2007-Implenia-Halbjahresbericht-e

Half-Year Report

2007

Contacts

CEOChristian BubbPhone +41 (0)44 805 45 55Fax +41 (0)44 805 45 56E-mail [email protected]

CFORoger MerloPhone +41 (0)22 787 03 16Fax +41 (0)22 787 02 21E-mail [email protected]

Media and CommunicationClaude VollenweiderPhone +41 (0)44 805 45 43Fax +41 (0)44 805 45 20E-mail [email protected]

Schedule2007 “Balance Sheet” Press conference11 March 2008

2007 Presentation to Financial Analysts11 March 2008

2008 General Meeting8 April 2008(Possible to request inclusion of a pointon the agenda up to 22 February 2008)

Unoffi cial translation for information purpose only. Offi cial version is available in German.

06 Message

10 Development of Our Activities

14 Condensed Consolidated Interim Income Statement15 Condensed Consolidated Interim Balance Sheet 16 Condensed Consolidated Interim Cash Flow Statement 17 Condensed Consolidated Interim

Statement of Changes In Equity19 Notes to the Consolidated Interim Financial Statements

Introduction Fields of Activity Financial Statements3

1 2 3

1 Introduction

6

Dear Ladies, Gentlemen and ShareholdersWe are proud to present to you the half-year report for 2007 of the Implenia Group. This is the Group‘s fi rst report covering a full half year. It is therefore only partially com-parable to the half-year report for 2006, as that report covered only the period starting from the creation of the Group and ending on 30 June 2006.

You will recall that, on 2 March 2006, you approved by an overwhelming majority the merger of the two leaders of the Swiss construction industry, Zschokke and Batigroup, to form the Implenia Group. This merger, prompted by strong economic reasons, put us in a position of strength and therefore won massive support. Your approval con-fi rmed our conviction that the best way to face market challenges, both present and future, was to combine our forces, thus establishing ourselves as the undisputed industry leader.

The Implenia Group: on the right roadDevelopments since this decision have confi rmed our expectations:– the merger has projected our Group into a new dimen-

sion; Implenia is now able to consolidate its position as undisputed leader in all of its fi elds of activity in Switzerland: construction, industrial construction, as general/total contractor or in real estate;

– having achieved this critical mass, the Group now has the capability to prevail over increasingly strong foreign competition; this new dimension is also a major prerequi-site for maintaining its independence;

– the merger has considerably strengthened our technical competence, as well as our fi nancial fl exibility and our capacity to take risks; it is a decisive asset in the area of project development;

– our critical mass allows us to adopt a balanced strategy; Implenia now has the know-how and fi nancial power needed to actively develop the provision of services up-stream and downstream of the actual construction process; we are also implementing industrial processes that will enable us to benefi t henceforth from major economies of scale;

– the synergy effects resulting from this increased pro-ductivity should also translate into an improvement of the results of the low margin segments;

– our new dimensions and strengths at national level also give us targeted access to attractive foreign markets (selected construction or services).

The Implenia Group, fully aware that its organisation needs to be aligned with the needs of the market, is today structured in four operating divisions:1. Real Estate division, grouping services provided up-

stream and downstream of actual construction activity – and, secondarily, work done as general contractor – such as the development of projects, engineering and real estate management;

2. Infra division, grouping traditional works, i.e. building, civil engineering, roads and special construction works;

3. Tunnels and total contractor division, specialised in major infrastructure projects, in particular tunnels and railway engineering;

4. Global Solutions division, which organises and groups all our activities abroad.

This range of services allows the Implenia Group to cover the entire life cycle of a building. Of course, we continue to be exposed to market forces in the various segments, but we now have the advantage of being able to offer our customers customised, global or specifi c solutions, by drawing on the broad range of services that we can offer. Moreover, the structure of our services makes us relatively less subject to the ups and downs of construction cycles compared to a classic contractor. This advantage clearly differentiates the Implenia Group from the other market actors.

Strong order book and good prospectsThe fi nancial situation in the construction industry, which on the whole is now satisfactory, is due mainly to a growth of activity with which the companies operating in the in-dustry have been able to cope without increasing their workforces and without intensifying their capital invest-ments. Overall productivity has therefore increased.

Increasing productivity in the construction industry

IntroductionMessage 7

In the fi rst quarter of 2007, the turnover of the Swiss construction industry amounted to about CHF 3.3 billion, with an increase of 14.6% over the fi rst quarter of last year. This growth can be explained by a positive economic climate, but also – and above all – by favourable weather conditions.

Despite the globally satisfactory order volume, con-struction continues to be plagued by a price war similar to that observed during the recession of the 1990‘s. Because of these prices, which often do not refl ect healthy manage-ment choices, our increased costs, for both materials or wages, can be offset only in part by an improvement of productivity.

The private sector has been the main driver of this increased turnover. The construction of homes, especially, remains very dynamic. Private investments in civil engi-neering also increased in the fi rst quarter. However, the progression of the order volume for homes is more modest, standing at 2.5%. The limited infl ow of orders at the end of March 2007 indicates that the construction of homes has presumably reached its peak.

The turnover for the construction of offi ces and in-dustrial buildings refl ects the present positive economic climate. It reached about CHF 540 million in the fi rst quarter of 2007, which is a level unmatched since 2002. On the other hand, the order book shows a decrease of more than 19%. It is therefore necessary to expect a drop in activity in this fi eld between now and the end of the year.

