 Testing - - 111 - (111) Construction 101 - 427 - (326) Legal, administrative and other services 8,102 0.5% 13,260 0.9% (5,158) Total 55,071 3.3% 56,832 3.9% (1,761)

2008 directors’ and statutory auditors’ fees, as approved by the shareholders and board of directors, totalled euro 3,441.4 thousand and euro 193.3 thousand, respectively.

Key managers received total remuneration of euro 2,761.1 thousand. The following table shows the fees paid to the directors, statutory auditors and key managers during 2008:

Fees paid to directors, statutory auditors and key managers (Consob resolution no. 11971 of 14 May 1999, article 78)

Name Position Term of Fees for Fees for Other Fees for Total Payment of office office duties as per fees positions previous years' art. 2389.3c held in fees as per of the Italian subsidiaries point 3 article Civil Code 2389 of the italian (Euro) civil code Ponzellini Massimo Chairman (*) 34,734.09 929,025.00 963,759.09 Castellucci Giovanni Deputy chairman (*) 46,497.26 50,000.00 96,497.26 Talarico Antonio Deputy chairman (*) 53,997.26 50,000.00 103,997.26 Rubegni Alberto CEO (*) 54,497.26 1,254,342.46 521,370.95 (**) 1,830,210.67 Buora Carlo Director (*) 23,892.56 23,892.56 Cavanenghi Alfredo Director (*) 51,677.64 51,677.64 Cominelli Claudio Director (*) 33,234.09 33,234.09 293 Fallica Nicola Director (*) 42,452.93 42,452.93 Gardelli Andrea Director 7.5.2008 8,743.17 8,743.17 Gavio Beniamino Director (*) 51,497.26 51,497.26 Gavio Marcello Director (*) 27,748.63 27,748.63 Guenzi Giancarlo Director (*) 25,248.63 25,248.63 Maresca Maurizio Director (*) 47,188.39 47,188.39 Novarese Andrea Director (*) 54,497.26 54,497.26 Piaggio Giuseppe Director (*) 51,997.26 51,997.26 Sacchi Alberto Director (*) 28,748.63 28,748.63 Levi Giuseppe Chairman of board of statutory auditors (*) 50,375.71 50,375.71 Ascoli Roberto Chairman of board of statutory auditors 7.5.2008 27,092.82 9,554.12 36,646.94 Oldoini Giorgio Statutory auditor (*) 51,645.69 51,645.69 Trotter Alessandro Statutory auditor (*) 33,583.81 33,583.81 Amadio Vittorio Statutory auditor 7.5.2008 18,061.88 2,995.23 21,057.11 Directors 636,652.32 2,283,367.46 521,370.95 3,441,390.73 Statutory auditors 180,759.91 12,549.35 193,309.26 TOTAL 817,412.23 2,283,367.46 521,370.95 12,549.35 3,634,699.99

Key managers 2,761,130.30

(*) In office until approval of the financial statements at 31 December 2010 as per shareholders' resolution of 7 May 2008 (**) Employee salary

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

Fees to the independent auditors, PricewaterhouseCoopers S.p.A., and other companies of its network for 2008 are detailed as follows:

Fees

(Euro/000) Audit Impregilo S.p.A. 648 Audit Subsidiaries 748 Total audit 1,396

Tax assistance Impregilo S.p.A. 29 Tax assistance Subsidiaries 180 Total tax assistance 209

Other services Other services Impregilo S.p.A. 20 Other services Subsidiaries 25 294 Total other services 45 Total 1,650

12.4 Personnel expenses Personnel expenses for 2008 amount to euro 120.5 million, down by euro 11.4 million on 2007. The item is made up as follows:

(Euro/000) 2008 % of revenue 2007 % of revenue Change Wages and salaries 73,303 4.4% 87,465 5.9% (14,162) Social security and pension charges 16,670 1.0% 19,024 1.3% (2,354) Accrual to post-employment benefits 9,912 0.6% 5,593 0.4% 4,319 Other personnel expenses 20,590 1.2% 19,761 1.3% 829 Total 120,475 7.2% 131,843 9.0% (11,368)

Other personnel expenses principally relate to repayments of travel expenses.

The following table shows the workforce at year end and the related average number:

31 December 2008 nr. head Headquarters Italy Abroad Total Average Managers 73 18 35 126 124 Junior managers 64 7 38 109 104 White collars 160 25 574 759 966 Blue collars 3 47 1.466 1.516 1.877 Total 300 97 2.113 2.510 3.071 12.5 Amortisation, depreciation, provisions and impairment losses This item of euro 15.0 million shows a decrease on the previous year figure of euro 55.0 million. It may be analysed as follows.

(Euro/000) 2008 % of revenue 2007 % of revenue Change Accrual to the provision for bad debts 27 - 1,278 0.1% (1,251) Accrual to the provision for risks 1,049 0.1% 56,257 3.8% (55,208) Impairment losses 5,882 0.4% - - 5,882 Release of excess provisions (11,030) (0.7%) (24,870) (1.7%) 13,840 Total provisions and impairment losses (4,072) (0.2%) 32,665 2.2% (36,737) Amortisation 2,818 0.2% 4,649 0.3% (1,831) Depreciation 16,284 1.0% 17,642 1.2% (1,358) Total amortisation and depreciation 19,102 1.1% 22,291 1.5% (3,189) Total 15,030 0.9% 54,956 3.7% (39,926)

The previous year balance included a non-recurring euro 50 million accrual made for risks related to the ongoing prosecution for the USW 295 Campania projects.

Impairment losses mainly relate to the assets of the Icelandic branch, whose contract is being finalised, for which the company does not deem it will recover their carrying amount.

The release of excess provisions principally referred to the cost of closing the Pakistani branch, which had already been provided for (euro 4.2 million), tax expenses provided for the claim with the Icelandic tax authorities (euro 2.5 million) and other settled disputes for which an excess euro 4.3 million had been accrued.

13. Financing income (costs) and gains (losses) on investments Financing income (costs) and gains (losses) on investments came to a positive euro 7.1 million compared to a positive euro 7.6 million for 2007.

(Euro/000) 2008 2007 Change Net financing income 10,065 36,267 (26,202) Net losses on investments (2,917) (28,660) 25,743 Total 7,148 7,607 (459)

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

13.1 Net financing income Net financing income decreased to euro 10.1 million from euro 36.3 million in 2007 as follows:

(Euro/000) 2008 2007 Change Bank interest income 6,443 9,055 (2,612) Interest on financial receivables 44,054 49,863 (5,809) Bank interest expense (58,127) (43,544) (14,583) Interest on other financial payables (12,314) (17,588) 5,274 Interest on leases (9) (137) 128 Bank charges and commissions (481) (657) 176 Commissions on sureties 5 (194) 199 Interest on tax assets 3,187 1,950 1,237 Detault interest, net 270 944 (674) Financial discounts and allowances 378 94 284 Impairment losses on financial receivables (14) (2,248) 2,234 296 Other financial income 8 1,633 (1,625) Other financial expense (275) (50) (225) Gains on the sale of securities 37,890 29,801 8,089 Fair value gains on financial instruments 4,233 - 4,233 Realised exchange rate gains (losses) (14,475) 9,437 (23,912) Unrealised exchange rate losses, net (708) (2,092) 1,384 Total 10,065 36,267 (26,202)

• Total net financial expense increased by euro 17.6 million, mainly due to the payables in Venezuela where interest rates rose significantly. This effect was worsened by an increase in the parent’s short-term exposure due to temporary delays in payments of progress billings by state-owned customers, for works duly approved. These delays started to be recovered in the last few months of 2008 and this trend has continued in early 2009.

• Gains on the sale of securities increased by euro 8.1 million. These gains were realised on payments made by customers in currencies other than those contractually provided for in 2007, whereas in 2008, they were realised by directly financing operations using the company’s own funds. It took advantage of the currency mismatches of money markets for certain South American currencies whose official exchange rates with some strong currencies, including the US dollar, are fixed artificially.

• Net exchange rate losses, including fair value losses on financial instruments, amounted to euro 11.0 million compared to net gains of euro 7.3 million for 2007, a negative net difference of euro 18.3 million due to the following situations.

- Net losses of euro 10.1 million in conjunction with the parent’s operations in Venezuela. This was basically due to the local customers’ failure to exercise their right to pay for work in US dollars, as contractually provided for and in their favour, but in the local contractual currency (Bolivar). They had continuously availed of this option in previous years for almost all contractual components expressed in the local currency and the related receivables were assessed on this basis at the end of the previous year. - Net losses of euro 0.9 million on weak and/or limited circulation currencies, such as those for Iceland and Brazil. Hedges cannot be agreed for such exchange rate risks at reasonable conditions

13.2 Gains (losses) on investments Net losses on investments in 2008 decreased by euro 25.7 million to euro 2.9 million as follows:

(Euro/000) 2008 2007 Change Profit or loss on investments (2,921) (38,773) 35,852 Dividends 4 2,550 (2,546) Gains on the sale of investments - 7,307 (7,307) Impairment losses on financial receivables - 256 (256) Total (2,917) (28,660) 25,743 297

With respect to gains (losses) on investments, the company recorded a net loss of euro 2.9 million (euro 28.7 million), affected by the euro 8.1 million loss arising from the impairment losses on its investments in FIBE and FIBE Campania at the end of the year to reflect their losses incurred for the USW Campania projects. This loss was partly covered (euro 6.7 million) by the release of the provision for risks on investments set up before 2006 for the Nigerian subsidiary Impresit Bakolori P.l.c.. Following the significant worsening in the general stability in that area, the conditions for the exercise of strategic and management control by the company ceased to exist. The provision had been set up to provide for the contingent liabilities of restructuring the subsidiary’s operations, which never took place due to the changed situation. The company had already fully impaired its receivables from Impresit Bakolori in previous years. Therefore, it did not have any specific risk positions with it at year end.

14. Income tax expense The company’s income tax expense for the year is euro 62.9 million as follows:

(Euro/000) 2008 2007 Change Current taxes 55,113 33,035 22,078 Net deferred tax expense 10,003 12,434 (2,431) Prior year taxes (5,742) (12,395) 6,653 Total 59,374 33,074 26,300 IRAP 3,599 3,912 (313) Total 62,973 36,986 25,987

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

An analysis and reconciliation of the theoretical income tax rate, calculated under Italian tax legislation, and the effective tax rate are set out below:

Income tax expense (Euro/m) % Profit before tax 146.0 Theoretical tax expense 40.1 27.5% Tax effect of permanent differences 4.1 2.8% Irrecoverable taxes paid abroad 13.8 9.5% Other 7.1 4.9% Prior year taxes (5.7) (3.9%) Total 59.4 40.7%

The tax expense for the year is greater than the theoretical amount and is affected by the temporary non-recovery in Italy of taxes paid abroad under the law of the countries in which the company operates. This is mainly due to the mismatch between the taxable profit earned 298 abroad and, in particular, that earned in Italy, which the company calculates, together with those of its Italian subsidiaries (the “national consolidation tax system”). In 2008, the IRES tax base is negative and, therefore, foreign taxes cannot be recovered. However their future recovery is still possible in accordance with current tax legislation. The following table shows the reconciliation of the theoretical IRAP tax rate and the effective tax rate:

IRAP (Euro/m) % Operating profit 138.7 Personnel expenses 120.4 Net operating profit 259.1 Theoretical tax expense 10.1 3.9% Tax effect of foreign production (5.6) (2.2%) Tax effect of permanent differences (0.9) 0.3% Total 3.6 1.4%

The net deferred tax expense contributes negatively to the company’s profit for euro 10.0 million, specifically for the following items:

(Euro/m) Deferred tax expense for the year 4.5 Reversal of deferred tax liabilities recognised in previous years (0.4) Deferred tax income for the year (1.5) Reversal of deferred tax income recognised in previous years 7.4 Total 10.0 Changes in deferred tax assets and liabilities and the related impact on profit or loss are set out below:

(Euro/000) 31 December Accruals Utilisations Reclassifications 31 December 2007 2008 Deferred tax assets: Amortisation and depreciation exceeding tax rates 2,440 - - - 2,440 Provisions for risks and impairment losses 31,028 1,543 (4,483) - 28,088 2005 share capital increase related charges 5,228 - (2,084) - 3,144 Other 858 - (847) 11 Total 39,554 1,543 (7,414) 33,683 Offsetting (6,874) - - (4,132) (11,006) (a) Net deferred tax assets 32,680 1,543 (7,414) (4,132) 22,677 Deferred tax liabilities: Unrecognised fiscally-driven amortisation and depreciation (4,231) - - - (4,231) Other (2,643) (4,510) 378 - (6,775) 299 Total (6,874) (4,510) 378 - (11,006) Offsetting 6,874 - - 4,132 11,006 (b) Net deferred tax liabilities - (4,510) 378 - - (a)+(b) Net deferred tax expense (2,967) (7,036) (10,003)

15. Related party transactions With reference to related party transactions affecting the income statement of Impregilo S.p.A. and the disclosure required by Consob communication no. 15519 of 27 July 2006, we note that company’s production is carried out mainly through special purpose entities (consortia and joint ventures). Since these companies operate on the basis of the reallocation of costs and revenue, they can be considered to be “transparent” with their investors, which take on the main obligations to their customers and suppliers. Therefore, revenue and costs reallocated by the special purpose entities have been considered similar to those from/to third parties and, hence, not classified as related party transactions.

