Translation
of a report originally issued in Spanish. In the event of a discrepancy,
the
Spanish-language version prevails.
SPECIAL
REPORT ON LIMITED REVIEW OF INTERIM CONSOLIDATED FINANCIAL
INFORMATION
To
the
Management of Endesa, S.A.:
We
have
performed a limited review of the interim consolidated financial information
of
Endesa, S.A. and Subsidiaries comprising the consolidated balance sheet at
30
June 2007, the consolidated income statement for the six-month period then
ended, the consolidated cash flow statement, the consolidated statement of
recognised income and expense and certain selective notes for the six-month
period ended 30 June 2007. The preparation of these interim consolidated
financial information is the responsibility of Company management. Our
responsibility is to issue a limited assurance report on these interim
consolidated financial information based on our review.
Our
limited review was performed in accordance with the generally accepted
international professional standards issued by the International Federation
of
Accountants (IFAC) relating to the limited review of interim financial
information (ISRE 2410), which is planned and performed with a view to obtaining
limited assurance that the financial statements do not contain material
misstatements. A limited review basically consists of making queries to the
Company’s employees and applying certain analytical procedures to the financial
information and does not provide the same degree of assurance as an audit.
Since
a limited review does not constitute an audit, we do not express an audit
opinion on the accompanying interim consolidated financial
information.
Our
limited review did not bring anything to our attention that might lead us
to
believe that the accompanying interim consolidated financial information
was not
prepared, in all material respects, in accordance with the International
Financial Reporting Standard adopted by the European Union in relation to
Interim Financial Reporting (IAS 34).
On
30
March 2007, we issued our auditors’ report, in accordance with generally
accepted auditing standards in Spain, on the consolidated financial statements
of Endesa, S.A. and subsidiaries at 31 December 2006, in which we expressed
an
unqualified opinion.
Deloitte,
S.L.
Eduardo
Sanz Hernández
10
October
2007
|
ENDESA,
S.A.
and
Subsidiaries
Interim
Consolidated Financial Statements
for
the Period Ended 30 June 2007
Translation
of interim consolidated financial statements originally issued
in Spanish
and prepared in accordance with IFRS as adopted by the European
Union (see
Notes 2 and 12). In the event of a discrepancy, the Spanish-language
version prevails.
|
Translation
of interim consolidated financial statements originally issued in Spanish
and
prepared in accordance with IFRS as adopted by the European Union (see
Notes 2
and 12). In the event of a discrepancy, the Spanish-language version
prevails.
ENDESA,
S.A. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS AT 30 JUNE 2007
AND
31 DECEMBER 2006
|
|
|
Millions
of Euros
|
|
|
|
|
30/06/07
(Unaudited)
|
|
|
31/12/06
|
|
|
ASSETS
|
|
|
|
|
|
|
|
NON-CURRENT
ASSETS
|
|
|
46,930
|
|
|
|
46,380
|
|
|
Property,
plant and equipment
|
|
|
34,591
|
|
|
|
33,714
|
|
|
Investment
property
|
|
|
79
|
|
|
|
81
|
|
|
Intangible
assets
|
|
|
496
|
|
|
|
804
|
|
|
Goodwill
|
|
|
4,021
|
|
|
|
3,986
|
|
|
Investments
accounted for using the equity method
|
|
|
720
|
|
|
|
649
|
|
|
Non-current
financial assets
|
|
|
4,417
|
|
|
|
4,482
|
|
|
Deferred
tax assets
|
|
|
2,606
|
|
|
|
2,664
|
|
|
CURRENT
ASSETS
|
|
|
7,998
|
|
|
|
7,708
|
|
|
Inventories
|
|
|
910
|
|
|
|
882
|
|
|
Trade
and other receivables
|
|
|
6,223
|
|
|
|
5,819
|
|
|
Current
financial assets
|
|
|
54
|
|
|
|
39
|
|
|
Cash
and cash equivalents
|
|
|
811
|
|
|
|
965
|
|
|
Non-current
assets classified as held for sale
|
|
|
--
|
|
|
|
3
|
|
|
TOTAL
ASSETS
|
|
|
54,928
|
|
|
|
54,088
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
AND LIABILITIES
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
16,378
|
|
|
|
15,936
|
|
|
Of
the Parent
|
|
|
11,442
|
|
|
|
11,291
|
|
|
Of
minority interests
|
|
|
4,936
|
|
|
|
4,645
|
|
|
NON-CURRENT
LIABILITIES
|
|
|
30,404
|
|
|
|
30,007
|
|
|
Deferred
income
|
|
|
2,661
|
|
|
|
2,442
|
|
|
Long-term
provisions
|
|
|
4,322
|
|
|
|
4,442
|
|
|
Bank
borrowings and other financial liabilities
|
|
|
20,748
|
|
|
|
20,487
|
|
|
Other
non-current payables
|
|
|
964
|
|
|
|
985
|
|
|
Deferred
tax liabilities
|
|
|
1,709
|
|
|
|
1,651
|
|
|
CURRENT
LIABILITIES
|
|
|
8,146
|
|
|
|
8,145
|
|
|
Bank
borrowings and other financial liabilities
|
|
|
714
|
|
|
|
629
|
|
|
Current
trade and other payables
|
|
|
7,432
|
|
|
|
7,516
|
|
|
TOTAL
EQUITY AND LIABILITIES
|
|
|
54,928
|
|
|
|
54,088
|
|
The
accompanying Notes 1 to 12 are an integral part of the consolidated balance
sheets
at
30 June
2007 and 31 December 2006.
Translation
of interim consolidated financial statements originally issued in Spanish
and
prepared in accordance with IFRS as adopted by the European Union (see Notes
2
and 12). In the event of a discrepancy, the Spanish-language version
prevails.
ENDESA,
S.A. AND SUBSIDIARIES
INTERIM
CONSOLIDATED INCOME STATEMENTS
FOR
THE SIX-MONTH PERIODS ENDED 30 JUNE 2007 AND 2006
|
|
|
Millions
of Euros
|
|
|
|
|
JANUARY-JUNE
2007
(Unaudited)
|
|
|
JANUARY-JUNE
2006
(Unaudited)
|
|
|
REVENUE
|
|
|
10,373
|
|
|
|
10,601
|
|
|
Sales
|
|
|
10,054
|
|
|
|
9,946
|
|
|
Other
operating income
|
|
|
319
|
|
|
|
655
|
|
|
PROCUREMENTS
AND SERVICES
|
|
|
(4,841
|
)
|
|
|
(5,302
|
)
|
|
Power
purchased
|
|
|
(2,021
|
)
|
|
|
(1,934
|
)
|
|
Cost
of fuel consumed
|
|
|
(1,959
|
)
|
|
|
(2,008
|
)
|
|
Transmission
expenses
|
|
|
(455
|
)
|
|
|
(369
|
)
|
|
Other
variable procurements and services
|
|
|
(406
|
)
|
|
|
(991
|
)
|
|
CONTRIBUTION
MARGIN
|
|
|
5,532
|
|
|
|
5,299
|
|
|
Work
on non-current assets
|
|
|
105
|
|
|
|
90
|
|
|
Staff
costs
|
|
|
(840
|
)
|
|
|
(767
|
)
|
|
Other
fixed operating expenses
|
|
|
(966
|
)
|
|
|
(860
|
)
|
|
GROSS
PROFIT FROM OPERATIONS
|
|
|
3,831
|
|
|
|
3,762
|
|
|
Depreciation
and amortisation charge
|
|
|
(1,054
|
)
|
|
|
(891
|
)
|
|
PROFIT
FROM OPERATIONS
|
|
|
2,777
|
|
|
|
2,871
|
|
|
FINANCIAL
LOSS
|
|
|
(496
|
)
|
|
|
(469
|
)
|
|
Net
finance costs
|
|
|
(494
|
)
|
|
|
(480
|
)
|
|
Net
exchange differences
|
|
|
(2
|
)
|
|
|
11
|
|
|
Result
of companies accounted for using the equity method
|
|
|
6
|
|
|
|
46
|
|
|
Income
from other investments
|
|
|
6
|
|
|
|
7
|
|
|
Income
from asset disposals
|
|
|
10
|
|
|
|
260
|
|
|
PROFIT
BEFORE TAX
|
|
|
2,303
|
|
|
|
2,715
|
|
|
Income
tax
|
|
|
(679
|
)
|
|
|
(473
|
)
|
|
PROFIT
FOR THE PERIOD
|
|
|
1,624
|
|
|
|
2,242
|
|
|
Parent
|
|
|
1,255
|
|
|
|
1,756
|
|
|
Minority
interests
|
|
|
369
|
|
|
|
486
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC
NET EARNINGS PER SHARE (in euros)
|
|
|
1,19
|
|
|
|
1,66
|
|
|
DILUTED
NET EARNINGS PER SHARE (in euros)
|
|
|
1,19
|
|
|
|
1,66
|
|
The
accompanying Notes 1 to 12 are an integral part of the interim
consolidated
income
statements for the first six months of 2007 and 2006.
