2009 FIRST HALF REPORT - investor.psf.itinvestor.psf.it/files/catalogue/attachments/PSF_1H_ENG_2009.pdf · Director () Riccardo Camia ()= Appointed on April 17, 2009 STATUTORY AUDIT

2009 FIRST HALF

REPORT

Approved by the Board of Directors August 28, 2009

Poligrafica S. Faustino S.p.A. 25030 CASTREZZATO (BS) ITALY - Via Valenca 15 Phone n. +39.030.70491 - (10 lines.) Fax +39.030.7049280 Share Capital Euro 6.161.592,12 fully paid - nr. of shares 1.194.107 Tax code number 01251520175 – VAT code 00614280980 Registered with “Registro Imprese” of Brescia nr. 01251520175 www.psf.it

Poligrafica S. Faustino Group – 2009 First Half Report ______________________________________________________________________________________________

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1. INDEX

2. BOARD OF DIRECTORS AND STATUTORY AUDIT COMMITTEE Page 3

3.

THE GROUP Page 4

4. SHAREHOLDERS AND STOCK PERFORMANCES

Page

5

5. MANAGEMENT REPORT 5.1. CONSOLIDATED financial and economic highlights 5.2. POLIGRAFICA S. FAUSTINO financial and economic highlights

Page 6

5.3. R&D activities 5.4. Personnel 5.5. Investments 5.6. Consolidated net financial position 5.7. Own shares 5.8. Related parties 5.9. Corporate Governance 5.10. Economic highlights of subsidiary companies 5.11. Subsequent events 5.12. Enterprise risks management and predictable managing evolution

6.

CONSOLIDATED FINANCIAL STATEMENTS 6.1. Tables of consolidated financial statements 6.2. Notes to consolidated financial statements

Page 16

7. Certification pursuant the article 154 bis of Italian Legislative Decree No. 58/1998

Page 31

Auditors’ review report Page 32


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2. BOARD OF DIRECTORS AND STATUTORY AUDIT COMMITTEE

BOARD OF DIRECTORS

Chairman and Managing Director Alberto Frigoli Managing Director Giuseppe Frigoli Managing Director Emilio Frigoli Director Francesco Frigoli Director Giovanni Frigoli Independent Director Carlo Alberto Carnevale Maffè Independent Director Alberto Piantoni Director (*) Riccardo Camia (*)= Appointed on April 17, 2009

STATUTORY AUDIT COMMITTEE

Chairman Umberto Bisesti Auditor Francesco Curone Auditor Umberto Bisesti

INDEPENDENT AUDITORS

ANALISI S.p.A. - REGGIO EMILIA

SPECIALIST

TWICE SIM S.p.A. - MILANO


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3. THE GROUP

Subsidiary Companies BB S.r.l.: E-commerce services www.cantoalto.it (already owner of the internet site

www.casarossi.it) Mediattiva S.r.l.: web agency and internet provider Litografia Spada S.r.l.: printing of prestige paper labels LinkOnLine S.r.l.: distribution of consumer products for informatics

POLIGRAFICA S. FAUSTINO S.p.A.

BB S.r.l.

Mediattiva S.r.l. Litografia

Spada S.r.l.

100% 65%

100%

LinkOnLine S.r.l.

100%


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4. SHAREHOLDERS AND STOCK PERFORMANCES

More relevant shareholders (>2%)

46.56%

Alberto Frigoli (Chairman and Managing Director) 8.61% Giuseppe Frigoli (Managing Director) 8.56% Francesco Frigoli (Director) 8.60% Emilio Frigoli (Managing Director) 8.61% Giovanni Frigoli (Director) 8.63% Own shares 3.55% Other shareholders (Market) 53.44% Total number of shares 1,194,107 (Number of own shares as at 30 June 09) (42,351) Issue price (29th of October 1999) Euro 37.00 Fixing as at 30/06/09 Euro 13.4 Average price of 2009 First Half Euro 12.14 Total share capital value as at 30th June 2009 Euro 16.00 mln Ticker: PSF NM Specialist: Twice Sim S.p.A. (www.twicetrade.it) Web site: www.psf.it Investor Relations: [email protected]


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5. MANAGEMENT REPORT

5.1. CONSOLIDATED FINANCIAL AND ECONOMIC HIGHLIGHTS

The main data are reported here below by comparison with those of the same period of 2008. CONSOLIDATED INCOME STATEMENT

2009First Half

2008First Half

Variation

Euro (mln) Euro (mln) Euro (mln) Sales and other operating income

22.74 24.95 (2.21)

Operating costs (21.92) (23.59) 1.67EBITDA 0.82 1.36 (0.54)Depreciation and amortization (1.10) (1.52) 0.42EBIT (0.28) (0.16) (0.12)Net financial income (expense)

(0.15) (0.16) 0.01

Before tax result (0.43) (0.32) (0.11)Tax (0.18) (0.18) -Net result (0.61) (0.50) (0.11)

The Group’s course Despite the considerable difficulties depending on the general economic proceeds, the reduction of profit of the first half of this year appears to be kept in under 10% in comparison with the same period of the last year business. However, the EBITDA is positive and it is equal to nearly 4% of the proceedings and it has benefited from reductions of fixed costs as personnel and services. In particular, significant savings in cost of services (reduction of external workings) and in cost of personnel (due to a more efficient managing of internal resources) have been registered. The limited signal of business increase during the month of July should bring benefits in the business trend of the second half of the accounting year. The commercial sector of office consumption articles (Linkonline S.r.l.) has been not so much affected by the decline in proceedings (-3.5%), despite considerable reductions of proceedings due to a more aggressive commercial policy. For a better read and evaluation of the area courses, below are the summarised economic accounts of the production and commercial area. For further comments, please see the explication notes here below.