The key related party transactions, as defined by IAS 24 and group policies, carried out in 2008 are summarised below:

(amounts in Euros for Impregilo) 31 December 2008 Related party Receivables Payables Revenue Costs Financial Cash flows income for the year (expense) Impresa Grassetto S.p.A. - 17,666,518 - - - - Total 17,666,518

2008 Annual Report IMPREGILO Separate financial statements of Impregilo S.p.A. as at and for the year ended 31 December 2008

The above transactions are governed by specific agreements and carried out on an arm’s length basis. Their effects on the balance sheet and income statement are shown together with the related contract. Their impact on the company’s financial position and results of operations is summarised in the above table. Such payable is due to Impresa Grassetto S.p.A. following the acquisition of the high speed/capacity business units of Cociv. Reference should be made to the annex “Intragroup transactions” to these notes and these notes for further details on intragroup transactions.

16. Significant non-recurring events and transactions No significant non-recurring events or transactions took place in 2008.

17. Balances or transactions arising from atypical and/or unusual transactions Impregilo did not carry out any atypical and/or unusual transactions, as defined in the Consob communication no. DEM/60642932(3) during the year. 300

On behalf of the board of directors Chairman (signed on the original)

3) Atypical and/or unusual transactions are those that, due to their significance and relevance, the counterparty, the object of the transaction, exchange pricing and timing, may cast doubts as to the accuracy and completeness of disclosures, conflict of interest, protection of the group’s assets and minority interests. SEPARATE FINANCIAL STATEMENTS 301 OF IMPREGILO S.p.A. INTRAGROUP TRANSACTIONS

2008 Annual Report IMPREGILO Intragroup transactions

SEPARATE FINANCIAL STATEMENTS OF IMPREGILO S.p.A. INTRAGROUP TRANSACTIONS - 31 DECEMBER 2008

RECEIVABLES

(Euro) trade financial other Total receivables trade Other CONCESSIONS 28094 - Pedemontana Veneta S.p.A. 121 121 Total concessions 121 121

CONSTRUCTION 00051 - Consorcio Acueducto Oriental 56,428 4,153,899 3,258,000 7,468,327 00153 - Joint Venture Aktor Ate - Impregilo S.p.A. 471,288 471,288 00156 - Joint Venture Aktor S.A. - Impregilo S.p.A. 01416 - Autostrada Estense S.c.p.a. (101,587) 04028 - Consorzio Camaiore Impianti 269,896 269,896 (120,988) 04119 - Consorzio Caserma Donati 1,818,578 1,818,578 (535,228) 04147 - Consorzio Alta V. Bo/Fi - C.A.V.E.T. 110,188,570 110,188,570 (67,510,529) 302 04148 - Consorzio Alta V. Torino/Milano - C.A.V.TO.MI. 309,394,438 309,394,438 (119,112,522) 04166 - Consorzio CCTE 1,414 139,756 141,170 (26,525) 04310 - J.Cartellone C.C. S.A.-Igl S.p.A - (Casisa UTE) 214,579 3,395,106 120,396 3,730,080 (271) 04481 - Consorzio Cociv 61,376,366 61,376,366 (128,625,211) 04495 - Joint Venture Impregilo S.p.A. - S.G.F. INC S.p.A. 8,235,940 4,520,584 3,996,168 16,752,692 04501 - Impregilo SpA-Iglys SA-Hochtief AG-Hochtief UTE 375,046 375,046 04508 - Joint Venture Impregilo S.p.A. - Empedos S.A. - Ak 1,182 1,182 04513 - Consorcio Impregilo - Ingco 2,778,825 2,778,825 04521 - Consorcio Impregilo Cosapi 6,014 6,014 04689 - Consorcio Grupo Contuy-Proyectos y Ob. De F. 04691 - Consorcio Contuy Medio Grupo A 3,090,529 13,243,259 12,964,298 29,298,086 (284,286) 04694 - Consorcio Contuy Medio 4,299,030 4,299,030 04728 - Consorzio CORAV 458,841 458,841 (172,723) 04790 - Consorzio CPS Pedemontana 210,275 210,275 (123,114) 05995 - Consorcio Central Hidro. Daule Peripa Obras Civiles 4,031,766 4,031,766 08187 - E.R. Impregilo/Dumez y Asociados para Yaciretê 2,208,615 2,890,226 5,098,842 (134,874) 12064 - Grupo Empresas Italianas - GEI 2,758,328 2,758,328 12115 - Ghazi-Barotha Contractors J.V. 21,502 11,228,373 11,249,875 16555 - Impregilo - Ebasco-Losinger J.V. 42,907 42,907 16804 - Consorcio Impregilo Yarull 41,651 41,651 17258 - Consorzio Iricav Due 8,945 8,945 (5,732,075) 20109 - Line 3 Metro Stations 178,918 175,895 354,813 22188 - Constructora Mazar Impregilo-Herdoiza Crespo 1,256,680 10,566,732 11,823,412 (194,748) 22232 - Metropolitana di Napoli S.p.A. 85,245 85,245 (61,431) 22247 - M.N. 6 S.c.r.l. (26,057) 24073 - Consorzio RCPS Nuova Romea 5,834 16,903 22,738 (34,778) 24126 - Consorcio Cigla-Sade 148,076 1,078,813 1,226,889 24313 - Nathpa Jhakri J.V. 1,374,964 2,191,069 3,566,033 (7,337) DEBITI NET Revenue from Costs for Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsor-ship fees income

121 121

(1,636) (1,636) 7,466,691 212,481 471,288 44,569 8,492 (101,587) (101,587) (120,988) 148,907 (142,432) (677,660) 1,140,919 5,674 (5,005,791) (51,537) (72,567,857) 37,620,713 5,272,720 4,950,952 1,503,092 (70,880,810) (489,501) (190,482,833) 118,911,605 3,386,982 19,368,948 6,635,211 303 (26,525) 114,645 (1,220,649) (1,220,919) 2,509,160 22,963 (128,625,211) (67,248,846) (5,262,882) (5,262,882) 11,489,810 250,602 127,906 (54,716) (54,716) 320,329 1,182 (2,455,032) (2,455,032) 323,793 143,400 6,014 (1,895,868) (1,895,868) (1,895,868) (8,070) (292,356) 29,005,730 1,736,536 2,260,604 4,299,030 (172,723) 286,118 (123,114) 87,161 (4,458,187) (4,458,187) (426,421) (2,397,680) (2,532,555) 2,566,287 93,611 2,758,328 (349,601) (349,601) 10,900,274 42,907 41,651 (5,732,075) (5,723,130) (117,135) (117,135) 237,678 (13,356) (208,104) 11,615,308 859,652 (61,431) 23,814 (26,057) (26,057) (34,778) (12,040) 1,226,889 55,668 (3,058,690) (3,066,027) 500,006

2008 Annual Report IMPREGILO Intragroup transactions

RECEIVABLES

(Euro) trade financial other Total receivables trade 25880 - Consorcio OIV-TOCOMA 2,371,373 40,355,822 4,267,456 46,994,650 28027 - Consorzio Paleuropa (11,602) 32115 - Consorcio Rio Tocantinis 236 236 32127 - Riviera S.c.r.l. 32,458 32,458 (1,016,379) 34310 - Consorzio San Cristoforo 201,755 201,755 (7,082) 34340 - Sarmento S.c.r.l. 4,200 358,900 363,100 34415 - Consorzio Scilla 22,562,414 22,562,414 (32,547,981) 34493 - Consorcio Serra do Mar 1,425,684 1,425,684 34680 - S.I.MA. GEST 3 S.c.r.l. (183,720) 36090 - Consorzio TAT-Tunnel Alp Transit Ticino 82,783 301,204 383,987 36275 - Techint S.A.C.I.- Hochtief A.G.- Impregilo S.p.A 29,716 3,942,147 3,971,863 36281 - Thessaloniki Metro 119,417 119,417 36282 - Thessaloniki Metro CW 898,940 1,165,555 2,064,496 (2,406) 304 36342 - Consorzio Torre 58,249,039 58,249,039 (101,901,467) 36376 - Consorzio TRA.DE.CI.V. 1,190,157 1,190,157 (237,158) 40016 - Vegas Tunnel Constructors 551,024 551,024 40023 - Consorzio Venezia Nuova (356) 40032 - Consorzio Venice Link 7,493,305 7,493,305 (554,997) 40147 - Consorzio VIT Caroni Tocoma 10,995,116 4,919 11,000,035 (19,474) 40148 - Consorcio VIT Tocoma 9,675,609 8,371 9,683,980 (33,495) 40440 - Consorcio V.S.T. Tocoma 225,303 281,240 506,543 43295 - Yellow River Contractors J.V. 18,562 894,818 913,380 43295H - Yellow River Contractor H.O. 21,600 21,600 Total construction 594,402,882 115,502,183 47,174,202 757,079,267 (459,320,400)

IMPREPAR 22180 - Matsoku Civil Contractor (MMC) J.V. 27370 - Impregilo - Salini Joint Venture for Owen Falls 27370H - Impregilo - Salini for Owen Falls H.O. (2,335) 34937 - SO.C.E.T. Societa' Costruttori Edili Toscani (106,287) Total Imprepar (108,622) Total other 594,403,003 115,502,183 47,174,202 757,079,388 (459,429,022)

Associates CONCESSIONS 01060 - Consorcio Agua Azul S.A. 16,535 16,535 01070 - Aguas del Gran Buenos Aires S.A. 13 13 28435 - Puentes del Litoral S.A. 693 693 (693) 43290 - Yacylec S.A. 38,675 38,675 Total concessions 55,902 13 55,916 (693) DEBITI NET Revenue from Costs for Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsor-ship fees income 46,994,650 (11,602) (11,602) 236 (1,016,379) (983,921) 731 (7,082) 194,673 353,100 18,516 (32,547,981) (9,985,557) (846,786) (846,786) 578,898 (183,720) (183,720) (1,587,447) (1,587,447) (1,203,460) 80,958 3,971,863 (2,940,030) (2,940,030) (2,820,614) (2,406) 2,062,090 (101,901,467) (43,652,428) 131,523 305 (237,158) 952,999 (3,118,209) (3,118,209) (2,567,185) (356) (356) (554,997) 6,938,309 436,278 (6,343,058) (6,362,532) 4,637,503 (6,122,560) (6,156,055) 3,527,925 506,543 (175,087) (175,087) 738,293 21,600 (83,482,739) (35,514,011) (578,317,150) 315,604,918 (136,842,801) 11,995,831 27,468,261 8,143,977

(972) (972) (972) (2,716) (2,716) (2,716) (2,335) (2,335) (106,287) (106,287) (3,688) (112,310) (112,310) (83,486,427) (35,514,011) (578,429,460) 315,605,040 (136,955,111) 11,995,831 27,468,261 8,143,977

16,535 13 (10,491) (11,184) (10,491) 38,675 (10,491) (11,184) 55,222 (10,491)

2008 Annual Report IMPREGILO Intragroup transactions

RECEIVABLES

(Euro) trade financial other Total receivables trade CONSTRUCTION 00233 - Anagnina 2000 S.c.r.l. 389,450 666 390,116 00316 - Aurelia 98 S.c.r.l. 27,820 27,820 (3,419) 04233 - CE.S.I.F. S.c.p.a. (1,824) 08248 - Eurolink S.c.p.a. 3,051,440 3,051,440 (2,986,199) 16960 - Impresit Bakolori Plc 122 122 22208 - Metrogenova S.c.r.l. 248,581 248,581 (5,061,142) 28090 - Passante di Mestre S.c.p.a. 66,802,881 66,802,881 (64,086,691) 28091 - Pedelombarda S.c.p.a. 191,826 191,826 (2,432,341) 29030 - Quattro Venti S.c.r.l. 958,522 958,522 (562,757) 40012 - VE.CO. S.c.r.l. (138,527) 40035 - Versilia S.c.r.l. 40041 - Versilia Servizi S.c.a.r.l. 78,552 78,552 306 Total construction 71,721,373 28,486 71,749,860 (75,272,901)

IMPREPAR 00235 - Ancipa S.c.r.l. 791 791 12076 - Imprese Riunite Genova Seconda S.c.r.l. 772,216 772,216 40040 - Monte Vesuvio S.c.r.l. 3,600 17,713 21,313 Total Imprepar 776,607 17,713 794,321 Total associates 72,553,883 46,213 72,600,096 (75,273,594)

Subsidiaries ENGINEERING & PLANT CONSTRUCTION 10460 - Fisia Babcock Environment Gmbh 428,163 428,163 14018 - Fisia Italimpianti S.p.A. 1,368,801 1,368,801 Total engineering & plant construction 1,796,965 1,796,965