Translation
of interim consolidated financial statements originally issued in Spanish
and
prepared in accordance with IFRS as adopted by the European Union (see Notes
2
and 12). In the event of a discrepancy, the Spanish-language version
prevails.
ENDESA,
S.A. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF RECOGNISED INCOME AND EXPENSE
FOR
THE SIX-MONTH PERIODS ENDED 30 JUNE 2007 AND 2006
|
|
|
Millions
of Euros
|
|
|
|
|
30/06/07
(Unaudited)
|
|
|
30/06/06
(Unaudited)
|
|
|
|
|
Of
the Parent
|
|
|
Of
Minority Interests
|
|
|
Total
|
|
|
Of
the Parent
|
|
|
Of
Minority Interests
|
|
|
Total
|
|
|
NET
PROFIT RECOGNISED DIRECTLY IN EQUITY
|
|
|
251
|
|
|
|
207
|
|
|
|
458
|
|
|
|
(535
|
)
|
|
|
(460
|
)
|
|
|
(995
|
)
|
|
In
retained earnings
|
|
|
64
|
|
|
|
-
|
|
|
|
64
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Actuarial
gains on pension schemes
|
|
|
95
|
|
|
|
-
|
|
|
|
95
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Tax
effect
|
|
|
(31
|
)
|
|
|
-
|
|
|
|
(31
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
In
asset and liability revaluation reserves
|
|
|
82
|
|
|
|
(1
|
)
|
|
|
81
|
|
|
|
(105
|
)
|
|
|
(33
|
)
|
|
|
(138
|
)
|
|
Available-for-sale
investments
|
|
|
(16
|
)
|
|
|
-
|
|
|
|
(16
|
)
|
|
|
(192
|
)
|
|
|
-
|
|
|
|
(192
|
)
|
|
Cash
flow hedges
|
|
|
125
|
|
|
|
(5
|
)
|
|
|
120
|
|
|
|
126
|
|
|
|
(33
|
)
|
|
|
93
|
|
|
Tax
effect
|
|
|
(27
|
)
|
|
|
4
|
|
|
|
(23
|
)
|
|
|
(39
|
)
|
|
|
-
|
|
|
|
(39
|
)
|
|
In
translation differences
|
|
|
105
|
|
|
|
208
|
|
|
|
313
|
|
|
|
(430
|
)
|
|
|
(427
|
)
|
|
|
(857
|
)
|
|
Gross
translation differences
|
|
|
115
|
|
|
|
208
|
|
|
|
323
|
|
|
|
(433
|
)
|
|
|
(429
|
)
|
|
|
(862
|
)
|
|
Tax
effect
|
|
|
(10
|
)
|
|
|
-
|
|
|
|
(10
|
)
|
|
|
3
|
|
|
|
2
|
|
|
|
5
|
|
|
PROFIT
FOR THE PERIOD
|
|
|
1,255
|
|
|
|
369
|
|
|
|
1,624
|
|
|
|
1,756
|
|
|
|
486
|
|
|
|
2,242
|
|
|
TOTAL
INCOME AND EXPENSE RECOGNISED IN THE PERIOD
|
|
|
1,506
|
|
|
|
576
|
|
|
|
2,082
|
|
|
|
1,221
|
|
|
|
26
|
|
|
|
1,247
|
|
The
accompanying Notes 1 to 12 are an integral part of the consolidated statements
of recognised income and expense
for
the
first six months of 2007 and 2006.
Translation
of interim consolidated financial statements originally issued in Spanish
and
prepared in accordance with IFRS as adopted by the European Union (see Notes
2
and 12). In the event of a discrepancy, the Spanish-language version
prevails.
ENDESA,
S.A. AND SUBSIDIARIES
CONSOLIDATED
CASH FLOW STATEMENTS
FOR
THE SIX-MONTH PERIODS ENDED 30 JUNE 2007 AND 2006
|
|
|
Millions
of Euros
|
|
|
|
|
JANUARY-
JUNE
2007 (Unaudited)
|
|
|
JANUARY-
JUNE
2006 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Gross
profit before tax and minority interests
|
|
|
2,303
|
|
|
|
2,715
|
|
|
Depreciation
and amortisation charge
|
|
|
1,054
|
|
|
|
891
|
|
|
Income
from asset disposals
|
|
|
(10
|
)
|
|
|
(260
|
)
|
|
Income
tax
|
|
|
(584
|
)
|
|
|
(780
|
)
|
|
Other
results not giving rise to cash flows
|
|
|
14
|
|
|
|
(49
|
)
|
|
Provisions
paid
|
|
|
(203
|
)
|
|
|
(242
|
)
|
|
Total
cash flows from operations
|
|
|
2,574
|
|
|
|
2,275
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
in income tax payable
|
|
|
168
|
|
|
|
183
|
|
|
Change
in operating current assets/liabilities
|
|
|
(540
|
)
|
|
|
(544
|
)
|
|
|
|
|
|
|
|
|
|
|
|
NET
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
2,202
|
|
|
|
1,914
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments
in property, plant and equipment and intangible assets
|
|
|
(1,699
|
)
|
|
|
(1,706
|
)
|
|
Other
investments
|
|
|
(236
|
)
|
|
|
(1,348
|
)
|
|
Investments
in Group companies
|
|
|
(87
|
)
|
|
|
(2
|
)
|
|
Disposals
of property, plant and equipment and intangible assets
|
|
|
21
|
|
|
|
98
|
|
|
Disposals
of investments
|
|
|
155
|
|
|
|
137
|
|
|
Cash
flows due to changes in the scope of consolidation
|
|
|
-
|
|
|
|
2
|
|
|
Grants
and other deferred income
|
|
|
206
|
|
|
|
165
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
CASH FLOWS USED IN INVESTING ACTIVITIES
|
|
|
(1,640
|
)
|
|
|
(2,654
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
bank borrowing drawdowns
|
|
|
1,304
|
|
|
|
3,887
|
|
|
Non-current
bank borrowings and other financial liabilities repaid
|
|
|
(1,146
|
)
|
|
|
(1,186
|
)
|
|
Net
cash flows from current bank borrowings and other financial
liabilities
|
|
|
116
|
|
|
|
(2,916
|
)
|
|
Dividends
of the Parent paid
|
|
|
(677
|
)
|
|
|
(323
|
)
|
|
Payments
to minority interests
|
|
|
(347
|
)
|
|
|
(206
|
)
|
|
|
|
|
|
|
|
|
|
|
|
NET
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
(750
|
)
|
|
|
(744
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
NET CASH FLOWS
|
|
|
(188
|
)
|
|
|
(1,484
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Effect
of foreign exchange rate changes on cash and cash
equivalents
|
|
|
34
|
|
|
|
(17
|
)
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCREASE/DECREASE IN CASH AND CASH EQUIVALENTS
|
|
|
(154
|
)
|
|
|
(1,501
|
)
|
|
|
|
|
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
|
|
965
|
|
|
|
2,614
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS AT THE END OF PERIOD
|
|
|
811
|
|
|
|
1,113
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying Notes 1 to 12 are an integral part of the consolidated cash
flow
statements
for
the
first six months of 2007 and 2006.
