GASOM RENEW BIL, NI, REL GEST 31 12 2011

Report and financial statements at 31/12/2011

Report and financial statements at 31 December 2011

Registered Office:Via Circo, 12 - 20123 MILAN Operational Offices:Piazza Aldo Moro, 12 (Palazzo Economia) - 35129 PADUAwww.gascomrenew.it

http://www.gascomrenew.it/


Corporate bodies

Chairman Mr. Valentino Barbierato

Chief Executive Officer Mr. Francesco Marangon

Councillors Andrea Parisotto

General Manager Mr. Michel Gouffon

Board of Statutory Auditors

Chairman Mr. Federico Roberto

Standing statutory auditors Mrs. Chiara Mangeri

Mr. Giorgio Fasol

Consulting companies Studio Ares Consulting S.r.l.

Modulo marketing S.r.l.

Studio BCL

Sole Auditor Mr. Simone Salata


Reg. Comp. 07118700967Eai 1936943

GASCOM RENEW SPA

Company subject to management and co-ordination of GASCOM S.p.A.Offices in VIA CIRCO 12 - 20123 MILAN (MI) Share capital Euro 16.500.000,00 f.p.u.

Balance sheet assets 31/12/2011 31/12/2010

A) Subscribed capital, unpaid(already requested)

B) Capital assets

I. Intangible

1) Start-up and expansions costs 36.972 47.266

2) Research, development and advertising costs 260.800 333.800

3) Industrial patent and intellectual property rights4) Concessions, licences, trademarks and similar rights 17.752

6.639

5) Start-up 4.714.932 5.264.932

6) Assets under construction and payments on account

7) Others 585

5.031.041 5.652.637

II. Tangible

1) Land and buildings 307.003

2) Plants and machinery

3) Industrial and commercial equipment

4) Other goods 74.181 55.475


III. Financial

1) Shares in:

74.181 362.478

a) subsidiaries 1.346.000 1.224.000 b)

associated companies 135.000

7.500 c) parent companies

d) other companies

2) Credits

a) towards subsidiaries

1.481.000 1.231.500

- within 12 months 1.542.704 1.743.086

- after 12 months

b) towards associated companies


1.542.704 1.743.086

- within 12 months 174.000

- after 12 months

174.000

c) towards parent companies

- within 12 months

- after 12 months

d) towards others

- within 12 months 3.771.904

- after 12 months

3.771.904

5.314.608 1.917.086

3) Other securities 231.000

4) Own shares(overall nominal value )

7.026.608 3.148.586

Total Capital assets 12.131.830 9.163.701

C) Current assets

I. Inventory

1) Raw/auxiliary materials and consumables 723.006

2) Work in process and semi-finished goods 11.251.681 10.136.693

3) Work in progress to order

4) Finished products and goods

5) Advances 3.419.148 1.623.000

15.393.835 11.759.693

II. Credits

1) Towards clients

- within 12 months 542.353 3.430.094

- after 12 months

2) Towards subsidiaries


- after 12 months

3) Towards associated companies


- after 12 monthsT

4) Towards parent companies


- after 12 months

4-bis) For tax credits

542.353 3.430.094

554.338

184.612

13.086

- within 12 months 8.200- after 12 months

4

-ter) For advanced taxes

- within 12 months

- after 12 months

8.200

5) Towards others- within 12 months 23.748- after 12 months

III. Current financial assets

1) Shares in subsidiaries2) Shares in associated companies

3) Shares in parent companies4) Other shares5) Own shares

(overall nominal value )

6) Other securities

23.748

1.318.137 3.438.294

IV. Cash and cash equivalents

1) Bank and postal deposits 16.746 12.527

2) Cheques

3) Cash and equivalents 3.470 5

20.216 12.532

Total Current assets 16.732.188 15.210.519

D) Accruals and deferrals

- discount on loans

- various 111.094 53.947

111.094 53.947

Total assets 28.975.113 24.428.167

Balance sheet liabilities 31/12/2011 31/12/2010

A) Net assetsI. Capital 16.500.000 16.500.000

II. Share premium account

III. Restatement gain

IV. Legal reserve 8.666

V. Statutory reserves

VI. Reserve for treasury shares (held in portfolio)

VII. Other reserves

Extraordinary or optional reserve 164.652

VIII. Earnings (losses) carried forward164.652

IX. Operating profit881.648 173.319

IX. Operating loss() ()

Total Net assets 17.554.966 16.673.319

B) Provisions for liabilities and charges1) Provisions for retirement benefits and similar obligations 621

2) Tax provisions, deferred also

3) Other

Total Provisions for liabilities and charges 621

C) Employee severance indemnity 73.754 16.656

D) Debts

1) Obligations

- within 12 months

- after 12 months

2) Convertible obligations

- within 12 months

- after 12 months

3) Payable to shareholders for financing

- within 12 months

- after 12 months

4) Payable to banks


- after 12 months

1.311.348

5) Payable to other investors- within 12 months 669

- after 12 months

6) Advances 669


- after 12 months

7) Payable to suppliers

1.185.000

- within 12 months 4.126.123 3.296.491

- after 12 months

8) Payable represented by credit securities

- within 12 months

- after 12 months

4.126.123 3.296.491

9) Payable towards subsidiaries


- after 12 months

10)Payable towards associated companies


- after 12 months

11) Payable to parent companies

66.733

105.419

- within 12 months 3.699.150 2.951.797

- after 12 months 976.439

12) Tax debts 4.675.589 2.951.797

- within 12 months 735.257 220.256

- after 12 months

13) Payable to social security and welfare agencies

735.257 220.256

- within 12 months 54.483 12.069

- after 12 months

14) Other debts

54.483 12.069

- within 12 months 181.735 55.989

- after 12 months

181.735 55.989

Total debts 11.257.355 7.721.602

E) Accruals and deferrals

- loan commissions- various 89.038 15.969

89.038 15.969

Total liabilities 28.975.113 24.428.167


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Memorandum accounts 31/12/2011 31/12/2010

1) Risks assumed by the company

Bank guarantees

Endorsements

Other personal guarantees

Real guarantees 231.000

Other risks

2) Commitments entered into by the company

3) Third party assets held by the company 27.445

4) Other memorandum accounts

Total memorandum accounts 231.000 27.445


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Income statement 31/12/2011 31/12/2010

A) Production value

1) Revenues from sales and services 13.037.889 2.900.000

2) Changes in inventory of work in process, semi-finished and finished goods

807.985

3) Changes in work in progress to order 2.397.516

4) Increases of non-current assets from in-house production

5) Other revenues and income:

- various 9.685 260.094

- grants for current expenses 1.101.527

- capital grants (operating units)

1.111.212 260.094

Total Production value 14.957.086 5.557.610

B) Production costs

6) For raw/auxiliary materials, consumables and goods 6.555.194 204

7) For services 5.314.541 4.535.082

8) For leased assets and rental assets 114.963 204.537

9) For personnel

a) Wages and salaries 859.128

122.402 b) Social security charges 258.635

21.202 c) Post employment benefit 47.300

9.039 d) Retirement benefits and similar obligations 9.017

1.885 e) Other costs

10) Amortisations and write-downs

a) Intangible assets amortisationb) Tangible assets amortisationc) Other capital asset write-downs

d) Write down of receivables included in current assets and of cash availability

11) Change of raw/auxiliary materials, consumables and goods

1.174.080 154.528

635.903 271.094

19.482 6.912

655.385 278.006

(723.006)

12) Risk allowance

13) Other allowances

14) Sundry operating expenses 22.088 10.231

Total Production costs 13.113.245 5.182.588


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Difference between production value and costs (A-B) 1.843.841 375.022


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C) Financial income and charges

15) Income from shares:

- from subsidiaries

- from associated companies

- others

16) Other financial income:

a) from non-current receivables

- from subsidiaries 51.331 23.559


- from parent companies 13.080

- others 61.191

b) from non-current securities

c) from securities held in current

assets d) different income from

previous:

- from subsidiaries


- from parent companies

- others 5.297 1

130.899 23.560

- 130.899 23.560

17) Interests and other financial charges:

- from subsidiaries


- from parent companies 69.508 14.886

- others 72.662 5

142.170 14.891

17-bis) Earnings and Losses on exchange (1.200)

Total Financial income and charges (12.471) 8.669

D) Value adjustments to financial assets

18) Write-ups:

a) of shares

b) of financial assets

c) of securities held in current assets

19) Write-downs:

a) of shares

b) of financial assets

c) of securities held in current assets

Total Valuation adjustments to financial assets


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E) Extraordinary income and charges

20) Income:

- gains on disposals- various 7.771

- Difference by rounding to unit of Euro

21) Charges:

- losses on disposals

- previous financial year taxes

7.771

- various 5.383 167

- Difference by rounding to unit of Euro

5.383 167

Total extraordinary entries 2.388 (167)

Before tax result (A-B±C±D±E) 1.833.756 383.524

22) Income tax for the financial year, current, deferred and advanced

a) Current taxes 952.108 210.205

b) Deferred taxes

c) Advanced taxes

d) income (charges) from participation in tax consolidation/special tax exemption

952.108 210.205

23) Operating profit earnings (loss) 881.648 173.319

Chairman of the Board of directors

Valentino Barbierato

Reg. Comp. 07118700967Eai 1936943

GASCOM RENEW SPA

Offices in VIA CIRCO 12 -20123 MILAN (MI) Share capital Euro 16.500.000,00 f.p.u.

Company subject to management and co-ordination of GASCOM S.p.A.

Financial statements management report at 31/12/2011(in accordance with art. 2428 c.c.)

Amounts expressed in Euro

Main financial-economic data

Income statement(in Euro /000) 2010 % 2011 %

Production 5.55 100% 14.95 100%

Operative costs (4.700) (85%) (12.343) (83%)

Rentals and leasing (205) (4%) (115) (1%)

EBITDA 653 12% 2.499

17%

Amortisations and alloc. (278) (5%) (655) (4%)

EBIT 375 7% 1.844

12%

Profit before taxes 383 7% 1.834 12%

Taxes (210) (4%) (952) (6%)

Net profit 173 3% 882 6%

Statement of assets and liabilities 2010 % 2011 %

Fixed assets 9.164 37,5% 12.132 41,9%

Inventory 11.760 48,1% 15.394 53,1%

Customers 3.430 14,0% 542 1,9%

Other credits 62 0,3% 887 3,1%

Availability 12 0,0% 20 0,1%

Total assets 24.428 100,0% 28.975 100,0%

Liabilities 2010 % 2011 %

Equity 16.673 68,3% 17.555 60,6%

Banks 0 0,0% 1.311 4,5%

Suppliers 3.296 13,5% 4.126 14,2%

Other debts 4.459 18,3% 5.983 20,6%

Total liabilities 24.428 100,0% 28.975 100,0%

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Capitalisation ratio

70,0%

68,0%

66,0%

64,0%

62,0%

60,0%

58,0%

56,0%

2010 2011

Net bank debt ratio/Tot. liabilities

4,5%

4,0%

3,5%

3,0%

2,5%

2,0%

1,5%

1,0%

0,5%

0,0%

-0,5% 2010 2011

Net bank debt ratio/Raw Material

8,0%

7,0%

6,0%

5,0%

4,0%

3,0%

2,0%

1,0%

0,0%

2010

2011

Management report

As the company was established on 28 July 2010 for effect of the Gascom SpA spin-off, the 2011 financial year was the company's first complete year of business.