CONCESSIONS 04037 - Caminos de las Sierras S.A. 268,259 268,259 (4,234) 04528 - Impregilo New Cross Ltd 1,780,623 1,780,623 (43,217) 10300 - Fibe S.p.A. 1,413,258 1,413,258 (203,657) 10305 - Fibe Campania S.p.A. 657,900 657,900 (1,625,658) 16145 - IGLYS S.A. 19,141 9,736 28,876 (24,020) 17050 - Impregilo International Infrastructures N.V. 44,241 238,410,184 238,454,426 22189 - Mercovia S.A. 5,000 5,000 Total concessions 4,188,421 238,419,920 242,608,341 (1,900,787)

CONSTRUCTION 00312 - Auditorium Roma S.c.r.l. 69,367 69,367 (24,416) 04039 - Campione S.c.r.l. (447,997) DEBITI NET Revenue from Costs for Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsor-ship fees income

(3,615) (3,615) 386,501 (3,419) 24,401 (1,824) (1,824) (50,625,000) (53,611,199) (50,559,760) 599,637 12,215 122 1,166,729 (40,413) (5,101,554) (4,852,974) 435,558 (64,086,691) 2,716,190 1,583,085 (28,200,000) (30,632,341) (30,440,515) (562,757) 395,765 (138,527) (138,527) (37) (37) (37) 78,552 19,757 (78,828,615) (40,450) (154,141,966) 3,601,532 (85,993,637) 2,038,400 1,766,366 12,215 307

791 772,216 21,313 794,321 (78,828,615) (50,941) (154,153,150) 4,451,075 (86,004,128) 2,038,400 1,766,366 12,215

428,163 (813,215) (813,215) 555,586 387,753 129,519 (813,215) (813,215) 983,749 387,753 129,519

(4,234) 264,024 (43,217) 1,737,406 (14,051,756) (14,255,414) (12,842,156) (710,063) (2,335,721) (1,677,821) (24,020) 4,857 1,570 192 238,454,426 12,439,102 5,000 (14,761,819) (16,662,605) 240,465,712 (14,519,976) 12,440,672 192

(24,416) 44,951 (5,870) (453,867) (453,867) 3,991

2008 Annual Report IMPREGILO Intragroup transactions

RECEIVABLES

(Euro) trade financial other Total receivables trade 04135 - Castello 99 S.c.r.l. 04427 - I.L.IM. - Iniziative Lombarde Immobiliari S.r.l. 161 161 (74,805) 04529 - Impregilo Lidco General Contracting Co 856,130 856,130 04763 - Empresa Constructora Costanera Norte Ltda 32,389 1,633,274 1,665,662 (40,585) 10465 - Consorzio C.I. Cariboni per la Frana di Spriana S.c.r.l. 8,332 134,070 142,402 (9,982) 14005 - S.A. Healy Company 356,656 59,898 416,554 (4,593) 16068 - Fisia Babcock Engineering Co Ltd 596,469 596,469 (595,621) 17140 - INC - Algerie S.a.r.l. (144,981) 18009 - Collegamento Ferroviario Genova-Milano 20055 - Lavori Lingotto S.c.r.l. 878,241 473,427 1,351,668 22030 - CSC Impresa Costruzioni S.A. 141,139 141,139 (215,525) 24125 - Construtora Impregilo y Associados S.A. - CIGLA S.A. 14,654,438 14,654,438 24132 - Bocoge S.p.A. - Costruzioni Generali 15,000 2,779,897 2,794,897 308 24259 - Nuovo Dolonne S.c.r.l. (73,451) 28155 - PGH Ltd 5,941 2,912,641 2,918,582 32128 - Rivigo J.V. (Nigeria) Ltd 25,575 25,575 33001 - S. Anna Palermo S.c.r.l. 70,370 70,370 34231 - Salerno-Reggio Calabria S.c.p.a. 37,302,562 52,960 37,355,523 (93,044,460) 34233 - Reggio Calabria Scilla S.c.p.a. 1,739,343 761,123 2,500,466 (25,947,609) 34499 - S.G.F. - I.N.C. S.p.A. 41,996 22,678,672 22,720,668 (2,081,181) 34509 - S.G.F. I.N.C. S.p.A. - filiale Venezuela 2,926,219 4,129,989 7,056,208 (9,512,926) 34511 - SGF-INC filiale Islanda (5,600) 34700 - Società Industriale Prefab. Edilizia del Mediter. - SIPEM S.p.A. 2,599,724 2,599,724 35430 - Suramericana de Obras Publicas C.A 8,258 8,258 (801,872) 39960 - Val Viola S.c.r.l. 86,664 86,664 Total construction 44,408,314 49,492,625 4,129,989 98,030,927 (133,025,605)

IMPREPAR 00180 - Alia S.c.r.l. 192,493 192,493 00272 - Aquiligest S.c.r.l. 154,202 154,202 00276 - Aquilpark S.c.r.l. 427,029 427,029 02091 - BA.TA. 91 S.c.r.l. 39,727 39,727 04125 - Impresa Castelli S.r.l. 04246 - Costruzioni Ferroviarie Torinesi Duemila S.c.r.l. 81,679 2,868,576 2,950,255 04340 - INCAVE S.r.l. 472,472 472,472 04457 - CO. MAR. S.c.r.l. 27,443 27,443 04637 - Congressi 91 S.c.r.l. 04968 - CIS Divisione Prefabbricati Vibrocesa Scac - C.V.S. S.r.l. 798,849 798,849 08105 - Edilizia Militare Reggio Calabria S.c.r.l. 08265 - Eurotechno S.r.l. 19,763 19,763 16270 - Imprefeal S.p.A. 220,181 220,181 DEBITI NET Revenue from Costs for Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsor-ship fees income (4,620) (4,620) (4,620) (2,210,190) (2,284,995) (2,284,834) 5,717 (1,213,170) (1,213,170) (357,040) (1,467,665) (1,508,250) 157,412 (9,982) 132,420 6,914 (7,968) (12,562) 403,992 43,150 (595,621) 848 (144,981) (144,981) (54,360) (54,360) (54,360) 1,351,668 (1,877,093) (2,092,618) (1,951,478) 641,552 72,022 14,654,438 2,794,897 48,983 201 (63,189) (136,640) (136,640) 2,428 309 2,918,582 73,918 25,575 70,370 (93,044,460) (55,688,937) 3,454,420 52,960 (8,763,999) (34,711,608) (32,211,142) 111,989 (2,081,181) 20,639,487 1,280,008 (9,512,926) (2,456,718) (5,600) (5,600) 2,599,724 19,952 (3,708,006) (4,509,877) (4,501,620) 174,010 86,664 (17,908,465) (1,467,665) (152,401,735) 45,881,030 (100,251,839) 4,207,961 1,525,885 258,369

192,493 9,929 154,202 7,952 427,029 22,032 39,727 2,045 (12,852) (12,852) (12,852) 757 334 2,950,255 150,310 (1,005,174) (1,005,174) (532,702) 3,363 3,837 27,443 1,411 (6,804) (6,804) (6,804) 265 798,849 41,220 3,457 19,763 1,015 220,181

2008 Annual Report IMPREGILO Intragroup transactions

RECEIVABLES

(Euro) trade financial other Total receivables trade 17564 - Imprepar - Impregilo Partecipazioni S.p.A. 87,166 87,166 20000 - La Fenice S.c.r.l. 20110 - Librino S.c.r.l. 101,586 101,586 22305 - Montenero S.c.r.l. 303,124 303,124 28325 - San Martino Prefabbricati S.p.A. 29,918 29,918 33025 - S. Leonardo Due S.c.r.l. 330 330 34312 - S. Leonardo S.c.r.l. 34328 - Sviluppo Applicazioni Industriali - SAPIN S.r.l. 35228 - Stelvio 91 S.c.r.l. 36456 - Trincerone Ferroviario S.c.r.l. 2,467 2,467 40150 - Vittoria S.c.r.l. 20,810 20,810 Total Imprepar 671,235 5,176,580 5,847,815 Total subsidiaries 51,064,935 293,089,124 4,129,989 348,284,047 (134,926,392) 310 TOTAL CURRENT 718,021,821 408,637,520 51,304,191 1,177,963,532 (669,629,007)

Other CONSTRUCTION 16565 - Executive J.V. Impregilo S.p.A. Terna S.A. 3,683,076 3,683,076 20109 - Line 3 Metro Stations 1,280,000 1,280,000 36282 - Thessaloniki Metro CW 255,000 255,000 Total construction 5,218,076 5,218,076

Total other 5,218,076 5,218,076

Subsidiaries CONCESSIONS 10300 - Fibe S.p.A. 143,954,469 143,954,469 Total concessions 143,954,469 143,954,469

IMPREPAR 17564 - Imprepar - Impregilo Partecipazioni S.p.A. 160,612,244 160,612,244 Total Imprepar 160,612,244 160,612,244 Total subsidiaries 304,566,713 304,566,713

TOTAL NON-CURRENT 309,784,789 309,784,789

TOTAL 718,021,821 718,422,309 51,304,191 1,487,748,321 (669,629,007) DEBITI NET Revenue from Costs for Financial financial other Total payables RECEIVABLES PAYABLES sponsorship fees sponsor-ship fees income (2,648,482) (2,648,482) (2,561,316) 282,596 1,402 101,586 5,237 303,124 15,638 (21,957) (21,957) 7,962 846 330 343 (9,531) (9,531) (9,531) 370 (8,898) (8,898) (8,898) 345 165 2,467 122 20,810 1,069 (3,713,698) (3,713,698) 5,266,220 (3,132,104) 263,845 292,215 (37,197,197) (1,467,665) (173,591,254) 292,596,712 (117,903,919) 4,207,961 14,618,155 680,295 311 (199,512,240) (37,032,617) (906,173,864) 612,652,827 (340,863,158) 18,242,192 43,852,782 8,836,487

3,683,076 1,280,000 255,000 5,218,076

5,218,076

143,954,469 143,954,469

160,612,244 160,612,244 304,566,713

309,784,789

(199,512,240) (37,032,617) (906,173,864) 922,437,616 (340,863,158) 18,242,192 43,852,782 8,836,487

2008 Annual Report IMPREGILO

SEPARATE FINANCIAL STATEMENTS 313 OF IMPREGILO S.p.A. - EQUITY INVESTMENTS

2008 Annual Report IMPREGILO Equity investments

SEPARATE FINANCIAL STATEMENTS OF IMPREGILO S.p.A. EQUITY INVESTMENTS

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

SUBSIDIARIES - Construction segment B.B.A. S.c.r.l. (in liq.) 80 Venafro Bocoge S.p.A. - Costruzioni Generali 100 100 Milan 2,466,851 Campione S.c.r.l. (in liq.) 99.9 99.9 Milan Castello 99 S.c.r.l. 60 60 Milan 6,600 Consorcio Acueducto Oriental 67 67 Santo Domingo 314 Consorcio Central Hidroelectrica Daule Peripa Division Obras Civiles 85 90 Guayaquil Consorcio Contuy Medio Grupo A C.I. S.p.A. Ghella Sogene C.A., Otaola C.A. 36.4 36.4 Charallave 1,027 Consorcio Impregilo - Ingco 70 70 Santo Domingo Consorcio Impregilo Yarull 70 70 Santo Domingo Consorzio Alta Velocità Torino/Milano - C.A.V.TO.MI. 74.69 74.69 Milan 2,634,120 1,100,380 O Consorzio Autosilo Vico Morcote 70 Lugano Consorzio C.A.V.E.T. - Consorzio Alta Velocità Emilia/Toscana 75.98 75.98 Pianoro 3,086,675 1,033,729 O Consorzio Camaiore Impianti 55 55 Cavriago 14,203 Consorzio Caserma Donati 84.2 84.2 Milan 240,000 Consorzio CCTE (in liq.) 60 100 Milan 24,790 Consorzio Cociv 94.5 94.5 Genoa 463,646 24,406 O Consorzio Cogefar-Impresit Cariboni per la Frana di Spriana S.c.r.l. (in liq.) 100 100 Milan 46,481 Consorzio Scilla 51 51 Palmi 508 Consorzio Torre 94.6 94.6 Milan 4,730,000 Consorzio tra le Società Cogefar/Bordin/Coppetti/Icep - CORAV 96.97 96.97 Milan 49,580 Consorzio Venice Link 61 61 Venice 610 Constructora Mazar Impregilo-Herdoiza Crespo 70 70 Construtora Impregilo y Associados S.A.-CIGLA S.A. 100 100 San Paolo CSC Impresa Costruzioni S.A. 100 100 Lugano 3,208,553 Effepi - Finanza e Progetti S.r.l. (in liq.) 100 Milan Empresa Constructora Costanera Norte Ltda 77.78 77.78 Santiago 14,634 Eurolink S.c.p.a. 45 45 Rome 67,500,000 Ghazi-Barotha Contractors J.V. 57.8 57.8 Lugano I.L.IM. - Iniziative Lombarde Immobiliari S.r.l. (in liq.) 100 100 Milan 3,834,610 Impregilo Engineering CO. Ltd 100 100 Shanghai 140,000 Impregilo Lidco Libya Co 60 60 Tripoli 1,748,170 L INC - Algerie S.a.r.l. 99.97 Hassi Joint Venture Impregilo S.p.A. - S.G.F. INC. S.p.A. 99 100 Drakotrypa Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008

