Management Report and Consolidated Financial Statements - SIA

Management Report andConsolidated FinancialStatementsas at 31 December 2012

TABLE OF CONTENTSManagement Report ............................................................................................. 5Profit and Loss Account position ...................................................................................................... 11Balance Sheet position .................................................................................................................... 14SIA Group Consolidated Financial Statements ................................................... 17Explanatory Notes ............................................................................................... 25Breakdown of Balance Sheet items .................................................................... 33Breakdown of Profit and Loss Account items ..................................................... 45Supplementary Information ............................................................................... 53Statement of changes in intangible assets ........................................................................................ 54Statement of changes in property, plant and equipment ................................................................... 56Cash Flow Statement (Section I)...................................................................................................... 58Cash Flow Statement (Section II) .................................................................................................... 59Reconciliation between parent company and consolidated shareholders’ equity and profit (loss) for theyear ............................................................................................................................................... 60Statement of changes in Shareholders' Equity .................................................................................. 61Board of Statutory Auditors’ Report ................................................................... 63Independent Auditors’ Report ............................................................................ 69

Management Report

Management ReportWe hereby present to you, pursuant to Italian Legislative Decree 127/91, the consolidated financialstatements as at 31 December 2012, composed of the Balance Sheet, the Profit and Loss Account and theExplanatory Notes, and accompanied by the Group Cash Flow Statement.The context in which the Group operated during the year is fully illustrated in the Management Reportaccompanying the financial statements of the parent company, to which reference should be made.COMPOSITION OF THE GROUP AND SCOPE OF CONSOLIDATIONIn addition to the parent company SIA S.p.A., the scope of consolidation includes the following companies,consolidated with the line-by-line method:SiNSYS SA/NVThis Belgian company based in Brussels, has a share capital of € 6,000,000 and a shareholders' equity of €10,585,000 including the net result for the year. Already 51% owned by SIA, the remaining 49% of thecompany was acquired during the year. Once acquiring all shares, SIA launched a merger by incorporationof the same, resolved by the shareholders’ meetings on 30 November 2012, which was completed on 18December 2012 with the formalisation and filing of the deed of merger by incorporation of SiNSYS SA/NV inSIA S.p.A. The merger took effect on 1 January 2013.SiNSYS operates in the card-processing market, with leading pan-European banking groups included amongits main customers.The financial statements of SiNSYS show a value of production of € 60.2 million and an operating margin of€ 3.5 million. The financial year closed with net profits for the year of € 1.9 million.RA Computer S.p.A.The company is based in Milan and has a share capital of € 3,000,000; it joined the SIA Group in 2006 withthe initial acquisition of a stake of 65%. The company is now wholly-owned, as a result of subsequentacquisitions, the last of which was completed in 2012 (the remaining 12.14% of shares). The companyrecords shareholders’ equity inclusive of the net result for the year of € 4,396,000.The year 2012 closed with a value of production of around € 30.5 million, a positive operating margin of €0.9 million and a net profit of € 0.6 million.RA Computer specialises in the creation of application packages and provision of services to the bankingmarket, the corporate sector and Public Administration, focusing its development on opportunities arisingfrom the evolution of bank-business and bank-Public Administration relationships.6

Management ReportTSP S.r.l.TSP, based in Milan and 100% owned by SIA, has a share capital of € 5,647,000 and a shareholders’ equityof € 14,435,605, including the net result for the year.TSP designs, creates and manages innovative on-line payment and collection solutions for companies andPublic Administration. TSP is now the reference company at national level for the multi-channel payment ofutilities, taxes and bills and for processing targeted at the sale of prepaid products, from telephone top-upsto fuel vouchers, from gift cards to bank cards.The positive performance of the company is linked to growth in the operations of Multichannel Gatewayservices and to the development of the associated management of POS terminals and new generationkiosks. In 2012, the positive development of revenues derives mainly from the increase in volumes relatingto the payment of bills and consolidation of project initiatives with the main operators in the telco andcatering sector for the management for their terminals.The 2012 financial statements closed with a value of production equal to € 21.6 million, an operating marginof € 9.6 million and a net profit of € 6.5 million.Since no additional provisions to the legal reserve are necessary, the company's Board of Directors proposedthe distribution to shareholders of a dividend of € 6.2 million.TSP owns 100% of the shares of PI4pay S.r.l..PI4PAY S.r.l.The company is 100% owned by TSP S.r.l. and its exclusive purpose is to carry out, for the public,financial activities and, more specifically, provide payment services supporting the TSP business.Established in 2009 and based in Milan, this company commenced operations in 2010. During 2011,the Bank of Italy authorised its entry into the Register of Payment Institutions. Shareholders' equityas at 31 December 2012, which includes a share premium reserve of € 600 thousand, was equal to€ 2,345,000, including the net result for the year. In fact, 2012 closed with value of production of €1.9 million, a positive operating margin of € 0.4 million and a net profit of € 0.2 million.SIA Central EuropeThe company, 100% owned by SIA and acquired in 2007, is based in Budapest (Hungary) and has a sharecapital of HUF 177,000,000 (equal to € 605,542 as at 31 December 2012) and shareholders’ equity,including the net result for the year, of € 2,659,000. The company, a leader in Hungary in payment systemsand payment card processing, mainly provides financial and corporate institutions, payment card issuers andacquirers with ATM and POS terminal management services, transaction switching, fraud monitoring andother payment system services.In keeping with SIA’s three-year Strategic Plan, SIA Central Europe’s aim is to consolidate and expand theGroup’s presence in Hungary and across its key operating area (Austria, Poland, Romania, Slovakia, Czech7

Management ReportRepublic, Slovenia, Croatia), by offering innovative and competitive technological solutions in the paymentssector for financial and corporate institutions, in compliance with European legislation (SEPA, PSD, etc.).Since 2012, SIA Central Europe has operated as a commercial hub for all services offered by the SIA Groupin Hungary and in Central European countries.The financial statements show a value of production of € 7.2 million and an operating margin of € 0.3million. The financial year closed with net profits for the year of € 0.3 million.Perago FSE LtdCompany based in Pretoria (Republic of South Africa) which, based on the experience acquired as a result ofthe transformation of payment systems in the Republic of South Africa, developed its own RTGS (Real TimeGross Settlement) system, considered by the market to be a sophisticated, modular and scalable system,based on the most advanced technologies in the sector.The 2012 financial statements show a value of production of € 4.6 million and a negative operating marginof € 1.5 million. The financial year closed with a net loss of € 1.7 million. At year-end, shareholders' equityamounted to € 40,000. The main reasons for a considerably negative result derive from certain one-offevents (write-down of assets no longer used and extraordinary charges for the resignation of personnel) andthe delay of some development projects.Perago AGIn December 2012, the procedure started in 2010 to liquidate the company Perago AG was completed,which concentrated all businesses, including sales, within the South African facility of Perago FSE. Therefore,the company was excluded from the scope of consolidation.Equity investments in associated companies and other companies, valued using the equity method, are asfollows:Kedrios S.p.A. (known as Xchanging Italy S.p.A. effective as of 2013)The company, with a share capital of € 13,200,000, is 1.30% owned by SIA. During 2010, SIA transferred itsmajority stake to Xchanging Italy S.r.l.. (Xchanging Group) by subscribing to a reserved capital increase of €2,500,000. This was part of a partnership agreement that established reciprocal undertakings, including SIAinvesting the funds needed in order to complete the restructuring plans that got underway prior to thechange of control and Xchanging investing the funds needed in order for the company to be relaunched. Inaddition to the above, the agreement also gives SIA a put option for the sale of the quotas it owns to theXchanging Group, at a price to be determined at the time said option is exercised in accordance withpredefined methodology, and with a floor value of € 4.8 million, an option that can be exercised as fromJanuary 2014 until January 2016.8

Management ReportIn 2012, the majority shareholder Xchanging Italy S.r.l. carried out a share capital increase which led to thedilution of the stake of SIA S.p.A. - which did not participate in the transaction - reducing its share from49% to 1.30%. The share capital increase was targeted at completing the acquisition of a significantcompany operating in Kedrios’s reference market and through which the company hopes to improve itsgrowth and development prospects. The Kedrios financial statements presented a value of production equalto € 13.9 million, a negative operating margin of € 2.3 million, and a loss for the year of € 3.6 million.Shareholders' equity, including the net result for the year, is equal to € 12.8 million.ATS S.p.A.In December 2000, SIA acquired 30% of ATS S.p.A., which has share capital of € 120 thousand. This is asoftware development company, operating mainly in the banking and finance sectors, and has been aqualified SIA business partner for many years.The year 2012 closed with a value of production of approximately € 9.9 million, an operating margin of € 0.5million and substantially balanced net profits. The company recorded shareholders’ equity of approximately €2.4 million at the end of 2012.TrustlinkTrustlink, 29.4% owned by SIA, is a service provider for the members of the SWIFT network in the Sub-Saharan area and carries out activities of development and maintenance of software applications for thefinancial and telecommunications sector.9

