annual accounts _06 annual accounts _06 page 04 1_ Consolidated annual accounts and Management report page 66 2_ Annual accounts and Management report 1 consolidated annual accounts and management report page 04 Consolidated balance sheets page 29 13_Borrowings at 31 December page 31 14_Deferred income page 05 Consolidated profit and loss page 31 15_Trade and other payables accounts at 31 December page 31 16_Corporate income tax page 05 Consolidated statements of income and expense recognised page 33 17_Liabilities for employee benefits in net equity page 34 18_Provisions and other liabilities page 06 Consolidated cash flow statements page 35 19_Income and expenses page 07 Notes to the 2006 consolidated page 36 20_Contingencies and commitments annual accounts page 36 21_Business combinations page 07 1_General information page 37 22_Shareholdings in multigroup companies page 07 2_Basis of presentation page 38 23_Environment page 10 3_Accounting policies page 38 24_Segment reporting page 15 4_Management of financial risk page 41 25_Related parties page 16 5_Property, plant and equipment page 44 26_Other information and reversible assets page 45 27_Subsequent events page 18 6_Goodwill and other intangible assets page 46 Appendix I. Subsidiary companies page 19 7_Investments in associates included in the consolidation scope page 54 Appendix II. Multigroup companies page 20 8_Available-for-sale financial assets included in consolidation scope page 21 9_Derivative financial instruments page 56 Appendix III. Associates included page 22 10_Trade and other receivables in the consolidation scope page 22 11_Cash and cash equivalents page 60 Consolidated management report for 2006 page 23 12_Net equity 04_05 consolidated annual accounts and management report Consolidated balance sheets at 31 December (thousand Euros) ASSETS Notes 2006 2005 Non-current assets Property, plant and equipment and reversible assets 5 9,609,848 4,596,431 Goodwill 6 3,935,343 1,082,456 Other intangible assets 6 2,869,807 707,909 Investments in associates 7 690,233 660,338 Deferred income tax assets 16 491,533 391,033 Available-for-sale financial assets 8 579,855 438,905 Derivative financial instruments 9 16,625 61,369 Trade and other receivables 10 77,840 29,896 Non-current assets 18,271,084 7,968,337 Current assets Inventories - 12,978 10,106 Trade and other receivables 10 600,323 379,637 Derivative financial instruments 9 485 - Cash and cash equivalents 11 332,465 88,592 Current assets 946,251 478,335 Assets 19,217,335 8,446,672 NET EQUITY Notes 2006 2005 Capital and reserves attributable to the Company’s equity holders Capital 12 1,824,025 1,737,166 Share premium 12 579,690 579,690 Treasury shares 12 (68,000) (164,477) Reserves 12 271,402 117,383 Retained earnings and other reserves 12 845,674 690,226 3,452,791 2,959,988 Minority interests in equity 12 993,830 76,145 Net equity 4,446,621 3,036,133 LIABILITIES Non-current liabilities Borrowings 13 11,103,688 3,227,323 Derivative financial instruments 9 88,872 46,550 Deferred income 14 51,021 86,096 Deferred income tax liabilities 16 1,249,548 264,986 Obligations for employee benefits 17 80,034 32,488 Provisions and other liabilities 18 201,337 178,815 Non-current liabilities 12,774,500 3,836,258 Current liabilities Borrowings 13 1,330,794 1,089,196 Derivative financial instruments 9 2,510 14,385 Trade and other payables 15 400.681 262,287 Current tax liabilities - 138,910 113,114 Provisions and other liabilities - 123,319 95,299 Current liabilities 1,996,214 1,574,281 Liabilities 14,770,714 5,410,539 Net equity and liabilities 19,217,335 8,446,672 These consolidated balance sheets should be read together with the Notes to the accounts on pages 7 to 59. Consolidated profit and loss accounts at 31 December (thousand Euros) Notes 2006 2005 Rendering of services 19 3,242,986 1,824,240 Other operating income 19 59,878 57,470 Own work capitalised - 10,058 4,382 Other income 19 22,070 19,788 Operating income 3,334,992 1,905.880 Personnel expenses 19 (472,822) (313,521) Other operating expenses - (751,006) (382,793) Variation in trade provisions - 551 158 Variation in provision for asset impairment 5/8 (4,902) - Depreciation and amortisation expenses 5/6 (750,434) (371,500) Other expenses - (13,178) (5,555) Operating expenses (1,991,791) (1,073,211) Operating profit 1,343,201 832,669 Variation in valuation of hedging instruments 19 7,281 5,091 Financial income 19 88,295 54,460 Financial expense 19 (556,109) (218,809) Net financial result (460,533) (159,258) Results of companies consolidated by equity accounting 12 46,942 65,095 Profit before tax 929,610 738,506 