Euro 10,000 8,000 ------2,466,851 Euro 1,702,720 1,702,720 2,466,851 245.236 uff.12/07 Euro 11,000 10,989 ------uff.12/07 6,600 I chiusa 171,686 (3.348.579) uff.12/07 315 1,027 884,671 690.201 uff.12/07 (1,745,078) (1.450.558) uff.12/07 uff.12/07 697,605 N 3,036,895 Euro 5,000,000 3,734,500 3,036,525 (697.975) uff.12/08 ------797,368 N 3,323,036 Euro 5,422,797 4,120,241 3,322,904 (797.337) uff.12/08 14,203 Euro 25,500 14,025 14,203 uff.12/07 240,000 Euro 300,000 252,600 252,600 uff.12/08 24,790 Euro 41,315 41,315 41,317 uff.12/08 9,847 N 478,205 Euro 516,457 488,052 478,205 (9.847) uff.12/08 46,481 Euro 45,900 45,900 46,482 uff.12/08 508 Euro 1,000 510 510 uff.12/08 4,730,000 Euro 5,000,000 4,730,000 4,730,000 uff.12/08 49,580 Euro 51,129 49,580 1,152 uff.12/08 610 Euro 1,000 610 610 uff.12/08 2,665,009 1.449.998 uff.12/07 BRL 7,641,014 2,355,720 (11,624) (6.393) uff.12/05 3,208,553 CHF 2,000,000 1,346,801 16,427,538 8.770.972 uff.12/07 Euro 78,000 78,000 ------14,634 CLP 10,000,000 8,758 (1,465,127) 143.423 uff.12/07 67,500,000 Euro 150,000,000 67,500,000 67,500,000 uff.12/07

3,834,610 Euro 3,100,000 3,100,000 4,008,343 (1.621) uff.12/07 140,000 G Euro 140,000 140,000 ------1,748,170 LYD 5,000,000 1,726,579 ------DZD 57,360,000 582,784 ------

2008 Annual Report IMPREGILO Equity investments

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

Lavori Lingotto S.c.r.l. (in liq.) 100 100 Turin Nathpa Jhakri J.V. 60 60 New Delhi Nuovo Dolonne S.c.r.l. (in liq.) 100 100 Milan 50,000 Opere Speciali Passante S.c.a.r.l. (in liq.) 62 Milan OR.MA - S.c.r.l.. (in liq.) 55 Venafro Passante di Mestre S.c.p.A. 42 42 Venice 21,000,000 Pedelombarda S.c.p.a. 47 47 Milan 37,600,000 A 316 PGH Ltd 100 100 Port Harcourt Reggio Calabria - Scilla S.c.p.a. 51 51 Rome 17,850,000 Rivigo J.V. (Nigeria) Ltd 70 Port Harcourt S.A. Healy Company 100 100 Lombard 8,451,000 S.G.F. - I.N.C. S.p.A. 100 100 Milan 4,639,084 2,000,000 O Salerno-Reggio Calabria S.c.p.a. 51 51 Rome 25,500,000 Società Ind. Prefab. Edilizia del Mediterraneo - S.I.P.E.M. S.p.A. (in liq.) 100 100 Assoro Suramericana de Obras Publicas C.A.- Suropca C.A. 99 100 Caracas 3,365,395 Val Viola S.c.r.l. (in liq.) 60 60 Milan 6,143 Vegas Tunnel Constructores 40 100 Las Vegas - Engineering & Plant Construction segment Fisia Babcock Environment Gmbh 100 Gummersbach Fisia Babcock Engineering CO. Ltd 100 Shanghai Fisia Italimpianti S.p.A. 100 100 Genoa 90,977,877 Gestione Napoli S.p.A. (in liq.) 24 99 Genoa 24,000 Società Italiana per l'Ecologia Marina Castalia Ecolmar S.c.p.a. 49.9 Genoa Steinmuller International Gmbh 100 Gummersbach - FIBE Fibe Campania S.p.A. 99.973 99.994 Naples 4,609,310 E/O Fibe S.p.A. 99.989 99.998 Naples 29,000,000 E/O - Concessions segment Caminos de las Sierras S.A. 90.52 Cordoba Concessionaria Ecovia Caminho do Mar S.A. 35 Curitiba Concessionaria Ecovias dos Imigrantes S.A. 35 San Bernardo Ecopatio Logistica L.t.d.a. 35 Sao Paulo Ecosul Partipacoes L.t.d.a. 31.5 Sao Paulo ECSC Centro de Servicos Corporativos L.t.d.a. 35 Sao Paulo ECSE Centro de Servicos de Engenharia L.t.d.a. 34.97 San Bernardo Elog Participacoes L.t.d.a. 35 San Paolo Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008 Euro 25,000 25,000 (1,295,927) (15.136) uff.12/07 USD 1,000,000 431,127 50,000 Euro 50,000 50,000 50,001 uff.12/08 Euro 10,000 6,200 ------Euro 10,000 5,500 ------21,000,000 Euro 50,000,000 21,000,000 21,000,000 uff.12/08 37,600,000 Euro 80,000,000 37,600,000 ------1° es. 2008 NGN 52,000,000 269,083 (1,158,192) 2.394.261 uff.12/07 317 17,850,000 Euro 35,000,000 17,850,000 17,850,000 uff.12/07 NGN 25,000,000 90,557 ------8,451,000 USD 11,320,863 8,134,557 9,275,117 1.220.001 uff.12/07 6,639,084 Euro 3,859,680 3,859,680 3,962,503 (4.384.736) uff.12/07 25,500,000 Euro 50,000,000 25,500,000 25,500,000 uff.12/07 Euro 438,546 438,546 (89,364) uff.12/08 3,365,395 VEB 2,874,118,000 961,758,131 16,013,873 249.660 uff.12/07 6,143 Euro 10,200 6,120 632 632 uff.12/07 ------1° es. 2008

Euro 10,000,000 10,000,000 ------Euro 140,000 140,000 ------90,977,877 Euro 10,000,000 10,000,000 40,275,858 (20.458.558) uff.12/07 24,000 Euro 100,000 99,000 110,225 (48.127) uff.12/07 Euro 102,000 50,898 ------Euro 25,000 25,000 ------

4,609,310 C Euro 2,051,400 2,051,277 (3,276,578) (8.927.735) uff.12/07 29,000,000 C Euro 3,500,000 3,499,930 (24,294,559) (29.586.523) uff.12/07

ARS 120,000,000 22,609,087 ------BRL 15,600,000 1,683,315 ------BRL 302,547,396 32,646,315 ------BRL 28,954,666 3,124,347 ------BRL 48,285,560 4,689,219 ------BRL 2,794,926 301,586 ------BRL 1,000 108 ------BRL 7,900,452 852,497 ------

2008 Annual Report IMPREGILO Equity investments

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

Empr.Concessionaria de Rodovias do Sul S.A. - Ecosul 31.5 Pelotas IGLYS S.A. 100 Buemos Aires Impregilo International Infrastructures N.V. 100 100 Amsterdam 39,100,758 Impregilo New Cross Ltd 100 Abingdon Impregilo Parking Glasgow Ltd 100 Abingdon Mercovia S.A. 60 Buemos Aires Primav Ecorodovias S.A. 35 Sao Paulo 318 Rodovia Das Cataratas S.A. 35 Cittè de Cascavel Shangai Pucheng Thermal Power Energy Co. L.t.d. 50 Shanghai - Imprepar Imprepar-Impregilo Partecipazioni S.p.A. (°°°) 100 100 Milan

Total consolidated subsidiaries 299,427,145 77,115,995

UNCONSOLIDATED SUBSIDIARIES Auditorium Roma S.c.r.l. (in liq.) 60 60 Lecco 54,000 Collegamento Ferroviario Genova-Milano S.p.A. 60.4 60.4 Genoa 72,480 6,393 O Impregilo Lidco Libya Co 60 60 Tripoli 1.748.170 Impregilo Healy Joint Venture 15 100 Oregon Isibari S.c.r.l. 55 Bari S. Anna Palermo S.c.r.l. (in liq.) 71.6 71.6 Palermo 18.592 Unicatanzaro S.c.r.l. (in liq.) 56 Germaneto ASSOCIATES - Construction segment Anagnina 2000 S.c.r.l. 50 50 Milan 5.165 A.T.I. Monte Bianco S.c.r.l. (in liq.) 33.33 Rome Aurelia 98 S.c.r.l. (in liq.) 40 40 Milan 4.000 B.O.B.A.C. S.c.a.r.l. 50 Pozzuoli CE.S.I.F. S.c.p.a. 24.18 24.18 Naples 63.460 G.T.B. S.c.r.l. 24.17 24.17 Naples 12.329 Impregilo Arabia L.t.d. 50 50 Jeddah 4.164.064 A Impresit Bakolori Plc 50.71 50.71 Abuja Impretech Infraestructura S.A. (in liq.) 49 49 Mexico City 355.536 Metrogenova S.c.r.l. 35.63 35.63 Genoa 8.257 Monte Mario S.c.r.l. (in liq.) 50 Rome Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008 BRL 17,755,000 1,724,265 ------ARS 17,000,000 3,538,394 ------39,100,758 Euro 50,000,000 50,000,000 35,974,000 12.325.000 uff.12/07 GBP 2 2 ------GBP 1,000 1,050 ------ARS 10,000,000 1,248,845 ------BRL 466,699,080 50,359,070 ------BRL 41.849.000 4,515,708 ------319 CNY 200,000,000 10,531,193 ------

Euro 3,100,000 3,100,000 (178,570,561) 4.474.722 uff.12/08

35,260,730 341,282,410

54,000 Euro 90,000 54,000 59,314 2.699 uff.12/07 78,873 Euro 120,000 72,480 66,087 (6.393) uff.12/07 1.748.170 L ------Euro 15,300 8,415 ------18.592 Euro 40,800 29,213 29,583 uff.12/07 Euro 15,300 8,568 ------

5.165 Euro 10,329 5,165 5,165 uff.12/07 Euro 10,329 3,443 ------4.000 Euro 10,000 4,000 4,000 uff.12/08 Euro 10,200 5,100 ------63.460 Euro 250,000 60,450 62,695 uff.12/07 12.329 Euro 51,000 12,327 12,327 uff.12/07 4.164.064 SAR 40,000,000 3,829,195 ------1° es. 2008 NGN 100,800,000 264,507 (7,534) (1.774) uff.12/06 355.536 I PSM 10,050,000 256,040 ------chiusa 8.257 Euro 25,500 9,086 9,201 Euro 10,328 5,164 ------

2008 Annual Report IMPREGILO Equity investments

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

Proyecto La Yesca S.A.CV (in liq.) 44.2 44.2 Mexico City 1.351 A 1.351 Quattro Venti S.c.r.l. 40 40 Rome 20.658 SO.CO.TAU. S.c.r.l. (in liq.) 20.27 Guidonia Società Autostrada Broni-Mortara S.p.A. 40 40 Milan 1.000.000 A VE.CO. S.c.r.l. 25 25 Venice 2.582 Versilia S.c.r.l. (in liq.) 34 34 Carpi 3.512 Versilia Servizi S.c.a.r.l. (in liq.) 34 34 Carpi 6.800 320 - Engineering & Plant Construction segment Nautilus S.c.p.a. (in liq.) 34.41 Rome Pertusola Sud S.c.r.l. 50 Genoa Villagest S.c.r.l. (in liq.) 50 Cagliari - Concessions segment Aguas del Gran Buenos Aires S.A. (in liq.) 16.5 42.59 La Plata Aguas del Oeste S.A. 33.33 Buenos Aires Coincar S.A. 26.25 35 Buenos Aires 4.153.032 Consorcio Agua Azul S.A. 25.5 Lima Ecologia Montana S.p.A. 49 Roccavione Enecor S.A. 30 Buenos Aires Impregilo Wolverhampton Ltd 20 Abingdon Nuova Romea S.p.A. 22.28 Venice Ochre Solutions Holdings Ltd 40 Abingdon Puentes del Litoral S.A. 22 26 Buenos Aires Sistranyac S.A. 20.1 Buenos Aires Yacylec S.A. 18.67 Buenos Aires

OTHER COMPANIES - Construction segment Aegek-Impregilo-Aslom J.V. 45.8 45.8 Athens Aoet Arbeitsgemeinschaft Oenzberg Tunnel Arge 10 Herzogenbuchsee Arbeitsgemeinschaft Aschertunnel 15 Arbeitsgemeinschaft Tunnel Umfahrung Saas (ATUS) 32 Herzogenbuchsee Arbeitsgemeinschaft Tunnel Zurich - Thalwil AZT 10 Arge Haupttunnel Eyholz 36 Thun Arge Stollen Chatzuhus 40 Thun Arge Uetlibergtunnel 15 Zurich Asociacion Costanera Norte Ltda-Igl filiale Cile 77 77.78 Santiago Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008 I PSM 50.000 1,149 ------chiusa 20.658 Euro 51,000 20,400 20,658 uff.12/07 Euro 10,200 2,068 ------1.000.000 Euro 2,500,000 1,000,000 ------1° es. 2008 2.582 Euro 10,200 2,550 2,582 uff.12/99 3.512 Euro 10,200 3,468 3,512 uff.12/07 6.800 Euro 20,000 6,800 3,512 uff.12/07 321 Euro 479,880 165,127 ------Euro 10,000 5,000 ------Euro 13,944 6,972 ------