The civil engineering turnover depends essentially on a small number of major projects. It was thus strongly infl uenced by the renovation works on the A2 motorway. The award of the Erstfeld lot of the alpine crossing projects has also infl uenced the order book and the quantity of work. In relation to the high turnover level, the decreased work volume (– 8%) is hardly surprising. However, thanks to the increase in private civil engineering works (close to CHF 420 million), the volume of work in this fi eld remains at the same level as last year.

The announced construction projects lead us to expect a continuation of this favourable economic climate for some time still. A sudden market collapse is not likely. The average volume of the companies‘ order books stands at a level comparable to that of last year.

Good half-year resultIn the fi rst half of 2007, the Implenia Group achieved results in line with its high expectations. The turnover, includ-ing the working partnerships (not consolidated), reached about CHF 1 444 million, which is an increase of 5% over its level last year in the same period. The overall Group result stands at CHF 3.5 million, after deducting CHF 6.7 million for integration costs, exceptional fees and deprecia-tion of intangible assets.

A good result for the year is forecastThis result is in line with our expectations and – keeping in mind the seasonal nature of our business – gives us a strong base for achieving a good result for the year. Thanks to the impressive order books on which all divisions of the Group can currently count, we estimate that the annual turnover of Implenia should reach CHF 3 000 million, after deducting the extraordinary costs for the year. For the year 2007, the balance of the integration costs, exceptional fees and depreciation of intangible assets should amount to about CHF 19.5 million.

At the end of July 2007, the Group‘s order book amount-ed to CHF 2 696 million, spread over a number of years. The Group‘s equity, as at 30 June 2007, amounted to CHF 369.8 million. The cash-fl ow before fi nancing activities amounted to CHF (190.8) million.

Still no agreement with LaxeyThe intentions of the UK-based investment fund Laxey Partners which, at the beginning of the year, secretly ac-quired a block of shares representing 22.9% of the capital of Implenia, still remain rather unclear. Based on the articles of association and the registration regulations, the Board of Directors rejects the request for registration by Laxey,

8

Key Figures for the Group

(in 1000 CHF Restated Restated

unless otherwise indicated) fi gures fi gures

06/2007 06/2006 12/2006 Turnover* 1 312 412 1 308 961 2 810 127

Order book1 2 695 760 2 726 655 2 303 646

EBIT without real estate 6 411 (2 144) 41 522

Real estate 6 418 (3 506) 5 980

Operating Result EBIT2 12 829 (5 650) 47 502

Reversal of EBIT Batigroup3 0 14 766 14 766

Integration costs (4 457) (15 180) (39 953)

Depr. of intangible assets (1 652) (2 286) (5 271)

Exceptional fees (555) 0 0

EBIT IFRS 6 165 (8 350) 17 044

EBITDA 25 167 10 771 54 370

Group result 3 495 (11 894) 6 142

Equity 369 800 352 246 369 519

Total employees1 6 074 6 157 5 942

* Total turnover (2006 fi gures including Batigroup starting from 1.1.06) including share in work partnerships.

1 as at 31.7. / 31.12. respectively2 2006 fi gures including Batigroup starting from 1.1.063 EBIT Batigroup 1.1.–2.3.06

which has increased its attempts to put pressure on our Board of Directors and our Management to obtain the registration of its shares, with the exception of the 4.9% of the capital already registered. Given the legislation currently in force (Lex Koller), the level of holding demand-ed by Laxey would entail the destruction of the values created so far and would threaten, or prevent the develop-ment of the Implenia Group in line with the strategy ad-opted, which has now demonstrated its worth. Your Board of directors remains determined to uphold its decision not to register any other shares held by Laxey and, there-by, to protect the interests of the majority of our sharehold-ers against the private interests of a single investor seek-ing only short-term profi t.

Just a little more than one year after the creation of the Implenia Group, the results achieved in the fi rst half of 2007 are evident. They would not have been possible without the efforts and commitment of our employees, at all levels. We take this opportunity to thank them all. As for you, shareholders, but also partners, we thank you for the confi dence that you show in our Group, its Board of directors and its management. For us, this is a confi r-mation of the validity of our strategy and an encourage-ment to continue along this road.

Our best regards

Anton Affentranger Christian BubbChairman of the Board of Directors CEO

Dietlikon, September 2007

Fields of Activity2

10

Real EstateCreation of an innovation pole For the current year, the Real Estate division (real estate, engineering and work as general contractor) expects a turnover of about CHF 1 305 million and an EBIT result before extraordinary charges of about CHF 33.2 million. At the end of July 2007, its order book amounted to CHF 1 196 million.

The Real Estate division is positioned as an innovation pole. Its objective is to win orders for global or partial services through the development of innovative solutions rather than through a price war. Its excellent reputation, its close ties with our customers, through its 30 branches, the strong support it receives from the Group and its fi rst-class references should all make the Real Estate divi-sion the ideal partner for real estate investors, both private and institutional.

Key Figures – Real Estate

(in 1000 CHF)

06/2007 06/2006 12/2006

Turnover* 620 371 577 480 1 338 694

Order book1 1 196 041 1 400 339 1 227 310

Operating Result EBIT2 11 066 3 545 21 085

Reversal of EBIT Batigroup3 0 159 159

Integration costs (525) (2 854) (16 921)

Depr. of intangible assets (767) (930) (1 851)

EBIT IFRS 9 774 (80) 2 472


* Total turnover (2006 fi gures including Batigroup starting from 1.1.06) including intra-group turnover.