Translation
of interim consolidated financial statements originally issued in Spanish
and
prepared in accordance with IFRS as adopted by the European Union (see Notes
2
and 12). In the event of a discrepancy, the Spanish-language version
prevails.
ENDESA,
S.A. AND SUBSIDIARIES
INTERIM
CONSOLIDATED FINANCIAL STATEMENTS FOR THE FIRST SIX MONTHS OF 2007 AND
2006
1.
GROUP ACTIVITIES AND PURPOSE OF THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
AT 30 JUNE 2007.
Endesa,
S.A. (“the Parent” or “the Company”) and its subsidiaries compose the Endesa
Group (“Endesa” or “the Group”). Endesa, S.A.’s registered office and
headquarters are in Madrid, at calle Ribera del Loira, 60.
The
Company was incorporated as a Spanish “Sociedad Anónima” in 1944 under the name
of Empresa Nacional de Electricidad, S.A. and it changed its corporate name
to
Endesa, S.A. pursuant to a resolution adopted by the shareholders at the
Annual
General Meeting on 25 June 1997.
Endesa's
company object is to carry on activities in the electricity business in all
its
various industrial and commercial areas; the exploitation of primary energy
resources of all types; the provision of industrial services, particularly
in
the areas of telecommunications, water and gas and those preliminary or
complementary to the business activities composing the Group's object, and
the
management of the corporate Group comprising investments in other companies.
The
Group may carry on the business activities composing its company object in
Spain
and abroad directly or through its investments in other companies. In 2005
the
Endesa Group disposed of substantially all of its investments in the
telecommunications business.
These
interim consolidated financial statements are presented in millions of euros
(unless expressly stated otherwise) because the euro is the functional currency
of the principal economic area in which the Endesa Group operates.
The
purpose of these interim consolidated financial statements at 30 June 2007
is to
serve as the basis for the preparation of certain pro forma financial
information that Enel S.p.A. must prepare and make public in the context
of the
takeover bid for Endesa, S.A. shares launched by Acciona, S.A. and Enel Energy
Europe, S.r.L. (see Note 11).
2.
BASIS OF PRESENTATION OF THE INTERIM CONSOLIDATED FINANCIAL
STATEMENTS.
2.1.
Basis of presentation.
The
interim consolidated financial statements of the Endesa Group for the first
six
months of 2007 were prepared in accordance with the International Financial
Reporting Standards adopted by the European Union at the consolidated balance
sheet date, in conformity with Regulation (EC) no. 1606/2002 of the European
Parliament and of the Council (“IFRS”).
In
the
interim consolidated financial statements for the first six months of 2007
the
Endesa Group applied the same accounting policies and measurement bases as
those
described in Notes 2 and 3 to the consolidated financial statements for 2006,
and the estimates that had to be made in preparing these financial statements
are basically of the same nature as those described in Note 2.2. to the
aforementioned consolidated financial statements.
The
only
significant change in the assumptions used to make estimates was the increase
in
the discount rate applied to provisions for pensions and similar obligations
and
for the restructuring of the labour force in Spain from 4% at 31 December
2006
to 4.47% at 30 June 2007 due to increases in the euro interest
rate.
These
interim consolidated financial statements present fairly the Group's
consolidated equity and financial position at 30 June 2007 and the results
of
its operations, the changes in the statement of recognised income and expense
and the cash flows at the Group in the first six months of 2007.
The
interim consolidated financial statements for the first six months of 2007
of
the Endesa Group were prepared on the basis of the accounting records kept
by
the Company and by the other Group companies.
2.2.
Subsidiaries.
Subsidiaries
are defined as companies over which the Parent controls half or more of the
voting power of the investee or, even if this percentage is lower, when it
has
the power to govern the financial and operating policies thereof.
The
inclusions in and exclusions from the scope of consolidation of the Endesa
Group
in the first six months of 2007, with respect to the situation at 31 December
2006, were as follows:
Inclusions:
|
|
-
|
Parque
Eólico Piano di Corda, S.r.L.
|
|
|
-
|
Parque
Eólico Serra Pelata, S.r.L.
|
|
|
-
|
Les
Ventas de Cernon, S.A.
|
|
|
-
|
Southern
Cone Power Argentina, S.A.
|
|
|
-
|
Endesa
Hellas Power Generation and Supplies,
S.A.
|
Exclusions:
The
main
changes in the scope of consolidation in the first six months of 2006 with
respect to 31 December 2005 were as follows:
Inclusions:
|
|
-
|
Explotaciones
Eólicas Sierra Costera, S.A.
|
|
|
-
|
Parque
Eólico Iardino, S.r.L.
|
Exclusions:
|
|
-
|
Empresa
de Generación Termoeléctrica Ventanilla,
Etevensa.
|
Had
these
changes in the scope of consolidation taken place at the beginning of 2007
or
2006, respectively, the changes in the main aggregates in the consolidated
income statements and consolidated balance sheet would not have been material
in
relation to the interim financial statements.
3.
INDUSTRY REGULATION.
The
principal developments concerning industry regulation affecting the Group
in the
first six months of 2007 related to the regulation of the electricity industry
in Spain, the main changes being as follows.
On
30 June
2007, the Spanish Council of Ministers approved Royal Decree 871/2007 adjusting
the electricity tariffs from 1 July 2007. This Royal Decree provided for
an
average increase of 1.81% for non-residential tariffs with respect to the
tariffs that came into force on 1 January 2007. It also acknowledged
ex
ante
the existence of a revenue shortfall in the settlements of regulated
activities that will arise in the period from 1 July 2007 to 30 September
2007
amounting to EUR 750 million, which will be added to the other EUR 750 million
acknowledged for the first quarter of 2007 by Royal Decree
1634/2006.
In
2006
Royal Decree-Law 3/2006 was approved. Among other things, this Royal Decree-Law
approved measures aimed at reducing the shortfall in revenue from regulated
activities. More specifically, these measures included the determination
of the
price applicable to producers’ sales to the distributors in the same corporate
group equated to bilateral contracts and the reduction of the producers’ revenue
due to the internalisation, in the wholesale market price, of the cost of
the
greenhouse gas emission allowances.
Royal
Decree 871/2007, of 30 June, established EUR 49.23/MWh as the definitive
price
referred to by Royal Decree-Law 3/2006 in relation to producers’ electricity
sales in the wholesale market in the period from the entry into force of
the
Royal Decree-Law to 31 December 2006 which coincide with the electricity
purchases made by a distributor in the same group for sale in the regulated
market. Pursuant to that same Royal Decree-Law, these transactions have been
settled at the provisional price of EUR 42.35/MWh.