ARS 45,000,000 3,989,123 (133,932) (83.628) uff.12/07 ARS 170,000 11,793 ------4.153.032 ARS 40,465,122 2,947,855 3,363,538 196.201 uff.12/07 PEN 69,001,000 4,024,947 ------Euro 548,069 268,554 ------ARS 20,250,740 1,264,502 ------GBP 1,000 210 ------Euro 3,800,000 846,640 ------GBP 20,000 8,399 ------ARS 43,650,000 2,362,190 (3,230,224) (651.118) uff.12/07 ARS 12,040,465 503,729 ------ARS 20,000,000 777,198 ------

2008 Annual Report IMPREGILO Equity investments

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

Autostrada Estense S.c.p.a. 18 18 Carpi 180.000 C.B.N. Chiasso consorzio 34 Lugano Calpark S.p.A. 1.9 Rende CASV Consorzio Allargamento Strada Vogorno 50 Bedano CCB Consorzio Centro Balneare 40 Lugano CMC - Consorzio Monte Ceneri lotto 851 40 Lugano Churchill Construction Consortium 30 322 Churchill Hospital J.V. 50 Consorcio Cigla-Sade 50 Sonora Consorcio Contuy Medio 29.04 29.04 Caracas Consorcio Grupo Contuy-Proyectos y Obras de Ferrocarriles 33.33 33.33 Caracas Consorcio Imigrantes 50 S. Bernardo do C. Consorcio Impregilo Cosapi 55 55 Lima Consorcio Normetro 13.18 13.18 Porto Consorcio OIV-TOCOMA 20 20 Caracas Consorcio Serra do Mar 25 50 Cubatao Consorcio V.I.T. - Tocoma 35 35 Caracas Consorcio V.I.T. Caroni - Tocoma 35 35 Caracas Consorcio V.S.T. 35 Caracas Consorcio V.S.T. Tocoma 30 30 Caracas Consorzio Casale Nei 3.45 Rome Consorzio CECB 50 Lugano Consorzio CON.SI 2.27 2.27 Pordenone 516 Consorzio CPS Pedemontana Veneta Costruttori Progettisti e Servizi 35 35 Verona 35.000 Consorzio Edile Palazzo Mantegazza 45 Lugano Consorzio Felce 25 Lodrino Consorzio FLP 30 Bioggio Consorzio FLP II 33.33 Lugano Consorzio Galleria Maroggia 25 Bedano Consorzio Galleria Scaglioni CGS 50 Lugano Consorzio Generale Pozzuoli - COGEPO (in liq.) 3.61 3.61 Pozzuoli 465 Consorzio Iricav Due 12 12 Rome 61.975 Consorzio MARC - Monitoraggio Ambientale Regione Campania (in liq.) 10 Naples Consorzio Nazionale Imballaggi - CO.NA.I. 1 1 Milan 5 Consorzio Paleuropa 60 60 Milan 6.000 Consorzio RCPS Nuova Romea 30.6 30.6 Milan 6.120 Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008 180.000 Euro 1,000,000 180,000

Euro 102,000 1,938

323

Euro 22,466 775

516 Euro 22,724 516 35.000 Euro 100,000 35,000

465 Lit 383,315,532 13,837,691 61.975 Euro 510,000 61,200 Euro 25,822 2,582 5 Euro 130 1 6.000 Euro 10,000 6,000 6.120 Euro 20,000 6,120

2008 Annual Report IMPREGILO Equity investments

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

Consorzio San Cristoforo (in liq.) 48 48 Milan 24.790 Consorzio TAT-Tunnel Alp Transit Ticino, Arge 17.5 25 Aarau Consorzio TRA.DE.CI.V. 8.06 8.06 Naples 12.534 Consorzio Tre Esse 38 Torre Boldone (BG) Consorzio Trevi - S.G.F. INC per Napoli 45 Naples Consorzio Venezia Nuova 0.95 0.95 Venice 52.727 CRA Consorzio Realizzazione Arca 40 Lugano 324 CSLN Consorzio 28 Lugano E.R. Impregilo/Dumez y Asociados para Yaciretê - ERIDAY 18.75 20.75 Buenos Aires EDIL.CRO S.c.r.l. 16.65 Lamezia Emittenti Titoli S.p.A. 0.24 0.24 Milan 10,832 Executive J.V. Impregilo S.p.A. Terna S.A. - Iris S.A. (in liq.) 33.33 33.33 Athens 440,205 Fox Valley West Properties JV 50 Illinois Groupement Hydrocastoro 49.5 Touggourt Grupo Empresas Italianas - GEI 33.33 33.33 Caracas Healy-Yonkers-Atlas-Gest J.V. 45 Harrogate Hydro La Yesca S.A. (in liq.) 0.01 0.01 Mexico City I_Faber S.p.A. 8 8 Milan 583,317 Immobiliare Golf Club Castel D'Aviano S.r.l. 0.44 0.44 Aviano 62,910 Impregilo - Ebasco-Losinger J.V. 18.75 75 Mc Cook Illinois Impregilo - Rizzani de Eccher J.V. 67 67 Lugano Impregilo SpA-Iglys SA-Hochtief AG-Hochtief C-Roggio-Iecsa-Sideco-Techint, UTE 26 26 Rosario Istituto Promozionale per l'Edilizia S.p.A. - Ispredil S.p.A. 0.42 Rome J.Cartellone C.C. S.A.-Igl S.p.A.-Iglys S.A.-Codi S.A.-EC Delta S.A.- Caruso S.A.- (Casisa UTE) 29.1 39.1 Malagueno 2,516 Joint Venture Aegek-Impregilo-Ansaldo-Seli-Ansaldobreda 26.71 26.71 Moroussi Joint Venture Aktor Ate - Impregilo S.p.A. (Constantinos) 40 40 Athens Joint Venture Aktor S.A. - Impregilo S.p.A. 50 50 Athens Joint Venture Impregilo S.p.A. - Empedos S.A. - Aktor A.T.E. 66 66 Athens Joint Venture Terna - Impregilo 45 45 Athens Libyan Italian Joint Company 1.19 1.98 Tripoli 29,863 Line 3 Metro Stations 50 50 Athens M.N. 6 S.c.r.l. 1 1 Naples 510 Malpensa 2000 S.c.r.l. (in liq.) 10.21 Parma Markland S.r.l. (in liq.) 1.9 1.9 Milan 1,270 Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008 24.790 Euro 51,645 24,790

12.534 Euro 155,535 12,536 Euro 51.646 19,625 Euro 10,000 4,500 52.727 Euro 274,000 2,603

325 USD 539,400 80,424 Euro 10,200 1,698 10,832 Euro 4,264,000 10,234 440,205 GRD 450,000 145,617

DZD 2,000,000 10,062

583,317 Euro 5,652,174 452,174 62,910 Euro 3,891,720 17,124

Euro 111,045 466

2,516 ARS 10,000 814

29,863 LYD 1,442,250 16,435

510 Euro 51,000 510 Euro 10,200 1,041 1,270 Euro 66,810 1,269

2008 Annual Report IMPREGILO Equity investments

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

Metropolitana di Napoli S.p.A. 5.18 5.18 Naples 313,652 Mohale Dam Contractors (MDC) J.V. 50 50 Mohale Tunnel Contractors (MTC) J.V. 35 35 Normetro - Agrupamento Do Metropolitano Do Porto, ACE 13.18 13.18 Porto Rimini Fiera S.p.A. 2.09 2.09 Rimini 3,437,554 Riviera S.c.r.l. 10.54 10.54 Naples 5,271 A S.I.MA. GEST 3 S.c.r.l. 0.01 0.01 Zola Predosa 5 326 Sarmento S.c.r.l. 0.01 Milan Skiarea Valchiavenna S.p.A. 1.27 1.27 Campodolcino 99,740 Società di gestione SSIC-TI 5 Bellinzona Techint S.A.C.I.- Hochtief A.G.- Impregilo S.p.A.-Iglys S.A. UTE 26.25 35 Buenos Aires 3,945 Thessaloniki Metro CW J.V. 42.5 42.5 Athens Transmetro - Construcao de Metropolitano A.C.E. 5 5 Porto Wurno Construction Materials - WUCOMAT Ltd 5.07 Sokoto Yellow River Contractors J.V. 36.5 36.5 Pechino - Engineering & Plant Construction segment Consorzio Agenzia del Mare (in liq.) 25 Rome Consorzio Agrital Ricerche (in liq.) 20 Maccarese Consorzio Aree Industriali Potentine (in liq.) 2 Baraggiano S. Consorzio Macopsissa Ambiente 45.12 Cagliari Consorzio Ramsar Molentargius 5.05 Rome Consorzio Unitam (in liq.) 3.57 Naples - Concessions segment Acqua Campania S.p.A. 0.1 Naples Autopistas del Sol S.A. 19.82 Buenos Aires Consorzio Acqua Blu 16.39 19.47 Naples 40,000 Ecopatio Bracor Imigrantes Emp. Imobiliarios S.A. 17.5 San Paolo Empr. Constr. Delta S.A., Josè Cartellone Constr. Civ. S.A., Iglys S.A. U.T.E. 5 Cordoba Iglys SA-Iecsa SA-Dragados Obras y Proyectos SA-Dycasa SA, UTE 33.33 Buenos Aires Mediterranea delle Acque S.p.A. 5.11 Genoa Pedemontana Veneta S.p.A. 19 19 Verona 570,000 Servicos e Tecnologia de Pagamentos S.A. 4.46 Sao Paulo Total unconsolidated subsidiaries, associates and other companies 12,505,024 5,177,079

Total investments 311,932,169 82,293,074 Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008 313,652 Euro 3,655,397 189,350

PTE 100,000 13,180 3,437,554 Euro 42,294,067 883,946 5,271 5 Euro 50,000 5 Euro 10,200 1 327 99,740 Euro 8,118,181 103,101 CHF 1,000,000 33,670 3,945

NGN 3,300,000 866

Lit 300,000,000 75,000,000 Euro 138,405 27,681 Euro 408,000 8,160 Euro 30,987 13,981 Euro 51,646 2,608 Euro 185,640 6,627

Euro 4,950,000 4,950 ARS 175,396,394 7,235,716 40,000 I BRL 15,873,440 856,410

Euro 15,337,003 783,721 570,000 Euro 3,000,000 570,000 BRL 16,358,461 224,931 2,145,057 15,537,046

37,405,787 356,819,456

2008 Annual Report IMPREGILO Equity investments

INVESTMENTS WITH NEGATIVE CARRYING AMOUNTS

Name % held % Registered Carrying Increase no. directly investment office amount of investment 01.01.2008 (Euro)

SUBSIDIARIES Lavori Lingotto S.c.r.l. (in liq.) 100 100 (1,280,793) Campione S.c.r.l. (in liq.) 99.9 99.9 (931,066) Impresit Bakolori Plc 50.71 50.71 (6,684,137) 6,684,137 M Construtora Impregilo y Associados S.A.-CIGLA S.A. 100 100 (13,744,931) PGH Ltd 100 100 (1,779,389) Fibe Campania S.p.A. 99.973 99.994 (3,276,775) 4,609,310 C 328 Fibe S.p.A. 99.989 99.998 (24,295,045) 29,000,000 C Total subsidiaries (51,992,136) 40,293,447

ASSOCIATES Puentes del Litoral S.A. 22 26 (3,013,684) Total associates (3,013,684) Total provisions for risks (55,005,820) 40,293,447 Most recent official financial statements in Euros using closing rate at 31.12.2008 Decrease no. Carrying Currency Nominal Nominal carrying profit balance amount of value value amount (loss) sheet investment subscribed/ subscribed/ of equity 31.12.2008 paid-up paid-up share (Euro) share capital capital % of in reporting investment currency (in Euro) 31.12.2008

(1,280,793) Euro 25,000 25,000 (931,066) Euro 11,000 10,989 NGN 100,800,000 264,507 (13,744,931) BRL 7,641,014 2,355,720 (1,779,389) NGN 52,000,000 269,083 2,100,000 N (767,465) Euro 2,051,400 2,051,277 6,000,000 N (1,295,045) Euro 3,500,000 3,499,930 329 8,100,000 (19,798,689)

(3,013,684) ARS 43,650,000 (3,013,684) 8,100,000 (22,812,373)

2008 Annual Report IMPREGILO Equity investments

Summary of changes in investments

(Euro) Summary of changes: Investments Provision for risks on investments Set-up and subscription A 42,770,686 Acquisition or follow-on investment B Reclassifications C 33,609,310 33,609,310 Share capital increase D Capital injection E 6,037,490 Reclassifications F Intragroup disposals G 140,000 Disposals to third parties H Liquidation I 403,487 Reclassifications following change in investment percentage or other L 1,748,170 1,748,170 330 Reversals of impairment losses within limits of such impairment losses M 6,684,137 Impairment losses N 1,504,820 8,100,000 Recostitution of share capital to cover losses O 31,736,728 Revaluation P Merger Q Elimination following merger R Negative reclassifications S Total 82,293,074 37,405,787 40,293,447 8,100,000

(°°°) A list of Imprepar’s subsidiaries and associates is not attached as they are mostly inactive, held for sale or in liquidation. STATEMENT ON THE SEPARATE 331 FINANCIAL STATEMENTS

2008 Annual Report IMPREGILO

Statement on the consolidated financial statements pursuant to article 81-ter of Consob resolution no. 11971 of 14 May 1999 and subsequent amendments and integrations

1 Alberto Rubegni, as chief executive officer, and Rosario Fiumara, as manager in charge of financial reporting, of Impregilo S.p.A. state, considering the provisions of paragraphs 3 and 4 of article 154-bis of Legislative decree no. 58 of 24 February 1998 • the adequacy of the administrative and accounting procedures given the company’s characteristics; and • their effective application during 2008 to prepare the separate financial statements.