Management ReportECONOMIC RESULTSThe costs and revenues structure largely mirrors that of the parent company. For a detailed analysis,reference should be made to the parent company Management Report.PROFIT FOR THE YEAR AND SHAREHOLDERS’ EQUITYGroup profit for the year amounted to € 41.3 million. Total revenues from services and product salesamounted to € 347.7 million, the value of production to € 359.3 million and the operating margin to € 64.7million. The reconciliation statement of parent company shareholders' equity and profit (loss) for the yearand those of the group is attached to the Explanatory Notes of the consolidated financial statements under"Supplementary information".10

Management ReportFINANCIAL STATEMENTS DATAProfit and Loss Account position(amounts in euro/000)Profit and Loss Account results 2012 2011 ChangesRevenues from sales and services 348,266 333,334 14,932Other value of production items 11,072 14,707 -3,635A Value of production 359,338 348,041 11,297B Cost of production 294,647 300,518 -5,871A-B Added value 64,691 47,523 17,168C Financial income and chanrges 3,177 988 2,189D Value adjustments to financial assets 425 -4,164 4,589C+D Financial management 3,602 -3,176 6,778E Extraordinary income and charges -2,397 -2,774 377A-B+C+D+E Profit (loss) before tax 65,896 41,573 24,323Income taxes for the year 24,622 18,717 5,905Profit (loss) including minority interests 41,274 22,856 18,418Profit (loss) for the year - minority interests - 1,206 -1,206Profit for the year 41,274 21,650 19,624An analysis of the items, compared to 2012 shows an increase in the company’s value of production, duemainly to higher service revenues relating to the parent company. In fact, all SIA business divisions recordedbetter results than 2011, with a particularly positive performance in the “Card Processing” area and servicesconnected with the “EBA” platform. The cost of production decreased due to the continuation of the processdesigned to reorganise and increase the efficiency of operating units. By contrast, in terms of financialmanagement, a € 6.8 million increase was recorded as a result of fewer write-downs in associatedcompanies. Profit before tax amounted to € 65.9 million versus € 41.6 million for the previous year.The items with the greatest impact on the year can be summarised as follows:11

Management Report> The value of production, which also takes into account increases in own work capitalised, changes inprojects under development, changes in contract work in progress and other revenues and income,amounted to € 359.3 million compared to € 348.0 million in the previous year. Revenues from sales andservices, which totalled € 347.7 million compared with € 333.3 million in 2011, may be broken down asfollows:a. Financial Institutions: higher total revenues were recorded, mainly for card services provided:credit, debit, prepaid, as well increased contract project activities; the higher contribution tothe increase in revenues from the Financial Institutions Division derives from the parentcompany, with a slight increase in the contribution from SiNSYS;b. Central Payment Institutions: higher revenues were registered, deriving from increased projectactivities and greater revenues for “EBA” services, partially offset by lower revenues on MassDatabase, Treasury and Supervision services; despite the persistent difficulties in thereference markets and weakness of the company, the contribution to the Division from thesubsidiary Perago FSE increased over the previous year;c. Capital Market: higher revenues were recorded in relation to Trading Access, Trading andPost-Trading services;d. Corporate & Public Administration: a general increase was registered in revenues derivingfrom an increase in technological outsourcing activities and business services; the contributionof subsidiaries TSP and PI4PAY to the Division’s revenues was positive, with an increase of18% compared to the previous year;e. Network Services: greater revenues were recorded for File Transfer and Service Bureauservices.> The cost of production was lower than the previous year, down from € 300.5 million to € 294.6 million.This change was mainly due to:a. higher staff costs due to the renewal of the credit CCNL (national collective labour contract),which impacted some of the Italian subsidiaries and the parent company in particular;12

Management Reportb. higher costs for application consultancy for adjustments to infrastructures for credit and debitcard management;c. higher depreciation of property, plant and equipment of € 0.8 million, due mainly to thecompletion of investments for the new Via Gonin office;d. higher amortisation of intangible assets of € 2.8 million, due to the completion of somesoftware development projects;e. lower allocations to provisions for risks by the parent company, due to the sizeable allocationmade in the previous year in relation to the closure and subsequent disposal of the VialeCertosa office, no longer replicated in 2012;f. lower costs for non-deductible pro-rata VAT as a result of the reduction in purchases of goodsand services;g. lower hardware and software lease costs, as a result of fewer requirements and therenegotiation of contracts with suppliers;h. lower property rental costs, due to the reasons already detailed in the comments on provisionsfor risks.> The added value, i.e. the difference between the value and the cost of production, was € 64.7 million,compared to € 47.5 million in the previous year;> Financial management recorded a positive result of € 3.6 million versus a negative result of € 3.2 millionin the previous year; the result is mainly due to higher returns on cash invested, the write-back of thevalue of securities written down in 2011 and less write-downs for the adjustment of associatedcompanies to shareholders’ equity, particularly Kedrios, which was written down in the previous year by€ 3.2 million due to the significant losses recorded;> Extraordinary income and charges recorded a negative balance of € 2.4 million, mainly due to highercosts relating to the personnel restructuring procedure of the parent company, partly offset by higherincome relating to the IRES (corporate income tax) refund estimate, in relation to the request presentedfor the recovery of the IRAP (regional business tax) deduction for the years 2007-2011.13

Management ReportBalance Sheet position(amounts in euro/000)Balance sheet results 31/12/2012 31/12/2011 ChangesIntangible assets 46,219 43,413 2,806Property, plant and equipment 16,876 19,637 -2,761Financial assets 1,401 1,809 -408A Total fixed assets 64,496 64,859 -363Inventories 1,716 2,697 -981Receivables 119,319 109,604 9,715Short-term investments 9,860 28,557 -18,697Cash and cash equivalents 103,193 45,749 57,444B Total current assets 234,088 186,607 47,481C Accruals and deferrals 12,326 14,282 -1,956A+B+C Total assets 310,910 265,748 45,162Share capital 22,091 22,091 0Reserves 103,250 104,649 -1,399Profit carried forward 17,326 -6,292 23,618Profit for the year 41,274 21,650 19,624Minority interests - 4,482 -4,482Profit for the year - minority interests - 1,206 -1,206A Total shareholders' equity 183,941 147,786 36,155B Provisions for risks and charges 14,502 15,665 -1,163C Employee severance indemnity 20,130 20,384 -254D Payables 90,030 78,950 11,080E Accruals and deferrals 2,307 2,963 -656A+B+C+D+E Total liabilities 310,910 265,748 45,16214

Management ReportThe main changes emerging from a comparative analysis between the balance sheet position and thefinancial statements for the previous year are:> Fixed assets:◦ higher amounts relating to intangible assets, due primarily to higher consolidation differencesderiving from the purchases of the residual stakes in SiNSYS and RA Computer made during theyear;◦ impairment of property, plant and equipment, essentially as a result of the normal process of assetdepreciation;◦ lower values of financial assets, following the valuation of associated companies with the equitymethod.> Current assets:◦ The increase in trade receivables mainly relates to the rise in revenues recorded in the year;◦ The increase in trade receivables derives essentially from the IRES refund request for the recoveryof IRAP not deducted in previous years, as specified in more detail previously and in theManagement Report of the parent company financial statements;◦ the increase in cash and cash equivalents, also including investments in trading and available-forsalesecurities, was mainly due to the parent company’s positive operations.> Provisions for risks and charges:◦ the decrease is due principally to lower allocations made by the parent company. The main usesconcerned payments of rent for the Viale Certosa office, for which an amount was set aside in theprevious year up until the natural expiry of the contract, and the employee restructuring provision.> Payables:◦ the increase is due mainly to payables due to employees and greater tax payables as a result ofbetter results recorded in the year by the parent company and consolidated companies.15

Management ReportSIGNIFICANT EVENTS SUBSEQUENT TO THE END OF THEFINANCIAL YEAR AND BUSINESS OUTLOOK.The significant events subsequent to the end of the financial year and the business outlook are fullyanalysed in the Management Report of the parent company, to which reference should be made.16

Proposed allocation of profitSIA Group ConsolidatedFinancial Statements

Balance sheetBALANCE SHEET(amounts in euro/000)Assets31/12/2012 31/12/2011ChangesA) Subscribed capital, unpaidCalled share - - -Total receivables due from shareholders A) - - -B) Fixed assetsI - Intangible assets:1) Formation costs 6 11 -53) Industrial patent and intellectual property rights 20,695 23,303 -2,6085 bis) Consolidation difference 20,859 17,177 3,6826) Work in progress and payments on account 3,150 1,064 2,0867) Other 1,509 1,858 -349Total intangible assets 46,219 43,413 2,806II - Property, Plant and Equipment:1) Land and buildings 49 722) Plant and equipment 12,369 13,452 -1,0833) Industrial and commercial equipment 610 658 -484) Other assets 3,732 4,261 -5295) Work in progress and payments on account 116 1,194 -1,078Total property, plant and equipment 16,876 19,637 -2,761III - Financial assets1) Equity Investments in: 1,323 1,749 -426b) associated companies 1,150 1,733d) other companies 173 162) Receivables 78 60 18d) other receivables 78 60Total financial assets 1,401 1,809 -408Total fixed assets B) 64,496 64,859 -36318