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PRODUCTION AREA (Euro/million) 2009

1st Half2008

1st HalfVariation

Sales and other operating income 16.65 18.63 (1.98)

Purchases and inventory change (5.66) (6.35) 0.69 Services (5.08) (5.48) 0.40 Personnel costs (4.10) (4.57) 0.47 Other net operating revenues (expenses) (1.03) (1.25) 0.22

Total operating costs (15.87) (17.65) 1.78

EBITDA 0.78 0.98 (0.20)

Depreciation and amortization (1.08) (1.34) 0.26

EBIT (0.30) (0.36) 0.06

Net financial income (expense) (0.09) (0.06) (0.03)

Before tax result (0.39) (0.42) 0.03

Tax (0.17) (0.11) (0.06)

Net result (0.56) (0.53) (0.03)

Minority interest - (0.01) 0.01

GROUP interest (0.56) (0.52) (0.04)

COMMERCIAL AREA (Euro/million) 2009

1st Half2008

1st HalfVariation

Sales and other operating income 6.09 6.31 (0.22)

Purchases and inventory change (4.78) (4.77) (0.01) Services (0.72) (0.65) (0.07) Personnel costs (0.32) (0.32) - Other net operating revenues (expenses) (0.23) (0.19) (0.04)

Total operating costs (6.05) (5.93) (0.12)

EBITDA 0.04 0.38 (0.34)

Amortization, (0.02) (0.04) 0.02 Adjustment, depreciation - (0.14) 0.14

EBIT 0.02 0.20 (0.18)

Net financial income (expense) (0.06) (0.10) 0.04

Before tax result (0.04) 0.10 (0.14)

Tax (0.01) (0.07) 0.06

Net result (0.05) 0.03 (0.08)


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CONSOLIDATED BALANCE SHEET STRUCTURE:

(Euro/million)

30-June-09 31-Dec-08 30-June-08

A) Net current assets

Trade receivables 15.50 16.19 17.45 Inventories 4.95 5.14 5.38 Other current assets 0.62 0.43 0.59 Trade payables (9.66) (9.19) (10.37) Other current liabilities (3.34) (3.23) (4.26)

8.07 9.34 8.79 B) Net fixed assets

Intangible assets 5.33 5.26 5.27 Tangible assets 7.02 7.97 8.79 Financial investments and other non current assets 0.17 0.16 1.09

12.52 13.39 15.15 C) Medium and Long Term liabilities (3.32) (3.47) (2.73)

D) Invested capital (A+B+C) 17.27 19.26 21.21

Covered by: E) Net financial debt (cash)

Short term loans 4.31 5.45 5.96 Cash and banks (2.74) (3.04) (4.90) Medium/long term loans 1.72 2.02 2.69 3.29 4.43 3.75 F) Equity

Share capital 6.16 6.16 6.16 Reserves and earnings 7.63 8.26 10.87 13.79 14.42 17.03 Minority 0.19 0.41 0.43 Total Equity F) 13.98 14.83 17.46

G) Total coverage (E+F) 17.27 19.26 21.21


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5.2. Poligrafica S. Faustino S.p.A. (Holding) – Financial and economic highlights

(Euro/million)

2009 First Half

2008 first Half Variation

Sales and other operating income 14.85 16.06 (1.21)Operating costs (14.24) (15.39) 1.15EBITDA 0.61 0.67 (0.06)Depreciation and amortization (1.02) (1.25) 0.23EBIT (0.41) (0.58) 0.17Net financial income (expense) (0.05) (0.03) (0.02)Before tax result (0.46) (0.61) 0.15Tax (0.08) 0.02 (0.10)Net result (0.54) (0.59) 0.05

The Group leader global sales during the first half of the year 2009 decreased of 7.5% in comparison with the data regarding the same period of the last year business; this reduction in sales, which unfortunately has been affected by a general economic heavy crisis, concerned all kind of products except for the most innovative articles. The export sales is equal to Euro 1.60 million, 11.1% of all sales and has a decrease both in percentage and absolute values in comparison with the previous accounting year (Euro 2.01 million equal to 12.6% in 2008 first half year). Among the operative costs we point out considerable savings in workings committed to a third party and in cost for personnel. The combined consequences of these dynamics, joined with a decrease in other operative costs, have confirmed a positive EBITDA equal to 4.1% of proceedings (it was 4.2% in 2008 first half year). Considering the progressive decrease of the amortizations also the EBIT, although negative, gets better for Euro 0.17 million. Considering the limited significance of taxes and financial elements, the net result of the first half of the year is Euro 0.54 million negative, without considerable variations in comparison with the result obtained in the first half of the year 2008, despite the reduction in proceedings.


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POLIGRAFICA S. FAUSTINO S.p.A. (Holding) Balance sheet structure:

(Euro/million)

30-June-09 31-Dec-08 30-June-08

A) Net current assets

Trade receivables 10.67 9.86 11.40 Inventories 2.93 2.85 3.06 Other current assets 0.28 0.21 0.33 Trade payables (6.95) (5.75) (7.33) Other current liabilities (2.53) (2.50) (3.30)

4.40 4.67 4.16 B) Net fixed assets

Intangible assets 0.49 0.54 0.56 Tangible assets 6.74 7.62 8.38 Financial investments and other non current assets 6.15 5.83 6.76

13.38 13.99 15.70 C) Medium and Long Term liabilities (2.61) (2.89) (2.05)

D) Invested capital (A+B+C) 15.17 15.77 17.81

Covered by: E) Net financial debt (cash)

Short term loans 1.48 1.50 1.96 Cash and banks (1.92) (2.43) (4.19) Medium/long term loans 1.49 2.01 2.62 1.05 1.08 0.39 F) Equity

Share capital 6.16 6.16 6.16 Reserves and earnings 7.96 8.53 11.26

Total Equity F) 14.12 14.69 17.42

G) Total coverage (E+F) 15.17 15.77 17.81


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5.3. RESEARCH AND DEPELOPMENT ACTIVITIES

The first half of the year, which is marked by effects of the heavy crisis which has affected all the productive sectors, has led to pay attention to a reduction in costs and to optimise the productive processes. Indeed, we didn’t consider useful to introduce new solutions to a market which is insensible and oppressed by different priorities. In our Group structure, it is physiologic to identify and work out some projects to create new products or to improve the ones already offered, but we will wait for better moments to present and market them.

