Biancamano : Report of the Independent Auditing Firm Mazars

PRESS RELEASE

Biancamano Spa announces that, at today date, pursuant to art. 154-ter of D. Lgs. 24

February 1998 n. 58, the Half Year Financial Statements as of June 30, 2014 and the

Report of the Independent Auditing Firm Mazars Spa are available for public access.

Note that the Independent Auditing Firm Mazars states that is not able to express its opinion on Half Year Financial Statements as of June 30, 2014. Please refer to the complete documents attached to this press release.

The Half Year Financial Report as of June 30, 2014 and the Reports of the Independent Auditing Firm Mazars Spa are available for public access at Company's Head Office and on the company website www.gruppobiancamano.it in the section Investor Relations under Financial Results and Presentations, and on the authorized storage system "1Info" at the web address www.1info.it .

Biancamano is the main Italian private operator in Waste Management sector, leader in the Urban Cleaning integrated Services . The Group, through its subsidiary company Aimeri Ambiente, is specialized in planning, managing and controlling the complete cycle of the environmental operating services: from the collection and transportation of Municipal Waste, to the separate collection, to the streets sweeping and washing, and to the realization and management of the ecological platforms, on behalf of local public organizations and private operators. The Group furthermore manages disposal and storage plants. With about 2,000 employees, 3,000 vehicles and a GPS advanced control system, the Group is present throughout the national territory.

This press release is an English translation of the original Italian document.

This Press Release is available on the website: www.gruppobiancamano.it under the section Investor Relations - Press Releases.

CONTACTS:

marketing & comunicazione

Tel. +39 02 528682 286 mailto:c.locati@gruppobiancamano.it www.gruppobiancamano.it

Tel. +41 (0)91 9228712 mailto: info@gfsmedia.ch www.gfsmedia.ch

Biancamano Spa Sede Legale e Amministrativa: Strada 4, Palazzo Q6 - 20089 Milanofiori - Rozzano (MI) tel. +39 02 528682 1 - Fax +39 02 628682 253 info@gruppobiancamano.it - www.gruppobiancamano.it -

Capitale Sociale € 1.700.000,00 i.v. - Registro Imprese MI/Cod. fisc e Partita IVA:01362020081.

1

Biancamanos.p.A.

MAZARS

uditor ' ' reviw r·eport on the lin1itcd t·eview on tl1c half ycar

conden. ed consolidated financial statements

To the shoreholders of

Biancamano S.p.A.

1. We have reviewed the half year condensed consolidated financial statements compns1ng the statement of financial position, the income statement. the statement of comprehensive income. the statement of changesin equìty, the statement of cash flows and the related speafic explanatory notes or Biancamano Group as of June 30" 2014. DirectOf'S of Biancamano S.p.A. are responsible for the preparat1on of the half year condensed oonsohdated financial statements 1n oonforrmty wrth the lntemabonal Ftnanctal Reporting Standards applicable to intenm financiallnformabon (lAS 34) as adopted by European Union Our responsibility is toissue this review report based on our review.

2. We conducted our revìew In acoordance with review standards reoommended by CONSOB (tho ltalìan Stock Exchange Regulatory Agency) In its Rcsolution n. 10867 of July 31, 1997 A review consisted mainly of obtaining informallon on the accounts included in the half year condensed consolidated financial statements and the consistency of the accounbng principles applied, through discussion wi1h management, and of applymg anafyttcal procedures to the financial data presented in these half year condensed consolidated financial statements. Our review did not include the application of audlt proccduros such as tests of compliance and substantivo procedures on assets and liabll1tìes and was substantially loss In scope than an audlt conducted In accordance with gensrally accepted auditing standards. Acoord.ngly, we do not express an audit opinion on the haff year condensed consolidated financial

statements.as we expressed on the annua! consolidateci financialstatements.

Wrth reference to the amounts of the prior year oonsolìdated finanaal statements and oondensed half year consolidated financlal statements whech are presented for comparative pu oses, reference should be made to our auditors' reports issued respectively on march

31*, 2014 and August 28" 2013.

3. As of June 30th 2014 the Biancamano Group summarized a consohdated loss equalto Euro

0,4 million against a net consol1dated equrty of Euro 6,0 million and a net negative financial poslbon of Euro 128.2 milllon. The half year condensed consolidated finane al statements points out also commeraal recetvables equal to approxlmately Euro 166,5 mlllion (gross of lmpairments for Euro 2,6 milllon) of which overdue for more than 9 months for Euro 44,9 mflllon. commercial debts for Euro 66,0 mlllìon of whìch ovordue for Euro 36,7 milhon, fiscal debts equal lo Euro 76,2 mllhon of which overdue for Euro 58,1 mlllion and other debts equal to approlCimately Euro 40,8 mllllon of which overdue toward employees and soaal contnbutions for Euro 21,5 million

As also 1nd1cated 1n the "Oisclosures for the sharehotders· we po1nt ou1 the followmg mam uncertainbes·

- the Bìancamano Group closed the first six months penod of 2014 with revenues equa! to approXlmately Euro 73 mìlhon, 1n decrease with respect lo the same penod of the prior year, with an impact also on operatlng and profit results. The Otrectors point out that thts reduction has beeninfluenced, by the selection activity of contracts in portfolio as well as by new tenders, and by the delayed implementation of the financial activity following the

...

