Tiscali 2014 Annual Report Download - page 17

Annual financial report as at 31 December 2014
Date
File Name
Status
Page
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Annual Report as at 31
December 2014
17
Bankruptcy Law; (ii) the signing of the Restructuring Agreements; (iii) the signing of the SEF
Agreement. For further information please refer to the section “Assessment of the business 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.
In relation to the exposure to the risks associated with interest rate fluctuations, with regard to the
Group’s predominant financing method (financial debt as per the Restructuring Agreement at a fixed
rate), the Group deems the risk of interest rate fluctuations as insignificant.
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.
The activities of the Tiscali Group also depend on the contracts outstanding with its strategic suppliers,
in particular Telecom Italia, concerning both the use of the network infrastructures and interconnection.
If these contract should fail to be renewed on expiry or be renewed under less favourable terms and
conditions with respect to those currently existing; or Tiscali does not manage to finalise new contracts
with Telecom Italia or with third party operators, necessary for the development of its business; or if a
serious contractual breach should be committed by Telecom Italia, there could be negative effects on
the activities and on the Group’s economic, equity and financial situation.
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
In this connection, please refer to the section “Assessment of the business 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”.