5.4. PERSONNEL

Group personnel at June 30, 2009 30/06/09 31/12/08 30/06/08 Managers 6 5 6Clerical employees 79 83 82Manual workers 143 148 150 Total 228 236 238

5.5. INVESTMENTS

During the first half of the year 2009 the Group has not made noteworthy investments (see specific chart of material and intangible asset variation), except for some intervention for the improvement of productive and informatics functionality already existing. The most substantial expense (equal to Euro 315 thousand) was the takeover of the remaining 49% of shareholding of Litografia Spada S.r.l. (now total) specialized in the production of high quality wet glue labels. This operation is due to a reorganization of Litografia Spada in the Group.

5.6. CONSOLIDATED NET FINANCIAL POSITION

NET FINANCIAL POSITION 30 June 09 31 Dec 08 30 June 08 Euro (000) Euro (000) Euro (000)

CASH AND BANKS 2,740 3,037 4,901 SHORT TERM LOANS (4,312) (5,441) (5,957) SHORT TERM NET POSITION (A) (1,572) (2,404) (1,056) MEDIUM/LONG TERM LOANS (1,717) (2,024) (2,692)

CONSOLIDATED NET FINANCIAL POSITION (A+B) (3,289) (4,428) (3,748)

The improvement of the overall net financial position is mostly due to a balance between payments and incomes, plus a temporary investment policy redefinition. We refer to an examination of the financial report for detailed records of the flows.


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5.7. OWN SHARES

During 2009 first half, as a consequence of a particular going of the Italian Stock Exchange, the Company has partially accomplished a plan for the acquirement of own shares. In particular, considering an expense of Euro 26,621, an amount of 2,962 shares have been acquired (medium value Euro 8.99). At the end of the half year there are n. 42,351 shares enlisted with a medium value of Euro 14.01. On a total of 1,194,107 (corresponding to the full capital stock), the own shares held by the holding correspond to 3.55%.

5.8. RELATED PARTIES

The Group Companies did not carry out any significant transactions with related parties and no credits or debts are open with related parties, a part from the payments due to directors which are shareholders.

5.9. CORPORATE GOVERNANCE

With the statement approved by the Board of Directors on March 13, 2009, available in the Investor Relations / Corporate Governance section of www.psf.it, the Company informed about its own governance corporate system and about the adhesion to the self-discipline code of listed companies. On March 19, 2008 the Board has adopted the Model for the Organization, Managing and Control as at the Legislative Decree n. 231/2001. Afterwards the Model has been modified and supplemented in date 29/08/2008 and 20/02/2009. In particular during this last opportunity, the special part has been implemented with the insertion of crime of receiving of stolen goods, money laundering, use of money or goods or proceedings of illicit origin. On March 13, 2009, the Board has evaluated the independence of Alberto Piantoni and Carlo Alberto Carnevale Maffè and the non-executive requirement for Francesco Frigoli and Frigoli Giovanni. With reference to the latter, such feature is no more existing as he is managing director of the controlled Linkonline S.r.l., company strategically relevant for the Group. So, the board has appointed Mr. Francesco Frigoli member of committee for the remuneration as substitute of Giovanni Frigoli till March 13, 2009. The Board appointed during the meeting on November 14, 2006 Mrs. Cristina Capitanio Manager executive responsible for the preparation of the Company’s accounting documents. This choice appeared to be the most appropriate as it was in possession of the indispensable professional skills requested by the D. Lgs. 58/1998 and by the Statute article n. 23, and having developed for several years the role of Administration Manager of Poligrafica S. Faustino. Till today, the requirements of honourably requested by the regulation in force for whom is attending to roles of control and a greater professional competence matured in accounting and financial matter, further increased in consequence of the development of the director in charge role. Furthermore on August 28, 2009, the Board has conferred to the director Dr. Riccardo Camia the necessary representation power of the company for the development of commercial activities “large” and “top”, as well as for the area “Merger & Acquisition”. For further information about the Corporate Governance please see the cited relation of March 13, 2009.


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5.10. ECONOMIC HIGHLIGHTS OF SUBSIDIARY COMPANIES

Here below there is the activity developed during the first half year in the 4 controlled companies: BB S.r.l. (100%), Mediattiva S.r.l. (65%), Litografia Spada S.r.l. (100%) and Linkonline S.r.l. (100%) and the trend of the respective IAS balance. BB S.r.l. As a consequence of the use by Holding of the B2B Cantoalto Platform, BB S.r.l. receives a n amount that allows to cover the managing costs. From the previous accounting year BB S.r.l. accomplishes also the Group’s marketing and promotion activities. For a total amount of recoveries of Euro 340 thousand (fully on charge of Poligrafica), the operative costs are about Euro 250 thousand for the whole half year. There are 5 employees together with 1 director. The result before taxes is positive for Euro 93 thousand and the net result is positive for Euro 57 thousand. Mediattiva S.r.l. Mediattiva is the web agency and internet provider of the Group, shared for the 65% by Poligrafica S. Faustino, dedicated to communication activities through telematic networks, elaboration of multimedia communication projects, the production and commercialisation of software. The sales for the first half year reached Euro 677 thousand (Euro 24 thousand are internal to the Group) with a decrease of 17% in comparison with 2008 first half year (Euro 814 thousand). The final result is essentially in draw. The employees are 14 (the same as they were on June 30, 2008) It is taking place an operative and commercial reorganization directed to obtain more proceedings and more pressing integrations and synergy with other companies of the Group. Litografia Spada S.r.l. Litografia Spada, with total shareholding the current accounting year, is specialised in the production of luxury labels for wines, liquors and beverages. The sales of paper and glue labels produced by Litografia Spada S.r.l. are Euro 1.93 million during 2009 first half year and are decreasing in comparison with last year’s amount (2.21). No important changes have been purchased in the different cost components and so the result before taxes at the end of the half year presents a negative amount equal to Euro 62 thousand euro (Euro 91 thousand negative at the net result). The employees were 27 at the end of the half year (they were 36 as at June 30, 2008) and a company is in a stage of productive and commercial reorganization for a re-balancing by a short time. Linkonline S.r.l. The acquisition of 100% of Linkonline Srl, company specialised in the trade of consumption products, has offered the group the chance to realize new synergies in the services sectors for the great distribution and the highly qualified institutional clients: banks, assurance companies, gdo. During 2009 first half year, as already pointed out, operating revenues equal to Euro 6.08 million with EBIT substantially unchanged.