OElE tnW>4.c""

·r · 01'82010 r.c •lt0l 2'111•03 ...,..,. "11

A r AU:trXIqtt ttiJOrniJXI w

fil:• ... teto' /P NAIII& Dll'IJIIIUOIN v lQ rlA:'

l&::f' f. ! at C."- 4 'JO(. .._ow ou t:Z.1H l t"':GIJ "'l"FCS

urr ... &•• ha"-' - 8llcltM F •""- C"aJ.cwA-M,..,.. U'O.J P•0'.:1H "'"'-'•ftolt•- rca..o

Biancamano Spa Sede Legfbe e Amministrfirva: Strada 4, Palazzo Q6 - 20009 MiiandiOfl - Rozzaro (Mi) te/ _ +Xl 02 5200821 - Fax +Xl 02620082 253 1 nf 0t.fl?gr v çpo ti a ncama n oit www q n ppdJ1 a rcam ano it

CapitaJe Sociale€ 1700.000,00 1.v - Re] lstrolmrrese MVCOd_ t1sc e Partita IV A.'01Y32020081

MAZARS

restructunng debts agreement following art. 67 R.D. 267/42 that Bìancamano S.p.A and the subsidiary Aimeri Ambiente S.r.l. subscribed on January 20" 2014 with financing

lnstitutJons, and by the delay of some tenders that were expected to begin wtih anticipated dates in the calendar.
Thts trend could cause a deviation from the expectations of the Ftnanaal and Economie Pian
2013/2019, which is the base of the restructurlng debts agreement,in caso some of the expected results from the intense commercial activity and the policy of costs reduction would not be completely achieved.

- from a financial point of view. the Restructuring agreement planned a progressive implementation that faced some delays Wlth respect to the beginning expectattons and pointed out that occurred someimponderables which were unpredictable. More in detail the Directors point out that :

(i) The process of new finance release is not ended yet due to two ooncurrent reasons. First of ali, some of the cltents included tn the total recetvables of Euro
68 mlllion did not accept the disposal or it could not be possibla to formalìze lt

wìth a consequential and necessary proportionate rescheduhng of the finance to

deliver. In thc second hand , the extìnction of roreclosures is not finished yet, onginally expected before February 20th, 2014- whose restdual amount ts equal to Euro 1,5 million - since some of the financing insbtlfbons required the release or the Court decisfon or extìnctton, instead than. as contractually previewed, to obtaJn a stmple waiver from the previous client;
(ii) factor lines granted, specifically the recourse in pool, are under use due to:

• contractual provtsions requmng the obligation for the Bìancamano Group of reimbursing the credit sold resulting unpaid at the 91 oday due date. or. altematively, the replacement of the same, that practically ended up to beimpracticable for being not consistent with average payment times
of Public Administrat1on;

• the event, unpredictable a priori, that some clients did not accept to be sold to the factor or some others are not constdered transferable from the leadlng financing lnsbtutJon;

(iii) the dynam1cs of net working capitai, that was negative as of June 30th 2014 due to the issues described above, lnfluenced negatively the respect of the rescheduling agreement of debts signed with some commercia] partners causing
• although only formeriy, the decadence of the term oonafit.

Based on the descnbed situation, the B1ancamano Directors acknowel dge that the events dnscribed . consldered as a whole, expose the Group to multiple uncertaintles that could cast slgnlficant doubts on the abilìty to continue as a going concern The Directors, 1n the explanatory notes, describe the reasons based on which they cons1der to have a reasonable expectation that the Group has adequate financial resources to continuein a
foreseeable future and consequently have adopted the going concern assumptiOn in the preparation of the half year condensed financial statements as of June 30" 2014

- the Group has recorded in the half year condensed consolidaled financial statements a goodwill equal to Euro 9,7 mllhon and deferred tax assets equa! to Euro 11,8 million The sustainability of these activitiesis based an the feasibility of the Financial and economie pian 2013/2019.

Biancamano Spa Sede Legfbe e Amministrfirva: Strada 4, Palazzo Q6 - 20009 MiiandiOfl - Rozzaro (Mi) tel_ +Xl 02 5200821 - Fax +Xl02620082 253 1 nf 0t.fl?gr v çpo tiancama n oit www q n. ppdJ1 a rca mano lt

CapltaJe Sociale€ 1700.000,00 1.v - Re] lstrolmrrese MVCOd_ t1sc e Partita IV A.'01Y32020081

MAZARS

The above description, points out that the going concem assumption is subject to multiple slgniflcant uncertainties with possible significant collective effects on the half year condensed consolidated tinancial statements of the Biancamano Group as of June 30th.

2014.

4. Based on our review. because of the significance of the effects of the uncertaintles described in paragraph 3, we are not able to express ourselves whether if the condensed consolidated half year financial statements of Bìancamano Group as of June 30th, 2014 have been prepared in accordance with the lntemational Flnancial Reporting Standards applicable to intelim financialinfonnation (lAS 34) as adopted by the European Union

Milan, August 29th 2014

Mazars S.p.A.

Sìgned by S1mone Del Bianco

Partner

This reporl has been translated into the English language from the originai prepared in Jtalian solely for the convenience of mtemational readers.

Amministrfirva: Strada 4, Palazzo Q6 - 20009 MiiandiOfl - Rozzaro (Mi) tel_ +Xl 02 5200821 - Fax +Xl02620082 253 1 nf0t.fl?grvçpotiancamanoit www qn.ppdJ1arcamano lt

1.v - Re]lstrolmrrese MVCOd_ t1sc e Partita IVA.'01Y32020081

distributed by