At
the
date of preparation of these interim consolidated financial statements the
definitive regulations establishing the method for calculating the deduction
from the effect of the internalisation of the cost of the emission allowances
on
revenue had not yet been approved.
Taking
into account all the foregoing, Endesa considers that the estimate of 2006
revenue made at the end of 2006 continues to be the best estimate of the
amount
that will ultimately be settled and, therefore, pending the completion of
the
legislation that is still at the implementation stage, no adjustments were
made
to the revenue recognised in this connection.
When
the
related implementing regulations have been approved, any difference that
might
exist with respect to the figures recorded will be recognised in the first
consolidated financial statements authorised for issue after the content
of the
regulations is known. In any case, based on the content of Royal Decree-Law
3/2006, it is considered that any such difference should not have a material
effect on the consolidated figures of Endesa.
Similarly,
at the date of these interim consolidated financial statements no final
administrative decision had been taken in relation to the revision of the
specific costs for the remuneration of the island and non-mainland system
costs
for 2001 to 2005. The final decision was taken on 2 October 2007 (see Note
11).
4.
CAPITAL EXPENDITURE.
The
detail
of the investments in property, plant and equipment in the first six months
of
2007 and 2006 is as follows:
|
|
Millions
of Euros
|
|
January-June
2007 (Unaudited)
|
|
Generation
|
Distribution
and Transmission
|
Other
|
Total
|
|
Spain
and Portugal
|
485
|
519
|
13
|
1,017
|
|
Rest
of Europe
|
137
|
2
|
1
|
140
|
|
Latin
America
|
123
|
192
|
32
|
347
|
|
TOTAL
|
745
|
713
|
46
|
1,504
|
|
|
Millions
of Euros
|
|
January-June
2006 (Unaudited)
|
|
Generation
|
Distribution
and Transmission
|
Other
|
Total
|
|
Spain
and Portugal
|
374
|
584
|
16
|
974
|
|
Rest
of Europe
|
83
|
-
|
1
|
84
|
|
Latin
America
|
140
|
220
|
8
|
368
|
|
TOTAL
|
597
|
804
|
25
|
1,426
|
At
30 June
2007, the Group companies had property, plant and equipment purchase commitments
amounting to EUR 2,498 million.
There
were
no significant divestments in the first six months of 2007.
5.
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD AND NON-CURRENT FINANCIAL
ASSETS.
There
were
no significant changes in the balance of these headings in the first half
of
2007. The most noteworthy variations related to the evolution of Gas Atacama
and
the transactions involving the shares of this company.
The
financial position of Gas Atacama, in which Endesa has an ownership interest
of
18.2% through its 50% holding in Endesa Chile, was affected by the
unavailability of gas from Argentina.
In
parallel, CMS, which owns the other 50% of the shares of Gas Atacama, had
initiated the sale of its ownership interest and the loans that it had granted
this company. Endesa Chile exercised its pre-emption rights and, in turn,
sold
the shares to Southern Cross for the same amount as that for which it had
acquired them.
Gas
Atacama has entered into certain framework agreements for the amendment of
electricity supply or back-up contracts, which contain more advantageous
trading
terms and conditions that will enable it to improve its operating and financial
position.
The
agreements entered into by Gas Atacama were subject to the condition precedent
that Endesa Chile exercised its pre-emption rights on CMS’s ownership interest
in Gas Atacama and on the loans that it had granted to it and that it
subsequently sold them to Southern Cross, which it did.
In
view of
the situation at Gas Atacama, the Group performed the related impairment
test at
30 June 2007, taking into account the aforementioned agreements when measuring
the investment in the company. The impairment test conducted did not disclose
any need to write down the carrying amount of the investment, the carrying
amount of which in the consolidated balance sheet at 30 June 2007 was EUR
243
million.
6.
DIVIDENDS.
The
interim dividend for 2006 approved by the Board of Directors of Endesa, S.A.
on
24 October 2006 amounted to EUR 0.5 gross per share, giving a total dividend
of
EUR 529 million. This amount was paid to the shareholders on 2 January 2007
and
was deducted from the Parent’s equity at 31 December 2006.
Also,
as
approved by the shareholders at the Annual General Meeting held on 20 June
2007,
on 2 July Endesa paid a final dividend of EUR 1.14 per share out of the profit
for 2006. Following this payment, the total amount earmarked for shareholder
remuneration out of the profit for 2006, including the interim dividend of
EUR
0.5 gross per share paid on 2 January, amounted to EUR 1.64 per share, giving
a
total disbursement of EUR 1,736 million.
In
addition, in the first quarter of 2007 Endesa paid an attendance fee of EUR
0.15
gross per share for attending the Extraordinary General Meeting scheduled
to be
held on 20 March, as a result of which an additional amount of EUR 148 million
was paid to the shareholders.
7.
ISSUES, REIMBURSEMENTS OR RETIREMENTS OF DEBT
SECURITIES.
The
detail
of the issues, reimbursements or retirements of debt securities in the first
six
months of 2007 and 2006 is as follows:
|
January-June
2007 (Unaudited)
|
|
Issuer
|
Transaction
|
Outstanding
Balance
(Millions
of Euros)
|
Interest
Rate (%)
|
Guarantor
|
|
Endesa
Capital
|
Retirements
|
513
|
3.52
|
Endesa
|
|
Endesa
Capital
|
Issues
|
353
|
3.76
|
Endesa
|
|
International
Endesa
|
Retirements
|
80
|
3.56
|
Endesa
|
|
International
Endesa
|
Issues
|
3,350
|
3.59
|
Endesa
|
|
International
Endesa
|
Retirements
|
2,640
|
3.75
|
Endesa
|
|
January-June
2006 (Unaudited)
|
|
Issuer
|
Transaction
|
Outstanding
Balance
(Millions
of Euros)
|
Interest
Rate (%)
|
Guarantor
|
|
Endesa
Capital
|
Retirements
|
30
|
2.97
|
Endesa
|
|
Endesa
Capital
|
Issues
|
609
|
3.03
|
Endesa
|
|
International
Endesa
|
Retirements
|
750
|
5.25
|
Endesa
|
|
International
Endesa
|
Retirements
|
44
|
2.64
|
Endesa
|
|
International
Endesa
|
Retirements
|
49
|
2.68
|
Endesa
|
|
International
Endesa
|
Issues
|
2,155
|
2.77
|
Endesa
|
|
International
Endesa
|
Retirements
|
2,167
|
2.48
|
Endesa
|
At
30 June
2007, neither Endesa, S.A. nor any of its significant subsidiaries was failing
to comply with the covenants habitually found in agreements of this
nature.
8.
SEGMENT REPORTING.
