Tiscali 2012 Annual Report Download - page 14

Annual financial report as at 31 December 2012
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Date File Name Status Page
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Annual Report as at 31
December 2012 14
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Risks associated with financial requirements
The evolution of the Group’s financial situation depends on different factors, in particular the
achievement of the forecast objectives, the trend in the general conditions of the economy, the
financial markets and the sector in which the Group operates.
The Group has implemented a restructuring plan aimed at ensuring long-term economic and financial
equilibrium. The on-going attainment of adequate financing depends largely on the general conditions
of the credit market and the Group’s ability to reschedule the debt outstanding with the Financing
institutions maturing in 2014 and 2015, and correctly implement the economic and financial plan aimed
at creating stable economic and financial balance conditions.
For further information please refer to section 3.7 “Evaluation of the company as a going-concern and
future outlook”.
Risks associated with fluctuations in interest and exchange rates
The Tiscali Group operates essentially in Italy. Some supplies, even though for insignificant amounts,
could be denominated in foreign currency; therefore, the risk of exchange rate fluctuations which the
Group is exposed to is minimum. The Tiscali Group is exposed to risks deriving from changes in the
interest rates which could have a negative impact on the economic and financial results.
Risks associated with dealings with employees and suppliers
Group employees are protected by various laws and/or collective labour contracts which ensure they
have, via local and national delegations, the right to be consulted with regard to specific matters,
including therein downsizing or the closure of departments and the reduction of the workforce. These
laws and/or collective labour contracts applicable to the Group and its suppliers could influence its
flexibility when strategically redefining and/or repositioning its activities. Tiscali’s ability and that of its
suppliers to make staff cuts or take other measures, even temporary, to end the employment
relationship is subject to government authorisations and the consent of trade unions. Trade union
protests by workers could negatively affect the company’s activities.
Risks associated with the turnover of management and other human resources with key roles
The Group’s future depends greatly on the ability of its executives to manage it effectively. The loss of
the services of an executive director, a first level manager and other key resources without adequate
replacement, as well as the inability to attract and retain new and qualified personnel, could therefore
have a negative impact on the Group’s prospects, activities and economic and financial results.
Risks associated with business continuity
For further information please refer to section 3.7 “Evaluation of the company as a going-concern and
future outlook”.
Risks associated with disputes and contingent liabilities
For further information please refer to the section “Ongoing disputes, contingent liabilities and
commitments”.
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Economic position
(EUR mln)