Fields of ActivityDevelopment of Our Activities 11

ConstructionClear improvementOver the whole year, the turnover of our Construction divi-sion, consisting of two units Infra and tunnels and works as total contractor, should reach about CHF 1 682 million. Based on the present fi gures, the annual EBIT result should amount to CHF 40 million, before extraordinary charges. At the end of July 2007, the order book amounted to CHF 1 499 million, distributed over several years, above all in tunnels and special construction works. The great in-crease compared to last year is mainly due to the synergies achieved, which have begun to bear their fruits.

Key Figures Tunnel and Total Contracting

(in 1000 CHF)

06/2007 06/2006 12/2006

Turnover* 190 373 222 723 402 630

Order book1 826 466 691 553 679 576

Operating Result EBIT2 12 009 9 756 20 723

Reversal Result EBIT Batigroup3 0 (1 147) (1 147)

Integration costs 0 (660) (137)

Depr. of intangible assets (426) (472) (0)

EBIT IFRS 11 583 7 477 19 439

Total employees1 607 693 655

* Total turnover (2006 fi gures including Batigroup starting from 1.1.06) including intra-group turnover / including share in work partnerships.


Key Figures Infra

(in 1000 CHF)

06/2007 06/2006 12/2006

Turnover* 615 057 555 918 1 204 243

Order book1 673 253 634 763 396 760

Operating Result EBIT2 (6 372) (16 632) 8 837

Reversal of EBIT Batigroup3 0 15 428 15 430

Integration costs (3 932) (3 269) (18 817)

Depr. of intangible assets 0 (884) (2 361)

EBIT IFRS (10 304) (5 357) 3 089


12

Global SolutionsFirst successes abroad

The Global Solutions division groups, executes and coordinates all of our activities abroad. It brings together all the competence and potential of the Group and is thus positioned as the partner of choice for an international clientele in a number of geographical areas and particular segments. The division concentrates on two key areas of competence: solutions for infrastructures and provision of services to the High Quality Buildings segment. Depend-ing on the problems to be solved, customised solutions are found working in collaboration with the other divi-sions of the Group. Implenia Global Solutions can there-fore count on its own internal resources, but also on a network of partners, both national and international.

In the area of infrastructures, Implenia concentrates on bridges, roads, tunnels and special construction works. The fi eld of High Quality Buildings includes design, planning, engineering and project implementation man-agement. Along these two lines, we profi le ourselves as providers of solutions for ambitious projects in terms of quality. On the geographical level, strong growth mar-kets, like Russia, other countries of Eastern Europe and the Middle East, are our priority targets. To implement

our strategy effectively, we are currently studying the possibility of entering into joint ventures with reputed local partners.

In Russia and the Middle East, the fi rst projects have already been booked or developed, notably a draft project including the design of two stadiums for the city of Sotchi, which will host the 2014 Winter Olympics. These two stadiums will form the heart of the Olympic vil-lage: the stadium seating 40,000 spectators will be used for the opening ceremony, while the icehockey stadium seating 12,000 spectators will be used as a multi-purpose facility. Implenia Global Solutions has taken on the func-tions of general planning, value design and engineering.

Financial Statements3

The notes on pages 19 to 30 are an integral part of these consolidated fi nancial state-ments. 1 Discounts (amounting to KCHF 1189 in 2006 in the fi nancial result) have been reclassifi ed in the Income Statement (materials and subcontractors). The results on other fi nancial invest-ments (KCHF 617) have been reclassifi ed as fi nancial income.

14

Condensed Consolidated Interim Income Statement

Condensed Consolidated Interim Income Statement Restated fi gures1

(in 1000 CHF) NotesJanuary to June 2007

January to June 2006

Group turnover 4 1 100 148 1 014 296

Materials and sub-contractors (649 047) (618 882)

Personnel (356 915) (321 508)

Other operating expenses (70 319) (65 273)

Depreciation (19 002) (19 121)

Income from associated companies 1 300 1 655

Income from other investments – 483

Operating result (EBIT) 4 6 165 (8 350)

Financial charges (4 131) (3 481)

Financial income 3 074 2 537

Earnings before tax 5 108 (9 294)

Income tax expense (1 613) (2 600)

Consolidated Group result 3 495 (11 894)

Attributable to:

Shareholders of Implenia SA 3 215 (12 390)

Minority interests 280 496

Consolidated Group result 3 495 (11 894)

Earnings per share (undiluted) 5 CHF 0.18 CHF (0.77)

Earnings per share (diluted) 5 CHF 0.18 CHF (0.77)


Condensed Consolidated Interim Balance Sheet

Condensed Consolidated Interim Income Statement | Condensed Consolidated Interim Balance Sheet

The notes on pages 19 to 30 are an integral part of these consolidated fi nancial state-ments.