Corporate income tax 16 (354,778) (223,638) Net income for the year 574,832 514,868 Attributable to minority interests 12 44,802 3,635 Attributable to the company’s equity holders 530,030 511,233 Earnings per share (expressed in € per share) - basic 12 0.899 0.905 - diluted 12 0.899 0.905 These consolidated profit and loss accounts should be read together with the Notes included in pages 7 to 59. Consolidated statements of income and expense recognised in net equity (thousand Euros) Notes 2006 2005 Net fair value gains, gross of tax, of available-for-sale financial assets 8/12 133,961 24,600 Cash flow hedges 12 30,606 714 Currency translation differences 12 9,070 23,094 Others 12 12,329 (57) Actuarial profit and loss 12 (2,578) (5,943) Tax on items taken directly to or transferred from net equity - (19,667) (250) Net income recognised directly in net equity 163,721 42,158 Net income for the year 574,832 514,868 Total recognised income for the year 738,553 557,026 Attributable to: - the Company’s equity holders 693,092 549,746 - Minority interests 45,461 7,280 738,553 557,026 These consolidated statements of recognised income and expense should be read together with the Notes to the accounts on pages 7 to 59. 06_07 consolidated annual accounts and management report Consolidated cash flow statements (thousand Euros) Net cash flow from operating activities: Notes 2006 2005 Net income for the year 574,832 514,868 Adjustments to: Taxes 16 354,778 223,638 Depreciation and amortisation for the year 5/6 750,434 371,500 Variation in asset impairment provision 5/8 4,902 - (Profit)/loss on sale of property, plant and equipment and intangible assets - (8,892) 5,555 (Profit)/loss on hedging instruments 19 (7,281) (5,091) Variation in post-employment provisions 17 11,857 5,663 Variation in other provisions 18 (5,186) 11,990 Dividend income 19 (16,530) (17,026) Interest income 19 (71,765) (37,434) Interest expense 19 556,109 218,809 Release of deferred income to profit and loss 14 (3,974) (11,833) Share in results of associates consolidated by equity accounting 7 (46,942) (65,095) 2,092,342 1,215,544 Variation in current assets/liabilities: Inventories 2,535 (4,713) Trade and other receivables (97,236) (83,982) Derivative financial instruments (12,360) 120,649 Trade and other payables (66,071) 69,805 Other current liabilities 10,257 68,759 (162,875) 170,518 Cash flow generated by operations 1,929,467 1,386,062 Corporate income tax paid (220,451) (197,287) Interest paid (556,109) (218,809) Non current trade and other receivables 69,464 874 (A) Total Net Cash Flow from Operations 1,222,371 970,840 Net cash flow from investing activities: Business combinations and changes in consolidation scope (3,634,462) (719,220) Acquisition of shareholdings in associates 7 (44,047) (20,448) Proceeds from sale of property, plant and equipment 36,838 47,249 Purchases of property, plant and equipment and intangible assets 5/6 (487,901) (589,992) Purchases of available-for-sale financial assets 8 (2,850) (1,038) Utilisation of provision for post-employment benefits 17 (13,075) (6,855) Utilisation of other provisions 18 (4,670) (13,910) Interest received 19 71,765 37,434 Dividends received from associates 7/19 76,237 41,915 Other creditors 18 32,632 38,827 Others - 8,272 4,397 (B) Total Net Cash Flow from Investing Activities (3,961,261) (1,181,641) Net cash flow from financing activities: Receipt / (Payment) of borrowings 3,179,621 718,349 Dividends paid to shareholders of Parent Company 12 (293,654) (282,634) Receipt / Refund of grants and other deferred income 14 319 4,618 Treasury shares 12 96,477 (164,477) (C) Total Net Cash Flow from Financing Activities 2,982,763 275,856 Net (decrease) / increase in cash and cash equivalents (A)+(B)+(C) 243,873 65,055 Opening balance of cash and cash equivalents 88,592 23,537 Closing balance of cash and cash equivalents 332,465 88,592 These consolidated net cash flow statements should be read together with the Notes to the accounts on pages 7 to 59. NOTES TO THE 2006 CONSOLIDATED ANNUAL ACCOUNTS NOTE 1_ GENERAL INFORMATION Abertis Infraestructuras, S.A. (hereinafter abertis or the parent Company) was incorporated in Barcelona on 24 February 1967.The registered office of the company is Avenida del Parc Logistic nº 12-20, Barcelona. On 30 May 2003 the Company’s name was changed from Acesa Infraestructuras, S.A. to its current name. abertis is the parent company of a group of companies mainly engaged in the management of mobility and communications infrastructures operating in five sectors: motorway concessions, telecommunications, airports, car parks and logistics services.