5.11. SUBSEQUENT EVENTS

The commercial sector has registered an encouraging sign of increase during the month of July. There are no further events after the closure of the half year that may have an impact on the data concerned in the present report.


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5.12. ENTERPRISE RISKS MANAGEMENT AND PREDICTABLE MANAGING EVOLUTION

FINANCIAL RISK MANAGING The holding works in the graphic-promotional sector exclusively on demand and, considering the particular productive typology, must adjust the production and the provisioning politics to the specific requests of the clients. The strong competitors and the lack of standard pricelist-products determine the necessity to have price politics that are often influenced by the promotional budget at the clients’ disposal. Till the end of 2007 accounting year, Poligrafica S. Faustino Group has always had only one reference market (the promotional one), with a modest exception of the web agency activity of the controlled Mediattiva. With the precise goal to diversify the reference markets and, in order to limit the different risk typologies, in 2008 Poligrafica S. Faustino S.p.A. acquired Linkonline S.r.l., company that operates in the consumables sector that are destined to the retail sector. Through this operation the Group Poligrafica S. Faustino has been developing a strategy aimed at collecting all possible synergies in particular about the commercial integration of the loyal clients. Each company of the Group is commercially autonomous but responds to strategies that are planned by the Direction of the Group. Similarly, each company ha s a financial autonomy; although the treasury is not correctly canalised on the Group, the financial fluxes of each company are managed by a central function. The financial direction of the Group manages the relations among different banks and analyses the different risks and offers indications about the credit risks, and in particular each time there are contracts with new clients. The financial management ‘s activity is concerned with keeping the relations with many banks and carries on the analysis of different risks favouring indications on the credit risks, and in particular when there are contacts with new clients. The change risk, given the absolute irrelevance of the transactions (both passive and active) also beyond the Euro area, is equal to zero. The supplying market of raw materials isn’t affected by indirect consequences bound to the dollar. As far as the credit risk is concerned, above all in front of the huge costs of the transactions and of the clients is limited. It is to be considered that the medium unity amount of the transitions is modest and the analysis of the credit positions already expired or soon to be expired are linked to a fortnight expiry date. About the liquidity risk, the relationship between own and others’ money has always been positive particularly considering the Holding. The negative trend of the last years notwithstanding, the net financial position has always been liquidity. However, in the first half of the year 2009 the net financial position has improved thanks to a balance between time of collection and time of payment. This notwithstanding, the present financial structure, characterised by modest debts in relation to the capitalisation, together with the existence of significant real estate investments free from bonds and mortgages, determine objective solidity indicators that guarantee the possibility to enter into new credit lines, if necessary. Concerning the interest rate risk, it is generated by short and long term flexible rate financial debts that are not so high to make a coverage politics necessary. For 2009 second half year we do not foresee significant variations which could change the evaluation of the risks above mentioned.


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PREDICTABLE MANAGING EVOLUTION During the first half of the year we have noticed a further decrease in the number of usual orders, while, even if it is not satisfactory yet, we have registered a slight increase in the activities oriented to the Direct Marketing and special labels. This increase, carried out in such a difficult period, is to be considered particularly positive. It means that the commercial reorganization is working, and that during the business increase we should easily carry out the targets we fixed in advance. Similar considerations can be done for the documental managing. The Italian companies are understanding more and more the need to adopt these technologies, even though in this stage they have stopped investments and they have postponed them to a near future, which we hope to be more dynamic. The activity of e-procurement managed by Linkonline has suffered from the clients’ need of saving, even if it is maintaining an essential balance. The most tangible consequence is a forced profit margin contraction, which is common to all the sectors. On the other hand we have to consider the defence of clients and of volumes as a priority. At the moment no clear sign of increase has appeared. The competent authorities think that they can foresee a market increase, even though cautious, in 2010. With this background everybody is very prudent with expenses and obviously, nobody is skimping on commercial efforts which could rebalance the situation also without an increase. In consideration of all the reflections above, we foresee a trend of the second half of the year in line with the one of the first 6 months of 2009.


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6. CONSOLIDATED FINANCIAL STATEMENTS

According to international accounting

(I.A.S. / I.F.R.S)


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6.1. TABLES OF CONSOLIDATED FINANCIAL STATEMENTS

Euro (thousand) BALANCE SHEET 30/06/09 31/12/08ASSETS NON CURRENT ASSETS Property, plant and equipments 7,022 7,965Intangible assets 5,332 5,262Equity investments 7 7Other non current assets 58 48Deferred tax assets 102 107Total non current assets 12,521 13,389 CURRENT ASSETS Inventories 4,949 5,137Trade receivables 15,499 16,195Tax receivables 299 199Other receivables 324 227Current financial assets 0 0Cash and banks 2,740 3,037Total current assets 23,811 24,795 TOTAL ASSETS 36,332 38,184 NET EQUITY AND LIABILITIES NET EQUITY Share capital 6,162 6,162Other reserves 8,069 11,343Own shares (-) (593) (567)Retained earnings 149 (2,514)Total Group Equity 13,787 14,424Minority Interests 190 405Total NET EQUITY 13,977 14,829 NON CURRENT LIABILITIES Loans 1,717 2,024Employee severance indemnity and retirement reserves

2,443 2,437

Deferred tax liabilities 432 251Other 444 778Total non current liabilities 5,036 5,490 CURRENT LIABILITIES Loans 4,312 5,441Trade payables 9,658 9,193Tax payables 446 643Other payables 2,903 2,588Total current liabilities 17,319 17,865 TOTAL NET EQUITY AND LIABILITIES 36,332 38,184


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CONSOLIDATED INCOME STATEMENTS

Euro (thousand)