Condensed Consolidated Interim Balance Sheet Restated fi gures

(in 1000 CHF) Notes 30.6.2007 31.12.2006

ASSETS

Cash and cash equivalents 52 645 107 346

Securities 822 686

Trade debtors 365 839 313 670

Work in progress 318 316 172 168

Work partnerships 78 022 72 615

Other debtors 39 955 29 984

Inventories 17 542 18 310

Real estate operations 176 550 165 077

Prepayments and accrued income 31 034 22 994

Current assets 1 080 725 902 850

Tangible fi xed assets 6 220 262 212 812

Investments in associated companies 22 317 22 354

Other fi nancial investments 38 500 40 823

Benefi t plan surplus 8 258 8 258

Intangible assets 7 91 436 93 416

Deferred tax assets 8 271 4 953

Non-current assets 389 044 382 616

TOTAL 1 469 769 1 285 466

EQUITY AND LIABILITIES

Current portion of long-term borrowings, banks 8 232 181 81 096

Trade payables 191 028 134 030

Work in progress 487 447 511 434

Work partnerships 15 191 9 103

Other payables 28 648 36 885

Current tax liabilities 3 194 4 883

Accruals and deferred income 101 836 89 408

Current liabilities 1 059 525 866 839

Long-term borrowings 8 5 010 15 718

Provision for deferred tax liabilities 15 188 11 691

Provisions 9 20 246 21 699

Non-current liabilities 40 444 49 108

Implenia SA share capital 10 89 589 89 589

Reserves 131 937 123 315

Retained earnings 159 742 154 465

Treasury shares (18 979) (7 319)

Result attributable to shareholders of Implenia 3 215 5 277

365 504 365 327

Minority interests 4 296 4 192

Equity 369 800 369 519

TOTAL 1 469 769 1 285 466

16

Condensed Consolidated Interim Cash Flow Statement

Transactions with no effect on cash and cash equiva-lents: acquisition of installa-tions held on leases amounting to CHF Mio 0.0 (CHF Mio. 1.7 in 2006).

The notes on pages 19 to 30 are an integral part of these consolidated fi nancial state-ments.

Condensed Consolidated Interim Cash Flow Statement Restated fi gures

(in 1000 CHF) NotesJanuary to june 2007

January to june 2006

Operating activities

Net profi t before taxes 5 108 (9 294)

Depreciation 19 002 19 121

Changes in provisions 9 (2 270) 5 379

Changes in value adjustment in real estate operations (1 721) (150)

Profi t on sale of fi xed assets ( 156) 98

Changes in benefi t plan adjustments – –

Other adjustments not effecting cash and cash equivalents 1 968 (1 621)

Changes in trade and other debtors (63 187) (116 462)

Changes in trade and other payables 48 761 90 951

Changes in work in progress/inventories (169 367) (23 484)

Changes in work partnerships 681 (25 509)

Investments in real estate operations (16 689) (31 750)

Disposals of real estate operations 10 262 8 744

Other short-term assets and liabilities 2 126 9 108

Interest paid (1 925) (2 782)

Interest received 1 277 2 113

Taxes paid (1 890) ( 966)

Net cash from operating activities a) (168 020) (76 504)

Investment activities

Investments in tangible fi xed assets 6 (24 876) (9 953)

Disposals of tangible fi xed assets 6 669 743

Purchase/sale of subsidiaries – 20 792

Other investments in fi nancial assets (887) (311)

Other disposals of fi nancial assets 2 413 5 882

Investments in intangible assets 7 (150) (207)

Net cash from investment activities b) (22 831) 16 946

Financing activities

Increase in borrowings 8 222 000 103 324

Repayment of borrowings (81 623) (64 720)

Minority interests (dividends paid) ( 176) (104)

Dividends paid – (6 827)

Nominal value refund – –

Purchase of treasury shares (17 711) –

Sale of treasury shares 13 761 1 585

Net cash from fi nancing activities c) 136 251 33 258

Net increase / (decrease) in cash and cash equivalents (a+b+c) (54 600) (26 300)

Foreign currency translation ( 101) 20

Increase / (decrease) in cash and cash equivalents (54 701) (26 280)

Cash and cash equivalents at the beginning of the fi nancial year 107 346 99 437

Cash and cash equivalents at the end of the half year 52 645 73 157

Financial Statements17Condensed Consolidated Interim Cash Flow Statement | Condensed Consolidated Interim Statement of Changes in Equity

Condensed Consolidated Interim Statement of Changes in Equity

Condensed Consolidated Interim Statement of Changes in Equity Restated fi gures

Implenia Ltd. Shareholders

(in 1000 CHF)Share

CapitalTreasury

Shares

Consoli-dated

ReservesRevaluation

Reserves

Foreign Currency

Translation Retained Earnings Sub-total

Minority Interests

Total Equity

Balance as at 1.1.2006 25 500 (1 923) 19 152 – 486 162 057 205 272 1 286 206 558

Foreign currency translation – – – – 381 – 381 – 381

Gain/Loss recognised directlyin equity (sub-total) – – – – 381 – 381 – 381

Loss for the period – – – – (12 390) ( 12 390) 496 (11 894)

Gain/Loss recognised for the period – – – – 381 (12 390) ( 12 009) 496 (11 513)

Capital increase as at 6.03.06(and share exchange) 64 089 (4 905) 100 390 – – – 159 574 6 159 580

Transaction costs – – (1 214) – – – ( 1 214) – ( 1 214)

Reverse 2005 capital gain on Batigroup shares – – – – – (765) (765) – (765)

Value adjustment of newly consolidated companies – – – 2 807 – – 2 807 2 139 4 946

Change in treasury shares – 729 856 – – – 1 585 – 1 585

Dividends paid – – – – – (6 827) (6 827) (104) (6 931)

Balance as at 30.06.2006 89 589 (6 099) 119 184 2 807 867 142 075 348 423 3 823 352 246

Balance as at 1.1.2007 89 589 (7 319) 120 049 2 906 360 159 742 365 327 4 192 369 519

Foreign currency translation – – – – 912 – 912 – 912

Gain/Loss recognised directlyin equity (sub-total) – – – – 912 – 912 – 912

Profi t for the period – – – – – 3 215 3 215 280 3 495

Gain/Loss recognised for the period – – – – 912 3 215 4 127 280 4 407

Change in treasury shares – (11 660) 7 7101 P18 – – – (3 950) – (3 950)