Balance sheetAssets31/12/2012 31/12/2011ChangesC) Current assetsI) Inventories:1) Raw materials, consumables and goods 957 180 7773) Contract work in progress 736 2,505 -1,7694) Finished products and goods 23 12 115) Payments on account - - -Total 1,716 2,697 -981II) Receivables1) Due from customers 98,772 96,481 2,291a) Due from associated companies 1,816 986 8304bis) Tax receivables 3,961 258 3,7034ter) Prepaid taxes 12,689 10,520 2,1695) Other receivables 2,081 1,359 722Total 119,319 109,604 9,715III) Short-term investments6) Other securities 9,860 28,557 -18,697Total 9,860 28,557 -18,697IV) Cash and cash equivalents1) Bank and postal deposits 101,756 44,612 57,1443) Cash on hand 1,437 1,137 300Total 103,193 45,749 57,444Total current assets C) 234,088 186,607 47,481D) Prepayments and accrued income- Other prepayments and accrued income 12,326 14,282 -1,956Total prepayments and accrued income D) 12,326 14,282 -1,956Total assets (A+B+C+D) 310,910 265,748 45,16219

Balance sheetLiabilities31/12/2012 31/12/2011ChangesA) Shareholders’ equityGroup:I Share Capital 22,091 22,091 -IV Legal reserve 4,418 3,443 975VII Other reserves: 80,270 80,270 -- split-off surplus 1,426 1,426- merger surplus 78,844 78,844VII Undistributed profits and other reserves 35,888 14,644 21,244IX) Profit / loss for the year 41,274 21,650 19,624Total shareholders’ equity pertaining to the Group 183,941 142,098 41,843Minority interests:X Share capital and reserves - 4,482 -4,482XII) Profit / loss for the year - 1,206 -1,206Total shareholders’ equity pertaining to minority interests - 5,688 -5,688Total Shareholders’ equity A) 183,941 147,786 36,155B) Provisions for risks and charges2) For taxes 741 2,158 -1,4173) Others 13,761 13,507 254Total Provisions for risks and charges B) 14,502 15,665 -1,163Employee severance indemnity C) 20,130 20,384 -254D) Payables4) Due to banks 6,139 3,339 2,8005) Due to other lenders - - -6) Advances 4,281 2,844 1,4377) Due to suppliers 25,028 26,660 -1,63210) Due to associated companies / investees 1,301 841 46012) Tax payables 13,713 8,997 4,71613) Due to social security institutions 15,050 14,975 7514) Other sundry payables 24,518 21,294 3,224Total Payables D) 90,030 78,950 11,080E) Accruals and deferrals- Other accruals and deferred income 2,307 2,963 -656Total accruals and deferred income E) 2,307 2,963 -656Total liabilities (A+B+C+D+E) 310,910 265,748 45,162Memorandum accounts31/12/2012 31/12/2011ChangesMemorandum accounts1. Personal guarantees given 17,834 17,386 448A) Guaranteesto others 17,834 17,3864. Others 49,959 56,777 -6,818Total Memorandum accounts 67,793 74,163 -6,37020

Balance sheet21

Profit and loss accountPROFIT AND LOSS ACCOUNT(amounts in euro/000)Profit and loss account2012 2011ChangesA) Value of production1) Revenues from sales and services 348,266 333,334 14,9323) Change in work in progress 70 3,873 -3,8034) Increases in own work capitalised 8,495 5,808 2,6875) Other revenues and income 2,507 5,026 -2,519Total A) 359,338 348,041 11,297B) Cost of production6) For raw materials, consumables and goods 3,853 3,406 4477) For services 91,882 89,961 1,9218) For use of third-party assets 39,348 44,584 -5,2369) For personnel 119,126 118,099 1,027a) wages and salaries 84,930 82,661b) social security costs 21,617 21,921c) employee severance indemnity 5,065 5,605e) other costs 7,514 7,91210) Amortisation, depreciation and write-downs 25,095 21,727 3,368a) amortisation of intangible assets 19,310 17,501a) depreciation of property, plant and equipment 5,021 4,226c) other write-downs of fixed assets 764d) write-downs of debts included under current assets and cashand cash equivalents11) Change in raw materials, consumables and goods -11 12 -2312) Provision for risks 187 5,046 -4,85913) Other provisions - 13 -1314) Sundry operating costs 15,167 17,670 -2,503Total B) 294,647 300,518 -5,871Difference between the value and costs of production (A-B) 64,691 47,523 17,16822

Profit and loss accountProfit and loss account2012 2011ChangesC) Financial income and charges15) Income from equity investments: - 130 -130- dividends and other income from associated companies - 130- dividends and other income from others16) Other financial income: 3,708 1,458 2,250a) interest income 97 178d) other income 3,611 1,28017) Interest and other financial charges -331 -501 170- bank charges -331 -50117-bis) Exchange gains (losses) -200 -99 -101Total C) 3,177 988 2,189D) Value adjustments to financial assets18) Revaluations 851 - 851a) of equity investments, including shares of profits from nonconsolidatedcompaniesc) of securities classified as current assets 85119) Write-downs -426 -4,164 3,738a) of equity investments, including shares of profits from nonconsolidatedcompanies -426 -3,243c) of securities classified as current assets - -921Total D) 425 -4,164 4,589E) Extraordinary income and charges20) Income 2,905 592 2,313- others 2,905 59221) Charges -5,302 -3,366 -1,936- others -5,302 -3,366Total E) -2,397 -2,774 377Profit (loss) before tax (A-B+C+D+E) 65,896 41,573 24,32322) Income taxes for the year: current, deferred andprepaid 24,622 18,717 5,905- current 26,268 20,582- deferred (prepaid) -1,646 -1,865Profit (loss) including minority interests 41,274 22,856 18,41822 bis) Profit / loss for the year - minority interests - 1,206 -1,20623) Profit / loss for the year 41,274 21,650 19,62423

Profit and loss account24

Financial Statements as at 31 December 2007Explanatory Notes

Explanatory NotesThe consolidated financial statements, comprised of the Balance Sheet, Profit and Loss Account andExplanatory Notes, have been prepared according to Italian GAAP supplemented with the accountingstandards developed by the professional bodies for certified accountants in Italy and, where lacking, withthose issued by the International Accounting Standards Board (IASB), were unchanged during the year. Inorder to provide full disclosure, the financial statements were integrated with the Cash Flow Statementwhich analyses cash flows generated during the year.The purpose of the Explanatory Notes is to illustrate, analyse and in some cases supplement data in theConsolidated Balance Sheet and Profit and Loss Account statements. The Explanatory Notes contain allinformation required under applicable regulations.Pursuant to art. 2428 of the Italian Civil Code, the nature of the group's business, the situation anddevelopment of group management, relations with subsidiaries and associated companies, significant eventssubsequent to the end of the financial year and the business outlook for the group are described in theManagement Report prepared by the parent company directors, to which reference should be made for amore complete disclosure.In addition to the parent company SIA S.p.A., the scope of consolidation includes the following companies:COMPANY NAMEREGISTEREDOFFICESHARECAPITALSIA S.p.A. (Parent company) MILAN 22,091SiNSYS S.A. BRUSSELS (B) 6,000 100.00%RA Computer S.p.A. MILAN 3,000 100.00%TSP S.r.l. MILAN 5,647 100.00%amounts in Euro/000DIRECT INDIRECT THROUGHPI4PAY S.r.l. MILAN 600 100.00% TSP S.r.l.SIA Central Europe BUDAPEST (HUN) 606 100.00%Perago FSE Ltd PRETORIA (SAF) 3 100.00%% OWNED BY THE GROUPSiNSYS SA, based in Brussels, was incorporated on 23 September 2003 with share capital of € 6,000,000,currently wholly-owned by SIA, thanks to the acquisition of the 49% stake completed in 2012. This companywhich, effective as of 1 January 2013, was incorporated in SIA, in execution of the resolutions of therespective shareholders’ meetings on 30 November 2012, is consolidated on a line-by-line basis.RA Computer S.p.A., based in Milan, has a share capital of € 3,000,000 and is 100% owned by SIA, as aresult of the acquisition of the last minority shareholding in 2012. This company is consolidated with the lineby-linemethod.26