Segment
information for the first six months of 2007 and 2006 is presented
below:
|
|
|
Millions
of Euros
|
|
|
|
|
January-June
2007 (Unaudited)
|
|
|
January-June
2006 (Unaudited)
|
|
|
|
|
Spain
and
Portugal
|
|
|
Rest
of
Europe
|
|
|
Latin
America
|
|
|
Total
|
|
|
Spain
and
Portugal
|
|
|
Rest
of
Europe
|
|
|
Latin
America
|
|
|
Total
|
|
|
REVENUE
|
|
|
4,997
|
|
|
|
2,066
|
|
|
|
3,310
|
|
|
|
10,373
|
|
|
|
5,268
|
|
|
|
2,251
|
|
|
|
3,082
|
|
|
|
10,601
|
|
|
Sales
|
|
|
4,832
|
|
|
|
1,992
|
|
|
|
3,230
|
|
|
|
10,054
|
|
|
|
4,826
|
|
|
|
2,087
|
|
|
|
3,033
|
|
|
|
9,946
|
|
|
Other
operating income
|
|
|
165
|
|
|
|
74
|
|
|
|
80
|
|
|
|
319
|
|
|
|
442
|
|
|
|
164
|
|
|
|
49
|
|
|
|
655
|
|
|
PROCUREMENTS
AND SERVICES
|
|
|
(1,958
|
)
|
|
|
(1,284
|
)
|
|
|
(1,599
|
)
|
|
|
(4,841
|
)
|
|
|
(2,315
|
)
|
|
|
(1,492
|
)
|
|
|
(1,495
|
)
|
|
|
(5,302
|
)
|
|
Power
purchased
|
|
|
(474
|
)
|
|
|
(674
|
)
|
|
|
(873
|
)
|
|
|
(2,021
|
)
|
|
|
(537
|
)
|
|
|
(546
|
)
|
|
|
(851
|
)
|
|
|
(1,934
|
)
|
|
Cost
of fuel consumed
|
|
|
(1,040
|
)
|
|
|
(588
|
)
|
|
|
(331
|
)
|
|
|
(1,959
|
)
|
|
|
(1,061
|
)
|
|
|
(733
|
)
|
|
|
(214
|
)
|
|
|
(2,008
|
)
|
|
Transmission
expenses
|
|
|
(263
|
)
|
|
|
(5
|
)
|
|
|
(187
|
)
|
|
|
(455
|
)
|
|
|
(173
|
)
|
|
|
(12
|
)
|
|
|
(184
|
)
|
|
|
(369
|
)
|
|
Other
variable procurements and services
|
|
|
(181
|
)
|
|
|
(17
|
)
|
|
|
(208
|
)
|
|
|
(406
|
)
|
|
|
(544
|
)
|
|
|
(201
|
)
|
|
|
(246
|
)
|
|
|
(991
|
)
|
|
CONTRIBUTION
MARGIN
|
|
|
3,039
|
|
|
|
782
|
|
|
|
1,711
|
|
|
|
5,532
|
|
|
|
2,953
|
|
|
|
759
|
|
|
|
1,587
|
|
|
|
5,299
|
|
|
Work
on non-current assets
|
|
|
89
|
|
|
|
3
|
|
|
|
13
|
|
|
|
105
|
|
|
|
76
|
|
|
|
1
|
|
|
|
13
|
|
|
|
90
|
|
|
Staff
costs
|
|
|
(561
|
)
|
|
|
(81
|
)
|
|
|
(198
|
)
|
|
|
(840
|
)
|
|
|
(500
|
)
|
|
|
(75
|
)
|
|
|
(192
|
)
|
|
|
(767
|
)
|
|
Other
fixed operating expenses
|
|
|
(566
|
)
|
|
|
(97
|
)
|
|
|
(303
|
)
|
|
|
(966
|
)
|
|
|
(499
|
)
|
|
|
(98
|
)
|
|
|
(263
|
)
|
|
|
(860
|
)
|
|
GROSS
PROFIT FROM OPERATIONS
|
|
|
2,001
|
|
|
|
607
|
|
|
|
1,223
|
|
|
|
3,831
|
|
|
|
2,030
|
|
|
|
587
|
|
|
|
1,145
|
|
|
|
3,762
|
|
|
Depreciation
and amortization charge
|
|
|
(629
|
)
|
|
|
(158
|
)
|
|
|
(267
|
)
|
|
|
(1,054
|
)
|
|
|
(527
|
)
|
|
|
(128
|
)
|
|
|
(236
|
)
|
|
|
(891
|
)
|
|
PROFIT
FROM OPERATIONS
|
|
|
1,372
|
|
|
|
449
|
|
|
|
956
|
|
|
|
2,777
|
|
|
|
1,503
|
|
|
|
459
|
|
|
|
909
|
|
|
|
2,871
|
|
|
FINANCIAL
LOSS
|
|
|
(188
|
)
|
|
|
(39
|
)
|
|
|
(269
|
)
|
|
|
(496
|
)
|
|
|
(200
|
)
|
|
|
(25
|
)
|
|
|
(244
|
)
|
|
|
(469
|
)
|
|
Net
finance costs
|
|
|
(190
|
)
|
|
|
(37
|
)
|
|
|
(267
|
)
|
|
|
(494
|
)
|
|
|
(192
|
)
|
|
|
(25
|
)
|
|
|
(263
|
)
|
|
|
(480
|
)
|
|
Translation
differences
|
|
|
2
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
(8
|
)
|
|
|
-
|
|
|
|
19
|
|
|
|
11
|
|
|
Result
of companies accounted for using the equity method
|
|
|
3
|
|
|
|
6
|
|
|
|
(3
|
)
|
|
|
6
|
|
|
|
42
|
|
|
|
(4
|
)
|
|
|
8
|
|
|
|
46
|
|
|
Income
from other investments
|
|
|
6
|
|
|
|
-
|
|
|
|
-
|
|
|
|
6
|
|
|
|
7
|
|
|
|
-
|
|
|
|
-
|
|
|
|
7
|
|
|
Income
from asset disposals
|
|
|
9
|
|
|
|
-
|
|
|
|
1
|
|
|
|
10
|
|
|
|
225
|
|
|
|
1
|
|
|
|
34
|
|
|
|
260
|
|
|
PROFIT
BEFORE TAX
|
|
|
1,202
|
|
|
|
416
|
|
|
|
685
|
|
|
|
2,303
|
|
|
|
1,577
|
|
|
|
431
|
|
|
|
707
|
|
|
|
2,715
|
|
|
Income
tax
|
|
|
(324
|
)
|
|
|
(145
|
)
|
|
|
(210
|
)
|
|
|
(679
|
)
|
|
|
(440
|
)
|
|
|
(18
|
)
|
|
|
(15
|
)
|
|
|
(473
|
)
|
|
PROFIT
FOR THE PERIOD
|
|
|
878
|
|
|
|
271
|
|
|
|
475
|
|
|
|
1,624
|
|
|
|
1,137
|
|
|
|
413
|
|
|
|
692
|
|
|
|
2,242
|
|
|
Parent
|
|
|
873
|
|
|
|
206
|
|
|
|
176
|
|
|
|
1,255
|
|
|
|
1,132
|
|
|
|
322
|
|
|
|
302
|
|
|
|
1,756
|
|
|
Minority
interests
|
|
|
5
|
|
|
|
65
|
|
|
|
299
|
|
|
|
369
|
|
|
|
5
|
|
|
|
91
|
|
|
|
390
|
|
|
|
486
|
|
|
|
|
Millions
of Euros
|
|
|
|
|
30
June 2007 (Unaudited)
|
|
|
31
December 2006
|
|
|
|
|
Spain
and
Portugal
|
|
|
Rest
of Europe
|
|
|
Latin
America
|
|
|
Total
|
|
|
Spain
and
Portugal
|
|
|
Rest
of Europe
|
|
|
Latin
America
|
|
|
Total
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
26,416
|
|
|
|
6,025
|
|
|
|
14,489
|
|
|
|
46,930
|
|
|
|
26,330
|
|
|
|