Dividends paid – – – – – – – (176) (176)

Balance as at 30.06.2007 89 589 (18 979) 127 759 2 906 1 272 162 957 365 504 4 296 369 800

1 Profi t resulting from the disposal of treasury shares in the fi rst semester of 2007 (average selling price = CHF 35.80). As required by IFRS the profi t was recorded directly to equity. 2 Implenia /Zschokke exchange ratio = 40:1 3 Implenia/Batigroup exchange ratio = 1:1

18

Change in Treasury Shares

Number

Average unit cost price

(in CHF) Total

Balance as at 1.1.2006 5 110 376 1 923

Disposals (profi t-sharing plan) (1 937) 376 (729)

Balance as at 2.03.2006 3 173 376 1 194

Exchanged for Implenia shares 1 126 920 9 1 194

Implenia SA shares held by Zschokke Holding 2 259 681 18 4 665

Implenia SA shares 20 700 5 100

Implenia SA shares held by Batigroup Holding 3 6 573 21 140

Balance as at 30.06.2006 413 874 15 6 099

Balance as at 1.1.2007 465 074 16 7 319

Disposals (profi t-sharing plan) (77 480) 16 (1 219)

Disposals (307 048) 16 (4 833)

Purchases 412 300 43 17 712

Balance as at 30.06.2007 492 846 39 18 979


Notes to the Consolidated Interim Financial Statements

Condensed Consolidated Interim Statement of Changes in Equity | Notes to the Consolidated Interim Financial Statements

1 General information This Half-year Report containing the consolidated interim fi nancial statements has been prepared in accordance with the «Interim Finan-

cial Information» standard (IAS 34) and does not include all the information and comments required in the Annual Report. This report

must be read in relation to the Annual Report dated 31 December 2006.

Comparative information relating to the period from 1 January to 30 June 2006 is restricted to the activity of the former Zschokke

Group up to 2 March 2006. The business combination of Zschokke and Batigroup within Implenia is effective as of 3 March 2006.

This report for the 1st half year of 2007 containing the consolidated interim fi nancial statements of the Implenia group was approved

by the Board of Directors of Implenia Ltd. in its meeting held on 11 September 2007.

All fi gures are presented in thousands of Swiss francs, unless indicated otherwise.

Implenia Ltd. is a Swiss company based in Dietlikon (Zürich). Its shares are traded on the Swiss stock exchange.

The group’s main business activities are presented in note 4 – Segment Information.

2 Accounting policiesThe consolidated fi nancial statements of the Implenia group are prepared in accordance with the Internal Financial Reporting Standards

(IFRS) issued by the «International Accounting Standards Board» (IASB).

The distribution of the segments has been adapted to refl ect the new distribution of activities in the various sectors. The description

of the new segments, which form part of the accounting policies, are indicated below. The comparative fi gures for 2006 of the segment

information have been restated accordingly.

General Contracting (forms part of the Real Estate division)

The activities of this segment include the general planning of projects, as well as work done as general and total contractor in the

construction fi eld.

Real Estate activities (form part of the Real Estate division)

Real estate activities include real estate promotion and the implementation of projects in the real estate fi eld.

Services (forms part of the Real Estate division)

Service activities include studies, the management and running of buildings, the coordination, engineering and planning of projects

related to real estate, as well as Facility Management.

Tunnel construction works and Total Contracting

Activities in this sector include underground works, tunnels and total contracting in railway engineering.

Infra construction works

This segment is active in the construction and maintenance of roads and buildings, civil engineering infrastructures and special

construction works.

Global Solutions

This new segment offers engineering and project management services mainly abroad.

Head offi ce overheads and sundry expenses

This category includes the costs of the parent company (Holding) that cannot be assigned to any segment and of the affi liated

companies not engaged in activities. At the reporting by segment level, this category includes notably the fi nancial commitments of

the Group (consortium loan).

20

The accounting policies applied in the preparation of the consolidated fi nancial statements as at 30 June 2007 are identical to those

published in the report dated 31 December 2006, but also take into account the new standards that have come into force since then and

are indicated below.

The following new standards, amendments and interpretations have been adopted starting from the accounting period beginning on 1st

January 2007:

– IFRS 7 – Financial Instruments: Disclosures

The new standard requires a signifi cant increase of disclosures on the impact of fi nancial instruments on the fi nancial statements.

It will be refl ected in annual fi nancial statements.

– IFRIC 7 – Applying the Restatement Approach under IAS 29 standard – Financial Reporting in Hyperinfl ationary Economies

– IFRIC 8 – Scope of IFRS 2

– IFRIC 9 – Reassessment of Embedded Derivatives

– IFRIC 10 – Interim Financial Reporting and Impairment

Any impairment of goodwill reported and recognised in the interim report can no longer be reversed in the second half year for presen-

tation in the annual report.

With the exception of the specifi c comments made, these new standards or amendments have no signifi cant impact on the interim

fi nancial statements of Implenia.

New standards, interpretations and amendments to standards that have already been published, but are not yet obligatory:

– IFRS 8 – Operating Segments (for accounting periods starting from 1st January 2009). The application of IFRS 8 will infl uence reporting

and presentation by segments, but it will not have any impact on the consolidated result.