2011 confirmed the good results estimated in previous financial year.The Company achieved a production volume of 14,957 million, with an EBIT of 1,844 million and net profit of 0,882 million Euro. Although extremely positive, they are not significant compared with last financial year.

The year was characterised by many events:

1) Spin-off of three company branches consisting of three photovoltaic systems of about 1 MWp each, located in Brindisi. The three branches were transferred to an Italian provision newco during June for about 12,3 million Euro: 12 million Euro for the plants and 0,3 million Euro for land ownership. The plants were, at the time, financed in fully equity.Spin-off entailed pay-back of a 1,4 million advance to a previous potential Spanish buyer who did not complete purchase.The transaction includes an option to earn-out worth up to euro 600.000 related to the parties' ability to engage in a financial line on the new vehicle at specific conditions.

2) The realisation of two photovoltaic systems, respectively of about 1 and 2.5 MWp, located in Latina. Gascom Renew SpA had the role of EPC for the purchaser PV Italy Two S.r.l., controlled by Gascom Renew SpA itself. PV Italy Two Srl is a SPE purchased at the beginning of 2011 and owned by the production authorisations.

The plants were built on land which surface right for 21 years was purchased by PV Italy Two, with a 4 year option.The plants were built in about 20 days and completed at the end of July; connection took place on 24 August 2011. Said plants benefit from the August 2011 incentive tariff (0.262 Euro per plant of 0.998 MWp and 0.25 Euro for the 2.5 MWp one).The plants are to-date financed in full equity in view of possible future transfer of SPV.

3) Effects of change in standards during the year.Significant measures operated by the Public Administration took place during the year, extremely negative for the sector and individual companies. Specifically:

a) Change in Feed-in Tariff.Legislative Decree 28/2011 blocked the tax break scheme in March 2011 foreseen by the 3rd Feed-in Tariff for the renewable sector introducing a new incentive scheme (the IV Feed-in Tariff) two months later with which the P.A. reduced incentive tariffs and significantly damaged (almost zeroing it) the high power ground plants' market (higher than 1 MWp).This made it impossible for Gascom Renew to realise the ground 35 MWp it had planned and on which it was structuring its short-term strategy.It was only able to realise and connect 3,5 MWp in Latina out of its entire pipeline.The standard change also affected the banking system that blocked any transaction while awaiting examinations that, added to scarce liquidity in the system, paralysed business in the entire renewable sector for months.b) Increase in direct tax.Art. 7 of Leg. Decree 138/2011 also extended application of the "Robin Tax" foreseeing IRES tax rate increase from 27,5% to 38%, to companies involved in the renewable energy sector (this includes Gascom Renew SpA).


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4) Transfer of subsidiary Gascom Servizi Energia Srl.Gascom Renew SpA transferred 100% share of Gascom Servizi Energia Srl in December 2011. This also included a transfer of the latter's 100% controlled subsidiaries (Cecchinato Impianti Srl, So.Vit Srl, Sma Srl).Despite their good name and future possibilities, these companies were no longer strategic for Gascom Renew which intends focusing on the upstream part of the chain, particularly project and development, also with the role of temporary investor, resorting to the market for the more strictly operational phase.On behalf of its former partner, Gascom Servizi Energia Srl took over the minority share (49%) in So.Vit Srl during the year. It undersigned the entire share capital of Cecchinato Impianti Srl that, after heavy loss due to management run by minority shareholder, needed re-capitalising through zeroing of capital and consequent re-constitution of the same. Unlike Gascom Servizi Energia Srl, the shareholder did not adhere to capital re-constitution, meaning the former holds 100% of capital.Transfer of Gascom Servizi Energia Srl shares occurred at nominal value due to the year's events. The Gascom Renew SpA financings towards the (directly or indirectly) sold companies, were also transferred.

5) Preparation of the Sunny People and Your Sun projects, formally started in the first quarter of 2012, but to-date (date of financial statements approval) suspended while awaiting to understand the new incentive fees application fields of the V Feed-in Tariff.

Gascom group is the investor of the Sunny People project (head of an ESCo set-up at the beginning of 2012). The former foresees a proposal for realising an up to 3KWp photovoltaic system on the roof of private homes, with full investment by Gascom Sunny People and, in exchange for channelling the incentive flows supplied by GSE and contribution for the so-called "net metering", Gascom Sunny People commits to pay the customer's electricity bill for up to an annual limit of 2.500 KW for 20 years which, specially in the South of Italy, is above normal consumption for an average family.


Page 21

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Whereas, Your Sun project sees Gascom Renew as EPC for the realisation of photovoltaic systems, again on residential covers. Installed power can, in this case, exceed 3 KWp. The commercial proposal foresees that the customer can also benefit from a 12 year financing for the full amount. For this purpose, Gascom Renew has stipulated agreements with some consumer credit companies with the aim of proposing said financings.It is a 25 million Euro transaction for 3.000 systems in the Sunny People formula and 7.000 in the Your Sun for the 2012-2013 period.The projects are to-date suspended awaiting the new Feed-in Tariff version but re-activation is probable with reviewed commercial conditions.

Relationships with subsidiaries, associated companies, parent companies and those subjected to their control, as well as third party

Gascom Renew SpA operates in designing systems for electric energy production from renewable sources.

From a juridical point of view, Gascom Renew SpA directly controls SPE normally having the functional authorisations (or awaiting obtainment) to systems.

With regard to Gascom Renew SpA shareholding, this is subjected to Gascom SpA's control by right in view of its 90% share capital ownership, also giving right to management and coordination.

Gascom Renew's shareholding consists of the following:

Shareholder Share

Gascom S.p.A.

90% Midlerton & Wickler

10%

16%


Page 22

D

Financial conditions falling within the normal sales/purchase terms practices with other operators of similar supplies, are applied to all group and associated companies.

Refer to other sections in the Explanatory Notes with regard to other related parties (e.g. Directors).

Development of demand and flow of markets the company works in

Gascom Renew S.p.A. operates in the realisation of systems for electric energy production from renewable sources using the operator BOT model and developing construction (built), connection management (operate) and systems' transfer. It works as EPC contractor and O&M contractor for third parties, dealing with the construction of systems, their testing and maintenance.

Most of the systems are own built (as a group) and, once completed and connected to national mains, sold to third party.Its operational structures manages all process phases, from opportunities' development and set-up of offers, to design, operations management, permitting, purchases, site management and management control.

Photovoltaic.

Photovoltaic systems in Italy are about 346.000 for total installed power of 13.000 MW. Of these, about 305.000 have power below 20 KW, about 12.000 have power between 20 KW and 50 KW and about 30.000 exceed 50 KW (Source: GSE Atlasole).

Sharing of systems' size per region is found below:

Photovoltaic systems' size in Italy per RegionSource: GSE Atlasole


Page 23

sharing of installed power per region is found below:

2011 saw Italy in first place in the world-wide classification for operating power in 2011, by-passing Germany, world-wide leader for over ten years, by three times (GSE September 2011).

The Electricity and gas authority estimates the systems present in Italy with a power of 17.000 MW by the end of 2012 will be 400.000.

Photovoltaic systems' size in Italy per RegionSource: GSE - Atlasole

Power of photovoltaic systems in Italy per RegionSource: GSE - Atlasole

Power of photovoltaic systems in Italy per Region (MW)Source: GSE Atlasole


Page 24

However, this has lead the 2020 target of 8.000 MW foreseen by the National Action Plan to be widely exceeded in 2011, with a probable drastic reduction in incentive tariffs.

The burden borne in 2011 by the Feed-in Tariff on the community for charge on the bill amounted to euro 6 billion, to which a cost of between euro 1.3 and 2 billion must be added for the withdrawal of Unsold Certificates and those related to the Cip 6 incentive scheme (euro 1.2 billion divided between 500 million for renewable energy and 700 for assimilated sources). The incentives cost for renewable sources will significantly increase in 2012: from 7 billion euro in 2011 to 9,4 billion in 2012.

Installed power in the rest of the world in 2011 went from 40 to 67 GW. The largest system in the world, boasting power of 200 MW, was realised in Qinghai in China.The European record is currently held with about 75% of installed power but this looks set to change with the new estimated realisations of over 20 power stations equal to 100 MW in the next 4 years in China, India and USA.

The national action plan of the European Union member states for 2010-2020 is set-out below:

Following this vigourous development, Italian companies have explored new technological opportunities by restructuring their production and specialising in order to downturn in business cycle to come out of the financial crisis.

Figure 1 – NREAPs (National Renewable Energy Action Plans) of the European Union Member States Additional power for electric energy production by FER programmed in the ten-year period

2010-2020


Page 25

Only by using incentive tariffs can an industrialisation level such to allow reduction in technological costs be reached, so that photovoltaic is independent, meaning able to compete with generating costs of electric energy produced with traditional sources on the electric market, reaching the so-called Grid Parity.

The first drafts of the Ministry of the Environment decree (V Feed-In Tariffs) fully re-dimensioning the incentive structures in the photovoltaic sector, particularly for industrial companies, leaving space to the realisation of self-consuming systems (below 12 Kwp), started circulating between February and March. The Sunny People and Your Sun projects were suspended due to these drafts. The effects of said measures are considered extremely negative for the sector in Italy.

Alternative sources.

GSE provided an initial estimate in March 2012 of the flow of renewable sources different from photovoltaic:

Renewable source systems in Italy(Source: March 2012 GSE estimate)

Gross Efficient Power(MW)

2008 2009 2010 20111

Hydraulic 17.623 17.721 17.876 17.950Wind-energy 3.538 4.898 5.814 6.860Bioenergies³ 1.555 2.019 2.352 3.020Total FER 23.859 26.519 30.284 41.352

Gross Production (GWh) 2008 2009 201020111

Hydraulic 41.623 49.137 51.117 46.350Wind-energy 4.861 6.543 9.126 10.140Bioenergies3 5.966 7.557 9.440 11.320Total FER 58.164 69.255 76.964 84.190

CIL4 Gross National Consumption(GWh

)

353.560 333.296 342.933 344.152

FER/CIL % 16 21 22 24

1 Estimates on TERNA/GSE data2 The 2011 value includes 3.740 MW installed in 2010 but started working in 2011 (Law 129/2010 - Salva Alcoa)3 Bioenergies: Solid Biomasses, Biogas and Bioliquids4 The 2011 value was estimated by GSE based on "January 2012 Provisional Data" _published by


Page 26

TERNA


Page 27

(Source: GSE Report 2010 statistics)

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Terna – August 2011 National Electric Balance

The maximum hydroelectric power on the Italian territory may be about 65 TW as shown by recent calculations. Comparing this with the 2010 gross productions, 90% of hydroelectric resource is used in our country. This sector appears able to further expand.The most convenient sites from a technical and financial point of view are already in use and costs are too high and there are many technical obstacles to realise new large storages and high power stations.

