At a meeting today, the Italcementi Board of Directors examined and approved the annual financial report as at December 31, 2009.
As a result of the severe worldwide economic and financial crisis in 2009, the Group experienced a reduction in sales volumes in all lines of business, although the slowdown eased in the last part of the year. While markets in the industrialized countries as a whole were weak, in some emerging countries the Group reported an improvement in sales compared with 2008.
The downturn in volumes, combined with stable average prices, pushed down revenues and results. Nevertheless, thanks to the benefits of the cost-cutting plan introduced as the crisis emerged, the Group was able to maintain its 2009 profit margins at the 2008 levels (recurring EBITDA/revenues 19.4%). In addition, the strong increase in cash flows from operations, assisted by incisive action to reduce working capital, and a lower level of financial investments brought an improvement of approximately 10% (259 million euro) in the net financial position compared with the position at the end of 2008.
The measures taken to raise efficiency brought significant savings in variable and fixed costs in 2009, estimated at more than 240 million euro; cost control and on-going efficiency programs will also produce cost reductions in 2010, albeit on a smaller scale.
For full-year 2009 cement and clinker sales totaled 55.7 million metric tons (-11.1% on an historic basis), aggregates sales were 39.1 million metric tons (-17.8%), and ready mixed concrete sales were 11.2 million cubic meters (-19.2%). The reduction in cement sales volumes was heavier in the industrialized countries, whereas Egypt and China reported significant growth and Morocco maintained the healthy levels of 2008.
Turning to revenues, the downturn in volumes, combined with stable average prices, generated 2009 consolidated revenues of 5,006.4 million euro, a reduction of 13.3% from 2008 (-13.6% at constant size and exchange rates).
Revenue growth was reported in several emerging countries, including Egypt, Morocco and China.
Operating results, too, were adversely affected by the significant volume effect, while the positive price trend of the first half of the year was undermined in part during the second half. Recurring EBITDA was 971.6 million euro (-12.7%); EBIT was 443.0 million euro
(-27.1%), reflecting the impact of impairment variations on industrial assets, mainly in Thailand, where the residual service life of a number of plants was shortened.
Profit before tax was 309.5 million euro (-27.7%), while net profit was 215.3 million euro (-22.2%). Group net profit, at 71.3 million euro, reflected a heavier decrease (-50.0%) since the positive contribution of companies with significant minority interests was not sufficient to counterbalance the general earnings decline.
Investments in fixed assets for 2009 totaled 742.3 million euro, and related largely to strategic projects in North America (Martinsburg), Morocco (Ait Baha), India (Yerraguntla) and Italy (Matera), where the new plants will already begin making a positive contribution to operations in 2010.
Thanks to careful cash flow management, and tight control of the working capital requirement in particular, at the end of 2009 Group net debt was significantly lower, at 2,419.9 million euro, an improvement of 259.4 million euro from 2,679.3 million euro at the end of 2008. Shareholders' equity rose to 4,692.2 million euro (4,621.6 million euro at the end of 2008). The gearing ratio (net debt / shareholders' equity) was 51.6% (60.8% at June 30, 2009, and 58.0% at the end of 2008). The composition of net debt and comments on the liquidity risk are provided on pages 20 and 21.

Outlook – With economic and financial conditions remaining extremely difficult and unstable at global level, with the exception of some important emerging countries, in 2010 the Group will continue with its program to contain costs and keep working capital under tight control. The greater industrial efficiency generated by the operating start-up of new strategic plants will counterbalance in part the expected negative effect of the volume-price factor on some Group markets and the possible increase in energy costs.
These measures, together with the new investment plans scheduled for 2010 – if on a more limited scale than in 2009 –, will enable the Group to develop an even more solid and efficient structure to enjoy the benefits as the recovery begins.
                                                        

In a very difficult country situation, the parent company Italcementi S.p.A. reported revenues for 769.3 million euro in 2009, down from 991.3 million euro in 2008. Recurring EBITDA was 26.4 million euro (76.1 million euro), while the net result for the year was a loss of 16.3 million euro (net profit of 35.0 million euro).
At the next Shareholders' Meeting (Bergamo, April 16 and 19, 2010, on first and second call respectively), the Board of Directors will propose distribution of a dividend of 0.12 euro per ordinary share (0.18 euro for 2008) and 0.12 euro per savings share (0.21 euro). The dividend is the same for both share classes as it is taken from available reserves, as allowed under art.7 of the by-laws. The dividend will be paid from May 27, 2010 (coupon date May 24, 2010).

