at 31 December (€m)20162015Increase/ (decrease) 
Non-current assets:        
Property, plant and equipment 2,080 2,190 (110) -5.0%
Investment property 56 61 (5) -8.2%
Intangible assets 513 545 (32) -5.9%
Investments accounted for using the equity method 218 214 4 1.9%
Total non-current assets (a) 2,867 3,010 (143) -4.8%
Working capital:        
Inventories 137 134 3 2.2%
Trade receivables and other receivables and assets 5,843 5,546 297 5.4%
Trade payables and other liabilities (4,724) (4,398) (326) 7.4%
Current tax assets and liabilities (73) 19 (92) n/s
Total working capital: (b) 1,183 1,301 (118) -9.1%
Gross invested capital (a+b) 4,050 4,311 (261) -6.1%
Provisions for risks and charges (1,507) (1,397) (110) 7.9%
Provisions for employee termination benefits and pension plans (1,347) (1,361) 14 -1.0%
Deferred tax assets/(liabilities) 53 (554) 607 n/s
Non-current assets and disposal groups held for sale and liabilities related to assets held for sale (1) 660 - 660 n/s
Net invested capital 1,909 999 910 91.1%
Equity 8,134 9,658 (1,524) -15.8%
Net funds 6,225 8,659 (2,434) -28.1%

(1) Non-current assets and disposal groups amount to €2,720 million and regard BdM-MCC SpA, totalling €2,665 million, and BancoPosta Fondi SpA SGR, totalling €55 million. Liabilities related to assets held for sale amount to €2,060 million and regard BdM-MCC SpA, totalling €2,049 million, and BancoPosta Fondi SpA SGR, totalling € 11 million.
n/s: not significant

The Poste Italiane Group’s net invested capital at 31 December 2016 amounts to €1,909 million, amply financed by equity. A comparison with the end of the previous year, when the figure was €999 million, shows an increase of €910 million. This partly reflects the previously noted application of IFRS 5, resulting in the presentation, for 2016 alone, of the financial assets and liabilities (a total of €595 million net) of BdM-MCC SpA and BancoPosta Fondi SpA SGR in “Non-current assets and disposal groups held for sale and Liabilities related to assets held for sale”. In addition, as these items include all the assets and liabilities of the two companies held for sale, the balances of non-current assets and working capital do not include – for 2016 – the current and non-current assets and liabilities of BdM-MCC and BancoPosta Fondi.

Non-current assets total €2,867 million (€3,010 million at the end of 2015). In addition to depreciation, amortisation and impairments of €581 million recognised during the year, the movement in this indicator reflects capital expenditure of €451 million, including €381 million invested by Poste Italiane and primarily relating to IT assets, which continue to play a key role in enabling the Group to achieve the objectives set out in its business plan. In particular, work on developing hardware, storage and backup systems continued, as did work on the rationalisation and consolidation of the Group’s Data Centre infrastructure. Over the years, these activities have led to the original 35 data rooms distributed nationwide being reduced to the current 7 Data Centres, including the new Data Centre in Viale Europa in Rome, completion of which, including the related testing, is expected to occur in early 2017. Work was also completed, in the second half of 2016, on enlargement (rooms 3 and 4) of the Turin Data Centre.

In keeping with the plan to ensure the security of IT infrastructure, work on the “Rinnovo Tecnologico dei sistemi PosteItaliane”, project continued, with the aim of upgrading the systems used by the rationalised Data Centres, in order to maximise their efficiency. In this context, the Group’s server farms were expanded during the year, partly under contracts concluded, at Group level, with the most important IT providers (i.e. Oracle and Microsoft) with the objective of obtaining more systemic solutions and achieving cost savings due to economies of scale. Work on Storage infrastructure also took place in 2016 in order to keep pace with the growing needs of the various businesses.
The upgrade of IT hardware also proceeded at local level (post offices, head offices and delivery offices), as did the extension of free Wi-Fi points at post offices, with a total of 3,224 Wi-Fi points operating at the end of 2016.
To support the planned Digital Transformation, work on integrating the new platform within the existing infrastructure continued in 2016, from the viewpoint of both hardware and software.
There was further investment in the development of advanced solutions relating to the Public System for Digital Identity Management (SPID), and in implementing the full acquiring service for all the main debit cards that use Italy’s network (Pagobancomat) or the international networks operated by VISA, VISA Electron, VPAY and Mastercard, Maestro. Work on the single Customer Database also continued, in line with the project carried out in the previous year, designed to ensure close links with the Customer Relationship Management (CRM) and Enterprise Data Warehouse (EDWH) systems.
On the IT security front, work on the analysis and assessment of Information Security risks continued, resulting in the definition of the security requirements needed to ensure an adequate level of data protection.
In terms of Group companies, the investment activities of PosteMobile SpA primarily related (over 60%) to the development of landline services, with the aim of supporting the evolution of Group business processes. The main initiatives carried out during the year relating to the mobile network were aimed at boosting the competitiveness and innovative nature of the retail offering in the mobile market, at expanding the range of services provided to business customers and on developing BancoPosta and PosteMobile apps.