– IFRIC 11 – Group and Treasury Share Transactions according to IFRS 2 (for accounting periods starting from 1st March 2007)

– IFRIC 12 – Service Concession Arrangements (for accounting periods starting from 1st January 2008)

– IFRIC 13 – Customer Loyalty Programmes (for accounting periods starting from 1st July 2008)

The Management has examined these new standards and interpretations and has come to the conclusion that, with the exception of the

comment made on IFRS 8, they will not have a signifi cant impact on the presentation of the fi nancial statements of Implenia.

3 Consolidation scopeMerger

Following the acquisition of the Reuss group in 2006 and with the aim of a simplifi cation of the legal structure, the following

companies were merged with retroactive effect as of 1st January 2007. The company resulting from the merger bears the new name

of Reuss Engineering AG.

Merged companies:

– B+B Engineering AG

– Reuss Management AG

– Reuss FM AG

– Robert Aerni AG

– Reuss Group Holding AG

– S+P Haustechnik AG

This merger of 6 wholly-owned subsidiaries (100%) of the Implenia group has no impact on the presentation of the consolidated fi nancial

statements.

Name changes

Implenia Real Estate SA has changed its name and is now called Implenia Development Ltd.

Reuss Group International AG has changed its name and is now called Implenia Global Solutions Ltd.

Batilabor AG has changed its name and is now called Implenia Investment Management Ltd.

The position as at 30 June 2007 of the affi liated companies is reported on page 29 and 30 of this report.

Financial StatementsNotes to the Consolidated Interim Financial Statements 21

1 The operating result of the Construction segments has been restated to refl ect the new organisation of the segments. The impact of the reclassifying of the discounts and the result on other fi nancial investments is attributed to the Infra Construction Works segment. (See also the comment on the Income statement).

4 Segment Information

The new operational organisation of the Group is based on the following main sectors of activity:

– general contractor (general planning, general and total contractor)

– real estate (promotion, project development)

– tunnel construction works + TC (undergroud works, total contracting in railway engineering)

– infra construction works (roads and buildings, civil engineering, special construction)

– services (building management, engineering and facility management)

– global Solutions (engineering and project management abroad)

Sectors ‹General contractor›, ‹Real estate› and ‹Services› are gathered within the global segment ‹Real Estate›.

Because Implenia is presently essentially active in Switzerland, no secondary segment disclosure by geographical areas is reported.

Inter-segment transactions are carried out at market conditions.

Real Estate

(in 1000 CHF) General

contracting Real Estate

activties Services

Tunnel construction

works + TC

Infra construction

works Global

Solutions

Head offi ce overheads and Miscellaneous

Group Total


Turnover before elimination of internal sales 508 583 68 174 43 579 68 623 523 796 2 477 16 746 1 231 978

./. Inter-group services (39 850) (2 879) (2 210) (211) (70 764) (10) (15 906) (131 830)

Turnover 468 733 65 295 41 369 68 412 453 032 2 467 840 1 100 148

Operating profi t/EBIT 5 558 6 418 (2 202) 11 583 (10 304) (945) (3 943) 6 165

Restated fi gures1 Real Estate

(in 1000 CHF) General

contracting Real Estate

activties Services

Tunnel construction

works + TC

Infra construction

works Global

Solutions

Head offi ce overheads and Miscellaneous

Group Total


Turnover before elimination of internal sales 490 159 3 806 52 297 147 492 368 142 – 12 181 1 074 077

./. Inter-group services (118) – (3 559) (12 875) (32 137) – (11 092) (59 781)

Turnover 490 041 3 806 48 738 134 617 336 005 – 1 089 1 014 296

Operating profi t/EBIT 3 743 ( 4262) 439 7 477 (5 357) – (10 390) (8 350)

22

5 Earnings per share Restated fi gures

January to January to June 2007 June 2006

Net earnings 3 215 (12 390)

Weighted average number of shares in circulation 18 146 079 15 996 444

Earnings per share 1 CHF 0.18 CHF (0.77)

Number of shares in circulation as at 30.06. 17 979 154 18 058 126

6 Tangible assets

Investments in tangible assets in the fi rst half year of 2007 amounted to 24.9 mio and mainly concern the production units (4.3 mio) and

machines and materials (19.4 mio). These investments were made essentially in the construction segments.

Disposals amounting to 0.67 mio concern machines and materials and were made mainly in the construction segments.1 There is no dilution.


The date of the goodwill impairment test is 31 December. No interim tests have been conducted, as no negative signs that could justify

such tests have been noted by the Management. Consequently, the fi gure for goodwill has not been revalued.

7 Intangible assets

(in 1000 CHF)

IT Project Licences

and Software Brands and Trademarks

Customer List and Order

Book Goodwill Group

Total


As at 1.1. after depreciation 2 903 1 054 1 001 10 901 77 557 93 416

Change in consolidation scope – – – – – –

Reclassifi cation 604 (784) – 45 – (135)

Net investments 150 – – – – 150

Depreciation (652) (186) – (1 157) – (1 995)

As at 30.06.07 after depreciation 3 005 84 1 001 9 789 77 557 91 436

of which pledged – – – – – –

(in 1000 CHF)

IT Project Licences

and Software Brands and Trademarks

Customer List and Order

Book Goodwill Group

Total

2006

As at 1.1. after depreciation – 695 – – 4 834 5 529

Change in consolidation scope 3 812 857 2 884 13 230 72 723 93 506

Net investments 150 294 – – – 444

Depreciation (1 059) (792) (1 883) (2 329) – (6 063)

As at 31.12.06 after depreciation 2 903 1 054 1 001 10 901 77 557 93 416

of which pledged – – – – – –

24

The increase of borrowings during the fi rst semester was required to fi nance the working capital (seasonality) and relates essentially to the

construction works segment.