FOURTH QUARTER 2009

Fourth-quarter sales volumes were down on the year-earlier fourth quarter in all lines of business, although the slowdown eased with respect to the first nine months of the year.
In the cement and clinker sector, performance declined in North America and Central Western Europe, while the emerging countries reported growth, with the exception of Bulgaria and Turkey. Performance was also positive for Trading.
The smaller reduction in the countries in Central Western Europe and the progress achieved in Morocco produced a significantly smaller downturn in performance in aggregates and ready mixed concrete compared with the figures for the year to September 30.

In the fourth quarter, revenues continued to be affected by the volume slowdown caused by the impact of the financial crisis on the real economy (especially in some industrialized countries), and fell to 1,158.9 million euro (-14.5% from the year-earlier period). A significant decline was reported in North America, Central Western Europe and cement and clinker Trading, counterbalanced by healthy progress in some emerging countries, notably Egypt, Morocco and China.
Fourth-quarter revenues were also affected by a negative overall exchange-rate effect.
 
Recurring EBITDA was 183.9 million euro, down 11.2% from the fourth quarter of 2008, a result arising mainly from the decrease in volumes and sales prices. These effects were largely countered by continuing incisive action to contain variable and fixed costs.
EBIT at 37.7 million euro (+28.1%) was up on 2008 due to the decrease in non-recurring charges and impairment variations.
The fourth quarter showed a net result of -6.1 million euro (-51.4 million euro in the year-earlier period).

BUSINESS PERFORMANCE IN 2009

Group sales volumes in 2009 declined significantly in all lines of business, a trend that eased, as mentioned above, in the last quarter of the year.
In cement and clinker, the fall in sales volumes arose largely in the mature countries (especially Italy, France, Spain and North America), and in Trading. In the emerging countries, performance declined overall, but at a slower rate, with trends varying from country to country. While Egypt, Kazakhstan and China reported growth, Morocco maintained the levels of 2008, and the other countries reported a reduction in sales volumes.

The aggregates sector was affected by the decline in all the countries in Central Western Europe, where the large majority of Group operations are based. Performance in Morocco was stable, thanks to a lively fourth quarter; significant growth was reported in North America, but absolute values were low and had a modest impact on total sales volumes.  
Ready mixed concrete saw a general decline in sales volumes on a wider scale than in cement, due to the sharper fall in demand on the Group markets. The largest reductions in absolute values were in France, Turkey, Spain and Egypt; in Egypt, the downturn arose as work was completed on a series of major contracts.

Italy
In Italy cement consumption dropped heavily in 2009 compared with 2008, with sharp downturns in performance in all segments of the construction sector and in all geographical areas. The contraction was less marked in the fourth quarter than in the first nine months of the year, largely because, in the fourth-quarter comparison, the year-earlier period saw a strong upsurge in the decline in consumption and extremely unfavorable meteorological conditions.
On the trading front, cement imports rose significantly and exports fell.
In these conditions, Group cement and clinker sales volumes were down 19.6% on 2008, with a reduction of 17.1% in the fourth quarter compared with the year-earlier period. The Group trend underperformed the market, in part as a result of the action taken in relation to the rigorous criteria used to assess commercial risk. The heavy competitive pressures that were a market feature in the previous quarters continued in the fourth quarter, leading to a decrease in sales prices in line with the trend that had emerged at the end of the second quarter.
Revenues in the cement sector were significantly down on 2008 (-23.4%), due, primarily, to the decrease in volumes, and, to a lesser extent, to the negative price effect.
These unfavorable effects were also at the root of the heavy reduction in recurring EBITDA in the cement sector (-64.6%). The particularly negative trend of the first half of the year eased notably in the second half, which reported a sharp fall in variable costs and a less adverse overall volume effect.
In addition to the savings achieved on variable costs, action to limit the downturn in operating results included measures to cut fixed costs, notably the continuation of the production and logistics restructuring program launched in 2008 and extended to other organizational units in 2009, with temporary or permanent plant shutdowns, a block on staff turnover and recourse to social security benefits (state subsidized lay-off). A mobility procedure was introduced at the Bergamo site to reduce the workforce, whose social impact was mitigated with early-retirement incentives. For this procedure and the previously announced permanent closure of two grinding centers and the conversion of a full-cycle cement plant into a grinding center, non-recurring charges of 10.1 million euro were provided.
The production and logistics restructuring also made it necessary to re-state fixed asset carrying amounts to reflect the aforementioned closures and those already announced for the first half of 2010.
With regard to the revamping of the Matera cement plant, all operations on the new kiln line were completed and the final work on the kiln is underway. The crude mill and the clay conveyor and stockpiling line went smoothly into operation. The line start-up is scheduled for the first quarter of 2010.