6,068
|
|
|
|
13,982
|
|
|
|
46,380
|
|
|
Property,
plant and equipment
|
|
|
20,243
|
|
|
|
3,816
|
|
|
|
10,532
|
|
|
|
34,591
|
|
|
|
19,758
|
|
|
|
3,872
|
|
|
|
10,084
|
|
|
|
33,714
|
|
|
Investment
property
|
|
|
30
|
|
|
|
-
|
|
|
|
49
|
|
|
|
79
|
|
|
|
32
|
|
|
|
-
|
|
|
|
49
|
|
|
|
81
|
|
|
Intangible
assets
|
|
|
366
|
|
|
|
42
|
|
|
|
88
|
|
|
|
496
|
|
|
|
660
|
|
|
|
66
|
|
|
|
78
|
|
|
|
804
|
|
|
Goodwill
|
|
|
61
|
|
|
|
1,676
|
|
|
|
2,284
|
|
|
|
4,021
|
|
|
|
61
|
|
|
|
1,653
|
|
|
|
2,272
|
|
|
|
3,986
|
|
|
Non-current
financial assets
|
|
|
3,778
|
|
|
|
67
|
|
|
|
572
|
|
|
|
4,417
|
|
|
|
3,839
|
|
|
|
89
|
|
|
|
554
|
|
|
|
4,482
|
|
|
Investments
accounted for using the equity method
|
|
|
412
|
|
|
|
118
|
|
|
|
190
|
|
|
|
720
|
|
|
|
407
|
|
|
|
81
|
|
|
|
161
|
|
|
|
649
|
|
|
Deferred
tax assets
|
|
|
1,526
|
|
|
|
306
|
|
|
|
774
|
|
|
|
2,606
|
|
|
|
1,573
|
|
|
|
307
|
|
|
|
784
|
|
|
|
2,664
|
|
|
Current
assets
|
|
|
4,193
|
|
|
|
1,124
|
|
|
|
2,681
|
|
|
|
7,998
|
|
|
|
3,924
|
|
|
|
1,171
|
|
|
|
2,613
|
|
|
|
7,708
|
|
|
Inventories
|
|
|
581
|
|
|
|
222
|
|
|
|
107
|
|
|
|
910
|
|
|
|
615
|
|
|
|
176
|
|
|
|
91
|
|
|
|
882
|
|
|
Trade
and other receivables
|
|
|
3,451
|
|
|
|
758
|
|
|
|
2,014
|
|
|
|
6,223
|
|
|
|
3,099
|
|
|
|
862
|
|
|
|
1,858
|
|
|
|
5,819
|
|
|
Current
financial assets
|
|
|
44
|
|
|
|
-
|
|
|
|
10
|
|
|
|
54
|
|
|
|
35
|
|
|
|
1
|
|
|
|
3
|
|
|
|
39
|
|
|
Cash
and cash equivalents
|
|
|
117
|
|
|
|
144
|
|
|
|
550
|
|
|
|
811
|
|
|
|
175
|
|
|
|
132
|
|
|
|
658
|
|
|
|
965
|
|
|
Non-current
assets classified as held for sale
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
3
|
|
|
|
3
|
|
|
TOTAL
ASSETS
|
|
|
30,609
|
|
|
|
7,149
|
|
|
|
17,170
|
|
|
|
54,928
|
|
|
|
30,254
|
|
|
|
7,239
|
|
|
|
16,595
|
|
|
|
54,088
|
|
|
EQUITY
AND LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
5,773
|
|
|
|
3,370
|
|
|
|
7,235
|
|
|
|
16,378
|
|
|
|
5,980
|
|
|
|
3,292
|
|
|
|
6,664
|
|
|
|
15,936
|
|
|
Of
the Parent
|
|
|
5,725
|
|
|
|
2,403
|
|
|
|
3,314
|
|
|
|
11,442
|
|
|
|
5,936
|
|
|
|
2,333
|
|
|
|
3,022
|
|
|
|
11,291
|
|
|
Of
minority interests
|
|
|
48
|
|
|
|
967
|
|
|
|
3,921
|
|
|
|
4,936
|
|
|
|
44
|
|
|
|
959
|
|
|
|
3,642
|
|
|
|
4,645
|
|
|
Non-current
liabilities
|
|
|
19,716
|
|
|
|
2,775
|
|
|
|
7,913
|
|
|
|
30,404
|
|
|
|
19,513
|
|
|
|
2,757
|
|
|
|
7,737
|
|
|
|
30,007
|
|
|
Deferred
income
|
|
|
2,392
|
|
|
|
100
|
|
|
|
169
|
|
|
|
2,661
|
|
|
|
2,185
|
|
|
|
116
|
|
|
|
141
|
|
|
|
2,442
|
|
|
Long-term
provisions
|
|
|
3,280
|
|
|
|
253
|
|
|
|
789
|
|
|
|
4,322
|
|
|
|
3,407
|
|
|
|
274
|
|
|
|
761
|
|
|
|
4,442
|
|
|
Bank
borrowings and other financial liabilities
|
|
|
13,177
|
|
|
|
1,663
|
|
|
|
5,908
|
|
|
|
20,748
|
|
|
|
13,043
|
|
|
|
1,643
|
|
|
|
5,801
|
|
|
|
20,487
|
|
|
Other
non-current payables
|
|
|
429
|
|
|
|
416
|
|
|
|
119
|
|
|
|
964
|
|
|
|
444
|
|
|
|
427
|
|
|
|
114
|
|
|
|
985
|
|
|
Deferred
tax liabilities
|
|
|
438
|
|
|
|
343
|
|
|
|
928
|
|
|
|
1,709
|
|
|
|
434
|
|
|
|
297
|
|
|
|
920
|
|
|
|
1,651
|
|
|
Current
liabilities
|
|
|
5,120
|
|
|
|
1,004
|
|
|
|
2,022
|
|
|
|
8,146
|
|
|
|
4,761
|
|
|
|
1,190
|
|
|
|
2,194
|
|
|
|
8,145
|
|
|
Bank
borrowings and other financial liabilities
|
|
|
(9
|
)
|
|
|
207
|
|
|
|
516
|
|
|
|
714
|
|
|
|
(9
|
)
|
|
|
163
|
|
|
|
475
|
|
|
|
629
|
|
|
Current
trade and other payables
|
|
|
5,129
|
|
|
|
797
|
|
|
|
1,506
|
|
|
|
7,432
|
|
|
|
4,770
|
|
|
|
1,027
|
|
|
|
1,719
|
|
|
|
7,516
|
|
|
TOTAL
EQUITY AND LIABILITIES
|
|
|
30,609
|
|
|
|
7,149
|
|
|
|
17,170
|
|
|
|
54,928
|
|
|
|
30,254
|
|
|
|
7,239
|
|
|
|
16,595
|
|
|
|
54,088
|
|
|
|
|
Millions
of Euros
|
|
|
|
|
January-June
2007 (Unaudited)
|
|
|
January-June
2006 (Unaudited)
|
|
|
|
|
Spain
and Portugal
|
|
|
Rest
of
Europe
|
|
|
Latin
America
|
|
|
Total
|
|
|
Spain
and Portugal
|
|
|
Rest
of
Europe
|
|
|
Latin
America
|
|
|
Total
|
|
|
Gross
profit before tax and minority interests
|
|
|
1,202
|
|
|
|
416
|
|
|
|
685
|
|
|
|
2,303
|
|
|
|
1,577
|
|
|
|
431
|
|
|
|
707
|
|
|
|
2,715
|
|
|
Depreciation
and amortisation charge
|
|
|
629
|
|
|
|
158
|
|
|
|
267
|
|
|
|
1,054
|
|
|
|
527
|
|
|
|
128
|
|
|
|
236
|
|
|
|
891
|
|
|
Income