Development of the Italian hydroelectric is based on mini and micro-hydro systems able to service isolated areas and use small height differences and minimum flow rates of rivers to obtain electric energy. They have respectively lower flow rate to 10 MW and 100 KW and are characterised by low financial, technical impact and respect the environment (Data source: Renewable source systems – 2010 Statistical report, GSE 2011).

The hydroelectric, wind-energy and bioenergy systems' installed powers and sizes in Italy per region up to 2010 (not having more recent data available) are given below.

Region

bioenergi

wind-Hydrau


Page 28

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The hydroelectric, wind-energy and bioenergy systems' productions in Italy per region up to 2010 (not having more recent data available) are given below.

(Source: GSE Report 2010 statistics)

Wind-energy parks development have increased from 2000 to 2010 by 785%, in an increasing trend in recent years. At the end of 2010 the national park had 487 systems for 5.814 MW of power against the 55 systems of 363 MW in 2000.The systems' average size grew from 6,6 MW to 11,9 MW in the same period.

The Apennines crest and mountainous sites in the South and islands, for natural reasons hold 98% of installed power. There were 374 municipalities with wind-energy stations and about 6.000 wind turbines installed on national soil at the beginning of 2011.

Hydrau Wind- Biomas


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Wind-energy power installed on national soil(Source: ANEV - National Wind-Energy Association, 2011)

Location of wind-energy parks on national soil(Source: ANEV - National Wind-Energy Association, 2011)

Biomass systems are placed inside the widest bioenergies powered group of systems, also including biogas and bioliquids.Biomasses cover 20% of these systems, which efficient powers and sizes are listed in the following table:

The table shows the gross efficient power and sizes of the biomass powered systems. The negative change is due to some systems that were classified in "other biomasses" and are now in bioliquids classes, not considered by us. Bioenergies systems represented 8% of power of the entire renewable systems park in 2010 and, therefore we can certify that biomasses alone represent 4%.

2009

2010

% Channo. kW no. kW no. kW

Biomasses 122 138 13,1 -1

- from municipal

69 781.96453 473.442

71 797.92967 444.730

2,9 +226,4 -6,1

Production of biomass powered systems:

2009

2010

% ChanGWh GWh %

Biomasses 4.443,80 4.307,60 -3,1- from municipal

1.616,202.827,70

2.048

26,7-

(Source: 2010 GSE report)

No installation


Page 30

Information in accordance with art. 2428, comma 1, point 6-bis of Civil Code

The non-photovoltaic sectors have also suffered drastic cuts in incentives with the new drafts of the ministerial decree (V Feed-In Tariff). Conditions for working risk being significantly reduced in Italy due to the frequent decrees and particularly long and complex authorisation process.It is specified, in accordance with art. 2428 no. 1 of Civil Code, that the company is exposed to normal market and operating risks that can be deduced from the Explanatory Notes and herein, with specific reference to the following point.

Information in accordance with art. 2428, comma 2, point 6-bis of Civil Code

In compliance with art. 2428, comma 1, point 6-bis c.c., below is some information aimed at giving a more precise assessment of the financial situation.

The company operates in the realisation of systems for electric energy production from renewable sources, today assisted by public grants.

The main classes of risk to-date are to be identified in the unpredictability of times and decisions of the central and local Government authorities in defining the contributions and authorisation process to obtain the grants, which are very complicated and with not always defined times despite the terms established by the so-called "Feed-In Tariff".

This risk affects a short-term logic as a new point of balance between cost of material (system) and investor profitability, can be searched for in a longer period of time.

Also:

a) Financial risk: the company is not currently exposed to monetary risk;

b) Interest rate risk: being financially supported by the group leader, there is no specific interest rate risk on companies; in this case, the risk finds compensation in the counterpart's, of the group, advantage;

c) Credit risk: credits are in view of projects normally covered by ad hoc financing transactions. The credit risk in these cases is must more modest.

d) Liquidity risk: there are no particularly critical situations in finding the credit and liquidity in general.


Page 30

Management flow

Income Statement and Statement of assets and liabilities entries are shown in the explanatory notes.

Below are specific re-classifications of the Income Statement and Statement of assets and liabilities, with regard to news introduced by Leg. D. 32/2007 and in applying the 14 January 2009 operative vademecum set-out by CNDCEC, in order to better understand the company's status under the income, property and financial profile.

The company's reclassified income statement (in Euro) is the following (as said, it is not possible to compare with previous financial year):

31/12/2011 31/12/2010 Change

Net revenues 14.139.416 2.900.000 11.239.416

External costs 10.475.797 2.352.538 8.123.259

Added value 3.663.619 547.462 3.116.157

Labour costs 1.174.080 154.528 1.019.552

EBITDA 2.489.539 392.934 2.096.605

Amort., write-downs and other adv. 655.385 278.006 377.379

EBIT 1.834.154 114.928 1.719.226

Different income 9.685 260.094 (250.409)

Financial income and charges (12.471) 8.669 (21.140)

Profit on ordinary operations 1.831.368 383.691 1.447.677

Net extraordinary components 2.388 (167) 2.555

Before tax result 1.833.756 383.524 1.450.232

Income taxes 952.108 210.205 741.903

Net result 881.650 173.319 708.331

Net revenues mainly come from sale of the three Brindisi systems to a mutual investment fund (12,3 million Euro), about 1,1 million from incentives on renewable energy production, 0,36 million from "dedicated withdrawal" and 0,38 million from smaller power systems completed for third party; the further work on ownership systems are found under changes in inventories.

The following table shows some income ratio to better describe the company's income situation (as said, it is not possible to compare with previous financial year):

31/12/2011 31/12/2010

Net ROE (Net profit / Own means) 5,02% 1,04%

Gross ROE (Gross profit / Own means) 10,45% 2,30%

ROI (EBIT/Total assets) 6,33% 1,57%

ROS (EBIT/Sales) 14,06% 13,22%


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ROE (net or gross from taxes) is the relation between profit (net or before taxes) and Net assets total (including operating profit); ROI is the relation between operating result and financial statements assets total; ROS is the relation between operating result and financial statements Net Revenues.

Main property data

The company's reclassified statement of assets and liabilities is the following (in Euro):

31/12/2011 31/12/2010 Change Net intangible assets 5.031.041 5.652.637 (621.596) Net tangible assets 74.181 362.478 (288.297) Shares

and other financial assets 1.712.000 1.231.500 480.500Capital assets 6.817.222 7.246.615 (429.393)

Inventories 15.393.835 11.759.693 3.634.142Credits to Customers 542.353 3.430.094 (2.887.741)Other credits 775.784 8.200 767.584Accrued income and deferred charges 111.094 53.947 57.147

Current assets 16.823.066 15.251.934 1.571.132

Payable to suppliers 4.126.123 3.296.491 829.632Advances 0 1.185.000 (1.185.000)Benefits and tax debts 789.740 232.325 557.415Other debts 4.053.704 3.007.786 1.045.918Accrued liabilities and deferred income 89.038 15.969 73.069

Current liabilities 9.058.605 7.737.571 1.321.034

Net working capital 7.764.461 7.514.363 250.098

Employee severance indemnity 73.754 16.656 57.098Benefits and tax debts (after 12 months) 0 0 0Other long-term liabilities 976.439 621 975.818

Long-term liabilities 1.050.193 17.277 1.032.916

Invested capital 13.531.490 14.743.701 (1.212.211)

Net assets (17.554.966) (16.673.319) (881.647)Long-term net financial situation 5.314.608 1.917.086 3.397.522

Current net financial situation (1.291.132) 12.532 (1.303.664)

Own means and net financial debt (13.531.490) (14.743.701) 1.212.211

The company is extremely net worth, with 60% weight of own means on total


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liabilities.

The following table shows some financial statements ratio to better describe the company's solid equity situation, concerning:


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a) financing methods of the medium/long term uses;b) composition of the financing sources, compared with the same ratio of previous

financial years statements.

31/12/2011 31/12/2010

Fixed asset to equity capital margin 10.737.744 9.426.704

Fixed asset to equity capital ratio 2,58 2,30

Fixed asset to equity capital and medium-long term debt margin

11.787.937 9.443.981

Fixed asset to equity capital and medium-long term debt ratio

2,73 2,30

It is very interesting ratio that shows a strong financial stability.

Main financial data

The net financial position at 31/12/2011, was the following (in Euro):

31/12/2011 31/12/2010 Changes

Bank deposits 16.746 12.527 4.219

Cash and other equivalents 3.470 5 3.465

Own shares 0 0 0

Cash availability and own shares 20.216 12.532 7.684

Current financial assets 0

Payable to shareholders for financing (within 12 months) 0 0 0

Payable to banks (within 12 months) 1.311.348 0 1.311.348Payable to other investors (within 12 months) 0 0 0

Advances for foreign payments 0 0 0

Short-term credit lines 1.311.348 0 1.311.348

Short-term net financial situation (1.291.132) 12.532 (1.303.664)

Payable to shareholders for financing (after 12 months) 0

Payable to banks (after 12 months) 0 0 0

Payable to other investors (after 12 months) 0

Advances for foreign payments 0

Long-term debt share 0

Financial credits (5.314.608) (1.917.086) (3.397.522)Medium-long term net financial situation 5.314.608 1.917.086 3.397.522

Net financial situation 4.023.476 1.929.618 2.093.858

The financial position is positive in this case also, with a 4 million balance due to granted financing to subsidiaries and account liquidity.


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These credits are due from financing that some SPE (particularly PV Italy Two Srl) await from bank institutes, so that said SPV/systems are financed in full equity.

The following table shows some financial statements ratio to better describe the financial situation:

31/12/2011 31/12/2010

Quick ratio 0,98 0,91

Current ratio 2,14 2,22

Debt 0,65 0,47

Fixed assets cover rate 2,73 2,30

Quick ratio, defined as relation between current assets, net of inventory, and financial statements "Total debts" entry, is equal to 0,98. The company's financial situation is satisfying.

Current ratio, defined as relation between current assets and the financial statements "Total debts" entry, is equal to 2,14. With regard to the amount of current debts, the working capital undertaken value is certainly satisfying.

The debt ratio defined as relation between debts and own means, is 0,65. Own means are to be considered congruous with regard to amount of existing debts.

The amount of own means and consolidated debts is to be considered appropriate in relation to the amount of fixed assets, as shown from their cover, equal to 2,73.

Sales flow

Sales were equal to 13 million Euro, whereas overall production was about 15 million.


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Costs flow

The main operative management costs are split as follows:

31/12/2011 31/12/2010 Changes

PRODUCTION COSTS

6) For raw/auxiliary materials, consumables and goods

6.555.194 204 6.554.9907) For services 5.314.541 4.535.082 779.459

8) For leased assets and rental assets 114.963 204.537 (89.574)

9) For personnel 1.174.080 154.528 1.019.55210) Amortisations and write-downs 655.385 278.006 377.379

11) Changes in inventory (723.006) (723.006)

14) Sundry operating expenses 22.088 10.231 11.857

13.113.245 5.182.588 7.930.657

Refer to the Explanatory Notes for a more structured explanation; however, it is highlighted that sub-contract costs for the realisation of the systems are included in Services.

