Financial Highlights

• 1H 2008 Net sales stands at € 2,685.3 mln, showing an improvement in the industrial activity and a decrease in Real Estate activity;
  
  
• EBIT before Restructuring Costs stands at € 211.5 mln compared to € 221.3 mln in 1H 2007 (number influenced by the raw material price in Tyre & the Real Estate market);
  
  
• Restructuring Costs at € 21.2 mln, related to Pirelli Real Estate and Tyre reorganization program;
  
  
• EBIT amounts at € 190.3 mln;
  
  
• Results from Equity Participations is negative for € 92.4 mln, mainly due to the TI devaluation for € 155 mln;
  
  
• Net Income before discontinued operations is positive for € 2.6 mln; € 157.9 mln excluding the impact of the TI devaluation;
  
  
• Discontinued Operations negative for € 12.1 mln; this refers to the deconsolidation in Photonic Business (as a consequence of the agreement we signed with CyOptics);
  
  
• Net Financial Position stands at € 823 mln;
  
  
• Pirelli Tyre Net Sales increased to € 2,166.3 mln from € 2,151.4 mln in 1H 2007, +0.7% Year on Year; EBITDA and EBIT below 2007, as input costs have been  increasing faster than prices; 1H 2008 Net income stood at € 101.7 mln, nearly flat Year on Year;
  
  
• Pirelli RE EBIT including income from Equity participations before restructuring costs of 49.2 million Euro, against a result of 105.7 million Euro in the first half of 2007 which was net of temporary effects of DGAG consolidation; Total Consolidated Net Profit amounted to 9 million Euro; P. Real Estate NAV has remained almost stable at 1 billion euro showing the good and defensive quality of the assets;
  
  
• For 2008 the Pirelli & C. SpA Group business operating results in line with year 2007, notwithstanding continuous pressure on the tyre business due to volatility of raw material costs.