ANNUAL REPORT 2007

The consolidated financial statements for the year ended 31 December 2007 are accompanied by this Directors' Report that has been prepared by the Board of Directors which is composed of the following eight members:
Dott, Franco Nobili Chairman of the Board of Directors Dott, Ing, Luca Sassi Vice-President and General Manager Dott, Ing, Luca Sassi Vice-President and General Manager Dott, Ing, Sergio Bandieri Director Geom, Corrado Bianchi Director Geom, Maurizio Fratoni Director Dott, Ing, Lidio Giordani Director Rag, Bruno Melardi Director.
The current Board of Directors will remain in office until the approvai of these financial statements.
The most important events that have occurred during the year are described below.
The 2007 consolidated financial statements shows a positive balance, net of taxes, totalling 23.4 millions of Euro (11.1 millions of Euro in 2006) against a consolidated production of 736.5 millions of Euro (672.9 millions of Euro in 2006).
The "EBITDA" is equal to 67.1 millions of Euro (55.8 millions of Euro in 2006) and the net financial position shows a negative balance totalling 88 millions of Euro (negative balance of 73.5 millions of Euro in 2006). The increase in the financial position is substantially due to the increase in production volumes and to the income support activities guaranteed to the contracts, some of which are currently under way and consequently require initial investments whose recovery is guaranteed by cash flows connected to construction activities. Real estate initiatives that are under way, both dealt with directly by the company, whose value at the year end totals 50 millions of Euro, as well as those dealt with by associated real estate companies, that have involved a net financial investment of 66 millions of Euro, have impacted the year end balance. Net equity totals 279.6 millions of Euro (256.6 millions of Euro in 2006).
Industriai production, although in the presence of a positive development of production volumes compared with prior year, has shown a net negative difference as opposed to the expectations that was mainly determined by delays in production in connection with the Catania-Syracuse contract and by the non-commencement and/or by the abnormal progress of the contracts relating to the Salerno-Reggio Calabria motorway portion.