Personnel costs (employees and temporary) on the whole, was 1.174.080Euro, with incidence on production value of 7,8%.

Financial management

Balance between financial income and charges is negative for 12.741 Euro.

The Explanatory Notes to financial statements detail the individual entries.

Investments

The annexes to the explanatory notes give details of the investments.

The company's investments made during the year amounted to about 14.308 Euro in intangible assets and 38.188 in tangible.Please note that the Brindisi parks' sales value includes land for the overall value of Euro 307.003.

Investments relate to:

INVESTMENTS 2011Intangible:

Concessions, licences, trademarks and similar rights 14.308Tangible:

Other goods 38.188


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Significant events occurred after financial year closing

As said in other parts of the Report, the draft of the new Ministry of the Environment decree (V Feed-In Tariffs) intervened at the beginning of 2012 that, with a logic to stopping cost of renewable in electricity bills, it has frozen the market.The new subsidiary Gascom Sunny People established at the beginning of 2012, stopped its own business oriented to retail and has made commercial investments and in software.The project foresees a proposal for realising an up to 3KWp photovoltaic system on the roof of private homes, with full investment by Gascom Sunny People and, in exchange for channelling the incentive flows supplied by GSE and contribution for the so-called "net metering", Gascom Sunny People will pay the customer's electricity bill for up to an annual limit of 2.500 KW for 20 years which, specially in the South of Italy, is above normal consumption for an average family.It is probably the most interesting retail project in photovoltaic on the market after other operators, with less interesting commercial formula, have had great success.

Gascom Renew has been led to undertake further investments in foreign companies, such as buying a 1,17% share in ASEC (American Sands Energy Corp.), a U.S. company developing a project for the extraction and separation of oil sands from land in the Utah, due to the entire Italian context, quite complicated and unstable. Asec is quoted on the OTC market of Nasdaq. The transaction took place in a 5 million dollar round collection to finance research work.The Gascom Renew share in ASEC will decrease to 0,57% with the next collection transaction for 45 million dollars to finance start of work. Investment in ASEC (0,5 million dollars) is considered very interesting for technological developments, as a first step in view of further transactions in USA and as profit, but not before 2-3 years.

Predictable management development

Perhaps the new drafts of the Decree (V Feed-In Tariff) of February/March 2012 have given a radical blow to the renewable sector, already damaged by the banking system's liquidity problems.Gascom Renew has re-structured its strategy with focus to abroad and in relation to business lines (biomass, hydroelectric, as well as photovoltaic) that in Italy are difficult to realise.In this regard, many areas of strong interest have been outlined, on which Gascom Renew is already acting and in which it will have a role as (temporary) investor:

- Balkan areas.With the constitution of 100% controlled Gascom Balkan D.o.o. by Gascom Renew in April 2012, that will act as holding for the SPV and projects in the Balkan area.


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Faggio Srl, company regulated by Bulgarian law (51%) constituted in March 2012 with a local partner for the realisation of a pellet system to be realised within 2013, will also be merged therein.Particularly, Gascom Renew is developing projects in Serbia (50 MWp photovoltaic, 5 MWp Biomass from agricultural products), Romania (13 MWp wood biomass and photovoltaic), Bulgaria (production of pellets for 4 MWp).Interventions in hydroelectric are also foreseen.Work will start at the beginning of May for a 2 MWp system in Merdare, South of Serbia on the border with Kosovo, that will start operating within June.

- USA and South Africa.A share in ASEC (already described above) in the USA has been purchased, preparatory for a bridgehead for the USA. Furthermore, the constitution of an 18,5 MW hydroelectric station in Ecuador - in which Gascom Renew will be plurality shareholder (43%) – to be realised within 12-18 months, is undergoing completion.

- Italy.With regard to Italy, Gascom Renew is now very critical because many projects, including wind-energy where money has been invested, do not have very clear prospective.With regard to photovoltaic, Sunny People will be re-formulated in view of the V Feed-In Tariff and working times in a Grid Parity logic, without tax break scheme, will be anticipated.In view of all this, 2012 and 2013 appear to be extremely full of opportunities for Gascom. There should also be a pick-up for banks in granting new loans; Gascom has never gone without, not even in 2011. However, pick-up of institutes in supporting development and companies, should give rise to new liquidity in the system, presumably after 30/6, with a view to giving greater turnover to Gascom transactions.

Research and development activity

With regard to research and development during contribution (2010 financial year), market research and feasibility analysis related to forward-thinking aimed at realising opportunities in the renewable energy field, have been transferred in accordance with article 2428 comma 2 number 1; these will be further developed and probably applied in the near future.There have been no new investment in research and development during the 2011 financial year.

Own shares and parent companies shares

The company does not posses own shares or parent company shares.


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Business conditions

The Company's registered offices are in Milan, in via Circo, 12 and the Operational Offices in Padua, in P.zza Aldo Moro, 12, in accordance with art. 2428.

Policy document on safety

In accordance with annex B, point 26, of Leg. Decree no. 196/2003 with Personal data protection code, the directors acknowledge that the Company has adapted to the personal data protection measures, in view of Leg. Decree no. 196/2003 dispositions, according to the terms and methods therein. In particular, the Policy Document on Safety filed with the registered office and available for consultation, was drawn-up on 30/03/2012, and firm data was affixed in the same date.

Additional information

With regard to Annex III “Environmental and employee-related information” of the Italian Association of Chartered Accountants Circular dated 14 January 2009, concerning compulsory information in acknowledging LEG. DECREE 32/2007, we can certify that cases identified therein have not occurred, with regard to personnel or to the environment.

Operating result destination

Dear Shareholders,

We invite you to approve the presented financial statements, proposing to assign the operating profit of 881.648 Euro as follows:

operating profit at 31/12/2011 Euro 881.648

5% to legal reserve Euro 44.082

To extraordinary reserve Euro 837.566

Padua, 30 March 2012

The Chief Executive OfficerMr. Francesco MARANGON


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Page 40

Reg. Comp. 07118700967Eai 1936943

GASCOM RENEW SPA

Offices in VIA CIRCO 12 - 20123 MILAN (MI) Share capital Euro 16.500.000,00 f.p.u.

Company subject to management and co-ordination of GASCOM S.p.A.

Explanatory Notes to financial statements at 31/12/2011(in accordance with art. 2427 c.c.)

Amounts expressed in Euro


Page 40


Page 41

Introduction

Dear Shareholders,

these financial statements subjected for your review and approval, highlight an operating profit of Euro 881.648.

Financial statements form and contents

In accordance with art. 2423 and subsequent of the Civil Code, the financial statements subjected for your approval consist of Statement of assets and liabilities, Income Statement and Explanatory notes.

It is drafted in compliance with article 2423 and subsequent of the Civil code; these explanatory notes drafted in accordance with articles 2427 and 2427 bis of the Civil code, in accordance and pursuant to article 2423, constitute integrating part of the financial year statements.

The comment on the main financial statements' entries at 31 December 2011 provides further clarifications and integrations to its data and contains information requested by art. 2427 and 2427 bis of c.c. and by other legal standards, adequately integrated by the recommendations of the Italian Association of Chartered Accountants' accounting principles, modified by the Official Italian Accounting Board in addition to those issued by said board.

To facilitate reading of the financial situation at 31 December 2011, where required, information has also been provided with regard to that set-out in the Civil Code.

Statements on financial years closed at 31 December 2010 and 2011, have also been attached. They refer to:

- Statement of changes in the Net Assets- Statement of changes in intangible assets- Statement of changes in tangible assets- Statement of changes in financial assets- Financial statement

All transactions implemented by the Company during the financial year are in the accounting entries and are summarised in these financial statements.

The financial statements and the Explanatory Notes are drafted in unit of Euro, without decimal digits, as provided by art. 2423, last comma, of the Civil Code. In consideration of the above, the amounts of the individual entries are rounded off according to general rules.


Page 42

Performed activities

As you know, your Company operates in the renewable energy sector.

Membership of a Group

Your company belongs to GASCOM Group and is controlled by GASCOM SPA which exercises its management and coordination.

The following statement gives essential data on the last financial statements approved by the above-said Company's Board of Directors that exercises management and coordination (article 2497-bis, fourth comma, C.c.).

Please also note that GASCOM SPA drafts the consolidated financial statements.

Description Last draft of financial statements available at 31/12/2011

Penultimate financial statements available at 31/12/2010

STATEMENT OF ASSETS AND LIABILITIES

ASSETS:A) Subscribed capital, unpaid -

B) Capital assets 24.241.807 20.863.851

C) Current assets 40.433.579 30.423.742

D) Accruals and deferrals 2.947.800 1.161.632

Total Assets 67.623.186 52.449.22

LIABILITIES:

A) Net Assets:

Share capital 5.500.000 5.500.000

Reserves 7.014.463 6.629.172

Operating profit earnings (losses) 698.331 1.060.248

B) Provisions for liabilities and charges 54.922 47.282

C) Employee severance indemnity 138.152 94.971

D) Debts 54.139.774 39.038.135

E) Accruals and deferrals 77.544 79.417

Total liabilities 67.623.186 52.449.22

INCOME STATEMENT

Description

Last draft of financial statements available at 31/12/2011

Penultimate financial statements available at 31/12/2010

A) Production value 147.880.149 111.164.046

B) Production costs (145.267.626) (109.015.117)

EBIT 2.612.523 2.148.929

C) Financial income and charges (1.056.579) (369.098)

D) Value adjustments to financial assets 0 0

E) Extraordinary income and charges 2.347 33.696

Income tax for the financial year (859.960) (753.279)

Operating profit earnings (loss) 698.331 1.060.24

The 2011 financial year has recorded a sales turnover for Gascom S.p.A. of 147,8 million Euro (111,1 million in 2010, 33% increase); the net operating margin was 2,6 million (2,1 million Euro in previous year; finally, net profit equal to 698.331 Euro (about 1 million in 2010).

The most significant facts were the following:

a) Continuation of own customer portfolio restructuring plan started in previous financial year.

b) Continuation of company re-organisation plan, also following new strategic set-up.

c) Particular attention to quality of service and correctness towards customers.

They are widely analysed in Gascom S.p.A. Financial Statements, Management report and Explanatory notes, to which reference is made for more details.

Drafting criteria

These financial statements are in compliance with article 2423 and subsequent of the Civil code as shown by these explanatory notes, drafted in accordance with article 2427 of the Civil code that, in accordance and pursuant to article 2423, constitute integrating part of the financial year statements.The financial statements values are represented in unit of Euro with rounding off of relative amounts. Any differences due to rounding off are indicated under "reserve from rounding off in Euro" included in the Net Assets entries and "rounding off from Euro" under "Extraordinary income and charges" entry in the Income Statement.

The explanatory notes are drafted in unit of Euro, in accordance with article 2423, fifth comma, C.C..

Assessment criteria

(Ref. art. 2427, first comma, no. 1, C.c.)

