Analysis of income statement items

Income from equity investments (€757 million) consists mainly of dividends distributed by subsidiaries Italgas S.p.A. (€356 million), Snam Rete Gas S.p.A. (€287 million), Stogit S.p.A. (€94 million) and GNL Italia S.p.A. (€3 million)³⁵.

Interest income and other financial income (€451 million) essentially refers to interest income from the intragroup loans granted by Snam to subsidiaries.

Interest expense and other financial expense (€495 million) refers to the costs relating to financial debt, and mainly concern the expenses on fixed-rate bonds³⁶ (€289 million) and on loans from banks and other financial institutions (€200 million).

The increase in interest expense and other financial expense (-€262 million) and in interest income and other financial income (+€245 million) is related to the centralised treasury management activities performed by Snam S.p.A. from the second half of 2012 onwards.

Income from services rendered (€170 million) refers to the chargebacks to subsidiaries of the costs incurred to perform services managed centrally by Snam S.p.A. These services are governed by contracts concluded between the parent company and its subsidiaries in the following areas: ICT, personnel and organisation, planning, administration, finance and control, general services, property and security services, legal and corporate affairs and compliance, health, safety and environment, regulation, external relations and communication, internal audit and Enterprise Risk Management (ERM). The pricing model for service contracts is based on the chargeback of all costs incurred to provide the services on a full-cost basis.

Other income (€13 million) essentially refers to revenue from renting and maintaining fibre optic telecommunications cables for third parties.

Personnel expenses totalled €65 million, up by €6 million, or 10.2%, compared with 2012. This increase was due largely to the centralisation within Snam S.p.A. in 2013 of certain activities that had previously been carried out by subsidiaries.

The number of employees as at 31 December 2013 (703 people) is analysed below by professional status:

Costs for non-financial services and other costs (€126 million) consist mainly of expenses for the provision of services that are charged back to subsidiaries.

Income taxes

The higher taxes associated with the increase in dividends received from subsidiaries were offset by the effects of higher operating costs and financial expense pertaining to Snam S.p.A.