2 No significant issues arose.

3 Moreover, they state that

3.1 the separate financial statements: 333 a) comply with the accounting records and entries; b) have been prepared in accordance with the IFRS, published by the International Accounting Standards Board (IASB) and endorsed by the European Union, pursuant to Regulation no. 1606/2002 issued by the European Parliament and Council implemented in Italy by Legislative decree no. 38/2005, and that they are suitable to give a true and fair view of the financial position at 31 December 2008 and results of operations for the year then ended of the Issuer. 3.2 the directors’ report includes a description of the important events that took place during the year and their impact on the consolidated financial statements, together with information about the key risks and uncertainties to which the Issuer is exposed.

Sesto San Giovanni, 25 March 2009

Chief executive officer Manager in charge of Financial reporting (signed on the original) (signed on the original)

2008 Annual Report IMPREGILO

INDIPENDENT AUDITOR’S OPINIONS 335 AND REPORT OF STATUTORY AUDITORS

2008 Annual Report IMPREGILO 336 337

2008 Annual Report IMPREGILO 338 339

2008 Annual Report IMPREGILO (Translation from the Italian original which remains the definitive version)

IMPREGILO S.p.A.

Registered office in Sesto San Giovanni (MI), Viale Italia 1

Share capital euro 718,364,456.72

Tax code and Milan Company Registration no.: 00830660155

R.E.A. no. 525502 - VAT no. 02895590962

* * *

REPORT OF THE BOARD OF STATUTORY AUDITORS

ON THE CONSOLIDATED FINANCIAL STATEMENTS OF IMPREGILO S.p.A. AS

AT AND FOR THE YEAR ENDED 31 DECEMBER 2008

340

Dear shareholders,

The consolidated financial statements of Impregilo group as at and for the year ended 31 December

2008, given to us with the separate financial statements of Impregilo S.p.A., include the balance

sheet, income statement, cash flow statement, statement of changes in equity, segment reporting and

the notes thereto. They have been prepared in accordance with the International Financial Reporting

Standards (IFRS) endorsed by the European Union.

They show equity of euro 824,834 thousand, including the share attributable to minority interests

(euro 4,182 thousand) and a profit for the year of euro 167,492 thousand, net of the profit attributable

to minority interests of euro 154 thousand. Based on the information obtained from the independent auditors, PricewaterhouseCoopers S.p.A., the figures in the consolidated financial statements comply with those in the accounting records of the parent and information formally sent to it by its subsidiaries.

The independent auditors issued an unqualified report on the consolidated financial statements, stating that they are clearly stated and give a true and fair view of the group's financial position and results of operations, changes in equity and cash flows.

The report includes two emphasis of matter paragraphs, with which we agree, and which we commented on in our report on the separate financial statements of Impregilo S.p.A..

The company complied with the disclosure requirements of article 2428 of the Italian Civil Code in a single document.

The specific information about the group, as shown in the figures set out in the consolidated 341 financial statements, is given in detail in the directors' report which comments on the group companies' performance, the group's decisions and strategies.

Sesto San Giovanni, 10 April 2009

Board of Statutory Auditors

Giuseppe Levi - Chairman (signed on the original)

Giorgio Oldoini - Standing statutory auditor (signed on the original)

Alessandro Trotter - Standing statutory auditor (signed on the original)

2008 Annual Report IMPREGILO (Translation from the Italian original which remains the definitive version)

IMPREGILO S.p.A.

Registered office in Sesto San Giovanni (MI), Viale Italia 1

Share capital euro 718,364,456.72

Tax code and Milan Company Registration no.: 00830660155

R.E.A. no. 525502 - VAT no. 02895590962

* * *

REPORT OF THE BOARD OF STATUTORY AUDITORS

TO THE SHAREHOLDERS OF IMPREGILO S.p.A.

PURSUANT TO ARTICLE 153 OF LEGISLATIVE DECREE NO. 58/1998

AND PARAGRAPH 3, ARTICLE 2429 OF THE ITALIAN CIVIL CODE 342 Dear shareholders,

Pursuant to ruling legislation covering public companies listed on regulated markets and in

accordance with the Italian Civil Code requirements, we inform you that we performed the

supervisory activities based on the conduct standards recommended by the Italian Accounting

Profession (Consiglio Nazionali dei Dottori Commercialisti e Esperti contabili) during 2008.

Specifically, and considering the guidelines set out by Consob (the Italian Commission for Listed

Companies and the Stock Exchange) in its communications, we:

- took part in the meetings of the board of directors, executive committee, internal control committee

and remuneration committee;

- met with the internal control head on several occasions to exchange information about our

activities and control programmes; - performed the periodic tests;

- exchanged information with the chairpersons of the boards of statutory auditors or supervisory body members of the main subsidiaries;

- examined the audit register of the independent auditors during their audit work and met with those in charge of the audit periodically;

- monitored the events in which the parent and group were involved on an ongoing basis.

Upon conclusion of our work, we would like to draw your attention to the following:

1. Significant financial or capital transactions

The directors informed us periodically about the operations and key transactions undertaken by the company and its subsidiaries. They also described such operations and transactions in their report with details of their characteristics and effects. 343 We obtained adequate information about them in order to be in a position to ensure their compliance with the law, by-laws and correct administration standards.

2. Atypical and/or unusual transactions, intragroup transactions or related party transactions

We did not identify nor were we informed by the directors, independent auditors or internal control head about any atypical and/or unusual transactions carried out with third parties, related parties or other group companies.

3. Adequacy of information provided in the directors’ report about atypical and/or unusual transactions, intragroup transactions or related party transactions.

The directors described the day-to-day transactions carried out during the year with group companies and related parties in the notes to the separate financial statements to which reference should be made, also for details about their characteristics and financial effects. We checked the

2008 Annual Report IMPREGILO existence of and compliance with procedures aimed at ensuring that these transactions were carried

out in line with suitable conditions and in the interests of the company.

4. Comments on and proposals about the findings and disclosures in the independent

auditors’ report

The independent auditors issued an unqualified report on the separate financial statements. They

stated that the financial statements comply with the regulations governing their preparation and

included two emphasis of matter paragraphs with which we agree. These are set out in point 21 of

this report.

5. Complaints as per article 2408 of the Italian Civil Code

No such complaints were received.

6. Communications presented 344 No communications were presented.

7. Engagement of independent auditors

We obtained evidence from the company supporting the recognition of the following fees paid to the

independent auditors and companies belonging to their network for their services provided in 2008,

as set out in the following table (in Euros):

Audit Other services Total Audit of the separate financial statements (*) 505,204 505,204 Audit of the consolidated financial statements 39,535 39,535 Review of the half year report 86,950 86,950 Quarterly checks pursuant to Legislative decree no. 58/1998 15,808 15,808 Total ordinary audit activities 647,497 647,497 Other services Audit of the financial statements of the Italian subsidiaries 539,455 539,455 Tender and other attestations 19,500 19,500 Tax services 29,354 29,354 Total other services 588,309 588,309

Total audit services 588,309 1,235,806

(*) Includes euro 126,457 related to audit services provided to foreign branches by foreign entities of the PricewaterhouseCoopers network.

The independent auditors confirmed their continued independence and objective position in respect of Impregilo S.p.A. and Impregilo group during the period in which they provided their services.

8. Assignment of other engagements to parties linked to the independent auditors 345 We noted that the company also recorded the following additional fees paid to companies or professional firms part of the international PricewaterhouseCoopers network for the following engagements (in Euros):

Company / Tax and legal firm of the international network Service provided Amount

PricewaterhouseCoopers network Audit services for foreign group companies 208,718

PricewaterhouseCoopers network Other attestation, administrative and tax advisory services 204,979

Total 413,697

2008 Annual Report IMPREGILO 9. Legally-required opinions

Opinions pursuant to article 2389 of the Italian Civil Code were expressed during the year.

10. Frequency of attendance at company body meetings

We took part in nine meetings of the board of directors, six of the executive committee and held

seven board of statutory auditors’ meetings.

11. Independence requirements of the directors and statutory auditors

We checked the correct application of the criteria and procedures used by the board of directors to

assess the independence of its members.

We verified that all the statutory auditors continued to meet the independence criteria established by

the Code of Conduct throughout 2008.

12. Compliance with correct administration standards 346 We have no comments to make about compliance with such standards based on our work.

13. Adequacy of the organisational structure

We believe that the company’s organisational structure is adequate given its size and type of

activities.

14. Adequacy of the internal control system

We supervised, tested and checked the adequacy of the internal control system. Specifically:

a. we regularly obtained information about the operations carried out during the meetings of the

internal control committee, through meetings with the internal control head and by obtaining

specific periodic documentation;

b. we were provided with the internal control head’s report which summarised his/her activities,

principally aimed at ensuring compliance with and the adequacy of the group’s internal control system. This entailed our performing tests at different internal levels at the company’s outlying and corporate offices; c. we were provided with the supervisory body’s reports required by Legislative decree no. 231/2001 which summarise its activities for the year.

To the extent of its duties, this board holds that the “Organisational, management and control model” is suitable to prevent the crimes covered by the aforesaid Legislative decree.

15. Adequacy of the administrative-accounting system and its reliability

We monitored and tested the adequacy of the administrative-accounting system and its ability to correctly show the company’s operations of the year by obtaining information from the different department heads, reviewing internal documentation and analysing the findings of the work performed by the independent auditors. 347 16. Adequacy of the instructions given to subsidiaries

We believe that the instructions issued by the company to its subsidiaries pursuant to paragraph 2, article 114 of Legislative decree no. 58/1998 are adequate to ensure compliance with the legal disclosure requirements.

17. Issues which arose during meetings with the independent auditors

No issues arose during the meetings with the independent auditors, held in accordance with article

150 of Legislative decree no. 58/1998.

18. Compliance with the Code of Conduct of the Corporate Governance Committee of Listed companies

The company has complied with this Code of Conduct.

The internal control committee met eight times while the remuneration committee held two meetings.

2008 Annual Report IMPREGILO 19. Corporate governance report

As required by the Consolidated Finance Act and article 89-bis of the Consob Issuer Regulation, the

company prepared and published the subject report and included it in the directors’ report.

20. The annex hereto sets out the list of offices held by the standing statutory auditors as required

by article 144-quinquiesdecies of Consob resolution no. 11971/99.

21 Assessment of the supervisory activities.

As noted, no reprehensible behaviour, omissions or irregularities were noted during our work that

would require communication to the supervisory bodies.

However, we note:

1. We have monitored the developments of the USW Campania project (described in detail in the

directors’ report) on an ongoing basis, also through meetings with the department heads and the 348 boards of statutory auditors of FIBE S.p.A., FIBE Campania S.p.A. and FISIA Italimpianti S.p.A..

We agree with the directors about the existence of significant, unquantifiable contingencies due to

the complexity of the issues and complex procedures in place for the recovery of the outstanding

receivables.

The directors have deemed it reasonable and prudent to maintain a provision for risks of euro 50

million and have explained the reasons therefor.

2. The directors have provided detailed information about the status of the proceedings with the

Court of Florence and events that have taken place after the reporting date in their report.

22. Proposals to the shareholders

To the extent we are concerned, nothing has come to our attention that would hinder the approval of the financial statements as at and for the year ended 31 December 2008 and we agree with the proposals made by the directors.