Initiatives in the Postal Logistics segment continued in 2016 via three courses of action: implementation of the postal network, involving activities designed to guarantee the operational continuity of facilities and delivery centres by supplying equipment; optimisation of the postal network which, in 2016, resulted in the rollout of electronic signatures on handheld devices throughout Italy, which will boost the efficiency of signed-for deliveries and enable provision of an increasingly innovative services meeting customer needs; and evolution of the postal network, entailing the launch of a project to redesign the logistics network with the introduction of new sorting and delivery models, in line with the new regulatory framework.
Activities regarding application platforms continued, aimed at developing the integrated Group-level system for tracking items of mail.
In addition, with regard to business support, work on the systems needed to rollout the “next day” service envisaged by the partnership with the customer, Amazon, was completed.

There was further investment in the modernisation and renovation of buildings, in keeping with Poste Italiane’s property development strategy, with the main focus on property used in operations. In particular, work continued on planned renovation and non-routine maintenance work, with the aim of upgrading and improving property used in operations in order to meet workplace needs and those related to the services provided, as well as initiatives designed to improve staff health and safety. Furthermore, around 2,386 non-routine maintenance works (heating and air-conditioning units, electrical and fire prevention equipment, etc.) were carried out during 2016, as well as work on restoring normal service at post offices where criminal acts had taken place.

Working capital amounts to €1,183 million at 31 December 2016, down €118 million compared with the end of 2015. The reduction essentially reflects the reclassification, in application of IFRS 5, of current and non-current receivables and payables attributable to BdM-MCC and BancoPosta Fondi, amounting to a net amount of €96 million at 31 December 2016, to “Non-current assets and disposal groups held for sale and Liabilities related to assets held for sale”.
The reduction in net deferred tax liabilities, after offsetting against deferred tax assets, amounts to €607 million. This is largely due to the net positive effect on taxation (an increase in deferred tax assets and/or a reduction in deferred tax liabilities) of increased fair value losses on investments in available-for-sale financial assets.
The net balance of “Non-current assets and disposal groups held for sale and Liabilities related to assets held for sale” amounts to €660 million, with €616 million attributable to BdM-MCC and €44 million to BancoPosta Fondi. In addition to the above financial assets and liabilities (totalling €595 million), this also includes the impairment of €37 million recognised in order to bring the value of the net assets into line with the estimated realisable value, less costs to sell.

Equity amounts to €8.1 billion at 31 December 2016 a reduction of €1.5 billion compared with 31 December 2015. This primarily reflects movements in the fair value reserves (€1.6 billion, after tax), reflecting positive and negative movements in the fair value of investments in available-for-sale financial assets held by the Financial Services segment.
The reduction in equity also reflects the payment of dividends totalling €444 million, as approved by the Annual General Meeting of 24 May 2016 (€0.34 per share, paid to shareholders on 22 June 2016). The above reductions were partially offset by profit for the year of €622 million.