The financial statements' entries have been assessed according to conservatism and matching principles, with a view to continuity of activities as well as considering the economic function of the considered asset and liability element.The application of principle of prudence has lead to individually assess the elements composing the individual assets and liabilities entries, to avoid compensation among losses that should have been recognised and profits not to be recognised as not realised.

On accrual basis, the effect of transactions and other events was accountably detected and attributed to the financial year to which these refer and not to that during which cash flows (receipts and payments) occur.Continuity in applying assessment criteria in time, represents a necessary element for comparing the company's financial statements in the various financial years.Assessment considering the economic function of the considered asset or liability element expressing principle of prevalence of substance over form - compulsory where not expressly in contrast with other standards specified in financial statements - allows representing the operations according to economic reality beneath the formal aspects.

Extensions

There have been no exceptional cases that have made use of extensions under art. 2423 comma 4 of Civil Code, necessary.

Particularly, the assessment criteria adopted in forming the financial statements is the following.

Capital assets

The financial year amortisation shares on financial statements are calculated using the pro-die method that considers the date of coming into force of the good in the company activity and date of closing of financial year.

Intangible

Recorded at purchase cost and rectified by corresponding amortisation provisions.

With Board of Statutory Auditors' consent, the plant and expansion costs, the research, development and advertising costs with long-term utility are recorded under assets and are amortised in a five financial year period.

With Board of statutory auditors' consent, start-up acquired upon payment, was recorded under assets for an amount equal to cost sustained for it and is amortised in a ten financial year period. The choice in a longer amortisation period than five financial years comes from the specific sector in which the company operates' need.

This period does not exceed duration for using this asset. Licences are

amortised with an annual rate of 20%.

If, regardless of already accounted amortisation, there is a long-lasting value loss, the capital assets are consequently depreciated. Lacking conditions for write-downs during subsequent financial years, the original value rectified of amortisations only, is restored.

Tangible

Recorded at purchase cost and rectified by corresponding amortisation provisions.

The recorded value in financial statements considers the accessory charges and costs sustained for using the capital assets, significantly reducing the cost of commercial discounts and cash discounts.

The income statement amortisation shares have been calculated awaiting use, destination and economic-technical duration of assets, based on residue possibility of use criteria that we have considered well represented by the following rates, not modified compared to those applied in sector of pertinence, but reduced on a pro-die basis in view of the fact that the Company has a lower financial year to the year:

- land: 0 %- furniture: 15 %- vehicles, motorcycles and similar: 25 %- computer: 20 %- other goods: 30 %

If, regardless of already accounted amortisation, there is a long-lasting value loss, the capital assets are consequently depreciated. Lacking conditions for write-downs during subsequent financial years, the original value rectified of amortisations only, is restored.

Leasing transactions

The leasing transactions are represented in the financial statements according to equity method, accounting the paid fees according on accrual basis, to income statement. The legally foreseen additional information concerning representation of leasing contracts according to finance lease, are found in the explanatory notes under specific section.

Credits

Set-out at estimated realisable value. Adjustment of credits' nominal value to estimated realisable value is obtained via appropriate credits write-down provision, considering the general financial conditions of sector and country risk.

Debts

Registered at their nominal value, modified during returns or invoicing adjustments.

Accruals and deferrals

Determined according to effective financial year accrual basis.The conditions that determined the original recording of accruals and deferrals, adopting the opportune changes, have been verified for long-term accruals and deferrals.

Inventories

Raw/auxiliary materials and finished goods are recorded at the lowest between purchase or manufacturing cost and realisable value inferable from market flow, applying:

- specific cost.Work in progress is recorded according to:

- specific cost.

Shares

Shares in subsidiaries and associated companies recorded among financial assets, are assessed at purchase or underwriting cost.

Other shares are recorded at purchase or underwriting cost.

Shares recorded under capital assets represent a long-term and strategic investment by the company.

The shares recorded at purchase cost have not been depreciated as they have not sustained any long-last value loss.

Provisions for liabilities and charges

Sums for this have not been allocated.

Post employment benefit

In compliance with laws and work contracts in force, it represents the effective debt matured towards employees, considering every form of continuous compensation.Provision corresponds to total of individual indemnities matured in favour of employees at date of closing of financial statements, net of supplied advances and equal to what should have been paid to employees in case of termination of their work contract at such date.

Income taxes

Taxes are allocated on accrual basis; they represent allowances for paid or to paid taxes during the financial year, determined according to rates and current standards.

Revenue recognition

The product sales revenues are recognised at time of property transfer, that is normally identified with delivery or shipment of goods.Financial revenues and those from services are recognised on an accrual basis.

Adjustment criteria

Criteria in this regard has not been used.

Guarantees, commitments, third party goods and risks

Risks related to granted, personal or real, guarantees for other debts, have been indicated in the memorandum accounts for an amount equal to the granted guarantee; the other debt amount guaranteed at date of financial statements reference, is indicated in these explanatory notes if less than the granted guarantee.Commitments have been indicated at nominal value in the memorandum accounts, taken from relative documentation.

Third party assets held by the company have been assessed at value taken from existing documentation.The risks for which liability is probable are described in the explanatory notes and allocated in the risk provision according to adequacy criteria.The risks for which liability is only possible are described in the explanatory notes without allocation of risk provisions according to accounting principles of reference. Remote risks have not been considered.

Employment data

Compared to previous financial year, company staff, divided by category, has sustained the following changes:

2011 2010Directors 2 0Employees 12 5Labourers 0 0Other 4 1

18 6

The applied national labour agreement is that of the trade sector.

Business

A) Subscribed capital, unpaid

The entry does not exist

B) Capital assets

Specific statements attached have been set-out for intangible and tangible assets, indicating historical costs, previous amortisations and write-ups and movements during the year for each entry.

I. Intangible assets

2011 2010 Changes

Total intangible assets 5.031.041 5.652.637 (621.596)

They consist of:

Description 31/12/201131/12/2010 Changes

Plant and expansion costs 36.972 47.266 (10.294) Research, development and advertising costs 260.800 333.800 (73.000)Industrial patent and

intellectual property rights 6.639 (6.639)

Concessions, licences, trademarks and similar rights 17.752 17.752Start-up 4.714.932 5.264.932

(550.000) Assets under construction and payments on account 0Other 585 585TOTAL 5.031.041 5.652.637 (621.596)

Statement of Intangible Assets movement is attached.

Refer to the 2010 financial year explanatory notes for further information on "Start-up" entry. The 2011 investments were Euro 14.308.

Previous write-ups, amortisations and write-downs

There have been no write-ups or write-downs.

The recorded costs reasonably relate to utility extended in more financial years and are systematically amortised in relation to their residue possibility of use.


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II. Tangible assets

2011 2010 ChangesTotal tangible assets 74.181 362.478 (288.297)

They consist of:

Description

31/12/2011

31/12/2010

ChangesLand and buildings 307.003 (307.003)

Plants and machinery 0

Industrial and commercial equipment 0

Other goods 74.181 55.475 18.706

Assets under construction and payments 0

TOTAL 74.181 362.478 (288.297)

Total Tangible Assets movement

Statement of Tangible Assets movement is attached.

The 2011 investments were Euro 38.188.

Previous write-ups, amortisations and write-downs

There have been no write-ups or write-downs.

The recorded costs reasonably relate to utility extended in more financial years and are systematically amortised in relation to their residue possibility of use.

III. Financial assets

2011 2010 ChTotal financial assets 7.026.608 3.148.586 3.878.022

They consist of:

Description 2011 2010 Change

1) Shares 1.481.000 1.231.500 249.500

2) Credits 5.314.608 1.917.086 3.397.522

3) Other Securities

4) Own shares

231.000 231.000

7.026.608

3.148.586 3.878.022


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In detail:

Shares

Description 2011 2010 Changes1) Shares in:

a) subsidiaries 1.346.000 1.224.000 122.000 b b)

associated companies 135.000 7.500

127.500 c) c) parent companies

d) other companies

1.481.000 1.231.500 249.500

The following information is provided on directly or indirectly owned shares for subsidiaries, associated companies (article 2427, first comma, no. 5, C.c.).

Subsidiaries

Name Share capital % Poss. Value of financial statements share

Platania Vento S.r.l. 10.000 100% 46.000

Liberi Vento S.r.l. 10.000 100% 431.000

2G Power S.r.l. 10.000 100% 690.000

Base Brindisi 1 S.r.l. 10.000 100% 12.500




Base Vento 1 S.r.l. 10.000 100% 12.500

Base Vento 2 S.r.l. 10.000 100% 12.500

Base Vento 3 S.r.l. 10.000 100% 12.500

PV Italy Two S.r.l. 10.000 100% 80.000

Società Agricola Agriwatt S.r.l. 20.000 70%

14.000

Associated companies

Name Share capital % Poss. Value of financial statements share

Gascom Real Estate S.r.l. 50.000 15% 135.000

Total Shares movement

Statement of Shares movement is attached.


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Shares recorded under capital assets represent a long-term and strategic investment by the company.Shares in subsidiaries or associated companies are evaluated respecting the principle of continuity of assessment criteria, at purchase or underwriting cost.The shares recorded at purchase cost have not been depreciated for long-lasting value losses; "restore of value" cases have not occurred.

No immobilised share has undergone change in destination.

There are no restrictions to availability by the participating company or option rights or other privileges on any immobilised share. No subsidiary has decided capital increases on payment or gratuitously during the financial year.No significant transaction has been implemented with subsidiaries.

Credits

31/12/2011 31/12/2010 ChangCredit

s5.314.608 1.917.086 3.397.522

In detail:

Description 31/12/2011 31/12/2010 Changes

1) Credits:

a) towards subsidiaries 1.542.704 1.743.086 (200.382)

b) towards associated companies

174.000 (174.000)

c) towards parent companies 3.771.904 3.771.904

d) towards others

5.314.608 1.917.086 3.397.522

We report that credits to subsidiaries recorded among financial assets at 31.12.2011, are all towards Italian subjects, whereas those towards other for Euro 3.771.904 refer to a company having its offices in the United Kingdom, in relation to art. 2427, first comma, no. 6, c.c. (sharing of credits per geographical area).

There are no financial assets recorded in financial statements for value higher than their fair value.


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C) Current assets

I. Inventory

31/12/2011 31/12/2010 Changes

Total Inventory 15.393.835 11.759.693 3.634.142

The assessment criteria adopted is explained in the first part of these Explanatory Notes.

The entry includes:

31/12/2011 31/12/2010 Changes

CURRENT ASSETS:

I – Inventory: 723.006 723.006

2) work in process 11.251.681 10.136.693 1.114.988

5) advances; 3.419.148 1.623.000 1.796.148

Total Inventory 15.393.835 11.759.693 3.634.142

II. Credits

31/12/2011 31/12/2010 Changes

Total Credits 1.318.137 3.438.294 (2.120.157)

Balance is divided according to deadlines as follows (article 2427, first comma, no. 6, c.c.).

Within 12 months After 12 months Total

1) towards clients; 542.353 542.353

2) towards subsidiaries; 554.338 554.338

3) towards associated companies; 184.612 184.612

4) towards parent companies;

4bis) tax credits;

13.086 13.086

4ter) advanced taxes;

5) towards others. 23.748 23.748

Total 1.318.137 1.318.137

We report that credits recorded under Current assets at 31.12.2011 for Euro 1.318.137, are all towards Italian subjects, in relation to art. 2427, first comma, no. 6, c.c. (sharing of credits per geographical area).