France – Belgium
In France, against a general economic slowdown whose effects were particularly significant in the building construction and public works sectors, the fall in cement consumption that began in August 2008 continued in 2009.
According to our estimates, cement consumption in 2009 was down 15.4% on 2008.
Group domestic cement sales volumes slackened by 14.7%, performing slightly better than the market in relation to the adverse effect of company strikes in February 2008.
In Belgium too, the market suffered from the general economic climate, although the slowdown (-9.2%) was less marked than in France, while Group volumes made a slight improvement (+0.3%; including sales to the Netherlands and Luxembourg volumes were down 0.9%).
Cement sales prices in France rose satisfactorily compared with 2008, but dropped slightly in Belgium.
Although the price effect was positive, revenues suffered from the negative performance in volumes and were down on 2008.
Despite the sharp negative impact of volumes, operating results showed only a small reduction from 2008, thanks mainly to the reduction in clinker procurement costs and measures to contain fixed costs.
In France, the negative trend in the construction sector pushed down sales volumes for ready mixed concrete and aggregates, which fell by 18.6% and 18.7% respectively.
Sales volumes also fell heavily in Belgium for ready mixed concrete (-9.6%) and aggregates (-11.5%).
Due to the adverse impact of volumes and despite satisfactory sales prices, revenues were down in both lines of business, as were operating results, even though savings were achieved on fixed costs.

Spain
The negative trend in the construction sector caused by the severe crisis in residential building continued in 2009; at the same time, signs of a recovery began to emerge in the non-residential sector, thanks to the support provided by the Government.
Nationwide, cement consumption fell by an estimated 32.9% from 2008, with a slower reduction in the second half of the year (-41.2% in the first half; -22.1% in the second half).
On the Group markets, our estimates indicate a smaller decrease in the Basque Country and a sharper decline in Andalusia, where the residential segment accounts for a greater proportion of the market.
In this context Group domestic cement sales volumes were down approximately 15%.
The construction crisis also affected sales volumes of ready mixed concrete and aggregates, which fell by 29.9% and 20.5% respectively from the previous year.
Overall cement sales prices were down on 2008 largely due to trends in southern Spain, where the reduction that began in July 2008 appeared to ease in the second half of the year.
Overall revenues were notably lower than in 2008 due to the reduction in sales volumes and, in part, to the negative price effect (principally cement and ready mixed concrete); this generated a decrease in operating results notwithstanding savings in fixed costs and lower energy costs.
To combat the heavy decline in demand, in 2009 the Group restructured its industrial operations in ready mixed concrete, with the closure of a number of plants and quarries.

Greece
The fall in domestic cement consumption in the fourth quarter was in line with the full-year decline (-22.6%). Despite strong competition from Turkey, Halyps exports made good progress in the last quarter. This helped to keep the downturn in overall cement and clinker sales volumes in 2009 at 10.0% compared with 2008.
Sales volumes in ready mixed concrete dropped by 18.7%, with a contained decrease in prices, while aggregates sales fell by 24.2%, with prices steady at 2008 levels.
Although a significant reduction was achieved in fixed costs and variable production costs in the cement business, operating results decreased owing to the negative volume effect.