Explanatory NotesTSP - Tecnologie e Servizi per il Pubblico S.r.l., based in Milan, has a share capital of € 5,647,000, composedof a single stake wholly-owned by the sole shareholder SIA. This company is consolidated with the line-bylinemethod.PI4PAY S.r.l., a company based in Milan, was incorporated in 2009 with share capital of € 600,000. It is100% owned by TSP, registered in the general list of financial intermediaries as per art. 106 of ItalianLegislative Decree 385/1993 (no. 41597), and its exclusive purpose is to carry out, for the public, financialactivities and, more specifically, provide payment services supporting the TSP business. This company isconsolidated with the line-by-line method and is not consolidated by TSP, which availed itself of the right notto draft consolidated financial statements, despite the presence of a controlling interest.SIA Central Europe, based in Budapest, Hungary, is 100% owned by SIA. This company has a share capitalof HUF 177,000,000 (equal to € 605,542 as at 31 December 2012). This company was acquired in July 2007and consolidated with the line-by-line method.Perago FSE Ltd., based in Pretoria (Republic of South Africa), is 100% owned by SIA. This company has ashare capital of ZAR 5,820,000. This company is consolidated with the line-by-line method.The closing date of the financial statements for the companies included in the scope of consolidationcoincides with that of the parent company.REPORTING CRITERIA FOR THE CONSOLIDATED FINANCIAL STATEMENTSThese consolidated financial statements were drafted on the basis of the financial statements as at 31December 2012 prepared by the respective companies in compliance with applicable law and weresubmitted for approval of the corporate bodies. All statements are expressed in thousands of euro unlessotherwise specified.CONSOLIDATION PRINCIPLESThe consolidation principles adopted, unchanged from the previous year, are discussed below.Asset and liability items, as well as income and charges of the companies included in the scope ofconsolidation are reported on a line-by-line basis.The book value of equity investments in the companies included in the scope of consolidation is eliminatedagainst the corresponding portion of the shareholders' equity. The difference in the cost of the equityinvestment compared to the shareholders’ equity of the investee at the date of acquisition is proportionallyrecognised to the asset and liability items to which it can be attributed. The remainder, if positive, isrecognised under assets as consolidation differences and, if negative, under consolidated shareholders’equity as consolidation reserves. Otherwise, if the acquiree is expected to incur losses in the financial years27

Explanatory Notesimmediately following acquisition, it is recognised to the liability item 'Consolidation provisions for risks andfuture charges'. These provisions will be used in future years to cover any losses incurred.Payables and receivables existing between companies included in the scope of consolidation at the end ofthe financial year are eliminated.Costs and revenues regarding intercompany transactions during the year are eliminated.If significant, the profits and losses resulting from transactions between the companies included in the scopeof consolidation are eliminated.Dividends, loss coverage and write-downs of equity investments included in the scope of consolidation areeliminated.The translation of the financial statements of foreign entities into euro is carried out by applying the yearendexchange rate to balance sheet items and the average annual exchange rate to profit and loss accountitems.RECONCILIATION BETWEEN THE PARENT COMPANY AND CONSOLIDATED SHAREHOLDERS'EQUITY AND PROFIT (LOSS) FOR THE YEARThe reconciliation statement between the parent company and the consolidated shareholders' equity andprofit (loss) for the year as at 31 December 2012 is attached to these Explanatory Notes.VALUATION CRITERIAIn drafting the consolidated financial statements, the valuation criteria and accounting standards adoptedare based on the general principles of prudence and accrual accounting, in the assumption of the companyas a going concern.The valuation criteria adopted for the most significant items are indicated below.Intangible assetsIntangible assets, based on art. 2426 of the Italian Civil Code, are recognised at purchase or productioncost, including any ancillary costs. Intangible assets subject to transfer or split are recognised at the valueestablished in the related agreement. The values recorded are amortised on a straight-line basis dependingon their future useful lives. If, at the balance sheet date, any intangible assets have suffered impairment,they are written down accordingly.If the reasons for the write-down no longer exist, the write-down is not carried forward to future years.28

Explanatory NotesIndustrial patent and intellectual property rights:- Patents:The amortisation period corresponds with the duration of the patent.- Software licences:This item includes costs for the purchase of user licences for third-party software. The costs recorded allrelate to long-term utilisation and are amortised according to the user licence duration. If the licence has anunlimited duration, the related cost is amortised over three years. Infrastructure and software applicationlicences of particular strategic importance are examined on a case-by-case basis to assess the fair usefultechnical and economic life, which in exceptional circumstances may be more than three years. Annuallicence fees are charged directly to the Profit and Loss Account under "Costs for use of third party assets".- Projects developed during the year:This item includes in-house software development projects already at the production stage at the end of thefinancial year. Third-party services are recognised at their direct cost, whereas the cost of production iscalculated according to art. 2426, paragraph 1, point 1 of the Italian Civil Code through identification of thespecific cost of related internal resources. The amortisation period is three years. Infrastructure andapplication software projects of particular strategic importance are examined on a case-by-case basis toassess the fair useful technical and economic life, which in exceptional circumstances may be more thanthree years. Costs relating to projects completed at the end of the financial year for which future utilisationis certain are recognised as assets in the Balance Sheet.Software programmes under development and payments on account:This item includes production and purchase costs for the realisation of new software programmes as part ofprojects not yet completed or at final testing stage, and therefore not yet in operation at the end of thefinancial year. These relate to projects for which completion by the Company is reasonably certain from atechnical point of view. Should these requisites not be met, the project costs are charged to the Profit andLoss Account for the year. It is only when the procedures using such software programmes go intoproduction that the costs are reclassified to "Projects developed during the year", with subsequentcommencement of the related amortisation.Goodwill:In compliance with art. 2426, paragraph 6 of the Italian Civil Code and subject to Board of StatutoryAuditors’ approval, goodwill is recognised to the extent of costs incurred and normally amortised over fiveyears. If amortisation is applied for a period exceeding five years, justification is provided in the ExplanatoryNotes.29

Explanatory NotesConsolidation differences:This item includes the positive differences between the purchase cost of investments in subsidiaries and thecorresponding portion of shareholders' equity acquired as at the date of consolidation, adjusted according togroup accounting principles. Consolidation differences are normally amortised over five years from the equityinvestment acquisition date. If amortisation is applied for a period exceeding five years, justification isprovided in the Explanatory Notes. For controlling interests acquired during the year, amortisation for thefirst year is calculated in proportion to the duration of the period of control.Other intangible assets:This item includes long-term charges relating to third-party assets. Amortisation is calculated according tothe duration of the contract concerned and the residual useful life of the investment, and in any event for aperiod not exceeding five years.Property, Plant and EquipmentProperty, Plant and Equipment are recorded at their purchase cost, inclusive of related start-up costs. Thevalues recorded are adjusted by their respective accumulated depreciation. If at the end of the financial yearthe value proves persistently lower than the net book value, the value is written down accordingly. If thereasons for the write-down no longer exist, the write-down is not carried forward to future years.Depreciation recognised to the profit and loss account was calculated systematically and on a straight linebasis - reduced to 50% for assets purchased during the year - according to the domestic rate consideredmost representative of the estimated useful technical and economic life of the assets. These rates are thendetailed in comments to the balance sheet items.Costs for maintenance and repairs are charged to the Profit and Loss Account for the year in which they areincurred when they are of an ordinary nature, or capitalised if extraordinary.Financial assetsEquity investments in associated companies are valued with the equity method; equity investments in othercompanies are recorded at their purchase cost and are written down in case of impairment. Securitiesclassified as long-term investments are recognised as "Other securities" under Financial Assets. This itemincludes both the purchase cost of the securities and directly attributable accessory charges, excludingaccumulated interest which is recorded under "Accruals and deferrals" or, if interest has already accrued infull, to "Other receivables" under Current Assets. If at the time of preparation of the financial statements,impairment of the security is ascertained, or if a change in its economic use is decided on, e.g. from acapitalised asset to an asset held for trading, the cost criterion is replaced by the lower of the cost and themarket value of the security. Securities classified as long-term investments are held until their naturalmaturity.30

Explanatory NotesInventories for contract work in progressLong-term contract work in progress is recorded using the percentage of completion method, whererevenues can be measured reliably, pursuant to art. 2426, paragraph 11 of the Italian Civil Code. Thepercentage of completion was calculated according to the cost-to-cost method. Any losses on the contract,expected on the basis of objective, reliable assessment, are charged to the profit and loss account in theperiod in which they become known, allocating a special fund or reducing the final inventories value asappropriate.Inventories of finished products and goodsInventories of finished products and goods are valued at the lower of the purchase cost and the realisablevalue deriving from the market trend. The cost is determined using the weighted average cost method.Values deriving from adoption of the weighted average cost method do not differ significantly from thoseresulting from current costs at the end of the financial year. The value of final inventories is adjusted forseveral items depending on the market price and the estimated realisable value in case of obsolete items.Receivables and payablesReceivables are recorded according to their estimated realisable value, corresponding to the differencebetween the nominal value and the bad debt provision created during the previous financial years andincreased by the amount allocated during the year. Payables are recorded at their nominal value.Short-term investmentsSecurities classified as short-term investments are valued at the lower of the purchase cost and the marketvalue, defined as the market value on the last trading day for the year.Cash and cash equivalentsCash and cash equivalents are recorded at nominal value and represent cash at bank and cash in hand atthe end of the financial year.Accrued incomeThe item “Accrued Income” includes the shares of revenues for the year to be collected in future financialyears.Prepayments and deferred incomeThese are recognised on an accrual basis. The item "prepayments" includes costs, the extent of which istime-dependent, incurred by the end of the financial year but relating to future financial years. The item“deferred income” includes income received during the year but relating to future financial years.31