Page 54

III. Financial assets

IV. Cash and cash equivalents

31/12/2011 31/12/2010 Changes

Cash and cash equivalents 20.216 12.532 7.684

The entry consists of:

IV - Cash and cash

equivalents

31/12/2011 31/12/2010 Changes

1) bank and postal deposits 16.746 12.527 4.219

2) Cheques

3) Cash and equivalents 3.470 5 3.465

Total cash and cash equivalents 20.216 12.532 7.684

The balance represents cash and asset availability at financial year closing date.

D) Accruals and deferrals

31/12/2011 31/12/2010 ChangesACCRUALS AND

DEFERRALS111.094 53.947 57.147

Entry composition is detailed as follows:

31/12/2011 31/12/2010 Changes

Accrued income 76.944 23.559 53.385

Deferred charges 34.151 30.388 3.763

Total Accruals and Deferrals 111.094 53.947 57.147

They measure income and charges which competence is advanced or delayed compared to the actual date of payment and/or document; they prescind from date of payment or collection of relative income and charges, common to two or more financial years and divisible over time.

Accrued income in statement mainly relate to interests on intercompany financings.

There are no accruals and deferrals lasting for more than five years at 31/12/2011.

Liabilities

A) Net assets

31/12/2011 31/12/2010 Changes

NET ASSETS 17.554.966 16.673.319 881.647

It consists of:

NET ASSETS

31/12/2011 31/12/2010 Changes

Capital 16.500.000 16.500.000

Legal reserve 8.666 8.666

Extraordinary reserve 164.652 164652

Operating profit earnings (loss) 881.648 173.319 708.329

NET ASSETS 17.554.966 16.673.319 881.647

The share capital consists of:

No. Shares Nom. val.

Ordinary 16.500.000 1

Total 16.500.000 1

The net asset entries are distinguished according to origin, possibility of use, distributability (article 2427, first comma, no. 7-bis, C.c.):

Nature / Description Amount Possibility of use (*) Available share

Eff. use in3 prev. finan. years

to cover losses

Eff. use in3 prev. finan. years for

other reasons

Capital 16.500.000 B

Share premium account

Restatement gains

Legal reserve 8.666 B

Statutory reserves

Reserve for treasury shares (held in portfolio)

Other reserves 164.652 A, B, C 164.652

Earnings (losses) carried forward

Total 164.652

Share not distributable

Distributable share residue 164.652

(*) A: for capital increase; B: to cover losses; C:for distribution to shareholders

Profit per share

Operating profit due to the owner of a unit share of company capital is of 0,0534 Euro.

31/12/2011Shares 16.500.000

Profit 881.648

Profit per share 0,0534

The used calculation method is based on relation between the achieved profit and number of ordinary shares issued and in circulation.

B) Provisions for liabilities and charges

31/12/2011 31/12/2010 Changes

1) For retirement benefits and similar obligations

621 (621)

TOTAL PROVISIONS FOR LIABILITIES AND CHARGES

621 (621)

Decreases refer to financial year uses.

C) Employee severance indemnity

EMPLOYEE SEVERANCE INDEMNITY

31/12/2011 31/12/2010 Changes

73.754 16.656 57.098

The change consists of:

31/12/2011 31/12/2010 Changes

Employees post employment benefit

Labourers post employment benefit

73.754 16.656 57.098

Managers post employment benefit

73.754 16.656 57.098

The set aside provision represents effective company debt to employees, net of paid advances, in force at 31/12/2011.

D) Debts

31/12/2011 31/12/2010 Changes

DEBTS 11.257.355 7.721.602 3.535.753

The entry consists of:

DEBTS

1) Obligations

2) Convertible obligations

3) Non convertible obligations

31/12/2011 31/12/2010 Changes

4) Payable to banks 1.311.348 1.311.348

5) Payable to other investors 669 669

6) Advances 1.185.000 (1.185.000)

7) Payable to suppliers 4.126.123 3.296.491 829.632

8) Payable represented by credit securities 0

9) Payable towards subsidiaries 66.733 66.733

10) Payable towards associated companies 105.419 105.419

11) Payable towards parent companies 4.675.589 2.951.797 1.723.792

12) Tax debts 735.257 220.256 515.001

13) Payable to social security and welfare agencies 54.483 12.069 42.414

14) Other debts 181.735 55.989 125.746

11.257.355 7.721.602 3.535.753

Debts are valued at their nominal value and their deadline is divided as follows:

Within 12 months After 12 months Total

Payable to banks 1.311.348 1.311.348

Payable to other investors 669 669

Advances

Payable to suppliers 4.126.123 4.126.123

Debts towards subsidiaries 66.733 66.733

Debts towards associated companies 105.419 105.419

Debts towards parent companies 3.699.150 976.439 4.675.589

Tax debts 735.257 735.257

Payable to social security 54.483 54.483

Other debts 181.735 181.735

10.280.916 976.439 11.257.355

"Payable to suppliers" are recorded net of commercial discounts; cash discounts are recorded at time of payment.For debts to subsidiaries, associated and parent companies, please note there is a debt for Euro 4.675.589 towards parent company GASCOM SPA.

"Tax debts" includes liabilities for sure and determined taxes, as liabilities for probable or unsure taxes in the amount or in date of contingency or for deferred taxes, are recorded under B.2 entry of liability (Taxes provision).

Tax debts includes debts for IRES tax for Euro 829.340 net of advances paid during the financial year for Euro 173.687;

debts for IRAP for Euro 122.768, net of advances paid during the financial year for Euro 35.323; debts from withholding tax for Euro 33.875, net of deductions incurred for Euro 34.234; finally, it also includes VAT debt for about Euro 8.200.The balance between tax credits and debs is a debt to the Exchequer for aboutEuro 735.257.

Tax debts entry includes debts for:

12) Tax debts

31/12/2011 31/12/2010 Changes

Employee withholding tax 31.091 7.809 23.282

Self-employed withholding tax 3.082 2.242 840

Substitute tax on tfr 62

Due to State Treasury - VAT fund (8.200)

Withholding tax on incentives (32.438)

Ires Advance (173.687)

Irap Advance (35.323)

Withholding tax credit (8)

Credit to Exchequer for tax on interests (1.429)

Inland Revenue Corporate income tax 829.340 173.641 655.699

IRAP withholding tax 122.768 36.564 86.204

Total Tax debts 735.257 220.256 766.024

With regard to sharing of Debts at 31.12.2011 per geographical area, note that almost all is attributed to company with offices in Italy, except for a debt of Euro 40.672 towards a supplier with offices in Switzerland.

The entry "Other debts" is detailed as follows:

31/12/2011 31/12/2010 ChangesWages and salaries to be paid 33.148 14.243 18.905

Different debts 148.587 41.746 106.841

181.735 55.989 125.746

E) Accruals and deferrals

Represent financial year adjusting entries calculated on an accrual basis.

Entry composition is detailed as follows:

31/12/2011 31/12/2010 ChangesAccrued liabilities 87.002 15.969 71.033

Deferred income 2.036 0 2.036

Total Accruals and 89.038 15.969 73.069

Accrued liabilities mainly refer to income to be reimbursed to a customer as not relevant to Gascom Renew. They are incentives on production from photovoltaic energy.

Memorandum accounts

31/12/2011 31/12/2010 Changes

MEMORANDUM ACCOUNTSRisks assumed by the company 231.000 231.000

Commitments entered into by the company 0

Third party assets held by the company 27.445 (27.445)

TOTAL MEMORANDUM ACCOUNTS 231.000 27.445 203.555

Unlike 2010, the residue plan of instalments relating to existing leasing at 31/12/2011 was not set-out among the memorandum accounts, as this will be explained later in the explanatory notes. In fact, accounting principles foresee this possibility and prefer not to repeat information.

There are no guarantees issued by the Company in favour of Bank institutes for third party companies at 31/12/2011.

The own guarantees issued by the company to bank are highlighted below.

Institute Type Number Euro

Banca Popolare di Vicenza Our bank obligation security 1375532 19/12/2011 31/07/2014 231.000,00231.000,00

Third party personal and real guarantees for company debts drafted by the financial statements in accordance with Accounting Principle no. 22 on Memorandum accounts (B.II h), must not be indicated in the Statement of assets and liabilities but in the explanatory as this is useful for assessing the Company's financial situation.

Guarantees granted by bank to Company:

Institute Type Number EuroBanca Popolare di Vicenza Financial bank guarantees 64493 21/07/2011 21/07/2012 1.000.000,00

1.000.000,00

Third party guarantees to the company.

Institute Type Number Euro

Banca Popolare di Vicenza Limited general bank guarantee 1066424 28/03/2011 termination 700.000,00

Banca Popolare di Vicenza Limited specific bank guarantee 1375522 01/12/2011 28/06/2012 1.000.000,00

Banca Popolare di Vicenza Limited specific bank guarantee 1375531 01/12/2011 31/07/2014 1.000.000,002.700.000,00

Information on financial instruments issued by the company

The company has not issued financial instruments.

Information on financial derivatives fair value

The company has not implemented transactions relative to financial derivatives.


Page 60

Income statement

A) Production value

31/12/2011 31/12/2010 ChaPRODUCTION VALUE 14.957.086 5.557.610 9.399.476

Of which:

31/12/2011 31/12/2010 Change1) Revenues from sales and services 13.037.889 2.900.000 10.137.889

2) Changes in inventory4) Increases of non-current assets from in-house production5) Other revenues and income

807.985

1.111.212

2.397.516

260.094

(1.589.531)

851.118

PRODUCTION VALUE 14.957.086

5.557.610 9.399.476

The change strictly relates to that set-out in the Management report.

Revenues for incentives on energy production from renewable sources in the financial year have been included under "Other revenues and income".

As provided by the Revenue Agency's circular number 46/E dated 19/07/2007 under article 6:

"VAT DISCIPLINE OF INCENTIVE TARIFFIn the event the incentive tariff is perceived by the system manager in performing a business, art or profession, it is believed that the purpose of tax on added value, under article 2, third comma, letter a) of Presidential Decree of 26 October 1972, no. 633, excludes the same tariff from the field of application of the tax. In fact, said tariff constitutes a financial subsidy, received by the person responsible in the absence of any counter-performance to the supplier.We observe that in the tax context the term used to indicate said incentive "incentive tariff" is non-technical. In this specific case, the supplied sums do not represent a price or consideration for the supply of energy (as the term tariff would suggest), but a sum paid to restore the system's owner of the costs incurred for constructing the system itself and those for the financial year, as reflected in article 7 of Leg. Decree no. 387 of 2003. No synallagmatic relation is found between the performance put in place by the person giving contribution and those put in place by the person receiving it, that, in fact, is not required to provide any service or sell any good in return.The beneficiary of the tariff only produces electric energy used directly to meet its energy needs or sell to the network manager it is connected to, while the operator obviously does not obtain any direct benefit from the operation of the person the tariff is paid to.Awaiting the absence of the objective element, the exclusion from VAT is also effective when the subject realises the photovoltaic system during the business activities, art or profession financial year.