Signs of a recovery from the severe economic crisis in the USA emerged toward the end of 2009. GDP rose 5.7% on an annualized basis in the fourth quarter, after growth of 2.2% in the third quarter. These rates are unlikely to be maintained in 2010, projections for which indicate only weak growth.
Construction investments, based on the latest available estimates (November 2009), decreased by 13% from 2008 mainly due to the crisis in the private sector (residential and non-residential); the public sector reported a small improvement, although this was lower than the expectations generated by the ”American Recovery and Reinvestment Act”.
The latest estimates from the Portland Cement Association (PCA) indicate that, after dropping by 15.1% in 2008 from 2007, cement consumption in the USA fell by 27% in 2009 and could show growth of around 5% in 2010.
The continuous decline in consumption led Essroc, like other cement producers, to close or temporarily halt operations at its less efficient production plants.
Group cement sales volumes in 2009 were down 24.6% on 2008, having fallen constantly since the second quarter of 2006.
The difficult situation in the construction sector also affected sales of ready mixed concrete, with a 23.0% decrease in volumes compared with 2008 and a slight reduction in prices.
Overall revenues, in local currency, fell by 24.1% from 2008. The sharp decrease in sales volumes was the main factor in the slide in operating results. This trend was, however, counterbalanced in part by the sharp reduction in fixed costs achieved through the program introduced in 2008 to maximize industrial and logistic efficiency, which continued throughout 2009.
In November production began on the new line at the Martinsburg cement plant, which offers a daily capacity of 5,000 metric tons of clinker and replaces the Frederik line and three old lines in Martinsburg.

Egypt
In November production began on the new line at the Martinsburg cement plant, which offers a daily capacity of 5,000 metric tons of clinker and replaces the Frederik line and three old lines in Martinsburg.
In a favorable market context, new clinker production lines with an additional capacity of around 5 million metric tons/year went into operation.
Group domestic cement sales volumes, limited by available production capacity, rose by 7.0%.
In ready mixed concrete, Group sales volumes fell by 24.6% after work ended at a number of major sites. Even so, sales prices showed healthy progress.
Overall, the Group’s positive business performance fuelled a significant improvement in operating results, despite the sharp increase in raw material and energy costs. The appreciation of the local currency helped improve results denominated in euro.

Morocco
Cement consumption rose by 3.4% in 2009, a smaller increase after three years of strong growth.
The most dynamic segments were private building construction and public investment in infrastructures, while private investment in social building slackened (after tax benefits were reduced) as did investment in tourist infrastructures.
Group cement sales volumes were down 0.9%, under-performing the market due to saturation of industrial capacity.
Sales volumes increased in ready mixed concrete and aggregates, with improvements of 10.8% and 0.7% respectively compared with 2008.
Overall revenues, in local currency, gained 2.8% over 2008, thanks to a positive sales price dynamic.
Local currency operating results showed a significant improvement, mainly as a result of the positive price effect and efficient management of procurements.
The new cement plant in Ait Baha commenced cement production in November; clinker production start-up is scheduled for mid-2010.

Bulgaria
The global crisis had a significant impact on local economic conditions from the start of 2009, with particularly severe consequences for the construction industry.
The residential sector was badly affected, with delays in major infrastructure construction projects. A freeze was placed on funding from the European Union, although the new Government believes this will be lifted in the second quarter of 2010.  In this highly unfavorable market situation, instability was heightened by imports from Turkey (currently accounting for about 16% of the market), where sales prices are significantly lower.
Cement consumption continued to fall during the fourth quarter (-46.6% compared with the year-earlier fourth quarter, -37% for the full year). Group domestic sales mirrored the trend. Although sales prices decreased in the second half, the full-year prices were slightly higher than the 2008 levels.
This positive factor, combined with improvements in productivity (fuel and maintenance) and a commercial focus on exports to Romania, where the Group has developed a distribution network, was not sufficient to counterbalance the sharp reduction in operating results.

Turkey
After a long period of uninterrupted growth, the Turkish economy has been in recession since the fourth quarter of 2008. This had had severe effects on construction, notwithstanding the positive impact for the industry of the sharp fall in interest rates.
Despite the country’s difficult economic situation, the exchange rate has not been affected and inflation has been relatively contained.
With demand slackening, Group domestic cement sales volumes fell by 24.1% (-20.7% for overall volumes including a modest level of export sales), in part due to the difference in trends in the regions where the Group has a stronger presence. Sales prices also decreased with respect to 2008.
In ready mixed concrete Group sales volumes were sharply down on the previous year (-27.5%). This was partly the result of the closure of a number of less efficient batching units with falling sales prices.
These trends generated a reduction in revenues and recurring EBITDA.