Sesto San Giovanni, 10 April 2009

Board of Statutory Auditors

Giuseppe Levi - Chairman (signed on the original)

Giorgio Oldoini - Standing statutory auditor (signed on the original)

Alessandro Trotter - Standing statutory auditor (signed on the original)

349

2008 Annual Report IMPREGILO List of offices held

GIUSEPPE LEVI (Chairman) LVEGPP48R03F205J Born in Milan (MI) on 3 October 1948

TAX CODE COMPANY POSITION

04844550154 Amplifin S.p.A. Chairman of board of statutory auditors 04923960159 Amplifon S.p.A. Chairman of board of statutory auditors 13196030152 Banca Esperia S.p.A. Chairman of board of statutory auditors 13413510150 BIT Systems S.p.A. Chairman of board of statutory auditors 12066470159 Borsa Italiana S.p.A. Standing statutory auditor 04289511000 Cassa di Compensazione e Garanzia S.p.A. Chairman of board of statutory auditors 08326440158 Cititrust S.p.A. Chairman of board of statutory auditors 13341260159 Duemme Hedge SGR S.p.A. Chairman of board of statutory auditors 05043020154 Duemme Servizi Fiduciari S.p.A. Chairman of board of statutory auditors 11381470159 Immobiliare Adamello S.r.l. Standing statutory auditor 05204160963 Immobiliare Milani S.r.l. Standing statutory auditor 350 08868910152 Luigi e Felice Castelli S.p.A. Chairman of board of statutory auditors 03638780159 Monte Titoli S.p.A. Standing statutory auditor 05367921003 M.T.S. S.p.A. Standing statutory auditor 00793920158 Ormic S.p.A. Chairman of board of statutory auditors 12980420157 Piazza Affari Gestioni e Servizi S.p.A. Chairman of board of statutory auditors 00893220152 Selex Italia S.p.A. Standing statutory auditor 06722790018 Servizio Titoli S.p.A. Chairman of board of statutory auditors 08220650157 Touring Editore S.r.l. Standing statutory auditor 03178460154 Touring Servizi S.r.l. Standing statutory auditor 08686110159 Touring Vacanze S.r.l. Standing statutory auditor 10434060157 Touring Viaggi S.r.l. Standing statutory auditor GIORGIO OLDOINI (Standing statutory auditor) LDNGRG40H07G628C Born in Pietrasanta on 7 June 1940

TAX CODE COMPANY POSITION

03300620964 SI Servizi S.p.A. Director 12721070154 Immobiliare Lombarda S.p.A. Director 07416030588 Premafin Finanziaria S.p.A. Director Holding di Partecipazioni 06670781001 Sogeli – Società di Gestione di liquidazioni S.p.A. Director 09357630012 Iride Energia S.p.A. Chairman of board of statutory auditors 03009720107 Consorzio Amga Energia Chairman of board of statutory auditors 01398970994 Carige Asset Management SGR S.p.A. Director

ALESSANDRO TROTTER TRTLSN40H09M052V Born in Vimercate (MI) on 9 June 1940

TAX CODE COMPANY POSITION 351 03731380261 Atlantia S.p.A. Standing statutory auditor 07516911000 Autostrade per l’Italia S.p.A. Chairman of board of statutory auditors 09816500152 Equitalia Esatri S.p.A. Director 06213991000 Infoblu S.p.A. Chairman of board of statutory auditors 01480930153 Petraco S.p.A. Chairman of board of statutory auditors 04208310153 Radiall Elettronica S.r.l. Chairman of board of statutory auditors 10502500159 Rotolito Lombarda S.p.A. Chairman of board of statutory auditors 03460140266 Schemaventotto S.p.A. Standing statutory auditor 13039920155 Siena Mortgages 00-1 S.p.A. Standing statutory auditor 01387890468 Sitech S.p.A. in liquidazione Chairman of board of statutory auditors 03421230966 Tlx S.p.A. Chairman of board of statutory auditors 13039940153 Ulisse S.p.A. Standing statutory auditor 05140920017 Unicredit Family Financing Bank S.p.A. Standing statutory auditor 02843911203 Unicredit Banca S.p.A. Chairman of board of statutory auditors

Annex to the Report of the board of statutory auditors on the separate financial statements as at and for the year ended 31 December 2008

10 April 2009

2008 Annual Report IMPREGILO

ABSTRACT FROM 353 THE SHAREHOLDER AGREEMENTS

Relazione finanziaria annuale - Esercizio 2008 IMPREGILO (Translation from the Italian original which remains the definitive version) Abstract from the shareholder agreements notified to Consob pursuant to article 122 of Legislative decree no. 58 of 24 February 1998

IMPREGILO S.p.A. Pursuant to article 122 of Legislative decree no. 58/1998 and subsequent modifications ("Consolidated Finance Act") and article 129 and following articles of Consob regulation no. 11971/1999 and subsequent amendments, the following is notified. Introduction (i) On 26 February 2007, TeSir S.r.l. ("TeSir"), on one side, and Argo Finanziaria S.p.A., registered office at Corso Romita 10, Tortona ("Argo Finanziaria"), Autostrade per l'Italia S.p.A., registered office at Via A. Bergamini 50, Rome ("Autostrade") and Immobiliare Lombarda S.p.A., registered office at Via Fabio Filzi 25, Milan ("Immobiliare Lombarda") (Argo Finanziaria, Autostrade and Immobiliare Lombarda, each a "Party" and, together the "Parties"), on the other, finalised an agreement (the "Agreement"), which regulated the transfer by TeSir of 7,236,000 ordinary shares of IGLI S.p.A., registered office at Via M. Camperio 8, Milan ("IGLI") to the Parties. (ii) IGLI's share capital of euro 24,120,000.00 is held by the Parties as follows: Argo Finanziaria 8,040,000 shares, making up 33.3% of the share capital; Autostrade 8,040,000 shares, making up 33.3% of the share capital and Immobiliare Lombarda 8,040,000 shares, making up 33.3% of the share capital; (iii) IGLI has a 29.866% investment in Impregilo S.p.A. ("Impregilo" or the "Company"), an issuer listed on the stock exchange organised and managed by Borsa Italiana S.p.A.. 1. Companies whose financial instruments are covered by the shareholder agreements The shareholder agreement covers: (i) shares of IGLI S.p.A., registered office at Via M. Camperio 9, Milan, Milan Company Registration no. 04822800969, share capital of euro 24,120,000.00, split into 24,120,000 ordinary shares with a nominal value of euro 1 each; and (ii) shares of Impregilo S.p.A., registered office at Viale Italia 1, Sesto San Giovanni (MI), Milan Company Registration no. 00830660155, share capital of euro 708,996,096.00, split into 398,810,304 shares including 397,194,813 ordinary shares and 1.615,491 savings shares, with no mention of their nominal value. 2. Parties and their financial instruments The shareholder agreement covers: (i) all the IGLI shares held by the Parties, ie, 24,120,000, making up its entire share capital as shown in the following table: 354 Shareholder No. of shares % of share capital Argo Finanziaria 8,040,000 33.3% Autostrade 8,040,000 33.3% Immobiliare Lombarda 8,040,000 33.3% Total 24,120,000 100%

(ii) all the Impregilo shares held by IGLI at the Agreement signing date, equal to 29.866% of the Company's share capital. 3. Type of agreement The shareholder agreements set out in this Agreement relate to a voting pool, which falls within the scope of article 122.1 of the Consolidated Finance Act. 4. Shareholder agreements included in the Agreement The Agreement provides for the following. (i) the Parties' commitment not to resolve or invoke the possible liability of IGLI directors appointed by TeSir, including on behalf of any of their successors in title; (ii) the Parties' commitment to do all that is in their power to ensure that the following resolutions will be proposed and approved in the meeting of the Impregilo shareholders held to approve the financial statements at 31 December 2006: (i) ratification and full approval of the work of the directors and statutory auditors as long as they are in office; (ii) waiver of any actions, pursuant to articles 2393 and 2393-bis of the Italian Civil Code, for any management decision taken and implemented by the directors and statutory auditors in 2005 and 2006; (iii) indemnification and holding directors and statutory auditors harmless for any claim and/or request and/or demand and/or compensation for damages they may receive from the Company's creditors and/or third parties (including state-owned or controlled bodies) and/or shareholders, pursuant to article 2395 of the Italian Civil Code and/or any civil and/or administrative fine that could be imposed on them, reimbursing all fees for legal counsel and assistance, also in penal proceedings, with respect to their duties carried out while in office, except when a final ruling is handed down stating their penal liability for actions carried out to their personal advantage and to the direct detriment of the Company; (iii) the Parties' commitment not to vote at any time that the Impregilo directors appointed indirectly by TeSir are liable for any reason. 5. Party exercising control pursuant to article 93 of the Consolidated Finance Act No party shall control Impregilo pursuant to article 93 of the Consolidated Finance Act as a result of this Agreement. 6. Filing with the Company Registrar The shareholder agreements included in this Agreement shall be filed with the Milan Company Registrar, as required by law. 7 March 2007 (Translation from the Italian original which remains the definitive version)

Notice of the renewal of the shareholder agreement published as required by article 131.3.b) of the Consob regulation adopted with resolution no. 11971 of 14 May 1999

Impregilo S.p.A

Given that on 8 March 2007, Autostrade per l’Italia S.p.A., Immobiliare Lombarda S.p.A. and Argo Finanziaria S.p.A. signed a shareholder agreement covering, inter alia, the corporate governance of IGLI S.p.A. (which has a 29.548% investment in Impregilo S.p.A.’s ordinary share capital) and the rights arising from IGLI S.p.A.’s investment in Impregilo S.p.A., whose original expiry date was 12 June 2008 (the “Agreement”)

It is notified that

On 12 March 2008, Autostrade per l’Italia S.p.A., Immobiliare Lombarda S.p.A. and Argo Finanziaria S.p.A. signed an agreement covering, inter alia, the renewal of the Agreement until 12 June 2009 (the “Renewal Agreement”).

The effectiveness of this Renewal is subject to communication from the European Commission to Autostrade per l’Italia S.p.A. or Immobiliare Lombarda S.p.A. or Argo Finanziaria S.p.A. before 12 June 2008 that the agreement does not represent a concentration pursuant to EC Regulation no. 139/2004 or, after informing the same parties that the agreement does represent a concentration pursuant to EC Regulation no. 139/2004, has adopted an authorisation measure (the "Condition”).

Pursuant to the Renewal Agreement, the Parties jointly agreed to do all that is in their power to ensure that, during the extraordinary part of the meeting of the shareholders called to approve the financial statements of IGLI S.p.A. at 31 December 2007, the shareholders resolve to extend 355 the company's term until 31 September 2009 and to modify article 4 of IGLI S.p.A.'s by-laws accordingly. Should the Condition not be met by 12 June 2008, the parties shall be obligated to commence the procedures for the winding up of IGLI S.p.A. after that date or the sale of IGLI S.p.A.’s investment in Impregilo S.p.A. to Autostrade per l’Italia S.p.A., Immobiliare Lombarda S.p.A. and Argo Finanziaria S.p.A. at the terms and conditions set out in the Agreement.

Milan, 22 March 2008

2008 Annual Report IMPREGILO Abstract from the shareholder pursuant to article 122 of Legislative decree and to article 129 and 130 of Consob Regulation n. 11971/1999 and following modifications Impregilo S.p.A. Pursuant on article 122 of Legislative decree 58/1998 and following modifications of Consob Regulation n. 11971/1999 and following modifications, the following is notified.