from asset disposals
|
|
|
(9
|
)
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
(10
|
)
|
|
|
(225
|
)
|
|
|
(1
|
)
|
|
|
(34
|
)
|
|
|
(260
|
)
|
|
Income
tax
|
|
|
(332
|
)
|
|
|
(101
|
)
|
|
|
(151
|
)
|
|
|
(584
|
)
|
|
|
(403
|
)
|
|
|
(187
|
)
|
|
|
(190
|
)
|
|
|
(780
|
)
|
|
Provisions
paid
|
|
|
(168
|
)
|
|
|
(3
|
)
|
|
|
(32
|
)
|
|
|
(203
|
)
|
|
|
(201
|
)
|
|
|
(6
|
)
|
|
|
(35
|
)
|
|
|
(242
|
)
|
|
Other
results not giving rise to cash flows
|
|
|
12
|
|
|
|
(35
|
)
|
|
|
37
|
|
|
|
14
|
|
|
|
(18
|
)
|
|
|
(25
|
)
|
|
|
(6
|
)
|
|
|
(49
|
)
|
|
Cash
flows from operations
|
|
|
1,334
|
|
|
|
435
|
|
|
|
805
|
|
|
|
2,574
|
|
|
|
1,257
|
|
|
|
340
|
|
|
|
678
|
|
|
|
2,275
|
|
|
Change
in income tax payable
|
|
|
263
|
|
|
|
(14
|
)
|
|
|
(81
|
)
|
|
|
168
|
|
|
|
282
|
|
|
|
(110
|
)
|
|
|
11
|
|
|
|
183
|
|
|
Change
in operating current assets/liabilities
|
|
|
(122
|
)
|
|
|
(173
|
)
|
|
|
(245
|
)
|
|
|
(540
|
)
|
|
|
(344
|
)
|
|
|
(163
|
)
|
|
|
(37
|
)
|
|
|
(544
|
)
|
|
Net
cash flows from operating activities
|
|
|
1,475
|
|
|
|
248
|
|
|
|
479
|
|
|
|
2,202
|
|
|
|
1,195
|
|
|
|
67
|
|
|
|
652
|
|
|
|
1,914
|
|
|
Investments
in property, plant and equipment and
intangible
assets
|
|
|
(1,244
|
)
|
|
|
(91
|
)
|
|
|
(364
|
)
|
|
|
(1,699
|
)
|
|
|
(1,218
|
)
|
|
|
(96
|
)
|
|
|
(392
|
)
|
|
|
(1,706
|
)
|
|
Disposals
of property, plant and equipment and
intangible
assets
|
|
|
9
|
|
|
|
6
|
|
|
|
6
|
|
|
|
21
|
|
|
|
22
|
|
|
|
2
|
|
|
|
74
|
|
|
|
98
|
|
|
Investments
in Group companies
|
|
|
-
|
|
|
|
(41
|
)
|
|
|
(46
|
)
|
|
|
(87
|
)
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
Other
investments
|
|
|
(196
|
)
|
|
|
(14
|
)
|
|
|
(26
|
)
|
|
|
(236
|
)
|
|
|
(1,256
|
)
|
|
|
(78
|
)
|
|
|
(14
|
)
|
|
|
(1,348
|
)
|
|
Disposals
of other investments
|
|
|
117
|
|
|
|
14
|
|
|
|
24
|
|
|
|
155
|
|
|
|
83
|
|
|
|
19
|
|
|
|
35
|
|
|
|
137
|
|
|
Cash
flows due to changes in the scope of
consolidation
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
|
|
1
|
|
|
|
-
|
|
|
|
2
|
|
|
Grants
and other deferred income
|
|
|
179
|
|
|
|
3
|
|
|
|
24
|
|
|
|
206
|
|
|
|
141
|
|
|
|
-
|
|
|
|
24
|
|
|
|
165
|
|
|
Net
cash flows used in investing activities
|
|
|
(1,135
|
)
|
|
|
(123
|
)
|
|
|
(382
|
)
|
|
|
(1,640
|
)
|
|
|
(2,229
|
)
|
|
|
(152
|
)
|
|
|
(273
|
)
|
|
|
(2,654
|
)
|
|
Non-current
bank borrowing drawdowns
|
|
|
636
|
|
|
|
8
|
|
|
|
660
|
|
|
|
1,304
|
|
|
|
3,156
|
|
|
|
104
|
|
|
|
627
|
|
|
|
3,887
|
|
|
Non-current
bank borrowings and other financial
liabilities
repaid
|
|
|
(857
|
)
|
|
|
(38
|
)
|
|
|
(251
|
)
|
|
|
(1,146
|
)
|
|
|
(852
|
)
|
|
|
(173
|
)
|
|
|
(161
|
)
|
|
|
(1,186
|
)
|
|
Net
cash flows from current bank borrowings and
other
financial liabilities
|
|
|
390
|
|
|
|
84
|
|
|
|
(358
|
)
|
|
|
116
|
|
|
|
(2,875
|
)
|
|
|
279
|
|
|
|
(320
|
)
|
|
|
(2,916
|
)
|
|
Dividends
of the Parent paid
|
|
|
(567
|
)
|
|
|
(110
|
)
|
|
|
-
|
|
|
|
(677
|
)
|
|
|
(81
|
)
|
|
|
(129
|
)
|
|
|
(113
|
)
|
|
|
(323
|
)
|
|
Payments
to minority interests
|
|
|
-
|
|
|
|
(57
|
)
|
|
|
(290
|
)
|
|
|
(347
|
)
|
|
|
(2
|
)
|
|
|
(48
|
)
|
|
|
(156
|
)
|
|
|
(206
|
)
|
|
Net
cash flows from financing activities
|
|
|
(398
|
)
|
|
|
(113
|
)
|
|
|
(239
|
)
|
|
|
(750
|
)
|
|
|
(654
|
)
|
|
|
33
|
|
|
|
(123
|
)
|
|
|
(744
|
)
|
|
Total
net cash flows
|
|
|
(58
|
)
|
|
|
12
|
|
|
|
(142
|
)
|
|
|
(188
|
)
|
|
|
(1,688
|
)
|
|
|
(52
|
)
|
|
|
256
|
|
|
|
(1,484
|
)
|
|
Effect
of foreign exchange rate changes on cash and
cash
equivalents
|
|
|
-
|
|
|
|
-
|
|
|
|
34
|
|
|
|
34
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(17
|
)
|
|
|
(17
|
)
|
|
Net
increase/decrease in cash and cash equivalents
|
|
|
(58
|
)
|
|
|
12
|
|
|
|
(108
|
)
|
|
|
(154
|
)
|
|
|
(1,688
|
)
|
|
|
(52
|
)
|
|
|
239
|
|
|
|
(1,501
|
)
|
|
Cash
and cash equivalents at beginning of period
|
|
|
175
|
|
|
|
132
|
|
|
|
658
|
|
|
|
965
|
|
|
|
1,910
|
|
|
|
127
|
|
|
|
577
|
|
|
|
2,614
|
|
|
Cash
and cash equivalents at end of period
|
|
|
117
|
|
|
|
144
|
|
|
|
550
|
|
|
|
811
|
|
|
|
222
|
|
|
|
75
|
|
|
|
816
|
|
|
|
1,113
|
|
9.
RELATED PARTY TRANSACTIONS.
9.1.
Transactions with significant shareholders of the
Company.