Thailand
During 2009, GDP dropped by an estimated 3% as a result of the impact of the international crisis in a country heavily dependent on exports. A recovery began, however, in the second half, thanks to the Government stimulus package. Cement consumption fell by 2.5% from 2008 according to our estimates.
In the first half of 2009, the Group completed the restructuring plan under which the Takli and Cha-am plants are used as grinding centers and the Pukrang plant for clinker production.
In these market conditions, Group domestic cement sales volumes were stable; total cement and clinker sales fell by 13.8%, due to the continued weakness in exports, especially to Cambodia, hit by a severe economic crisis. Although average sales prices on the domestic market were down on 2008, they showed signs of a recovery in the second half from the lows reported in June.
Ready mixed concrete sales volumes fell by 31.5% from 2008, reflecting the impact of severe competitive pressures on a market where urban demand declined significantly.
Overall operating results were down compared with 2008 mainly as a result of the sharp reduction in revenues due to the volume and price effects, and the rise in electricity costs. The corporate restructuring generated non-recurring charges in the first half of the year, but produced important long-term structural savings in fixed costs.

India
The Indian economy continued to grow in 2009, if at a slower rate than in previous years due to the international crisis. Prior to the general election in April, the construction industry benefited from Government investments in infrastructures, which more than made up for the slowdown in the residential and commercial sectors. In the second half of the year, however, the growth in demand began to slow in some market segments.
Although cement consumption continued to grow on the markets in southern India, Group domestic sales were down 8.4% as a result of the sharp increase in competitive pressures caused by excess production capacity in the industry.
Average cement sales prices were above the 2008 levels in the first half, but subsequently began to feel the impact of growing competitive pressure, falling significantly as from September.
Operating results were down on 2008 as a result largely of the reduction in revenues and the devaluation of the rupee against the euro, effects counterbalanced only in part by the decrease in fuel costs.
Construction work on the new 5,500 metric ton/day kiln line at the Yerraguntla plant has now been completed.

China
Economic growth continued in 2009, albeit at a slower rate than in 2008.
The rise in cement consumption on the Group’s key market (Shaanxi province in central China) was driven largely by Government investment in infrastructures, which amply counterbalanced the slowdown in the residential and commercial sectors.

Under these favorable conditions, Group cement and clinker sales volumes rose by 13.9%.
Operating results made significant progress, thanks above all to important growth in revenues (volumes and prices) and the decrease in variable costs (specifically the cost of coal).

Kazakhstan
Although the construction industry was supported by major Government investment programs in 2009 (hospitals, motorways, schools) and a recovery began in the residential sector, cement consumption was down 10.7% on 2008.
Group cement sales, arising almost entirely on the domestic market, rose by 42.6%, but the reduction in sales prices and rise in production costs, amplified by the depreciation of the local currency, prevented an improvement in operating results, notwithstanding the increase in business activity compared with 2008.
On the environmental sustainability front, two electrofilters were installed at the Shymkent cement plant.
A majority shareholding was acquired in a ready mixed concrete company.

Intragroup and third-party cement and clinker sales volumes fell by 24.5% in 2009, but reflected a recovery in the fourth quarter (+6.5%) compared with the year-earlier period.
The reduction in volumes arose largely on intragroup sales as a result of the general market slowdown; the terminals (specifically Albania, Mauritania and Kuwait) reported an overall improvement of 5.7% in sales volumes.
Operating results were down, mainly as a result of the reduction in volumes.