8 Borrowings

(in 1000 CHF) 2007 2006

As at 1.1. 96 814 1 535

Change in consolidation scope – 99 836

Increase in borrowings 222 000 310 664

Repayments (81 623) (315 221)

As at 30.06.07/31.12.06. 237 191 96 814

Due dates:

Within 12 months 232 181 81 096

Between 1 and 5 years 5 010 15 718

As at 30.06.07/31.12.06. 237 191 96 814

of which fi nancial leases 8 260 13 289


Provisions for warranty relate to the residual risk on completed projects which, according to contracts, can be claimed within a period of

usually 2 to 3 years, and possibly 5 years at the most.

Onerous contracts relate to renting agreements. They usually expire within 2 to 3 years.

The remaining balance of the provision for integration costs relates essentially to rebranding and other current costs not yet due.

Other provisions cover risks related to foreign activities, ongoing litigation, ongoing claims for damages and site restoration.

9 Provisions

(in 1000 CHF)

Warranty provisions

Onerous contracts

Integration costs Others

Group Total

2007

As at 1.1. 4 319 3 962 1 766 11 652 21 699

Foreign currency translation difference – – – 88 88

Change in consolidation scope – – – – –

Reclassifi cation 138 – 474 117 729

Allocation – – – 233 233

Utilised (254) – (698) (1 120) (2 072)

Released – – (40) (391) (431)

As at 30.06.07 4 203 3 962 1 502 10 579 20 246

(in 1000 CHF)

Warranty provisions

Onerous contracts

Integration costs Others

Group Total

2006

As at 1.1. – – – 1 491 1 491

Change in consolidation scope 4 696 2 692 7 766 4 590 19 744

Allocation – 1 270 (6 000) 5 581 851

Utilised – – – (10) (10)

Released (377) – – – (377)

As at 31.12.06 4 319 3 962 1 766 11 652 21 699

26

The Annual General Meeting on 2 March 2006 decided on a conditional capital increase of up to a total of CHF 44 794 600 (9 236 000

shares with a nominal value of CHF 4.50 each) for the purpose of covering the potential conversion of future convertible bonds or similar

fi nancial instruments. As of 30 June 2007, no such fi nancing instruments had been issued.

10 Share capital

Known shareholders holding more than 5% of share capital as at 30 June 2007(31 December 2006):

30.6.2007 31.12.2006

Laxey Group 22.9% 0.0%

Parmino Holding AG 11.1% 10.9%

Port Noir Investment Sàrl 6.5% 0.0%

3V Asset Management AG – 5.2%

Number of registered shares: 18 472 000 18 472 000

Nominal value per share in CHF 4.85 4.85

Total nominal value in CHF, as at 89 589 200 89 589 200

Number of shares in circulation, as at 17 979 154 18 006 926

ISIN Code CH002 386 8554 (IMPN)


11 Related party disclosures

(in 1000 CHF)January

to june 2007January

to june 2006

Information on related party transactions

Sales to related parties

– associated companies 2 363 498

– companies related to a key management executive – –

– work partnerships 116 172 76 462

– others – 490

Purchases from related parties

– associated companies 1 968 3 105

– companies related to a key management executive 1 336 3 013

– work partnerships 3 140 –

– others – 5 895

Credit claims on related parties (as at 30.06.)

– associated companies 2 832 280

– companies related to a key management executive – –

– work partnerships 77 752 33 632

– others 250 –

Debts to related parties (as at 30.06.)

– associated companies 2 626 1 168

– companies related to a key management executive 96 341

– work partnerships 5 437 –

– others 658 –

Transactions with related parties are dealt with at arm’s length. The term “key management executives” includes the members of the Board of Directors and the members of the Group Management.

Short-term employee benefi ts 2 778 2 225

Other post-employment benefi ts 183 163

Long-term benefi ts – –

Termination benefi ts – –

Share-based payments 748 405

Total remuneration of key management executives 3 709 2 793

Balance in favour of key management executives as at 30.06. 1 566 –

28

12 Contingent liabilities

(in million CHF) 30.6.2007 31.12.2006

Third party guarantees 178.0 228.6

The balance of outstanding guarantees relates essentially to ongoing own projects (submission, warranty and issued

guarantees) as well as for work partnership projects.

13 Post-balance sheet events

The Annual General Meeting of Shareholders held on 24 April 2007 decided to repay CHF 0.35 of the face value of each Implenia Ltd.

share. As the legal requirements for repayment were met, the repayment was made as planned on 10 July 2007. Starting from that date,

the share capital of Implenia Ltd. amounts to CHF 83 124 000.–.

On 20 July 2007, Implenia Ltd. signed a rider to its credit agreement with a consortium of banks increasing the cash credit limit from

CHF 50 mio to CHF 250 mio and reducing the guarantee limit by CHF 50 mio to CHF 250 mio.

The total cash and guarantee limit remains unchanged at CHF 500 mio. The other terms of the initial contract also

remain in effect.

Up to the time of the approval of this report, there were no known events that might require an adjustment to the

accounting values of the Group‘s assets and liabilities.