Page 61

The contribution in question cannot even be considered as an "integration of consideration" under article 13, first comma, last part of Presidential Decree no. 633 of 1972 and of article 73 of the VAT Directive (n2006/112/EC of 28 November 2006), since, under that article, for this contribution to be subject to VAT, it should be an integral part of the fees due from other subjects or a real integration of the 12 prices applied at time of supply of goods or provision of service.This circumstance is not valid for the case in question as the incentive tariff is provided to facilitate the production of electric energy, even if intended for the exclusive use of the perceiver”.

B) Production costs

31/12/2011 31/12/2010

Changes PRODUCTION COSTS

13.113.245 5.182.588 7.930.657

They are detailed as follows:

PRODUCTION COSTS

31/12/2011 31/12/2010 Changes

6) For raw/auxiliary materials, consumables and goods 6.555.194 204 6.554.990

7) For services 5.314.541 4.535.082 779.459

8) For leased assets and rental assets 114.963 204.537 (89.574)

9) For personnel 1.174.080 154.528 1.019.552

10) Amortisations and write-downs 655.385 278.006 377.379

11) Changes in inventory (723.006) (723.006)

14) Sundry operating expenses 22.088 10.231 11.857

13.113.245 5.182.588 7.930.657

Costs for raw/auxiliary materials, consumables and goods and Costs for services

They strictly relate to that set-out in the Management and flow report of point A (Production value) of the Income statement.

Personnel costs

The entry includes full personnel costs including merit salary increases, promotions, automatic cost-of-living increase, cost of not taken holidays and legal allowances and collective contracts.


Page 62

31/12/2011 31/12/2010 Changes

9) For personnel

a) wages and 859.128 122.402 736.726

b) social security

258.635 21.202 237.433

c) post employment benefit; 47.300 9.039 38.261

d) retirement benefits and similar obligations; 9.017 1.885 7.132

Total 1.174.080 154.528 1.019.552

Capital assets amortisation

With regard to amortisations, note that the same were calculated based on the asset's useful duration and its use during production phase.

10) Amortisations and write-downs

31/12/2011 31/12/2010 Changes

a) intangible assets amortisation; 635.903 271.094 364.809

b) tangible assets amortisation; 19.482 6.912 12.570

Total 655.385 278.006

377.379

Other capital asset write-downs

There have been no write-downs.

C) Financial income and charges

31/12/2011 31/12/2010 Changes

FINANCIAL INCOME AND CHARGES (12.471) 8.669 (21.140)

Financial income

Description 31/12/2011 31/12/2010 Changes

From shares

From non-current receivables 125.602 23.559 102.043

From non-current securities

From securities held in current assets

Different income from previous 5.297 1 5.296

Total 130.899 23.560 107.339


Page 63

Specifically:

Description Parent companies Subsidiaries Associated companies Other Total

Interests on obligations

Interests on securities

Bank and postal interests

Interests on financings 13.080 51.331 61.191 125.602

Interests on commercial credits

Other income 5.297 5.297

Rounding off

Total 13.080 51.331 66.488 130.899

Interests and other financial charges

Description Parent companies Subsidiaries Associated companiesOther Total

Interests on obligations

Bank interests

Suppliers interests

Medium-term credit

interests Financial

charges or discounts

Interests on financings (69.508) (72.662) (142.170)

Amortisation of bond issue discount Other

charges on financial transactions Allowance to

risk provision on exchange Rounding off

Total (69.508) (72.662) (142.170)

D) Value adjustments to financial assets

No account to report.

E) Extraordinary income and charges

31/12/2011 31/12/2010 Changes

EXTRAORDINARY INCOME AND CHARGES 2.388 (167) 2.555

of which:

31/12/2011 31/12/2010 Changes

Various income 7.771 7.771

Various charges (5.383) (167) (5.216)

2.388 (167) 2.555


Page 64

Income tax for the financial year

31/12/2011 31/12/2010 Changes

INCOME TAX FOR THE FINANCIAL YEAR

952.108 210.205 741.903

TAXES 31/12/2011 31/12/2010 Changes

Current taxes

IRES 829.340 173.641 655.699

IRAP 122.768 36.564 86.204

Total 952.108 210.205 741.903

The financial year taxes have been recorded.

Settlement between theoretical charge from financial statements and theoretical tax charge is set out below:

Reconciliation between tax charge in financial statements and theoretical tax charge (IRES)

Description Value Taxes

Before tax result 1.833.758

Theoretical tax charge (%) 38% 696.828

Temporary differences taxable in subsequent financial years:

Temporary differences deductible in subsequent financial years:

Directors' Severance Indemnity allowance (deed without precise date)

Turnover of temporary differences from previous financial years:

Maintenance costs deductible from prev. finan. year

Differences which do not affect subsequent financial years:

Non deductible interest payable 1.932

non deductible amortisations (vehicles and start-up) 257.067

Transport means costs 29.129

Contingencies 446

Restaurant and hotel costs 5.980

Other increasing changes 72.723

Deduction A .C.E. (3.190)

IRAP 10% one-off deduction (7.065)

Other decreasing changes (8.307)

Taxable income 2.182.473Current taxes for the financial year 829.34


Page 65

Determination of taxable IRAP

Description Value Taxes

Difference between production value and costs 3.017.921

Costs not recorded for IRAP 199.183

Non deductible start-up amortisation 244.444

Employed personnel IRAP deductions ex art. 11 c.1 Leg. Decree 446/97 (313.656)

Revenues not significant for IRAP

Theoretical tax charge (%) 3,9Taxable IRAP 3.147.892

Current IRAP for financial year 122.76

The information requested on deferred and advanced taxes in accordance with article 2427, first comma no. 14, C.c. is highlighted:

Advanced/deferred taxes

There have been no temporary tax changes for which deferred taxes require recording during the financial year.

Fiscal cleansing

In compliance with the principle under art. 6, letter a), of Law 366/2001, Leg. Decree no. 6/200 bearing the company law reform has repealed the second comma of article 2426 allowing to make value adjustments and allowances only with the application of tax regulations.Lacking of this right does not entail loss of right to deduction of income negative components as, under article 109, comma 4, letter b) of TUIR (Italian consolidated law on income tax), there is the possibility of deducting said components on a non-accounting basis, as re-formulated by Leg. Decree no. 344/2003 bearing the state tax system reform.As Leg. Decree no. 6/2003 does not provide any transitional discipline for value adjustments and allowances attributed to income statement purely in application of tax regulations before the coming into force of the company law reform and having the company made allowances and adjustments to value in previous financial years, without statutory justification, through explicit indication of their exclusive tax validity in the explanatory notes, it has been necessary to write them off recording the relative effects. In accordance with OIC 1 document THEMAIN EFFECTS OF THE COMPANY LAW REFORM ON EDITING OF THE FINANCIAL YEAR

STATEMENTS which refers to accounting principle no. 29, the previous effects of adjustments have been attributed under a specific entry of the extraordinary components in the income statement.


Page 66

Leasing transactions

The company has no. 2 leasing contracts for which the following information, in accordance with article 2427, first comma, no. 22, C.c., is provided:

Leasing no. 1

Business Data

Supplying body VOLKSVAGEN BANK

Leasing contract no. 117088

Contract date 27/07/2011AUDI A6 - NUMBER PLATE:

Used properlyEH668TW

Down payment on lease contract date 27/07/2011

Down payment on lease contract amount 4.166,67

No. overall instalments (excluding any down payment on lease contract) 47,00

Contract duration in months 48,00

Periodicity of fee (Valid 1=month,2=two-month t.,3,4,6,12) 1,00

Advanced/Deferred Fees 2)Adv./1)Defe. 1,00

Instalment amount (net VAT) 879,17

Date of coming into force of good 27/07/2011

First ordinary fee deadline 30/08/2011

Redemption of good date 26/07/2015

Amount requested for redemption 416,67

Incurred cost by grantor (net VAT) 41.666,67

Contractual costs 300,00

VAT rate 20,00

VAT deductible percentage 40,00

Direct taxes deductible percentage 90,00

Any limit amount 18.076,00

Virtual amortisation rate 25,00

Moratorium

Number of suspended instalments in moratorium (0 for no

moratorium) Moratorium start date


Page 67

a) Existing contracts

Financial leasing goods at end of previous financial year, net of

Amount

total amortisations for Euro 0,00 at end of previous financial year 0,00

+ Goods purchased in financial leasing during the financial year 46.667,00

- Goods in financial leasing redeemed during the financial year 0,00

- Financial year amortisation shares 11.667,00

+ / - Value adjustments/recovery on financial leasing goods 0,00

Financial leasing goods at end of financial year, net of total amortisations for Euro 11.667,00

b) Recovered goods

35.000,00

Higher overall value of recovered goods, established according to finance lease, compared to their net accounting value at end of financial year 0,00

Write-off of deferred charges on financial leasing transactions 3.876,00

c) Liabilities

Leasing liability for financial leasing transactions at end of previous

financial year (of which Euro 0,00 expiring in subsequent financial year, Euro 0,00 expiring from 1 to 5 years and Euro 0,00 expiring after 5 years)

0,00

+ Leasing liability arisen during financial year 42.000,00

- Reductions for capital share refund 6.465,00

- Reductions for redemptions during financial year 0,00

Leasing liability for financial leasing transactions at end of financial year (of which

Euro 10.144,00 expiring subsequent financial year, Euro 25.391,00 expiringfrom 1 to 5 years and Euro 0,00 expiring after 5 years)

35.535,00

Write-off of accruals on financial leasing fees 0,00 d)

Gross overall effect at end of financial year -4.411,00 e) Net

tax effect -644,00 f) Effect on

Net Assets at end of financial year -3.767,00

Effect on Income Statement is represented as follows

Write-off of fees on financial leasing transactions 8.688,00

Detection of financial charges on financial leasing transactions 1.412,00

Detection of

- amortisations shares

- on existing contracts 11.667,00

- on recovered goods 0,00

- value adjustments/recovery on financial leasing goods 0,00

Effect on before tax result -4.391,00

Detection of tax effect -641,00

Effect on operating result of detection of leasing transactions with finance lease -3.750,00


Page 68

Leasing no. 2

Business Data

BNP PARIBAS (former

Supplying bodyFORTIS LEASE SPA)

Leasing contract no. L0001141 (former LA 29129)

Contract date 05/08/2009

Used properly RANGE ROVER VEHICLE

(DN014RS)

Down payment on lease contract date 05/08/2009

Down payment on lease contract amount 872,68

No. overall instalments (excluding any down payment on lease contract) 47,00

Contract duration in months 48,00

Periodicity of fee (Valid 1=month,2=two-month t.,3,4,6,12) 1,00

Advanced/Deferred Fees 2)Adv./1)Defe. 1,00

Instalment amount (net VAT) 872,68

Date of coming into force of good 05/08/2009

First ordinary fee deadline 05/09/2009

Redemption of good date 05/07/2013

Amount requested for redemption 391,67

Incurred cost by grantor (net VAT) 39.166,67

Contractual costs 0,00

VAT rate 20,00

VAT deductible percentage 40,00

Direct taxes deductible percentage 40,00

Any limit amount 18.076,00

Virtual amortisation rate 25,00

Moratorium

Number of suspended instalments in moratorium (0 for no moratorium) 0,00

Moratorium start date


Page 69


Financial leasing goods at end of previous financial year, net of total amortisations for Euro 21.933,00 at end of previous financial year