2009 First Half

2008 First Half

OPERATING REVENUES Sales 22,542 24,889Other operating income and revenues 198 58Total operating revenues and income 22,740 24,947 OPERATING COSTS Materials (10,248) (11,386)Change in inventory (188) 245Services (5,795) (6,133)Payroll costs (4,428) (4,889)- less costs for capitalized in-house work - 63Other net operating (costs) revenues (1,258) (1,488)Total operating costs (21,917) (23,588) EBITDA 823 1,359 Depreciation and amortization (1,105) (1,376)Capital gains (losses) on disposal of non current assets - -Write-down/write backs of non current assets - (142) EBIT (282) (159) Financial income 12 96Financial expenses (161) (252) BEFORE TAX RESULT (431) (315)Income taxes (181) (183)NET RESULT FOR THE PERIOD (612) (498) Net result for Group interest (611) (485)Net result for minority (1) (13)


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CONSOLIDATED CASH FLOW STATEMENT

30/06/2009 31/12/2008

A) OPENING net short term cash (debt) (2,404) 2,421

B) Operating cash flow Cash flow

Net result for the period (minority included) (612) (3,089)

Depreciation and amortization

- of intangible assets 110 210

- of tangible fix assets. 995 2,423

Total CASH FLOW 493 (456)

Net book value on disposal of fixed assets 36 8

Change in deferred tax assets and liabilities 186 1,070

Change in other non current liabilities 6 74

721 696

Changes in current assets and liabilities

(increase) Decrease of trade receivables 696 (4,118)

(increase) Decrease of inventories 188 (1,209)

(Decrease) Increase of trade payables 465 2,848

Other change in current assets and liabilities (412) 1,705

Total Changes in current assets and liabilities 937 (774)

Total operating cash flow (B) 1,658 (78)

C) Cash flow for investments

Intangibles (79) (239)Tangible assets (89) (1,337)

Other investments (10) (15)

Increase goodwill of 100% Spada acquisition (101) -

Linkonline first consolidation goodwill - (3,461)

Linkonline fixed assets as at 31/12/2007 - (292)

Total cash flow used for investments (C) (279) (5,344)

D) Cash flow from financing activities

Change in medium/long term loans, net (307) 835

Dividends and other change in equity - -

Other changes and purchase of own shares (240) (238)

Net Cash flow from financing activities (D) (547) 597

E) TOTAL CASH FLOW FOR THE PERIOD (B + C + D) 832 (4,825)

F) Net CLOSING short term financial position (debt) (1,572) (2,404)

30/06/2009 31/12/2008

Details

Cash and banks 2,740 3,037

Short term loans from bank (3,721) (4,338)

Short term loans from leasing companies (591) (1,103)

(1,572) (2,404)


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TABLE OF MOVEMENTS IN CONSOLIDATED EQUITY

EQUITY 31/12/2007 Result Other Result 31/12/2008

2008 movements allocation movements

Share capital 6,162 6,162

Share premium reserve 13,044 (2,269) (240) 10,535

Own shares’ reserve 327 240 567

Own shares (327) (240) (567)

Revaluation reserve 241 241

Legal reserve 175 175

Other reserves 266 86 9 361

- Result for period (2,183) 2,183 (3,050) (3,050)

Total GROUP Equity 17,705 0 (231) (3,050) 14,424

Minority reserves 458 (14) 444

- Minority result (14) 14 (39) (39)

Total Minority Equity 444 0 0 (39) 405

TOTAL 18,149 0 (231) (3,089) 14,829

EQUITY 31/12/2008 Result Other Result 30/06/2009

2009 First half movements allocation movements

Share capital 6,162 6,162

Share premium reserve 10,535 (3,274) (26) 7,235

Own shares’ reserve 567 26 593

Own shares (567) (26) (593)

Revaluation reserve 241 241

Legal reserve 175 175

Other reserves 361 224 585

- Result for period (3,050) 3,050 (611) (611)

Total GROUP Equity 14,424 0 (26) (611) 13,787

Minority reserves 444 (253) 191

- Minority result (39) 39 (1) (1)

Total Minority Equity 405 (214) 0 (1) 190

TOTAL CONSOLIDATED EQUITY

14,829 (214) (26) (612) 13,977


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CONSOLIDATED NET FINANCIAL POSITION NET FINANCIAL POSITION 30 June 09 31 Dec 08 Euro (000) Euro (000)

CASH AND BANKS 2,740 3,037 DEBTS TOWARDS BANKS (SHORT TERM) (3,721) (4,338) DEBTS TOWARDS LEASING COMPANIES (SHORT TERM) (591) (1,103) TOTAL SHORT TERM POSITION (A) (1,572) (2,404) DEBTS TOWARDS BANKS (medium/long TERM) (1,495) (1,575) DEBTS TOWARDS LEASING COMPANIES (M/L TERM) (222) (449) TOTAL M/L POSITION (B) (1,717) (2,024)

NET FINANCIAL POSITION (A+B) (3,289) (4,428)

The medium and long term debts towards other financiers are made exclusively by funds derived from financial locations on plants and machinery whose payback is now previewed in a maximum period of 3 accounting years. In particular, the financial position specifically referable to Linkonline (commercial area) can be summoned as follows: LINKONLINE 30 June 09 31 Dec 08 NET FINANCIAL POSITION Euro (000) Euro (000)

CASH AND BANKS 678 572 DEBTS TOWARDS BANKS (SHORT TERM) (2,179) (2,651) DEBTS TOWARDS LEASING COMPANIES (SHORT TERM) (11) (20)

TOTAL SHORT TERM POSITION (A) (1,512) (2,099) DEBTS TOWARDS BANKS (medium/long TERM) - - DEBTS TOWARDS LEASING COMPANIES (M/L TERM) - (2)

TOTAL M/L POSITION (B)) 0 (2)

NET FINANCIAL POSITION (A+B) (1,512) (2,101)

For further dynamics of financial character, please see the consolidated financial statements.