Introduction approval of the 2007 financial statements; and (c) a new board of directors will be appointed (A) On 8 March 2007, the shareholders of IGLI S.p.A. ("IGLI"), namely Argo Finanziaria S.p.A., registered during the meeting held to approve the 2007 financial statements, as provided for above and office at Corso Romita 10, Tortona ("Argo Finanziaria"), Autostrade per l'Italia S.p.A., registered office at in line with Impregilo's by-laws, modified to comply with Law no. 262/2005, as amended by Via. A. Bergamini 50, Rome ("Autostrade") and Immobiliare Lombarda S.p.A., registered office at Via Legislative decree no. 303/2006 (the "Savings Law"). This new board of directors shall remain Fabio Filzi 25, Milan ("Immobiliare Lombarda") (Argo Finanziaria, Autostrade and Immobiliare Lombarda, in office until approval of the 2010 financial statements; each a "Party" and, together, the "Parties") signed a shareholder agreement subject to article 122 of (ii) that each Party shall act suitably to ensure that: (a) the executive committee shall have six the Consolidated Act (the "Shareholder Agreement"), aimed at covering the relationships of the Parties members, including: the CEO and the two deputy chairpersons; one member from the directors as shareholders of IGLI directly and of Impregilo S.p.A., an issuer listed on the stock exchange managed candidated by Argo Finanziaria, one member from the directors candidated by Autostrade and by Borsa Italiana ("Impregilo"), indirectly. The Shareholder Agreement sets out the essential terms of the one member candidated from the directors appointed by Immobiliare Lombarda; and (b) the term-sheet, agreed by the Parties on 27 February 2007, which has already been notified to the market executive committee has the same powers as those given to it by the ruling regulation of such and published pursuant to the law. executive committee; (B) On 12 March 2008, Autostrade, Immobiliare Lombarda and Argo Finanziaria signed an agreement (iii) that each Party shall act suitably to ensure that the board of statutory auditors has three (the "Renewal Agreement") covering, inter alia, the renewal of the Shareholder Agreement until 12 June standing statutory auditors (considering that the minority shareholders have the right to appoint 2009 (the "Renewal"). The effectiveness of this Renewal is subject to communication from the European the chairperson pursuant to article 148 of the Consolidated Act) and two substitute statutory Commission to Autostrade or Immobiliare Lombarda or Argo Finanziaria before 12 June 2008 that the auditors, appointed as follows: one standing statutory auditor presented by Autostrade; one agreement does not represent a concentration pursuant to EC Regulation no. 139/2004 or, after standing statutory auditor by Immobiliare Lombarda; one substitute statutory auditor by informing the same parties that the agreement does represent a concentration pursuant to EC Autostrada and Immobiliare Lombarda jointly; and one substitute statutory auditor by Argo Regulation no. 139/2004, has adopted an authorisation measure (the "Condition"). Finanziaria, Autostrade and Immobiliare Lombarda jointly, where not otherwise provided for by (C) On 6 May 2008, the European Commission communicated that the Renewal Agreement does not law or the by-laws; represent a concentration pursuant to article 3 of the Regulation. (iv) that, should one of the members of Impregilo's company bodies leave office before this 1. Company whose financial instruments are covered by the shareholder agreements expires, the Parties shall take all necessary actions to replace the outgoing director or statutory auditor in line with that set out in points 4.1(a)(i), 4.2(a)(ii) and 4.2(a)(iii). The Shareholder Agreement covers: (i) shares of IGLI S.p.A., registered office at Via M. Camperio 9, Milan, Milan Company Registration no. 04822800969, share capital of ? 24,120,000.00, split into (b) in terms of the exercise of voting rights by Impregilo's directors: 24,120,000 ordinary shares with a nominal value of ? 1 each; and (ii) shares of Impregilo S.p.A., (i) that each Party shall act suitably to ensure that certain resolutions are passed with the registered office at Viale Italia 1, Sesto San Giovanni (MI), Milan Company Registration no. favourable vote of two thirds of the members present (including identification of strategic 00830660155, share capital of ? 709,814,896.00, split into 399,270,304.00 shares including subsidiaries, exercising voting rights for specific matters at meetings of the strategic 397,654,813.00 ordinary shares and 1.615,491 savings shares, with no mention of their nominal subsidiaries' shareholders, acquisitions and disposals of investments, companies and business value. units for certain sectors and amounts above a certain threshold, allocation of proxies to 2. Type of agreement management bodies, related party transactions up to a certain ceiling; and approval of the business plan, budget and industrial plan); The Shareholder Agreement includes conditions that fall under the voting and blocking pool category as per article 122 of the Consolidated Act. (ii) that each Party shall act suitably to ensure that certain resolutions are passed with the favourable vote of four fifths of the members present (including the allocation of new proxies 3. Parties and their financial instruments to the management bodies, exercise of voting rights for specific matters at extraordinary At the date of this abstract, the Shareholder Agreement covers: meetings of the strategic subsidiaries' shareholders and related party transactions for amounts (i) all the 24,120,000 ordinary shares making up IGLI's share capital, held by Argo Finanziaria, above a certain ceiling). Autostrade and Immobiliare Lombarda as follows: (c) in terms of changes to Impregilo's by-laws: Shareholder No. of shares Fraction - % of share capital that each Party shall act suitably to ensure that, should Impregilo's by-laws be amended to comply Argo Finanziaria 8,040,000 1/3 ( 33.33%) with the Savings Law, they will include a list voting condition for the election of directors as Autostrade 8,040,000 1/3 (33.33%) summarised below: Immobiliare Lombarda 8,040,000 1/3 (33.33%) - should just one list obtain votes representing at least 29% of Impregilo's share capital, 14 directors will be taken from the first list and one director from the second; Total 24,120,000 100% - should more than one list obtain votes representing at least 29% of Impregilo's share capital, (ii) all the Impregilo shares held by IGLI at the Shareholder Agreement signing date, equal to 29.699% 14 directors will be taken from the list with the most votes and one director from the second of the Company's share capital. list; should the first two lists obtain the same number of votes, seven members shall be taken 4. Content of the Shareholder Agreement from each list while the fifteenth director will be taken from the third list, if this has been 4.1 Voting pool for the IGLI shares presented; should there not be a third list, the oldest candidate of the first two lists is elected With respect to IGLI, the Shareholder Agreement provides: as the fifteenth director; (a) in terms of the composition of its company bodies: - should neither list obtain votes representing at least 29% of Impregilo's share capital, the fifteen directors will be elected using the simple proportionate method (ie, they will be selected (i) that the board of directors shall have six members appointed as follows: each Party shall elect from the lists in proportion to the number of votes that each one got). two directors; the chairperson shall be candidated by Argo Finanziaria, with the prior approval 356 of Autostrade and Immobiliare Lombarda, which cannot be withheld unreasonably; 4.3 Blocking pool on IGLI shares (ii) that the board of statutory auditors shall have three standing statutory auditors and two The Shareholder Agreement has a lock up condition which is binding for the Parties throughout its term substitute statutory auditors, appointed as follows: each Party shall elect one standing statutory (except for transfers of IGLI shares by the Parties to their "associates"). auditor; the chairperson shall be appointed jointly by Autostrade and Immobiliare Lombarda; 4.4 Blocking pool on Impregilo shares the two substitute auditors shall be appointed jointly by Argo Finanziaria, Autostrade and Under the Shareholder Agreement, the Parties are required not to purchase, also via trustees or Immobiliare Lombarda; nominees, nor through takeover bids, public exchange offerings or public purchase and exchange (iii) that, should one of the members of IGLI's company bodies step down before their term of office offerings, Impregilo shares during the Agreement's term (also on behalf of their "associates"). expires, the Parties shall take all necessary actions to replace the outgoing director or statutory 4.5 Takeover bids for Impregilo auditor in line with that set out in points 4.1(a)(i) and 4.1.(a)(ii). In the case of a takeover bid for Impregilo, the Shareholder Agreement establishes that, during the bid's (b) in terms of the exercise of voting rights at meetings of the IGLI shareholders: term and unless a decision is taken by majority vote as per article 1.1(c) to take part in or not to take that resolutions taken by the shareholders in ordinary and extraordinary meetings are passed by part in the bid, the Parties that disagree with IGLI's involvement in the bid ("dissenting shareholders") legal majority, except for those resolutions reserved for extraordinary meetings about specific have the option to purchase IGLI shares held by the Parties that intend to participate in the bid matters (including share capital increases, convertible bond issues or the issue of other financial ("interested shareholders") in proportion to their investment in IGLI (with the right to increase their instruments excluding or limiting options, mergers and demergers, changes to the by-laws affecting investment should one or more dissenting shareholders not intend to exercise their option rights). the business object and qualified voting majorities in shareholders' or directors' meetings and the Exercise of this option shall take place at a purchase price per IGLI share calculated by considering dissolution of IGLI before 12 June 2008) which shall be taken during the meetings held on first or 100% of IGLI's share capital using the adjusted equity method and calculating the Impregilo shares held second call with the qualified majority of 71% of the share capital; by IGLI at the takeover bid price. (c) in terms of the exercise of voting rights by IGLI's directors: Should the takeover bid be subject to conditions, the purchase and sale of IGLI shares under option shall that resolutions about certain extraordinary matters (including proposals to be made to IGLI also be subject to the condition precedent on the occurrence or non-occurrence of the condition or shareholders in extraordinary meetings about relevant matters as per point 4.1(b) above, the conditions blocking the takeover bid. Should the non-occurrence of the takeover bid condition depend exercise of votes at extraordinary meetings of Impregilo shareholders about share capital increases on the non-inclusion in the bid of the Impregilo shares held by IGLI equal to the IGLI shares under option, and issues of convertible bonds or other financial instruments excluding or limiting options, share the option shall be exercised, even though the condition for the execution of the takeover bid has not capital increases against consideration, mergers and demergers, changes to the by-laws affecting been met. the business object; the purchase, sale and transfer of Impregilo shares in any form, including Should none of the dissenting shareholders intend to exercise in whole or in part their purchase option takeover bids, public exchange offerings and public purchase and exchange offerings, are passed (except for the above increasing right), the Parties will take the necessary steps to ensure that: (i) IGLI with the favourable vote of five directors out of six; takes part in the bid by delivering a number of Impregilo shares proportionate to the number of IGLI (d) in terms of changes to IGLI's by-laws: shares of the interested shareholders for which the purchase option has not been exercised by the dissenting shareholders; and (ii) the income generated by this participation in the takeover bid is that certain changes to IGLI's by-laws, including the elimination of the lock up condition and distributed to the interested shareholders by decreasing share capital, demerging IGLI or another inclusion of measures about majorities at meetings of the shareholders and directors as per points procedure that gives the same end result. Therefore, the shareholder or shareholders involved shall be 4.1(b) and 4.1(c), shall be approved. obliged to exit IGLI's shareholding structure. Pursuant to the Renewal Agreement, the Parties jointly agreed to do all that is in their power to Should either the purchase option be exercised or IGLI partly adhere to the takeover bid, this Shareholder ensure that, during the extraordinary part of the meeting of the shareholders called to approve the Agreement is terminated with effect from the date on which the interested shareholders cease being financial statements of IGLI at 31 December 2007, the shareholders resolve to extend the shareholders of IGLI, without prejudice to the dissenting shareholders’ commitment to renegotiate a new company's term until 31 September 2009 and to modify article 4 of IGLI's by-laws accordingly. shareholder agreement in good faith, which shall consider their different investments in IGLI. 4.2 Voting pool on Impregilo shares The Shareholder Agreement provides that the instructions summarised in this point 4.5 are also With respect to Impregilo, the Shareholder Agreement provides: applicable in the case of a public exchange offering or a public purchase and exchange offering (without (a) in terms of the composition of its company bodies: affecting the purchase price of each IGLI share) and should competitive offers and/or relaunches of the above bids be made, with the suitable adjustments, when necessary. (i) that each Party shall adopt suitable measures to ensure that the board of directors has 15 members appointed as follows: four directors (including one independent director) candidated 5. Party exercising control pursuant to article 93 of the Consolidated Finance Act by Argo Finanziaria; four directors (including one independent director and one deputy There is no party which controls IGLI pursuant to article 93 of the Consolidated Act. chairperson) by Autostrade; four directors (including one independent director and one deputy 6. Term of the Shareholder Agreement chairperson) by Immobiliare Lombarda; one director (to act as chairperson) by Argo Finanziaria, Autostrade and Immobiliare Lombarda jointly (should they be unable to agree, this position will The IGLI Shareholder Agreement is valid until 12 June 2008. be filled by a candidate appointed by Autostrade and Immobiliare Lombarda jointly, with the The Parties agree to wind up IGLI at the Shareholder Agreement's expiry date and to concurrently assign prior approval of Argo Finanziaria, which cannot be withheld unreasonably); one director (to act themselves Impregilo shares, after taking on their share of IGLI's liabilities, in proportion to their as CEO) by Argo Finanziaria, Autostrade and Immobiliare Lombarda jointly (should they be investment indirectly held in Impregilo at that date. unable to agree, this position will be filled by a candidate appointed by Argo Finanziaria, with Should the Parties not reach an agreement about how to dissolve IGLI, the latter shall sell the Parties the prior approval of Immobiliare Lombarda and Autostrade, which cannot be withheld (obliging them to purchase or have purchase) its Impregilo shares, in proportion to their investment in unreasonably); and one director by Argo Finanziaria, Autostrade and Immobiliare Lombarda IGLI and that, after having sold them the Impregilo shares, it shall be put into liquidation. jointly, when not otherwise provided for by law or the by-laws. 7. Filing of the Shareholder Agreement The Shareholder Agreement also provides that suitable actions shall be taken to ensure that: The Shareholder Agreement has been filed with the Milan Company Registrar pursuant to the law. (a) at the date of approval of the 2006 financial statements, the new board of directors will be appointed (as above) with a term of office until approval of the 2007 financial statements; (b) the CEO will be given the same powers as those currently assigned to Impregilo's CEO until 16 May 2008 SHAREHOLDERS’ MEETING 357 OF 29 APRIL 2009

2008 Annual Report IMPREGILO

(Translation from the Italian original which remains the definitive version)

Resolutions taken by the shareholders in their meeting of 29 april 2009

The shareholders of IMPREGILO S.p.A. holding 134,542,824 ordinary shares, equal to 33.430282% of the company’s share capital with voting rights, took part in the meeting held on second call on 29 April 2009 chaired by the chairman of the board of directors Mr. Massimo Ponzellini.

They: unanimously approved the financial statements as at and for the year ended 31 December 2008, the related reports and the proposal to allocate the profit for the year of ? 83,039,554 as follows:

• Euro 4,151,977.70, equal to 5% of the profit for the year, to the legal reserve; 359 • Euro 32,196,634.96 as a dividend, being the total of euro 0.08 per share to be paid to the holders of the ordinary shares; • Euro 1,260,082.98 as a dividend, being the total of euro 0.78 per share to the holders of the savings shares as per article 33.b of the company’s by-laws; • Euro 45,430,858.36 to be carried foward. set the ex-dividend date as 18 May 2009 and the payment date as 21 May 2009.

2008 Annual Report IMPREGILO Published by Relazioni Esterne Impregilo April 2009 Project by Milano AD S.r.l. Milan Progress, our greatest work