XXIV. Provisions for risks and charges

Provisions

There were no significant changes in the composition of this item with respect to 31 December 2007. The difference results from ordinary accruals and utilisations for the year, and the contribution of the newly consolidated entities (€7,220m).

Net of the exchange effect, this item would have grown by €6,277k.

Provision for taxes

This relates primarily to disputes over US companies' direct and indirect tax obligations (€5,369k).

Other provisions

These mainly concern:

  • a "self-insurance" provision (€18,088k) to cover the deductibles on third-party liability provided for in insurance plans. In 2008, an allocation of €5,056k was made and €2,840k was taken out for settlements;
  • provisions for concession renewal costs totalling €8,235k.

Decreases, pertaining mostly to "Other provisions", refer chiefly to the use of the self-insurance provision.

Restructuring provision

This covers the restructuring of central and local corporate units headed up by Autogrill Group Inc.

Provision for legal disputes

This provision covers the risk of losing lawsuits brought against Group companies, and takes account of the opinions

of the Group's legal advisors. Utilisations concern actual payments during the year as well as revised estimates.

Provision for the refurbishment of third party assets

This represents estimated liabilities for ensuring that assets to be relinquished are returned in the contractually agreed condition. Utilisations refer to the release of funds due to the expiration of certain contracts.

Onerous contracts provision
These funds cover loss-making concession contracts at unprofitable units.
The allocations in 2008 are based on projections by certain stores where earnings are not expected to cover lease payments; the stores are managed under multi-year concessions from which the Group cannot withdraw in advance.