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12 Financial income and charges

Bank interest income4,2664,22838
Interest income on other short term receivables543564-21
Interest charged to customers159770-611
Financial income generated by derivatives on commodities2,90722,927-20,020
Financial income generated by derivatives on rates16,9299,8317,098
Financial income - gains from trading of equity interests221,305-1,283
Dividends from equity interests in other companies1,9092,539-630
Other financial income1,8645,538-3,674
Total financial income28,59947,702-19,103


Financial charges31-Dec-200731-Dec-2006Change
Interest expense on bank current account overdrafts13.,62810,4223,206
Interest expense charged by banks for medium/long term loans31,18322,5338,650
Financial charges generated by derivatives on commodities2,82722,933-20,106
Financial charges generated by derivatives on rates14,1086,2007,908
Financial charges generated by the application of IAS 194,4113,754657
Financial charges generated by the application of "other international accounting standards"10,74610,965-219
Write-downs of equity interests326217109
Losses from trading of equity interests1801,163-983
Total financial charges107,875101,6246,251

The change in the balance of financial operations is described, overall, in the Directors' Report.

The financial income item "dividends from equity interests" is comprised of dividends declared by the subsidiary Energia Italiana s.p.a.

The item "other financial charges" is comprised of Euro 27,880 thousand of charges related to certain bond issues of the parent company. The latter include approximately Euro 910 thousand related to the differential between nominal interests and interests deriving by the application of the amortised costs with reference to four new loans obtained in 2007 (please see comment on the notes). With reference to these loans, it should be specified that, in applying the amortised cost method, the maximum duration of the loan was assumed, thus assuming that no put option would be exercised during the entire expected life of the loans at the due dates contractually scheduled.

As regards commodity derivatives, both charges and income register some changes, against the 2006 financial year, of a virtually identical amount.

As regards interest rates hedging derivatives, income are virtually on line with the charges.

Item "financial charges determined by the application of other international principles", for Euro 10,746 thousand, is comprised as follows:

  • IAS 17 "financial leasing" for Euro 1,220 thousand;
  • IAS 37 "discounting landfill post-closure provision" for Euro 4,455 thousand;
  • IAS 37 "discounting of provisions for restoration of third party assets" for Euro 5,071 thousand.


This item is, in 2007, virtually in line with 2006 figures.

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