The
material transactions performed in the first six months of 2007 and 2006
with
Groups of companies headed by significant shareholders, all of which were
carried out on an arm’s length basis, were as follows:
|
January-June
2007 (Unaudited)
|
|
Related
Party
|
Description
of the Transaction
|
Amount
(Millions
of
Euros)
|
|
Caja
Madrid
|
Services
provided
|
9
|
|
|
Financing
agreements: loans
|
64
|
|
|
Financing
agreements: other
|
348
|
|
|
Interest
paid
|
30
|
|
|
Interest
charged
|
40
|
|
|
Unpaid
accrued interest
|
21
|
|
|
Uncollected
accrued interest
|
10
|
|
|
Guarantees
|
102
|
|
|
Purchase
option obligations
|
58
|
|
|
Sale
option obligations
|
1
|
|
|
Other
(*)
|
1,956
|
|
Acciona
Group
|
Purchases
of goods (finished or otherwise)
|
64
|
|
|
Services
provided
|
10
|
|
|
Services
received
|
8
|
|
Enel
Group
|
Purchases
of goods (finished or otherwise)
|
1
|
|
|
Sales
of goods (finished or otherwise)
|
82
|
|
|
Services
|
21
|
|
January-June
2006 (Unaudited)
|
|
Related
Party
|
Description
of the Transaction
|
Amount
(Millions
of
Euros)
|
|
Caja
Madrid
|
Financing
agreements: loans
|
25
|
|
|
Interest
paid
|
30
|
|
|
Interest
charged
|
40
|
|
|
Unpaid
accrued interest
|
15
|
|
|
Uncollected
accrued interest
|
11
|
|
|
Guarantees
|
114
|
|
|
Other
(*)
|
4,665
|
(*)
The
amounts included in “Other” relate mainly to the notional amount of financial
derivatives arranged with Caja Madrid.
9.2.
Transactions with the Company’s directors and
executives.
The
significant transactions performed in the first six months of 2007 and 2006
with
the Company’s directors and senior executives were as follows:
|
January-June
2007 (Unaudited)
|
|
Description
of the Transaction
|
Amount
(Millions
of Euros)
|
|
Remuneration
|
20
|
|
Contributions
to pension plans and life insurance policies
|
3
|
|
Guarantees
|
49
|
|
Financing
agreements: loans
|
5
|
|
January-June
2006 (Unaudited)
|
|
Description
of the Transaction
|
Amount
(Millions
of Euros)
|
|
Remuneration
|
19
|
|
Contributions
to pension plans and life insurance policies
|
3
|
|
Guarantees
|
47
|
|
Financing
agreements: loans
|
5
|
At
June 30
2007, the Company had provisioned in full the pre-retirement and pension
obligations to the directors and senior executives.
10.
OTHER DISCLOSURES.
In
order
to be able to compare the results between the six-month periods ended 30
June
2007 and 30 June 2006, the following matters relating to unusual events of
significant amounts must be taken into account:
|
|
-
|
The
recognition in the first six months of 2006 of certain excess costs
of
non-mainland generation in the period from 2001 to 2005 amounting
to EUR
227 million as operating income and the related interest amounting
to EUR
31 million as finance income.
|
|
|
-
|
The
tax effect recognised in the period ended 30 June 2006 of adjusting
the
tax bases and carrying amounts of the non-current assets of Endesa
Italia,
as required by Italian legislation, which had a positive tax impact
of EUR
148 million (EUR 118 million after minority
interests).
|
|
|
-
|
The
recognition in the first six months of 2006 of the tax effect of
the
merger of Elesur and Chilectra, which gave rise to the recognition
of a
tax asset of EUR 170 million (EUR 101 million after minority
interests).
|
|
|
-
|
The
effect in the first six months of 2006 of the sale of certain assets
(mainly a 5.01% investment in Auna) for EUR 260 million (EUR 225
million
after taxes and minority interests.
|
In
the
six-month period ended 30 June 2007 there were no material unusual
items.
Group
management considers that the provisions recognised in the interim consolidated
financial statements at 30 June 2007 adequately cover the contingencies relating
to litigation, arbitration and claims and no liabilities additional to those
recognised are expected to arise.
11.
EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE.
On
20
September 2007, ENDESA, S.A. completed the sale of 2,705,400 shares of Red
Eléctrica de España, S.A. representing 2% of the latter’s share capital through
various transactions carried out in recent months, the most significant of
which
was the sale of 1.35% of the share capital to Citigroup, which subsequently
placed it on the market. The 2% ownership interest was sold for EUR 96 million,
representing an average price per share of EUR 35.33. This sale reduced Endesa,
S.A.’s ownership interest in Red Eléctrica de España, S.A. to 1%, thereby
complying with the limits established, for 31 December 2007, by current
legislation.
A
resolution of the Directorate-General of Energy Policy and Mines establishing
a
revision of the definitive specific costs for the remuneration for the island
and non-mainland electricity systems for 2001 to 2005 was approved on 2 October
2007. Through the resolution, the Directorate-General established that the
definitive amount of those costs at 31 December 2005, after discounting the
annual amounts for 2003, 2004 and 2005 of the provisional shortfall for
2001-2002 and including the finance costs accrued each year, calculated using
an
interest rate equal to average annual three-month Euribor, was EUR 921
million.
One
of the
conditions of the takeover bid launched by Acciona, S.A. and Enel Energy
Europe,
S.r.L. for all the shares of Endesa, S.A. was that certain articles of the
bylaws of Endesa, S.A. be changed. In order to enable the shareholders to
decide
on the bylaw changes on which Acciona, S.A. and Enel Energy Europe, S.r.L.
had
made the takeover bid conditional, the Board of Directors called an
Extraordinary General Meeting for 25 September 2007 and resolved to pay an
attendance fee of EUR 0.15 per share, as a result of which EUR 148 million
were
paid to the shareholders in this connection.
On
5
October 2007, in compliance with Article 27.2 of Royal Decree 1197/1991,
of 26
July, the Spanish National Securities Market Commission (CNMV) announced
that
the takeover bid launched by Acciona, S.A. and Enel Energy Europe, S.r.L.
for
all the shares of Endesa, S.A., from which 487,116,120 shares, equal to 46.01%
of the share capital, were excluded as a result of having been blocked by
their
respective holders, as indicated in the related information memorandum, had
been
accepted by the holders of 487,601,643 shares, representing 85.30% of the
shares
at which the bid had been targeted and 46.05% of the share capital of the
company affected. Of the aforementioned figure, 4,541,626 shares related
to the
US bid. Accordingly, the takeover bid was successful, since it was accepted
by
the holders of shares exceeding the minimum threshold established by the
bidders
for it to be considered valid.
Once
the
positive outcome of the takeover bid has been announced by the CNMV, Enel,
S.p.A. and Acciona, S.A. will be able to take the necessary steps to implement
the agreement relating to the joint management of Endesa, S.A. entered into
by
the two parties on 26 March 2007. These measures include most notably the
agreement entered into with E.on AG. on 2 April 2007 whereby the former
undertook to submit for consideration by the managing bodies of Endesa the
sale
to the latter of certain assets in Italy, France, Poland and Turkey, together
with other Endesa generating assets in Spain, and the assignment of certain
volume of nuclear production capacity for a period of ten years.
12.
EXPLANATION ADDED FOR TRANSLATION TO ENGLISH.
These
interim consolidated financial statements are presented on the basis of IFRS
as
adopted by the European Union. Certain accounting practices applied by the
Group
that conform with IFRS may not conform with other generally accepted accounting
principles.
10
October
2007
|
Rafael
Miranda
|
Carlos
Torres
|
|
CEO
|
CFO
|
17