Analysis of income statement items

Income from equity investments (€753 million) consist of the dividends distributed by the subsidiaries Snam Rete S.p.A.(€435 million), and Stogit S.p.A.(€169 million) as well as companies under joint control Trans Austria Gasleitung GmbH (€88 million), TIGF Holding S.A.S. (€39 million) and the associated company Italgas S.p.A.(€22 million)³⁸.
The expenses from shares refer to the devaluation of shares in GasBridge 1 B.V. and GasBridge 2 B.V. (€13 million total)³⁹.

The asset interest and other financial revenue (€262 million) essentially concern: (i) interest income deriving from intragroup loans granted by Snam S.p.A. to the subsidiaries Snam Rete Gas S.p.A. and Stogit S.p.A. (€205 million total); (ii) the financial revenue deriving from the recharge to the companies Snam Rete Gas S.p.A. and Stogit S.p.A. of the charges connected to the buyback operation put into effect by Snam in the month of October 2017 (€50 million total); (iii) the revenue connected to the Shareholders’ Loan granted in favour of TAP (€6 million).

The Liability Interest and other financial expenses (€292 million) principally refer:(i) to the expenses connected to the bond buyback operation (€56 million), equal to the difference between the reacquisition price for the bonds on the market and the relative value to the depreciated cost; (ii) to expenses on short-long term financial debts and concern expenses on bond loans⁴⁰ (€219 million) and on loans issued by Banks and other Financial Institutions (€17 million).

Revenues from services (€210 million) mainly refer to the recharges to subsidiaries and to the Italgas Group of the costs for the provision of services performed by Snam S.p.A.(respectively €140 and €60 million).The services provided by Snam S.p.A. to the subsidiaries are regulated by service contracts which concern the following areas:ICT, personnel and organisation, planning, administration, finance and control, general services, property services, legal and corporate affairs and compliance, health, safety and environment, external relations and communication, internal audits, commercial services, regulation and development, security, technical services and procurement. The services provided by Snam S.p.A. to the Italgas Group are settled by means of certain contracts for a transitional period, as provided for in the contract for the spin-off transaction, finalised in November last year.

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

Personnel costs increased by €2 million compared to the previous year, mainly due to higher charges for the Isopensione fund.

The number of employees at 31 December 2017 (822 people) is broken down below by professional status:

The increase of 39 persons is mainly attributable to the adjustment of the organisational structures, started on 1 November 2016, to which some staff services are assigned, which involved the centralisation of certain functions previously performed by the operating companies on Snam.

Costs for the provision of non-financial services and other costs increased (€11 million) mainly due to higher provisions for risks and charges (€11 million).Further information is provided in Note 17 “Provision for risks and charges” of the Notes to the financial statements.

Income tax

Income taxes (€1 million) recorded a reduction of €12 million compared to the corresponding period of the previous year. The effects deriving from the higher pre-tax profit were more than offset by the reduction of the IRES rate starting from 1 January 2017, from 27.5% to 24.0%⁴¹.