14 Subsidiaries

Name Shareholding Registered Currency Share Segment Active/ Held By

offi ce capital Inactive

AG für manuelle Dienstleistungen 53.33% Neuenhof CHF 150 000 Services Active Implenia AG

Balduin Weisser AG 100% Basel CHF 1 750 000 Overheads Holding Inactive Implenia

and Miscellaneous Immobilien AG

Bâtiments industriels 100% Mulhouse (F) EUR 195 000 Real Estate Inactive Implenia AG

du Haut-Rhin Sàrl (Bâtirhin)

Développements transfrontaliers SA 100% Lyon (F) EUR 14 663 800 Real Estate Active Implenia

Real Estate AG

Gebr. Ulmer GmbH 100% Bruchsal (D) EUR 25 565 Overheads Holding Inactive Implenia AG

and Miscellaneous

Gravière de La Claie-aux-moines SA 66.66% Savigny CHF 1 500 000 Infra Construction Works Active Implenia AG

Gust. Stumpf GmbH 100% Bruchsal (D) EUR 1 533 876 Overheads Holding Inactive Implenia Holding

and Miscellaneous GmbH

Gust. Stumpf Verwaltungs GmbH & Co KG 100% Bruchsal (D) EUR 511 292 Overheads Holding Inactive Implenia AG

and Miscellaneous

Implenia (Ticino) SA 100% Lugano CHF 150 000 Infra Construction Works Active Implenia AG

Implenia Bau AG 100% Genève CHF 40 000 000 Infra + Tunnel, Active Implenia AG

TC Construction Works

Implenia Bau GmbH 100% Rümmingen (D) EUR 2 556 459 Infra Construction Works Active Implenia Holding

GmbH

Implenia Generalunternehmung AG 100% Basel CHF 20 000 000 General Contractor Active Implenia AG

Implenia Development AG 100% Dietlikon CHF 30 000 000 Real Estate Active Implenia AG

Implenia Global Solutions Ltd. 100% Dietlikon CHF 100 000 Global Solutions Active Implenia AG

Implenia Holding GmbH 100% Rümmingen (D) EUR 3 067 751 Overheads Holding Active Implenia


Implenia Immobilien AG 100% Dietlikon CHF 30 600 000 Real Estate Active Implenia AG

Implenia Investment Management AG 100% Dietlikon CHF 100 000 Real Estate Active Implenia AG

Implenia Management AG 100% Genève CHF 500 000 Overheads Holding Active Implenia AG

and Miscellaneous

M.F. Wachter Bauunternehmung GmbH 100% Stuttgart (D) EUR 1 000 000 Overheads Holding Inactive Implenia Holding


Privera AG 100% Bern CHF 4 000 000 Services Active Implenia AG

Privera Services AG 100% Bern CHF 1 000 000 Services Active Implenia AG

Reprojet AG 100% Zürich CHF 100 000 Infra Construction Works Active Implenia AG

Reuss Engineering AG 100% Dietlikon CHF 100 000 Services Active Implenia AG

Rocmouve SA 66.66% Echallens CHF 120 000 Infra Construction Works Active Implenia AG

SAPA, Société Anonyme de Produits 75% Satigny CHF 500 000 Infra Construction Works Active Implenia AG

Asphaltiques

SISAG 100% Abidjan (CI) XOF 492 000 000 Infra Construction Works Active Implenia AG

Socarco 100% Bamako (Mali) XOF 100 000 000 Infra Construction Works Active SISAG

Sonnrain Wohnbau GmbH 100% Rümmingen (D) EUR 255 646 Overheads Holding Inactive Implenia Holding


Strassen und Tiefbau AG 100% Vaduz (FL) CHF 50 000 Overheads Holding Inactive Implenia


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14 Subsidiaries

Name Shareholding Registered Currency Share Segment Active/ Held By

offi ce capital Inactive

Stuag Bauunternehmung GmbH 100% Rümmingen (D) EUR 306 775 Overheads Holding Inactive Implenia Holding


Swiss Overseas Engineering Company 100% Genève CHF 200 000 Overheads Holding Inactive Implenia AG

and Miscellaneous

Tetrag AG 100% Gisikon CHF 100 000 Services Active Implenia AG

Trachsel AG 100% Heimberg CHF 100 000 Infra Construction Works Active Implenia AG

Zschokke Bratislava s.r.o. 100% Bratislava (SLK) SKK 2 225 000 General Contractor Inactive Implenia AG

Zschokke Construction Sàrl 100% Lyon (F) EUR 76 225 Overheads Holding Inactive Zschokke France SA

and Miscellaneous

Zschokke Développement SA 100% Lyon (F) EUR 457 347 Overheads Holding Inactive Zschokke France SA

and Miscellaneous

Zschokke France SA 100% Lyon (F) EUR 914 694 Overheads Holding Inactive Implenia AG

and Miscellaneous

Zschokke GmbH Leipzig 100% Leipzig (D) EUR 1 022 584 Overheads Holding Inactive Zschokke Holding

and Miscellaneous Deutschland GmbH

Zschokke Holding Deutschland GmbH 100% Berlin (D) EUR 3 067 751 Overheads Holding Inactive Implenia AG

and Miscellaneous

Zschokke Österreich GmbH 100% Wien (O) EUR 35 000 Tunnel + Active Implenia AG

TC Construction Works

Zschokke Procédés Spéciaux Sàrl 100% Lyon (F) EUR 457 347 Overheads Holding Inactive Zschokke France SA

and Miscellaneous

All subsidiaries of the Group are fully consolidated.

Financial StatementsNotes to the Consolidated Interim Financial Statements

Implenia Ltd.Industriestrasse 248305 DietlikonPhone +41 44 805 45 55Fax +41 44 805 45 56www.implenia.com

2007-Implenia-Halbjahresbericht-e

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