Explanatory NotesProvisions for risks and chargesThe provisions for risks and charges include allocations to cover losses or debts whose nature is clearlydefined, and which are certain or likely to be incurred, but whose amount or date of occurrence cannot bedetermined at the close of the financial year.Employee severance indemnityAllocation is performed in compliance with reference legal regulations and current employment contracts,and represents the debt accrued in favour of employees at the end of the financial year.Costs and RevenuesThese are recorded on an accrual basis, also in observance of the principle of prudence.Income from equity investmentsDividends from equity investments in companies that are not consolidated with the line-by-line method andnot valued with the equity method, are recorded in the year in which they are collected.DerivativesFinancial derivatives, if any, are used for hedging purposes.In the case of IRS, interest spreads are recorded among financial charges in the profit and loss account onan accrual basis. If any transaction is not in perfect alignment with the underlying financial position, it isvalued according to market conditions.TaxesThe allocation of taxes for the year, recorded in the financial statements, was calculated based on theforecast of taxable income pursuant to current regulations. Deferred tax assets and liabilities are calculatedon the basis of the temporary differences between the value of assets and liabilities according to ItalianGAAP criteria and the value assigned to them for tax purposes. Deferred tax assets are recognised to theextent that it is probable that future taxable profits will be available. This also applies to the tax benefitrelating to tax losses carried forward.32

Breakdown of BalanceSheet items

Explanatory NotesASSETSFixed assets – 64,496 €/000Intangible assetsIntangible assets totalled € 46,219 thousand (€ 43,413 thousand in 2011) and were primarily composed of:Industrial patent and intellectual property rightsSoftware programmes for services to customersThese refer to software programmes required to provide services to customers. The increases refer to newapplications or increases in old applications, aimed at meeting the changing needs of the market orcomplying with new rules regarding the provision of services.Software programmes for internal useThese refer to basic software programmes which, along with the Operating System, allow full use of thefunctionalities offered by the hardware in a data processing system, to software applications allowing dataprocessing according to different needs and software for the Corporate Office Automation System.Patents and trademarksThis represents the cost, net of direct amortisation, for the preparation and filing of patent applications inItaly and abroad and of trademarks used to identify the products/services offered by the group.Consolidation differencesThese refer to residual differences on items not attributable to the Balance sheet, between the cost ofacquisition of equity investments and the related portion of shareholders’ equity at the time of their inclusionin the scope of consolidation. Amortisation is spread over five years, except for SIA Central Europe, forwhich it was considered reasonable to opt for a 10-year period. In establishing ten years as the goodwillamortisation period, reference was made to SIA Central Europe’s operating plan. The residual value ofgoodwill to be amortised will be reviewed on an annual basis to confirm its recoverability, guaranteeing anadequate return on the capital invested. Such assessments were also confirmed by an independent expert.An increase in consolidation differences was recorded during the year following the purchase of theremaining stakes in SiNSYS and RA Computer.34

Explanatory NotesWork in progress and payments on accountThese costs refer to the development of software programmes for which, at the end of the financial year,their completion and future use is certain in providing profitable services to customers. It is only after theseprogrammes advance to the production stage and external procedures testing that the costs relating to suchprojects are classified under "Software programmes for services to customers" with subsequentcommencement of the amortisation process.Other intangible assetsThese mainly comprise long-term charges regarding works on leased assets, and mainly refer to adaptationscarried out in the registered offices.Intangible assets were not revalued and do not include capitalised financial charges. The changes inintangible assets during the year are illustrated in the Supplementary Information section of the ExplanatoryNotes.Property, plant and equipmentThe net book value of property, plant and equipment amounted to € 16,876 thousand (€ 19,637 thousand in2011).Property, plant and equipment were not revalued and do not include capitalised financial charges.Depreciation recognised during the year amounted to € 5,021 thousand and was calculated on all assetsdepreciable as at 31 December 2012, applying the rates deemed to best represent the economic-technicallife of the assets. The decrease during the year refers mainly to the natural process of asset depreciation.The changes in property, plant and equipment during the year are illustrated in the SupplementaryInformation section of the Explanatory Notes.Financial assetsThe net book value of financial assets amounted to € 1,401 thousand (€ 1,809 thousand in 2011).Equity investments in associated companiesAs at 31 December 2012, equity investments in associated companies totalled € 1,150 thousand, whileinvestments in other companies amounted to € 173 thousand, for a total value of € 1,323 thousand. Thesecompanies were not consolidated, but rather recognised using the equity method for the correspondinginvestment. The fall in value compared to the previous year is due to a decrease in the valuation of Kedrios(known as Xchanging Italy S.p.A. from 2013), due to the decrease in the stake held in the company.Equity investments in non-consolidated companies can be summarised as follows:35

Explanatory NotesAssociated companiesPercentageownedValue as at31/12/12ATS S.p.A. 30.00% 721Trustlink 29.40% 429OthersKedrios S.p.A. 1.30% 157Banca Etica S.p.A. - 16Total 1,323ATS S.p.A.The year 2012 closed with a value of production of approximately € 9.9 million, an operating margin of € 0.5million and substantially balanced net profits. The company recorded shareholders’ equity of approximately €2.4 million at the end of 2012.TrustlinkTrustlink, 29.4% owned by SIA, is a service provider for the members of the SWIFT network in the Sub-Saharan area and carries out activities of development and maintenance of software applications for thefinancial and telecommunications sector.Equity investments in other companiesFor an analysis of the business activities and performance of the various companies, reference should bemade to the Management Report.Kedrios S.p.A. (known as Xchanging Italy S.p.A. effective as of 2013)The company, with a share capital of € 13,200,000, is 1.30% owned by SIA. During 2010, SIA transferred itsmajority stake to Xchanging Italy S.r.l. (Xchanging Group) by subscribing to a reserved capital increase of €2,500,000. This was part of a partnership agreement that established reciprocal undertakings, including SIAinvesting the funds needed in order to complete the restructuring plans that got underway prior to thechange of control and Xchanging investing the funds needed in order for the company to be relaunched. Inaddition to the above, the agreement also gives SIA a put option for the sale of the quotas it owns to theXchanging Group, at a price to be determined at the time said option is exercised in accordance with36

Explanatory Notespredefined methodology, and with a floor value of € 4.8 million, an option that can be exercised as fromJanuary 2014 until January 2016.In 2012, the majority shareholder Xchanging Italy S.r.l. carried out a share capital increase which led to thedilution of the stake of SIA S.p.A. - which did not participate in the transaction - reducing its share from49% to 1.30%. The share capital increase was targeted at completing the acquisition of a significantcompany operating in Kedrios’s reference market and through which the company hopes to improve itsgrowth and development prospects.The Kedrios financial statements presented a value of production equal to € 13.9 million, a negativeoperating margin of € 2.8 million, and a loss for the year of € 4.4 million. Shareholders' equity, including thenet result for the year, is equal to € 12.1 million.Banca Etica S.p.A.This equity investment is held by the subsidiary RA Computer.Due from others beyond the following financial yearThese refer to security deposits on service supply contracts and property lease agreements.Due from others 31/12/2012 31/12/2011Other 78 60Total 78 6037

Explanatory NotesCurrent assets – 234,088 €/000As at 31 December 2012, current assets were composed as follows:Current assets 31/12/2012 31/12/2011Inventories 1,716 2,697Receivables 119,319 109,604Short-term investments 9,860 28,557Cash and cash equivalents 103,193 45,749Total 234,088 186,607Taken collectively, current assets increased over 2011, which was the combined result of increases anddecreases. The reduction in inventories is a result of the conclusion of significant projects developed forcustomers; the increase in trade receivables is primarily related to the rise in revenues recorded in the year,the increase in tax receivables is due essentially to the IRES refund request for the recovery of IRAP on thecost of labour not deducted in previous years envisaged by Italian companies, as specified in more detailabove and in the parent company’s management report; the decrease in financial assets is due to thenatural expiry of securities held in the portfolio; the overall increase in cash and cash equivalents is aconsequence of not only the expiry of the above-mentioned securities but also the results of operations,particularly those of the parent company;Prepayments and accrued income – 12,326 €/000Prepayments and accrued incomeThese can be broken down as follows:Prepayments and accrued income 31/12/2012 31/12/2011Accrued income 821 3,767Prepayments 11,505 10,515Total 12,326 14,28238