Amount

21.933,00

+ Goods purchased in financial leasing during the financial year 0,00

- Goods in financial leasing redeemed during the financial year 0,00

- Financial year amortisation shares 10.967,00

+ / - Value adjustments/recovery on financial leasing goods 0,00

Financial leasing goods at end of financial year, net of total

amortisations for Euro 32.900,00

b) Recovered goods

Higher overall value of recovered goods, established according tofinance lease, compared to their net accounting value at end of financial year

10.967,00

0,00

Write-off of deferred charges on financial leasing transactions 377,00

c) Liabilities

Leasing liability for financial leasing transactions at end of previous

financial year (of which Euro 10.776,00 expiring in subsequent financial year, Euro 18.387,00 expiring from 1 to 5 years and Euro 0,00 expiring after 5 years)

29.163,00

+ Leasing liability arisen during financial year 0,00

- Reductions for capital share refund 10.776,00

- Reductions for redemptions during financial year 0,00


Euro 11.207,00 expiring subsequent financial year, Euro 7.180,00 expiringfrom 1 to 5 years and Euro 0,00 expiring after 5 years)

18.387,00

Write-off of accruals on financial leasing fees 0,00 d)

Gross overall effect at end of financial year -7.798,00 e) Net

tax effect -539,00 f) Effect on

Net Assets at end of financial year -7.259,00


Write-off of fees on financial leasing transactions 11.942,00

Detection of financial charges on financial leasing transactions 953,00

Detection of


- on existing contracts 10.967,00

- on recovered goods 0,00

- value adjustments/recovery on financial leasing goods 0,00

Effect on before tax result 23,00

Detection of tax effect 2,00

Effect on operating result of detection of leasing transaction with

finance lease 21,00


Page 70

In compliance with indications given in the OIC (Official Italian Accounting Board) document 1 - THE MAIN EFFECTS OF THE COMPANY LAW REFORM ON EDITING OF THE FINANCIAL YEAR STATEMENTS - the following table gives information on the effects that would have been had on the Net Assets and Income Statement by recording leasing transactions with finance lease compared to so called equity method of charge to Income Statement of the paid fees.

Assets


Financial leasing goods at end of previous financial year, net of total amortisations for Euro 21.933 at end of previous financial year 21.933

+ Goods purchased in financial leasing during the financial year 46.667

- Goods in financial leasing redeemed during the financial year

- Financial year amortisation shares 22.634

+ / - Value adjustments/recovery on financial leasing goods

Financial leasing goods at end of financial year, net of total amortisations for

Euro 44.567

b) Recovered goods

Higher overall value of recovered goods, established according to finance lease, compared to their net accounting value at end of financial year

c) Liabilities

Leasing liability for financial leasing transactions at end of previous financial year (of which Euro expiring in subsequent financial year, Euro expiring from 1 to 5 years and Euro expiring after 5 years)

45.967

29.163

+ Leasing liability arisen during financial year 42.000

- Reductions for capital share refund 17.241

- Reductions for redemptions during financial year


Euro 38.351 expiring subsequent financial year, Euro 104.273 expiring from 1 to 5 years and Euro expiring after 5 years)

53.922

d) Gross overall effect at end of financial year (a+b-c) -12.208 e) Net

tax effect -1.183 f) Effect on

Net Assets at end of financial (d-e) -11.025


Write-off of fees on financial leasing transactions 20.630

Detection of financial charges on financial leasing transactions 2.365

Detection of


- on existing contracts 22.634

- on recovered goods

- value adjustments/recovery on financial leasing goods

Effect on before tax result -4.368

Detection of tax effect -639

Effect on operating result of detection of leasing transactions with finance lease -3.729


Page 71

Information concerning agreements not resulting from statement of assets and liabilities

The company does not have agreements not resulting from Statement of assets and liabilities.

Overall compensation due to directors and members of the Board of statutory auditors and to auditor (article 2427, first comma, no. 16, C.c.) is highlighted in accordancewith the law.

Qualification

CompensationDirectors 178.873

Board of Statutory Auditors 39.751

Auditors 16.575

These financial statements consisting of Statement of assets and liabilities, Income statement and Explanatory note, truthfully and correctly represents the financial situation and financial year net result and complies with the accounting records.

Chairman of the Board of Directors

Valentino Barbierato


Page 72


Page 73

ANNEXES

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STATEMENT OF CHANGES IN THE NET ASSETS AT 31 DECEMBER 2011 (In Euro)

Starting Balance Profit destination

Dividends distribution

Paymentcapital Re-classifications Operating profit

Balance

Share capital 16.500.000 16.500.000Legal reserve 0Extraordinary reserve 0Reserve from contribution 0Other reserves 0Earnings carried forward 0Losses carried forward 0Operating profit 173.319 0 173.319Operating loss 0

TOTAL NET ASSETS 31/12/2010 16.673.319 0 0 0 0 0 16.673.318

Share capital 16.500.000 16.500.000Legal reserve 0 8.666 8.666Extraordinary reserve 0 164.652 164.652Reserve from contribution 0 0Other reserves 0 0Earnings carried forward 0 0Losses carried forward 0 0Operating profit 173.319 (173.319) 881.647 881.648Operating loss 0 0

TOTAL NET ASSETS 31/12/2011 16.673.319 0 0 0 0 881.647 17.554.966

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STATEMENT OF CHANGES IN FINANCIAL ASSETS AT 31 DECEMBER 2011 (In Euro)

Initial situation Financial year movements

Final situation

Description value at 31/12/10 increases decreases re-classifications value at 31/12/11

1) Shares in: 1.231.500 349.500 (100.000) 0 1.481.000 a)

subsidiaries; 1.224.000 222.000 (100.000) 1.346.000 b)

associated companies; 7.500 127.500

135.000 c) parent companies; 0

0 d) other companies; 0

0

2) credits: 1.917.086 3.771.904 (374.382) 0 5.314.608

a) to subsidiaries; 1.743.086 (200.382) 1.542.704 b) to

associated companies; 174.000 (174.000) 0c) to parent companies; 0 0

d) to others; 0 3.771.904 3.771.904

3) other securities; 0 231.000 231.000

4) own shares; 0 0

TOTAL 3.148.586 4.121.404 (243.382) 0 7.026.608

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STATEMENT OF CHANGES IN INTANGIBLE ASSETS AT 31 DECEMBER 2011 (In Euro)

Initial situation Financial year movements Final situation

Description cost Accumulated

amort.

value at31/12/10

increases decreases re-classifications on asset

Financial year amort.

re-classifications on provision

cost Accumulated

amort.

value at31/12/11

1) start-up and expansions costs; 51.471 4.205 47.266 10.294 51.471 14.499 36.972

2) research, development and advertising costs; 365.000 31.200 333.800 73.000 365.000 104.200 260.800

3) industrial patent and intellectual property rights; 7.259 620 6.639 (7.259) (620)

4) concessions, licences, trademarks and similar rights; 14.308 6.440 2.445 550 20.748 2.995 17.752

6) start-up; 5.500.000 235.068 5.264.932 550.000 5.500.000 785.068 4.714.932

6) assets under construction and payments on account;

7) others. 819 164 70 819 234 585

TOTAL 5.923.730 271.093 5.652.637 14.308 0 0 635.903 0 5.938.038 906.996 5.031.041

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STATEMENT OF CHANGES IN TANGIBLE ASSETS AT 31 DECEMBER 2011 (In Euro)

Initial situation Financial year movements Final situation

Description cost Accumulated

amort.

value at31/12/10

increases decreases re-classifications on asset

Financial

year

amort.

re-

classificatio

ns on

provision

cost Accumulated

amort.

value at

31/12/11

1) land and buildings; 307.003 307.003 (307.003)

2) Plants and machinery

3) Industrial and comm. equipment

4) other goods; 77.049 21.574 55.475 38.188 19.482 115.237 41.056 74.181


TOTAL 384.052 21.574 362.478 38.188 (307.003) 0 19.482 0 115.237 41.056 74.181


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Working capital financial statement (OIC 12)

Net result 881.648

Amortisations (+) 655. 385

Net allowances to provisions (+) (621)

TFR net change (+) 47. 300

Write down (+) 0

Write-ups (-) 0

Cost capitalisation (-) 0

Working capital flow generated by operating activities 1.583.712

Disinvestment of technical investments 307. 003

Disinvestment of financial investments 100. 000

Disinvestment of intangible investments 0

Undertaking of new medium-long term debts 1.032. 916

Own capital real increase 0

Balance other changes (292.180)

Working capital flow generated by non-operating activities 1.147.739

TOTAL WORKING CAPITAL SOURCES 2.731.451

New technical, financial and intangible investments 387. 495

Medium-long term debts payment 0

Own capital real reductions 0

Payment of dividends 0

Short-term share transfer of m/l term debts 0

TOTAL COMMITMENTS 387.495

WORKING CAPITAL CHANGE 2.343.956

Cau

se f

or

chan

geChange in short-term assets

Immediate liquidity 7. 684

Deferred liquidity 1. 300. 362

Inventory 3. 668. 292

Total short-term asset changes 4.976.339

Change in short-term liabilities

Financial liabilities 1. 312. 017

Non-financial liabilities 1. 320. 366

Total changes in short-term liabilities 2.632.383

WORKING CAPITAL CHANGE 2.343.956

Restatements of capital assets 0

Capital contribution in kind 0

Other transactions 0

TOTAL TRANSACTIONS WITHOUT EFFECTS ON WORKING CAPITAL

0


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Liquidity financial statement (OIC 12)

Liq

uid

ity

sou

rces

Net result 881.648

Amortisations (+) 655. 385

Net allowances to provisions (+)

(621)

TFR net change (+) 47. 300

Write down (+) 0

Write-ups (-) 0

Cost capitalisation (-) 0

Inventory change (3. 634. 142)

Credits to customers change 2. 887. 741

Accrued income and deferred charges change (57. 148)

Accrued liabilities and deferred income change 73. 068

Total liquidity generated by operating activities 909.708

Disinvestment of technical investments 307. 003

Disinvestment of financial investments 474. 382

Disinvestment of intangible investments 0

Undertaking of new financial debts 3. 535. 754

Own capital increase with issue of cash 0

Balance other changes (1. 059. 764)

Total liquidity generated by non-operating activities 3.257.375

TOTAL LIQUIDITY SOURCES 4.167.083

New technical, financial and intangible investments 4. 159. 399

Financial debts payments 0

Own capital reductions 0

Payment of dividends 0

TOTAL INVESTED LIQUIDITY 4.159.399

LIQUIDITY CHANGE 7.684

GASOM RENEW BIL, NI, REL GEST 31 12 2011

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