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6.2. NOTES

The 2009 first half consolidated accounting period report has been made following the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) already applied for 2008 financial statements and according to CONSOB rules n. 11971 of 14/05/1999 and following. This was issued in thousands of Euro and was compared with consolidated data of the previous accounting period that were collected with an homogeneity of principles. It is formed by the balance sheet, the income statement, the cash flow statement, the table of net equity movements and the comment notes. As regards the half yearly report, the indications applied followed the IAS 34 principles about. Please note that in the six months covered by this report, the group hasn’t carried out transactions for unusual nature and size and that no changes have been made in the evaluations made in intermediate periods during the current year or in the evaluations made in previous accounting years. The outline of the consolidated balance sheet does not include specifications relative to assets held for sale and assets and liabilities included in disposal groups held for sale as there is no such case. With regard to the consolidated income statement, it has been decided to present a unique perspective (total income). However, nothing is indicated relating to income and charges concerning equity because there are no such circumstances. The half-yearly consolidated financial statements presents the comparative data required by IAS 34 par. 20. The Group also did not have retroactive application of accounting principles, retrospective elements of the budget or reclassifications of one or more elements for which it was not necessary to generate additional comparative information required by IAS 1 revised 2007. Segment information A segment is a distinctly identifiable part of a Group which supplies a combination of related products and services (business segment) or supplies products and service in a specific economic area (geographical segment). The PSF Group substantially operates in just one business segment (personalized graphic products), except for the web agency activity performed by Mediattiva which, however, is not relevant (less than 5%) compared with total Group activity. Similarly the market business area involves Euro area with local market absolute priority. Starting from 2008 first half year, after the acquisition of LinkOnLine S.r.l., company for the distribution of consumption products for computers, all the data referred this company are given separately. Financial and income Statement tables In the balance sheet there is the essential content based on International accounting principles and has the distinction between current and non-current assets and liabilities, according to their attitude to get realized within 12 months since the reference date. The income statement is developed according to a cost-based structure. The cash flow statement is developed applying the indirect method.


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This first half report is audited (limited review) by the independent Auditors ANALISI S.p.A. – Reggio Emilia. All data are presented in thousand Euro.

6.2.1. CONSOLIDATION CRITERIA AREA

Premise The consolidation area includes the following companies and has changed in comparison with last accounting year because of the acquisition of Linkonline S.r.l.: Poligrafica S. Faustino S.p.A., holding company, operates mostly in 3 business areas:

• printed forms (promotional items, business papers and others) • self-adhesive labels and flexible packaging • documental managing

BB S.r.l. (100%), already owner of the patented Casarossi.it, is the owner of B2B (“Cantoalto”) Platform now granted to Poligrafica. The company in involved in Marketing activities for the Group. Mediattiva S.r.l. is a Group’s company, controlled for 65% by Poligrafica S. Faustino, involved in communication activities through telematic webs, in the elaboration of multimedia communication projects, in the production and commercialisation of software. Moreover, Mediattiva manages the files and bank dates, the promotional actions also through internet and intranet, the development of services aimed to the use of digital and computer systems. Litografia Spada S.r.l.: it deals with the production of luxurious glue and paper labels with operative headquarter is in Venaria (TO). Poligrafica S. Faustino S.p.A. holds the 100% of the company against the takeover of the remaining 49% (controlled by a third party) from the month of march of the present business. Linkonline S.r.l.: it is a commercial company that is active in the distribution of consumption computer products: Poligrafica S. Faustino S.p.A. acquired the 100% in February 2008. Group Companies Holding Company Registered Office Capital Stock Poligrafica S. Faustino S.p.A. Castrezzato Euro 6,161,592.12

Consolidated subsidiaries Registered Office Capital Stock ControlBB S.r.l. Castrezzato Euro 10,000 100% DirectMediattiva S.r.l. Castrezzato Euro 78,000 65% DirectLitografia Spada S.r.l. Castrezzato Euro 125,000 100% DirectLinkonline S.r.l. Castrezzato Euro 200,000 100% Direct There are no other companies excluded from the consolidation.


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Reconciliation Table Reconciliation table from Holding result and equity to Consolidated result and equity (Euro/000) Result of period Net Equity

Holding Company (547) 14,116Subsidiaries’ result (IAS) (88) (88)Other adjustments of consolidation 23 (51)Total Consolidated Result and Equity (612) 13,977Minority interest (1) 190Group interest (611) 13,787

6.2.2. NOTES TO CONSOLIDATED BALANCE SHEET

(All data reported are expressed in THOUSANDS OF EURO, unless otherwise indicated) NON CURRENT ASSETS

- Tangible fixed assets Value at 30/06/09 7,022Value at 31/12/08 7,965

Variation (943) Lands Historical cost 1,047Revaluation 0Devaluation i 0Net book value at 31/12/08 1,047Increase -Disposals -Net book value at 30/06/09 1,047 Buildings Cost (413/91 revaluation included for Euro 249 thousand) 5,665Accumulated depreciation (1,891)Net book value at 31/12/08 3,774Increase 7Disposals -Depreciation of the year (85)Net book value at 30/06/09 3,696 Plants and machinery Historical cost 19,943Accumulated depreciation (17,443)Net book value at 31/12/08 2,500Increase 33Disposals (199)Depreciation write-off from disposals 166Depreciation of the year (771)Net book value at 30/06/09 1,729


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Other fixtures, fittings, tools and equipment Historical cost 2,296Revaluation Accumulated depreciation (1,967)Devaluation Net book value at 31/12/08 329Increase 23Disposals (1,060)Depreciation write-off from disposals 1,058Depreciation of the year (67)Net book value at 30/06/09 283 Other tangible assets Historical cost 2,447Revaluation Accumulated depreciation (2,198)Devaluation Net book value at 31/12/08 249Increase 24Disposals (1)Depreciation write-off from disposals 1Depreciation of the year (57)Net book value at 30/06/09 216 Improvements on third parties’ buildings Cost 429Accumulated depreciation (363)Net book value at 31/12/08 66Acquisitions 1Disposals -Depreciation of the year (16)Net book value at 30/06/09 51

- Intangible asset

Value at 30/06/09 5,332Value at 31/12/08 5,262

Variation 70

Description Value at Increase Amort. Other Value at 31/12/08 Variations 30/06/09 Goodwill 4,702 101 4,803Development costs 449 45 (65) 429Software 111 33 (44) 100 5,262 179 (109) 0 5,332 The original setting off values are Euro 940 thousand (now reduced at Euro 846 thousand) for the acquisition of Litografia Spada S.r.l. accomplished in 2003 and Euro 395 thousand derive from the starting out coming from the acquisition of one branch of BOL (Brescia On Line) Business accomplished in October 2004; Euro 3,461 thousands for the acquisition of Linkonline S.r.l. which took place in 2008 and a further component of goodwill of Litografia Spada S.r.l. (Euro 101


____________________________________________________________________________________________ 26

thousand) generated by the acquisition of the further 49% finalized in the month of march 2009 (see press release). With this latest operation (with a cost of about Euro 315 thousand) the Group has a total shareholding in Litografia Spada S.r.l. As seen in IFRS 3, the set off is no longer systematically amortized, but is subject to impairment tests. This test is carried out during the business final balance. The development costs comprehend the costs for the build implementation of computer platforms used also in the producing managing of the graphic supports. The increases of the period refer to improvements and perfections with a special attention for the documental managing platform.

