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This section is aimed at providing investors and other stakeholders with useful information on the main operational, financial and economic terms which can be found in financial statements and press releases. Fincantieri's management reviews the performance of the Group and its business segments also using certain non-GAAP measures not defined under IFRS. The description of each of these measures can also be found below.
CGT - Compensated Gross Tonnage
An international unit of measurement that provides a common way of measuring the amount of work needed to build a given ship. It is calculated by multiplying the GT of a ship by a coefficient determined according to the type and size of ship.
Dry-dock
Basin-like structure in which ships are built or repaired.
GT - Gross Tonnage
A unit that measures a ship's total internal volume, including its engine rooms, fuel tanks and crew quarters. Its measurement is based on the external area of the bulkheads.
Mega-Yachts
The business of building motor yachts that are at least 70 meters (230 feet) in length.
Merchant vessels
Ships intended for commercial purposes, mostly involving passenger transportation. Examples are cruise ships, ferries (either for transporting just vehicles or for both vehicles and passengers), container ships, oil tankers, dry and liquid bulk carriers, etc.
Naval vessels
Vessels used for military purposes, such as surface combat vessels (aircraft carriers, destroyers, frigates, corvettes, patrol ships) as well as support craft and submarines.
Order backlog
Residual value of orders not yet completed. This is calculated as the difference between the total value of an order (including any additions and amendments) and the value reported as "Work in progress" at the period-end reporting date.
Order book
Value of principal contracts, order additions and variations, in respect of orders not yet delivered or fulfilled.
Order intake
Value of new orders, including order additions and variations, awarded to the Company in each reporting period.
Refitting/refurbishment
The business of refitting ships that are obsolete or no longer fit for use after changes in the law and/or regulations.
Shipowner
The entity that operates the ship, irrespective of whether it is the owner or not.
Soft Backlog
Value of existing contract options and letters of intent as well as of contracts at an advanced stage of negotiation, none of which yet reflected in the order backlog.
Total backlog
This is calculated as the sum of the order backlog and soft backlog.
Total order book
This is calculated as the sum of the order book and soft backlog.
Basic or diluted earnings per share
Basic earnings per share are calculated by dividing profit or loss for the reporting period attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share are calculated in the same way as for basic earnings per share, but take account of all dilutive potential ordinary shares as follows: (i) profit or loss attributable to ordinary shares is increased by the after-tax amount of dividends and interest recognized in the period in respect of the dilutive potential ordinary shares and is adjusted for any other changes in income or expense that would result from the conversion of the dilutive potential ordinary shares; (ii) the weighted average number of ordinary shares outstanding is increased by the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.
Business combination
This is the aggregation of entities or businesses into a single entity that is required to prepare financial statements.
CGU
Acronym for Cash-Generating Unit, defined as the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.
EBIT
Acronym for Earnings Before Interest and Taxes. It is defined as: Profit/(loss) for the year adjusted for the following items (i) Income taxes, (ii) Share of profit/(loss) of investments accounted for using the equity method, (iii) Income/(expense) from investments, (iv) Finance costs, (v) Finance income, (vi) costs associated with the "Wage Guarantee Fund", (vii) costs relating to reorganization plans and other non-recurring personnel costs, (viii) provisions for costs and legal expenses associated with lawsuits for asbestos-related damages, and (ix) other non-recurring income and expenses.
EBITDA
Acronym for Earnings Before Interest, Taxes, Depreciation and Amortization. It is defined as: Profit/(loss) for the year adjusted for the following items (i) Income taxes, (ii) Share of profit/(loss) of investments accounted for using the equity method, (iii) Income/ (expense) from investments, (iv) Finance costs, (v) Finance income, (vi) Depreciation, amortization and impairment; (vii) costs associated with the "Wage Guarantee Fund", (viii) costs relating to reorganization plans and other nonrecurring personnel costs, (ix) provisions for costs and legal expenses associated with lawsuits for asbestos-related damages, and (x) other non-recurring income and expenses.
Fair value
The amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm's length transaction.
IAS/IFRS
Acronyms for the International Accounting Standards and International Financial Reporting Standards, adopted by the Company.
Impairment testing
This is the work performed by the Group to assess, at every reporting date, whether there is evidence that an asset might be impaired, by estimating its recoverable amount.
Net expenditure/disposals
These represent investments and disinvestments in property, plant and equipment, intangible assets, equity investments and other net non-operating assets.
Net financial position
A line in the statement of financial position that summarizes the Company's financial position and includes (i) Net current cash/(debt): cash and cash equivalents, trading securities, current financial receivables, current bank debt (excluding construction loans), current portion of long-term loans and credit facilities, other current financial liabilities; (ii) Net non-current cash/(debt): noncurrent financial receivables, non-current bank debt, bonds, other non-current financial liabilities.
Net fixed capital
This reports the fixed assets used in the business and includes Intangible assets, Property, plant and equipment, Investments and Other non-current assets (including the fair value of derivatives classified in non-current Financial assets and noncurrent Financial liabilities) net of Employee benefits.
Net invested capital
This represents the sum of Net fixed capital and Net working capital.
Net working capital
This is equal to capital employed in ordinary operations which includes Inventories and advances, Construction contracts and advances from clients, Construction loans, Trade receivables, Trade payables, Provisions for risks and charges, and Other current assets and liabilities (including Income tax assets, Income tax liabilities, Deferred tax assets and Deferred tax liabilities, as well as the fair value of derivatives classified in current Financial assets and current Financial liabilities).
Operating capex
This represents investments in property, plant and equipment and intangible assets other than those acquired in a business combination and allocated to property, plant and equipment or intangible assets.
Revenue
This line in the income statement reports revenue earned on contracts and revenue from the sale of various products and services.
Statement of cash flows
This examines all the cash flows that caused changes in cash and cash equivalents, in order to determine "Net cash flows for the period", as the difference between cash inflows and outflows in the period.
WACC
Acronym for Weighted Average Cost of Capital. This represents the average cost of the various sources of company financing, both in the form of debt and of capital.