At constant size and exchange rates, the revenue decrease affected all the macro areas, notably Central Western Europe and North America. Among emerging countries, which as a whole showed a contained decline, performance was positive in Egypt, Morocco, China and Kazakhstan.
The action taken by management in all countries to cut variable and fixed costs and boost operating efficiency generated significant savings of around 240 million euro.
Following these measures, recurring EBITDA, at 971.6 million euro, fell by 12.7% from 2008, but the recurring EBITDA margin made a slight improvement, rising from 19.3% to 19.4%. EBITDA, at 956.7 million euro, was down 13.3%.
EBIT, after higher amortization and depreciation charges and an increase in impairment variations compared with 2008, totaled 443.0 million euro, a decrease of 27.1% from 2008.
Finance costs net of finance income increased from 79.5 million euro to 106.9 million euro (+34.5%), rising in relation to revenues from 1.4% to 2.1%.
2008 had benefited from the 50 million euro compensation received in connection with the non-sale of operations in Turkey. Net interest expense on net debt decreased from 127.9 million euro to 102.3 million euro.
The share of results of associates, at 14.6 million euro, was down from 2008 (25.1 million euro) largely due to the decline in results at Vassiliko (Cyprus) and Ciment Quebec (Canada).
Impairment on financial assets was 41.1 million euro (124.9 million euro in 2008) and referred to the share held in the Calcestruzzi group.
Profit before tax amounted to 309.5 million euro, a decrease of 27.7% from 2008 (428.0 million euro).
Income tax expense, at 94.2 million euro, decreased by 37.8% compared with the previous year (151.4 million euro).
Net profit attributable to the Group was 71.3 million euro, a decline of 50.0% from 2008 (142.5 million euro), while net profit attributable to minority interests rose by 7.4%, from 134.1 million euro to 144.0 million euro.

FINANCIAL PERFORMANCE

Group revenues for 2009 amounted to 5,006.4 million euro.
The 13.3% fall in revenues compared with 2008 arose from the slowdown in business performance (-13.6%), offset only to a limited extent by a modest exchange-rate effect (+0.4%), whose positive impact in the first nine months faded in the fourth quarter. The consolidation effect was immaterial (-0.1%).

Investments in fixed assets totaled 742.3 million euro in 2009, down by 245.4 million euro from 2008 (987.7 million euro), largely as a result of the decrease in investments in non-current financial assets.
Capital expenditure, at 680.1 million euro, was comparable with the 2008 level (705.4 million euro); to an increasing extent (approximately 57% of the total compared with approximately 41% in 2008) it referred to the strategic plant projects launched in previous years, which went into operation in 2009 or are due to begin in 2010: Martinsburg (North America), Ait Baha (Morocco), Yerraguntla (India) and Matera (Italy).
Investments in non-current financial assets amounted to 42.8 million euro (252.9 million euro in 2008); they referred largely to acquisitions in the ready mixed concrete sector in France (Masoni) and Kuwait (Gulf Ready Mix).
The strong improvement achieved in cash flows from operations (1,101.9 million euro, from 642.2 million euro in 2008), notwithstanding the business slowdown, was supported by a significant containment of working capital, in part through measures designed to keep inventories and terms of collection under tight control. The change in working capital generated a net cash inflow of 380.1 million euro, compared with a net outflow of 153.9 million euro in 2008. The reduction in investments in non-current financial assets was another significant factor contributing to the decrease in net debt.
As a result of these dynamics, net debt stood at 2,419.9 million euro at December 31, 2009, down by 259.4 million euro from the end of 2008.
Total shareholders' equity at December 31, 2009, was 4,692.2 million euro, up by 70.5 million euro from December 31, 2008.
At December 31, 2009, no changes had taken place in treasury shares in portfolio compared with the end of December 2008. Italcementi S.p.A. held 3,793,029 ordinary treasury shares (representing 2.14% of ordinary share capital) servicing stock option plans, and 105,500 savings treasury shares (0.1% of savings share capital).
The gearing ratio (net debt/consolidated shareholders' equity) was 51.6% at December 31, 2009 (58.0% at December 31, 2008).
The composition of net debt and comments on the liquidity risk are provided on pages 20 and 21.