- Investments and other non current receivables 30/06/09 31/12/08Equity investments in other companies 7 7Other receivables 58 48Deferred tax assets 102 107 167 162The data concerning the anticipated taxes include the IRES determined on the fiscal losses obtained by the Holding and Litografia Spada so as resulting from the definitive liquidation of the taxes until December 31, 2008 and it is kept as the latent fiscal benefit is justified by reasonable predictions of taxable income, within the reported period. The temporary fiscal effects concerning the first half year have been issue of evaluation and imputation to the taxes fund, postponed of the liabilities.

- CURRENT ASSETS Description 30/06/09 31/12/08 VariationInventories 4,949 5,137 (188)Trade receivables 15,499 16,195 (696)Tax receivables 299 199 100Other receivables 324 227 97Cash and banks 2,740 3,037 (297)Total current assets 23,811 24,795 (984)

The dynamic of the current posts is partially conditioned by seasonal nature effects. The financial dynamics are defined in financial report to which we refer. The commercial credit is so built up: Description 30/06/09 31/12/08Trade receivables: Italy 15,113 15,305CEE Area 444 813Extra-CEE Area 101 209(less) Allowance for doubtful credits (159) (132) Total 15,499 16,195

- EQUITY

30/06/09 31/12/08 VariationShare capital 6,162 6,162 -Reserves and earnings 7,625 8,262 (637)Minority interests 190 405 (215) 13,977 14,829 (852)


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During 2009 first half year, the total net patrimony has decreased for effect of the period result, for further acquisition of own shares and for the variation of the consolidation area following the takeover of a further shareholding of Litografia Spada S.r.l. (now total). In particular, during 2009 half year the holding has made further acquisitions of own shares for a value of Euro 26 thousand for 2,962 shares. All ordinary shares are equal to 1,194,107 with a nominal value of 5.16 Euro. At the end of the half year, the holding keeps a total of 42,351 own shares (3.547%) with a value equal to Euro 593,143. For further details please see the survey on the variations of equity.

- NON CURRENT LIABILITIES Description 30/06/09 31/12/08 Variation Loans (medium/long term debt) 1,717 2,024 (307)Employee severance indemnity 2,443 2,437 6Deferred tax liabilities 432 251 181Other non current liabilities 444 778 (334)Total non current liabilities 5,036 5,490 (454)

The total funds on charge of the Group are:

- Euro 2,407 thousand for bank loans, Euro 1,495 of which is the medium-long term part (Euro 912 thousand in short term);

- Euro 813 thousand from debts on financial location contacts, whose medium-long term component is Euro 222 thousand (Euro 591 thousand in short term).

During the first half of the year a new loan has been raised for a total amount of Euro 600 thousand (of the duration of 24 months from January 2009); new finance leases have not been drawn up. The passivity for postponed taxes are made up by postponed fiscal effects on the fiscal cleaning operated in 2004 and to which the fiscal effects deriving from the application of different accounting principles made for the IAS/IFRS and evaluation of taxes for 2009 first half year. The variation happened in comparison with the December 31, 2008 is determined by the net effect deriving from the period evaluation net taxes on the different Group’s companies.

- CURRENT LIABILITIES Description 30/06/09 31/12/08 Variation Loans (short term debt) 4,312 5,441 (1,129)Trade payables 9,658 9,193 465Tax payables 446 643 (197)Other payables 2,903 2,588 315 Total current liabilities 17,319 17,865 (546)

In addition to the current amount of the loan equal to Euro 912 thousands, the short-term loans include various credit worthiness use equal to Euro 2,809 thousands and short-term finance leases amounts for Euro 591 thousand. The dynamic of the short-term finance leases amounts is consistent with what described above and with what is showed by the financial report.


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Details of trade payables are following: Description 30/06/09 31/12/08Trade payables:

Italy 9,184 8,545CEE Area 199 371

Extra-CEE Area 15 2Advance from clients 260 275

Total 9,658 9,193The increasing of the commercial debt is mostly related to a policy of balance between time of payment and time of income. The other current liabilities increase is mostly related to the increase in the social security costs and personnel, justified by allocation for matured holidays and for additional monthly salary. The debt is also including the residual amount due for the takeover of shareholding in Linkonline S.r.l. (Euro 667 thousand in a short term and Euro 444 thousand in medium-long term) which has been planned monthly payment of Euro 50 thousand each. The Group has no derivatives. NOTES TO CONSOLIDATED INCOME STATEMENT Description 30/06/09 % 30/06/08 % Operating revenues 22,740 100.00 24,947 100.00

Materials and change in inventory (10,436) (45.90) (11,141) (44.66)

Services (5,795) (25.49) (6,133) (24.59)

Personnel costs (4,428) (19.48) (4,889) (19.60)

Other operating costs (net) (1,258) (5.54) (1,425) (5.72)

EBITDA 823 3.62 1,359 5.45

Depreciation and amortization (1,105) (4.86) (1,518) (6.09)

EBIT (282) (1.24) (159) (0.64)

Net financial income (expense) (149) (0.66) (156) (0.63)

BEFORE TAX RESULT (431) (1.90) (315) (1.27)

Income tax (181) (0.80) (183) (0.73)

NET RESULT (612) (2.70) (498) (2.00)

The operating revenues of the Group suffers from a decrease of nearly 9% due to the company heavy economic crisis. The commercial difficulties had an effect also on the global profit margin which has decreased in spite of the cut in fixed costs and particularly for personnel and services. However the EBITDA is positive even if it is decreasing also in percentage terms. More comments can be made by analysing the data listed below and divided into the two areas the Group operates:


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Production area (Euro/thousand) 2009

1° Half% 2008

1° Half %

Sales 16,464 100.00 18,585 100.00 Other operating income and revenues 185 1.13 49 0.26

Total operating income and revenues 16,649 101.13 18,634 100.26

Materials (5,544) (33.68) (6,687) (35.98) Change in inventories (117) (0.72) 343 1.85 Services (5,080) (30.86) (5,480) (29.49) Personnel costs (4,104) (24.93) (4,570) (24.59) - costs for capitalized in-house work 0 0 63 0.34 Other operating (costs) revenues/net (1,027) (6.24) (1,322) (7.11)

Total operating costs (15,872) (96.43) (17,653) (94.98)

EBITDA 777 4.70 981 5.28

Depreciation and amortization (1,082) (6.58) (1,337) (7.19) Other write-off of fixed assets

EBIT (305) (1.88) (356) (1.91)

Net financial income (expense)i (86) (0.53) (66) (0.36)

BEFORE TAX RESULT (391) (2.35) (422) (2.27)

Income taxes (170) (1.04) (110) (0.59)

NET RESULT (561) (3.41) (532) (2.86)

Minority interest (1) (13)

GROUP Interest (560) (519)

The producing sector, linked to the original structure of the Group before the acquisition of LinkOnLine S.r.l., suffered a decrease in the proceedings equal to 11%. The contraction regarded most of all the web agency sector and the traditional graphic product paper and glue. The export sales is equal to Euro 1.61 million and has decreased of 24% in comparison with the same period of the previous accounting year (Euro 2.11 million). The decrease of the proceedings hasn’t determined important impacts on the marginality that despite its limitation has taken advantage of general decreases on all the costs centres (personnel, workings and fixed costs). EBITDA has remained at 5% and the EBIT (although still on balance) has slightly improved as a consequence of a decrease of the amortizations. Further benefits should come from the advanced commercial and productive reorganizations (among which the outsourcing of some productions) with savings in the direct and producing costs. The incidence of the net financial tax burdens also considering the improve of the net financial position.


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Commercial area LINKONLINE INCOME STATEMENT (Euro/thousand) 1°Sem.

2009Peso

%1°Sem.

2008 Peso

%

Sales 6,078 100.00 6,304 100.00Other operating income and revenues 13 0.22 9 0.14

Total operating income and revenues 6,091 100.22 6,313 100.14

Materials (4,704) (77.40) (4,699) (74.54)Change in inventories (71) (1.17) (98) (1.55)Services (715) (11.77) (653) (10.36)Personnel costs (324) (5.34) (319) (5.06)- costs for capitalized in-house work - - - -Other operating (costs) revenues/net (231) (3.81) (166) (2.63)

Total operating costs (6,045) (99.49) (5,935) (94.14)

EBITDA 46 0.73 378 6.00

Depreciation and amortization (23) (0.37) (39) (0.62)Other write-off of fixed assets - (142) (2.25)

EBIT 23 0.36 197 3.13

Net financial income (expense)i (63) (1.04) (90) (1.43)

BEFORE TAX RESULT (40) (0.68) 107 1.70

Income taxes (11) (73) NET RESULT (51) 34

Linkonline S.r.l. works in the sector of the trade of consumables for office. The proceedings contraction, equal to 3.5%, seems to be limited but has been accompanied by commercial policies necessarily more aggressive that have generated a significant reduction in the margins. Such dynamics have regarded, in particular, the acquisition and/or the renewal of important contacts with companies leader in the wholesales. The EBITDA decrease is the consequence of the increases in all the components of the costs bound to an organising and commercial phase of the Group.


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7. Certification pursuant the article 154 bis of Italian Legislative Decree No. 58/1998

Certification of the half year report pursuant to article 154 bis, paragraph 5, of Italian Legislative Decree no. 58/1998 and article 81 ter of Consob Regulation no. 11971 of May 14, 1999, as amended.

1. We, Alberto Frigoli, Emilio Frigoli and Giuseppe Frigoli, declare herewith as managing directors, together with Cristina Capitanio, account manager responsible for the accounting documents of Poligrafica S. Faustino S.p.A., confirm (considering all stated of art. 154 bis, paragraph 3 and 4, of Italian Legislative Decree no. 58 of February 24, 1998) as follows:

the adequacy concerning the company characteristics and

the factual application,

of the administrative and accounting procedures for the forming of the half year report during the first half 2009.

2. This concerning, no aspects of particular managing or strategic or existence of anomalies and problems also seen in the effecting procedure application emerged.

3. Herewith it is also confirmed that

3.1 the 2009 first half report at June 30, 2009: a) it is made up in conformity with the international accounting principles acknowledged by the

European Community according to the Regulation (CE) n. 1606/2002 of the European Parliament and Council, of July 19, 2002.

b) corresponds to the results of the accounting reports and books; c) is made according to the International Financial Reporting Standards of the International

Accounting Standards Board. It is furthermore apt to give a faithful representation of the patrimonial situation of the issuer and of the whole of the companies included in the consolidating.

3.2 The intermediate survey on the managing includes a reliable analysis of the going and the result and of the issuer situation and of the group of enterprises included in the consolidation, together with the description of the principal risks and uncertainties.

Castrezzato, August 28, 2009

Managing Directors The account manager responsible for the accounting documents

Mr. Alberto Frigoli Mrs. Cristina Capitanio

................... ………………………..

Mr. Emilio Frigoli

...................

Mr. Giuseppe Frigoli

...................

2009 FIRST HALF REPORT - investor.psf.itinvestor.psf.it/files/catalogue/attachments/PSF_1H_ENG_2009.pdf · Director (*) Riccardo Camia (*)= Appointed on April 17, 2009 STATUTORY AUDIT

Documents

2009 FIRST HALF REPORT - investor.psf.itinvestor.psf.it/files/catalogue/attachments/PSF_1H_ENG_2009.pdf · Director () Riccardo Camia ()= Appointed on April 17, 2009 STATUTORY AUDIT