At 31 December 2016
Postal and Business ServicesFinancial ServicesInsurance Services and Asset ManagementOther ServicesEliminationsConsolidated amount
Financial liabilities (1,947) (59,225) (1,012) (2) 1,265 (60,921)
Technical provisions for insurance business - - (113,678) - - (113,678)
Financial assets 1,236 58,681 115,596 29 (1,180) 174,362
Technical provisions for claims attributable to reinsurers - - 66 - - 66
Net financial assets/(liabilities) (711) (544) 972 27 85 (171)
Cash and deposits attributable to BancoPosta - 2,494 - - - 2,494
Cash and cash equivalents 1,556 1,320 1,324 21 (319) 3,902
Net funds/(debt) 845 3,270 2,296 48 (234) 6,225

At 31 December 2015
Postal and Business ServicesFinancial ServicesInsurance Services and Asset ManagementOther ServicesEliminationsConsolidated amount
Financial liabilities (2,442) (55,418) (1,218) (4) 1,604 (57,478)
Technical provisions for insurance business - - (100,314) - - (100,314)
Financial assets 1,396 57,574 102,409 26 (1,315) 160,090
Technical provisions for claims attributable to reinsurers - - 58 - - 58
Net financial assets/(liabilities) (1,046) 2,156 935 22 289 2,356
Cash and deposits attributable to BancoPosta - 3,161 - - - 3,161
Cash and cash equivalents 1,315 485 1,615 16 (289) 3,142
Net funds/(debt) 269 5,802 2,550 38 - 8,659

Total net funds at 31 December 2016 amount to €6,225 million, down on the figure for 31 December 2015 (when net funds amounted to €8,659 million). This primarily reflects the component linked to fair value measurement of available-for-sale financial assets, totalling approximately €2,265 million, before tax, largely attributable to BancoPosta RFC’s investments and, to a lesser extent, to the subsidiary, Poste Vita. The reduction in net funds also reflects the reclassification of financial assets and liabilities attributable to BdM-MCC SpA and BancoPosta Fondi SpA SGR, totalling €595 million net, to the specific items, “Non-current assets and disposal groups held for sale and Liabilities related to assets held for sale”, in application of IFRS 5.


An analysis of the industrial net funds/(debt) of the Postal and Business Services and Other Services segments at 31 December 2016, in accordance with ESMA guidelines, computed on the basis of paragraph 127 of the recommendations contained in ESMA document 319 of 2013, is provided below:

At 31 December (€m)20162015
A. Cash 2 2
B. Other cash equivalents 1,575 1,329
C. Securities held for trading - -
D. Liquidity (A+B+C) 1,577 1,331
E. Current loans and receivables 63 169
F. Current bank borrowings (2) (515)
G. Current portion of non-current debt (14) (16)
H. Other current financial liabilities (22) (20)
I. Current financial debt (F+G+H) (38) (551)
J. Current net funds/(debt) (I+E+D) 1,602 949
K. Non-current bank borrowings (400) (400)
L. Bond issues (798) (797)
M. Other non-current liabilities (50) (57)
N. Non-current financial debt (K+L+M) (1,248) (1,254)
O. Industrial net funds/(debt) (ESMA guidelines) (J+N) 354 (305)
Non-current financial assets 651 553
Industrial net funds/(debt) 1,005 248
Intersegment loans and receivables 522 674
Intersegment financial liabilities (634) (615)
Industrial net funds/(debt) including intersegment transactions 893 307
of which:    
Postal and Business Services 845 269
Other 48 38


for the year ended 31 December (€m)20162015
Cash and cash equivalents at beginning of period 3,142 1,704
Cash flow from/(for) operating activities 2,258 2,563
Cash flow generated by operating activities before movements in working capital 1,439 1,192
Cash flow generated by /(used in) movements in working capital (83) 2,040
Cash generated by/(used for) assets and liabilities attributable to financial activities 864 (835)
Cash generated by/(used for) assets and liabilities attributable to insurance activities 38 166
Cash flow from/(for) investing activities (444) (689)
Cash flow from/(for) financing activities and shareholder transactions (964) (436)
Cash and cash equivalents reclassified to non-current assets and disposal groups held for sale (90) -
Movement in cash 760 1,438
Cash and cash equivalents at end of period 3,902 3,142
of which:    
Cash subject to investment restrictions 780 1
Cash attributable to technical provisions for insurance business 799 1,324
Other cash subject to restrictions 31 34

Operating activities generated a cash inflow of €2,258 million as a result of, among other things, profit for the year (€622 million).
The cash generated was primarily used to finance capital expenditure which, after disposals, resulted in an outflow of €446 million, and to pay off short-term borrowings of approximately €521 million.
Cash and cash equivalents is up €760 million, after the payment of dividends of €444 million.