Explanatory NotesWith regard to their nature, accrued income concerns revenues for the year that will be accounted for in thesubsequent year, while prepayments regard costs incurred in advance for services to be used in 2013. Theseessentially relate to hardware and software rentals, maintenance agreements and insurance premiums.There are no prepayments and accrued income with a duration of over five financial years.LIABILITIESShareholders' equity – 183,941 €/000Share capitalThe share capital amounted to € 22,091 thousand, divided into 169,932,974 ordinary shares with a nominalvalue of € 0.13 each. For an analysis of changes in capital during the year, reference should be made to theattached table.Share capital 31/12/2012 31/12/2011Share capital 22,091 22,091Total 22,091 22,091Legal reserveThe legal reserve of the group recorded the following changes:Legal reserve 31/12/2012 31/12/2011Legal reserve 4,418 3,443Total 4,418 3,44339

Explanatory NotesReserve for split-off surplusThis represents the difference between the total value of assigned SIA shares and the book value of assetstransferred in the year 2000 following the partial split-off of the "processing" branch of Servizi InterbancariS.p.A.Reserve for split-off surplus 31/12/2012 31/12/2011Split-off Servizi Interbancari 1,426 1,426Total 1,426 1,426Reserve for merger surplusThis represents the total difference of € 78,844 thousand generated from the merger by incorporation of SIAS.p.A. in 2007.Reserve for merger surplus 31/12/2012 31/12/2011Merger by incorporation of SIA S.p.A. 78,844 78,844Total 78,844 78,844Undistributed profits and other reservesThe item “Undistributed profits and other reserves” includes the effects on group results in previous financialyears and translation reserves.Undistributed profits and other reserves 31/12/2012 31/12/2011Undistributed profits and other reserves 35,888 14,644Total 35,888 14,64440

Explanatory NotesProvisions for risks and charges – 14,502 €/000ProvisionBalance as at31/12/2011IncreasesUtilisationsBalance as at31/12/2012Risks for damages 92 - -92 -Restructuring risks 4,929 87 -1,772 3,244Restructuring costs 8,475 4,470 -2,428 10,517Deferred tax provision 2,169 - -1,428 741Total 15,665 4,557 -5,720 14,502The provisions for risks and charges are largely made up of allocations made by the parent company.The provisions for restructuring risks refers mainly to the rental costs allocated by the parent company forthe Viale Certosa office, which was vacated during 2011 but burdened by a property lease agreementexpiring in August 2014. This office was actually vacated in 2011 following the strategic decision tocentralise all company’s staff, at the new Via Gonin office in Milan. The developments foreseen mean thatthe Viale Certosa office will no longer be used and will not therefore be part of the company’s productioncycle, until expiry of the lease, which cannot be terminated earlier. Use of the provision derives mainly fromthe payment of rent for the Viale Certosa office. The allocation in the year refers to legal expensesconcerning the tax inspection of the Italian permanent establishment SiNSYS in 2012.The provision for restructuring costs was established by the parent company and increased during the yearto meet personnel reorganisation costs; its use is due to staff exits during the year.Employee severance indemnity – 20,130 €/000Adjustment of the debt was performed in compliance with current regulations and covers rights accrued byemployees as at 31 December 2012. Movements during the year were as follows:41

Explanatory NotesEmployee severance indemnity 31/12/2012 31/12/2011Opening balance 20,384 21,191Utilisation for termination of employmentcontracts, advances and pension funds-5,319 -6,412Allocations accrued during the year 5,065 5,605Total 20,130 20,384Payables – 90,030 €/000Due to banksPayables due to banks refer to current account overdrafts and loans granted by banks and mainly concernthe subsidiary RA Computer.AdvancesThese primarily concern the parent company and refer to advances received from customers for projects stillin progress.Due to suppliersPayables due to suppliers amounted to € 25,028 thousand (€ 26,660 thousand in 2011) and are made up oftrade payables due within the next financial year. The decrease relates mainly to minor purchases and asupplier contract and conditions optimisation policy.Due to associated companies / investeesPayables due to associated companies can be broken down as follows:Due to associated companies 31/12/2012 31/12/2011Kedrios S.p.A. 83 58ATS S.p.A. 1,218 783Total 1,301 84142

Explanatory NotesPayables due to associated companies refer to advisory activities.Tax payablesPayables due to tax authorities are broken down as follows:Tax payables 31/12/2012 31/12/2011Due to tax authorities for withholding taxes 2,282 1,997Due to tax authorities for VAT 4,394 3,670Due to tax authorities for income taxes 6,238 2,442Others 799 888Total 13,713 8,997Due to social security institutionsThe amount can be broken down as follows:Due to social security institutions 31/12/2012 31/12/2011INPS 14,468 14,285Others 582 690Total 15,050 14,975The payables indicated above mainly refer to social security contributions on deferred wages and salariespertaining to 2012, as well as contributions for holidays accrued but not taken.43

Explanatory NotesOther payablesThe overall amount of € 24,518 thousand (€ 21,294 thousand in 2011) is composed mainly of payables dueto employees for remuneration accrued but not yet paid. The payables due to employees include variablepay elements, i.e. MBO system payments and bonuses, together with amounts relating to personnelreorganisation procedures implemented by the parent company, for the part that is definite and certain.Accrued liabilities and deferred income – 2,307 €/000Accrued liabilities and deferred income amounted to € 2,307 thousand (€ 2,963 thousand in 2011) andrefers to revenues recorded in 2012 but relating to future financial years and costs accrued during the yearbut not yet accounted for.Memorandum accounts – 67,793 €/000Memorandum accounts 31/12/2012 31/12/2011Guarantees 17,834 17,386Others 49,959 56,777Total 67,793 74,163The values concerning guarantees relate mainly to participations in tenders and to property leaseagreements. The item “Others” relates to the residual debt for the purchases of technological infrastructurescarried out through operating leases, as well as to the value of the microprocessor cards owned bycustomers and to the nominal value of the PIN codes held on customers’ behalf.44

Breakdown of Profit andLoss Account items

Explanatory NotesValue of production – 359,338 €/000Revenues from services and sales of productsRevenues from ordinary operations are broken down as follows:Revenues from sales and services2012 2011Financial Institutions189,686 182,645SIA 130,742 124,032SiNSYS 30,956 30,313RA Computer 22,233 22,501SIA Central Europe 5,755 5,799Central Payment Institutions28,349 26,213SIA 25,689 24,323Perago FSE 2,660 1,890Capital Markets30,965 30,371SIA 30,965 30,371Corporate & Public Administration38,529 34,418SIA 16,857 16,038TSP 19,755 17,046PI4PAY 1,917 1,334Network Services60,737 59,687SIA 60,737 59,687Total 348,266 333,334The table above shows Group revenues, broken down by business division, and details the contributionmade by each subsidiary to the consolidated accounts. Subsidiaries are classified within the respectivedivisions to which they belong and which co-ordinate their activities.In relation to financial Institutions, higher total revenues generated by the parent company were recorded,mainly for card services provided: credit, debit, prepaid, as well as increased contract project activities; thehigher contribution to the increase in revenues from the Financial Institutions Division derives from theparent company, with a slight increase in the contribution from SiNSYS.46

Explanatory NotesIn the Central Payment Institutions area, higher parent company revenues were registered, deriving fromincreased project activities and greater revenues for “EBA” services, partially offset by lower revenues onMass Database, Treasury and Supervision services; despite the persistent difficulties in the referencemarkets and weakness of the company, the contribution to the Division from the subsidiary Perago FSEincreased over the previous year.As regards the Capital Market division, higher revenues were recorded in relation to Trading Access, Tradingand Post-Trading services.The Corporate & Public Administration division registered a rise in revenues deriving from an increase intechnological outsourcing activities and business services; the contribution of subsidiaries TSP and PI4PAY tothe Division’s revenues was positive, with an increase of 18% compared to the previous year.The Network Services division, pertaining solely to the parent company, recorded higher revenues for FileTransfer and Service Bureau services.Change in contract work in progressChanges in contract work in progress amounted to € 70 thousand, which mainly stemmed from a number ofprojects being finalised for the relevant supervisory body in respect of Brazilian financial markets and thecontinuation of an initiative for Italian financial markets.Increases in own work capitalisedThe overall amount totalled € 8,495 thousand (€ 5,808 thousand in 2011) and relates to:Software programmes developed during the yearThese refer to costs incurred during the year for the completion of software programmes, for which theamortisation procedure has been initiated.Software programmes under developmentThese costs refer to the development of software programmes for which, at the end of the financial year,their completion and future use is certain in providing profitable services to customers. It is only after theseprogrammes advance to the production stage and external procedures testing that the costs relating to suchprojects are classified under "Software programmes for services to customers" with subsequentcommencement of the amortisation process.47