ITALCEMENTI SPA

The parent company Italcementi S.p.A. reported revenues of 769.3 million euro in 2009, a decrease of 22.4% from 2008 (991.3 million euro), determined primarily by the fall in sales volumes and, to a lesser extent, by the fall in sales prices.
Recurring EBITDA, at 26.4 million euro, was down 65.3% from 2008 (76.1 million euro), with the return on revenues falling from 7.7% to 3.4% despite the cost savings obtained during the year. Widespread and significant reductions were achieved on variable production costs, particularly energy.
On the fixed costs front, too, important improvements were reported in all expenditure categories. This was the result of the action taken in response to the reduction in volumes produced and the benefits of the production and logistics restructuring (introduced in 2008 and continued in 2009) with temporary or permanent plant shutdowns, a block on staff turnover and recourse to social security benefits (state subsidized lay-off).
A mobility procedure was introduced at the Bergamo site to reduce the workforce, whose social impact was mitigated with early-retirement incentives. For this procedure and the previously announced permanent closure of two grinding centers and the conversion of a full-cycle cement plant into a grinding center, non-recurring charges of 10.1 million euro were provided (5.4 million euro in 2008).
EBITDA was 30.2 million euro, a reduction of 61.2% from 2008, with an EBITDA margin of 3.9% (7.9% in 2008).
After amortization and depreciation charges (83.9 million euro) in line with the previous year, and impairment variations (12.9 million euro) arising from the aforementioned closures and those announced for the first half of 2010, EBIT was negative at 66.6 million euro (negative EBIT of 6.2 million euro in 2008).
Net finance income amounted to 70.7 million euro (90.1 million euro in 2008). Dividends totaled 101.6 million euro, down from 114.9 million euro in 2008, which benefited from the capital gain on the sale of Intercom S.r.l.; net finance costs on the net financial position decreased from 35.5 million euro in 2008 to 27.3 million euro in 2009.
The parent company reported a negative result before tax of 36.9 million euro (a positive result of 27.6 million euro in 2008), reflecting the adverse impact of impairment on financial assets for 41.1 million euro (57.0 million euro in 2008) relating almost entirely to the writedown of Calcestruzzi S.p.A..
After tax income of 20.6 million euro (tax income of 7.4 million euro in 2008), 2009 closed with a net loss of 16.3 million euro (net profit of 35.0 million euro in 2008).
Italcementi S.p.A. shareholders' equity decreased by 48.6 million euro from December 31, 2008, from 1,952.2 million euro to 1,903.6 million euro.
Net debt, at 751.1 million euro, decreased by 78.4 million euro from December 31, 2008 (829.4 million euro), largely thanks to the significant increase in cash flows from operations, which rose from 138.7 million euro to 214.8 million euro as a result of containment of net working capital.

OUTLOOK
With economic and financial conditions remaining extremely difficult and unstable at global level, with the exception of some important emerging countries, in 2010 the Group will continue with its program to contain costs and keep working capital under tight control. The greater industrial efficiency generated by the operating start-up of new strategic plants will counterbalance in part the expected negative effect of the volume-price factor on some Group markets and the possible increase in energy costs.
These measures, together with the new investment plans scheduled for 2010 – if on a more limited scale than in 2009 –, will enable the Group to develop an even more solid and efficient structure to enjoy the benefits as the recovery begins.

DEBENTURE ISSUES AND MATURITIES 

The Italcementi Group has not issued any debentures during the last 12 months.
Debenture maturities in the 18 months from December 31, 2009 amount to 50 million euro and refer to the 50 million euro stand-alone debenture issued by Ciments Français International S.A., a subsidiary of Ciments Français S.A., on March 3, 2005, and maturing on March 3, 2010.

*****

Acting on a proposal presented by the Remuneration Committee, after assessing the degree of attainment of the performance targets originally assigned at the beginning of the three-year period of the “Stock option plan for directors – 2007” approved with the resolution of June 20, 2007, the Board of Directors granted:
* to the Chairman 401,250 stock options, in respect of a quantity originally established between 255,000 and 450,000;
* to the Chief Executive Officer 300,000 stock options, in respect of a quantity originally established between 300,000 and 600,000.
Both the Chairman and the Chief Executive Officer informed the Board that they waived the stock options granted to them.
No new stock option grants were approved by the Board of Directors. Following the resolution of the Board of Directors and the subsequent waiver by the Chairman and the Chief Executive Officer, no stock options are outstanding on the “Stock option plan for directors – 2007”.
The Board of Directors ascertained that the directors Alberto Bombassei, Alberto Clô, Federico Falck, Pietro Ferrero, Karl Janjöri, Emma Marcegaglia, Ettore Rossi, Attilio Rota, Carlo Secchi and Emilio Zanetti met the independence requirements as set out in the company voluntary code of conduct.

The manager in charge of preparing the company’s financial reports, Carlo Bianchini, declares, pursuant to paragraph 2 article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the document results, books and accounting entries.