Explanatory NotesOther revenuesOther operating revenues are broken down as follows:Other revenues 2012 2011Other revenues 622 675Contingent assets 1,885 4,351Total 2,507 5,026Contingent assets related mainly to the reversal of the allocations set aside for outstanding invoicespertaining to the previous year, to training grants and to the reversal of some of the provisions for risks setup in previous years.48

Explanatory NotesCost of production – 294,647 €/000The cost of production is composed of:Cost of production 2012 2011Purchase costs 3,853 3,406Service costs 91,882 89,961Costs for use of third-party assets 39,348 44,584Personnel costs 119,126 118,099Amortisation, depreciation and write-downs 25,095 21,727Changes in inventories of raw materials -11 12Provisions for risks 187 5,059Sundry operating costs 15,167 17,670Total 294,647 300,518The Amortisation item includes the amortisation relative to consolidation differences totalling € 4.9 million,regarding SIA Central Europe (€ 2.8 million), SiNSYS (€ 0.8 million), RA Computer (€ 1.1 million) and PeragoFSE (€ 0.2 million). The residual amount of consolidation differences, totalling € 20.8 million, relates to SIACentral Europe (12.8 million), SiNSYS (€ 6.7 million), RA Computer (€ 0.7 million) and Perago FSE (€ 0.6million).Amortisation is normally spread over five years, except for SIA Central Europe for which it was consideredreasonable to opt for a 10-year period. The residual value of goodwill to be amortised will be reviewed on anannual basis to confirm its recoverability, guaranteeing an adequate return on invested capital. Suchassessments were also confirmed by an independent expert hired by the parent company to check its value.It should be pointed out that compensation for auditing activities and periodic checks paid by the parentcompany to Deloitte & Touche S.p.A. during the year amounted to € 133,188. Each subsidiary subsequentlybore its own costs for auditing activities and checks.49

Explanatory NotesAs at 31 December 2012, employees numbered 1,494, divided by category as follows:2012 2011Top Management and Executives 43 45Middle managers and staff 1,451 1,450Total 1,494 1,495Staff numbers were essentially stable with respect to the previous year.Financial income and charges - 3,177 €/000Financial income and charges 2012 2011Income from investments - 130Interest income 97 178Other income 3,611 1,280Interest expense -331 -501Exchange gains and losses -200 -99Total 3,177 988Income relates to the net finance income generated by the parent company and interest charge wasincurred mainly in respect of RA Computer’s debt.50

Explanatory NotesValue adjustments to financial assets 425 €/000RevaluationsWrite-downsThe item refers to the write-down of the equity investment in Kedrios S.p.A. for € 426 thousand.Write-downs 2012 2011Of equity investments -426 -3,243Of securities recorded under current assetsbut not classified as investments- -921Total -426 -4,164Extraordinary income and charges - 2,397 €/000Extraordinary income and charges 2012 2011Income 2,905 592Charges -5,302 -3,366Total -2,397 -2,774Extraordinary charges mainly include costs incurred by the parent company as a result of implementation ofthe personnel reorganisation process.51

Explanatory NotesIncome taxes for the year – 24,622 €/000These are composed of:Income taxes for the year 2012 2011Direct taxes for the year 26,268 20,582Deferred taxes -1,646 -1,865Total 24,622 18,71752

Explanatory NotesSupplementary Information

Supplementary InformationStatement of changes in intangible assetsHistorical costBalance as at translation Reclassifications Increases Decreases Balance as at31/12/2011 differences 31/12/2012(a) (b) (c) (d) (e) (f=a+b+c+d-e)Formation costs 280 - - - - 280Industrial patent andintellectual property rights 287,252 326 11,191 - 298,769Concessions, licences andtrademarks - - - - - -Goodwill 2,353 - - - - 2,353Projects under development 1,064 - - 7,277 5,191 3,150Other intangible assets 16,807 - - 345 - 17,152Consolidation differences 106,075 - - 8,603 - 114,678Total intangible assets duringthe year413,831 326 - 27,416 5,191 436,38254

Supplementary InformationAccumulated amortisation31/12/2011 31/12/2012Balance as at translation Reclassifications Increases Amortisation Decreases Balance as at Net intangible Net intangible31/12/2011 differences due to acquisitions for the year due to adjustments 31/12/2012 assets assets(g) (h) (i) (j) (k) (l) (m=g+h+i+j+k-l) (n=a-g) (o=f-m)269 - - - 5 - 274 11 6263,949 -329 - - 13,690 764 278,074 23,303 20,695- - - - - - - - -2,353 - - - - - 2,353 - -- - - - - - 1,064 3,15014,949 - - - 694 - 15,643 1,858 1,50988,898 - - - 4,921 - 93,819 17,177 20,859370,418 -329 - - 19,310 764 390,163 43,413 46,21955

Supplementary InformationStatement of changes in property, plant and equipmentHistorical costBalance as at Translation Increases Decreases Reclassifications Balance as at31/12/2011 differences 31/12/2012(a) (b) (b) (c) (d) (e=a+b-c-d)Land and buildings 140 11 - - - 151Plant and equipment 90,615 8 2,923 53 - 93,493Equipment 2,198 122 233 - - 2,553Other assets 13,785 50 153 77 - 13,911Work in progress andpayments on account 1,194 93 598 1,769 - 116Total property, plantand equipment 107,932 284 3,907 1,899 - 110,22456

Supplementary InformationAccumulated depreciation31/12/2011 31/12/2012Balance as at Translation Increases due to Depreciation Decreases Reclassifications Balance as at Net property, plant Net property, plant31/12/2011 differences acquisitions for the year during the year 31/12/2012 and equipment and equipment(f) (g) (h) (i) (l) (m) (n=f+g+h+i-l-m) (o=a-e) (p=e-n)68 5 - 29 - - 102 72 4977,163 5 - 4,009 53 - 81,124 13,452 12,3691,540 76 - 327 - - 1,943 658 6109,524 59 - 656 60 - 10,179 4,261 3,732- - - - - - - 1,194 11688,295 145 - 5,021 113 - 93,348 19,637 16,87657

Supplementary InformationCash Flow Statement (Section I)(in Euro/000)2012 2011SOURCES OF FINANCINGProfit (loss) for the year 41,274 21,650Minority interest profit (loss) for the year 0 1,206Amortisation, depreciation and write-downs 24,798 21,727Employee severance indemnity fund 5,065 5,605Allocation to provision for risks and charges 4,557 5,046Change in consolidation reserves (4,139) (165)NET WORKING CAPITAL GENERATED 71,555 55,069FROM INCOME MANAGEMENTTOTAL SOURCES 71,555 55,069USES OF FUNDSInvestments in property, plant and equipment 2292 8,142Investments in intangible assets 22,551 14,797Net change in financial assets 0 0Change in equity investments in associated companies (426) (3,243)Change in non-current receivables 18 (60)Employee severance indemnity disbursements 5,319 6,412Dividend distribution 980 980Use of provision for risks 5,720 4,208TOTAL UTILISATIONS 36,454 31,236Increase (decrease) in net working capital 35,101 23,83358

Supplementary InformationCash Flow Statement (Section II)(in Euro/000)2012 2011CHANGES IN CURRENT ASSETSInventories (981) (1,876)Receivables- Due from customers 2,291 11,528- Due from associated companies 830 (3,724)- Tax receivables 3,703 (1,395)- Prepaid taxes 2,169 1,625- Due from others 722 (572)Other securities (18,697) 13,917Cash and cash equivalents 57,444 (3,522)Prepayments and accrued income (1,956) 2,144TOTAL CURRENT ASSETS 45,525 18,125CHANGES IN CURRENT LIABILITIESPayables- Due to banks 2,800 (7,064)- Due to other lenders 0 (49)- Payments on account 1,437 1,239- Due to suppliers (1,632) (1,245)- Due to associated companies 460 (318)- Tax payables 4,716 (3,291)- Due to social security institutions 75 2,050- Other payables 3,224 3,496Accruals and deferred income (656) (526)TOTAL CURRENT LIABILITIES 10,424 (5,708)Increase (decrease) in net working capital 35,101 23,83359

Supplementary InformationReconciliation between parent company and consolidated shareholders’ equityand profit (loss) for the yearshareholders’equityof which profitfor the yearSIA S.p.A. 195,276 43,073Shareholders' equity and profit (loss) ofconsolidated companies 34,460 7,720Elimination of carrying value of consolidatedequity investments -54,426 0Amortisation of consolidation differences 20,859 -4,921Elimination of capitalised costs -55 -55Reversal of dividends -6,200 -6,246Reversal of equity investments write-downs 99 2,129Equity method accounting of associatedcompanies -6,144 -426Other consolidation adjustments 72 0SIA Group 183,941 41,27460

Supplementary InformationStatement of changes in Shareholders' EquitySharecapitalLegalreserveReserve forsplit-offsurplusReserve formergersurplusUndistributedprofits andotherreservesProfit for theyearShareholders'equityBalance as at 31 December201122,091 3,443 1,426 78,844 14,644 21,650 142,098Allocation of previous year's profit 975 20,675 -20,670Dividend distribution -980Translation reserve changes 569Profit for the year 41,274Balance as at 31 December201222,091 4,418 1,426 78,844 35,888 41,274 183,94161

Supplementary Information62

Board of Statutory Auditors’Report

Board of Statutory Auditors’ ReportSIA S.p.A.Registered office: Via Francesco Gonin 36, MilanFully paid-in share capital: € 22,091,286.62VAT no. / tax no. /Milan Companies’ Register no. 10596540152.Milan Economic and Administrative Register (REA) no. 1385874* * *BOARD OF STATUTORY AUDITORS’ REPORT TO THE SHAREHOLDERSPURSUANT TO ART. 2429, PARAGRAPH 2, OF THE ITALIAN CIVIL CODE ANDLEGISLATIVE DECREE 127 OF 9 APRIL 1991To the shareholders of SIA S.p.A:During the year ended 31 December 2012, we undertook our activities in accordance with legalrequirements and the Code of Conduct for Boards of Statutory Auditors, issued by the Consiglio Nazionaledei Dottori Commercialisti e degli Esperti Contabili (CNDCEC), the professional body for certifiedaccountants in Italy.Compliance activitiesWe monitored your company’s compliance with legal requirements, the provisions of the Articles ofAssociation and the principles of proper business management.We attended the Shareholders’ and Board Meetings, which – based on the information available –we can confirm were conducted in accordance with legal requirements and the provisions of the Articlesof Association, and which did not highlight any transactions that were manifestly imprudent or risky,implied a potential conflict of interest or were as such to compromise the integrity of the company’sassets.During the meetings held, we obtained information from the directors regarding the operatingperformance and outlook, as well as regarding transactions considered significant in terms of size orcharacteristics that were carried out by the company and its subsidiaries. Based on the informationobtained, we have nothing of note to report in this regard.We met the independent auditors, with no significant data or information coming to light worthy ofbeing included in this report.We exchanged information with the statutory auditors of subsidiaries, where not members of the64

Board of Statutory Auditors’ ReportBoard of Statutory Auditors, with no significant data or information emerging that needed to behighlighted in this report.We obtained information from the Head of Risk Governance, with no significant data or informationemerging that needed to be highlighted in this report.We periodically obtained information from the company’s Internal Audit Department, with nosignificant data or information emerging that needed to be highlighted in this report.We obtained information from the supervisory body, and during these meetings we were informedof the monitoring activities carried out and of the updating of the organisational model adopted.We oversaw, as part of our duties and responsibilities, the company’s organisational structure, alsothrough the collection of information from the various department heads. In this regard, we can confirmthat said organisational structure is adequate in relation to the activities undertaken.We oversaw, as part of our duties and responsibilities, the company’s administrative/accountingsystem, as well as its reliability in presenting business operations and events correctly, by obtaininginformation from the various department heads and the independent auditors and through theexamination of company documentation. In this regard, we can confirm that said system is adequate andefficient.No formal notifications as referred to in art. 2408 of the Italian Civil Code were received.During the year under review, the Board of Statutory Auditors did not issue any of the opinionsenvisaged by law.On today’s date, we issued a justified proposal for the assignment of the audit pursuant to art. 13of Italian Legislative Decree no. 39/2010.Our supervisory activities, as described above, did not reveal any other significant facts thatneeded to be highlighted in this report.Separate and consolidated financial statementsWe have examined the separate financial statements as at 31 December 2012, which were madeavailable to us pursuant to the provisions of art. 2429 of the Italian Civil Code, and in this regard we wishto report as follows:Since we were not charged with the audit of the financial statements, we oversaw their generallayout and structure, and - with regard to their preparation and structure – we can confirm that theycomply with the relevant legal requirements.We have verified and ascertained the compliance with the relevant legal requirements pertaining tothe preparation of the Management Report.To the best of our knowledge, your company’s Directors, in drawing up the financial statements,65

Board of Statutory Auditors’ Reportdid not depart from the legal requirements laid down under art. 2423, paragraph 4, of the Italian CivilCode.In the Management Report and Explanatory Notes, your company’s Directors have providedinformation to the effect that, with regard to the shareholdings held in a number of subsidiaries, anindependent expert was asked to assess the value recorded in the financial statements of SIA S.p.A.,while the appraisal drawn up by said expert was also taken into consideration. More specifically, theDirectors have adequately presented the reasons why the carrying values of the following shareholdingsin subsidiaries were written down:- SIA Central Europe Z.R.t. (formerly GIRO BANKKARTYA Z.R.t.); the reduction in the value of theequity investment derives from the application, during the phase of calculation of the rate to beused for the Terminal Value, of a 2% premium to the specific risk of execution of the three-yearplan. This risk premium was applied in light of the 2012 results, which were below budgetforecasts, also due to the difficult economic conditions in the country in which the companyprimarily operates (Hungary), which prompted the company to strengthen its efforts as regardsdiversification towards other Eastern European countries;- RA Computer S.p.A.; the reduction in the value of the equity investment derives essentially fromthe worsening in the long-term growth rate g with respect to the previous year and theapplication of a more prudential prospective tax rate, against the essential confirmation of thecompany’s profit prospects, which remained almost unchanged with respect to the previousestimates.It should also be noted that, in the Management Report and the Explanatory Notes, the Directorsacknowledged that:- the liquidation procedure of Swiss company Perago AG, already 100%-owned by SIA S.p.A.,,concluded in December 2012, and led to the concentration of businesses, including sales, withinthe South African facility of Perago FSE;- the company SiNSYS SA/NV, already 51% owned by SIA, saw the remaining 49% acquiredduring the year. Once all shares were acquired, SIA S.p.A. launched a merger by incorporation ofthe same, which was completed on 18 December 2012 with the formalisation and filing of thedeed of merger by incorporation of SiNSYS SA/NV in SIA S.p.A.. The merger took effect on 1January 2013. The financial statements of the incorporated company for the year ended 31December 2012 were approved by the Board of Directors of SiNSYS SA/NV on 18 March 2013and, as required by Belgian legislation, were presented to the shareholders’ meeting of SIA S.p.A.for approval. The approved financial statements are accompanied by the Independent Auditors’Report.66

Board of Statutory Auditors’ ReportIn the Explanatory Notes, the Directors also outlined the reasons for increasing the provision forrestructuring charges during the year to cover charges incurred in the personnel reorganisation.With regard to intergroup transactions undertaken with subsidiaries, the information reportedherein confirms that these transactions were completed in the interest of the company, and that notransactions that would be atypical and/or unusual in relation to normal business operations wereundertaken.On 12 April 2013, the auditing firm Deloitte & Touche S.p.A. issued its own report pursuant to art.14 of Italian Legislative Decree 39 of 27 January 2010, which did not contain any findings and in whichthe firm confirmed that the separate financial statements as at 31 December 2012 give a true and fairview of the financial position and profit or loss of your company. The auditing firm also expressed itsopinion regarding the consistency between the Management Report and your company’s separatefinancial statements as at 31 December 2012.In accordance with Italian Legislative Decree 127/1991, the company also produced theconsolidated financial statements and management report.The Board of Statutory Auditors oversaw thegeneral layout and structuring of these documents as well as their compliance with legal requirementsregarding their preparation and structure. We have nothing of note to report in this regard.On 12 April 2013, the auditing firm Deloitte & Touche S.p.A. issued the independent auditors’report in respect of the consolidated financial statements, which did not contain any findings and inwhich the firm confirmed that the consolidated financial statements as at 31 December 2012 give a trueand fair view of the financial position and profit or loss of the Group. The auditing firm also expressed itsopinion regarding the consistency between the consolidated management report and the company’sconsolidated financial statements as at 31 December 2012.ConclusionAlso in view of the findings arising from the activities undertaken by the independent auditors, webelieve that the Shareholders’ Meeting may approve the separate financial statements as at 31 December2012, which post a profit for the year of € 43,072,549, as reported by the Directors. We have noobjections to the proposal put forward by the Board of Directors regarding the allocation of the profit forthe year, part to the legal reserve and in part carried forward as retained earnings.We’d like to thank you for the confidence shown in us and, finally, state that, our office, as well as thatconferred to the Board of Directors, ceases on approval of these separate financial statements; therefore,we invite you to resolve accordingly.Milan, 12 April 201367

Board of Statutory Auditors’ ReportThe Board of Statutory AuditorsMario CattaneoGiorgio SilvaPier Luigi DiociaiutiChairmanStanding auditorStanding auditor68

Independent Auditors’ Report