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BOARD OF DIRECTORS’ REPORTAND SPECIAL CONSOLIDATED

FINANCIAL STATEMENTS

TECHINT E&C S.A.

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Techint E&C S.A. (TECHINT E&C), is a new holding company of a group of subsidiaries

which provide Engineering, Procurement, Construction, Operation and Management

services for very large and important projects globally in the segments of oil & gas, energy,

industrial plants, oil refineries and petrochemical plants, mining and infrastructure and

architecture civil works. TECHINT E&C, through its subsidiaries, conducts activities

mainly in the markets of America, Europe, Africa and the Middle East. Any references in

this Report to “TECHINT E&C” or “the Entity” or “the Company”, refer to Techint E&C S.A.

and its consolidated subsidiaries.

TECHINT E&C consolidates the provision of engineering, construction and management

services mainly of their subsidiaries in Argentina, Ecuador, Canada, Central America,

Netherlands and Mexico (see further information in Overview of the twelve-month period).

The Company develops highly complex ventures, from design to commissioning and

start-up, taking care of the environment and the welfare of the communities at the

locations where it operates.

TECHINT E&C develops the projects, taking into account the requirements of standards

ISO 9001, ISO 14001 and OHSAS 18001, and using methods which assure the achievement ofthe highest standards relating to quality, safety and health, as well as environmental protection.

TECHINT E&C has gained strength from the new synergies resulting from the integration

with the subsidiaries in the American Continent and Europe, and it offers more customized

services in different industrial sectors (such as oil & gas, energy, industrial plants, mining and

infrastructure) ensuring quality, reliability and expertise to our customers in diversified markets.

For the purpose of providing its customers with comprehensive solutions with a high addedvalue, the Company counts on highly qualified human resources, various skills in engineering

and construction, and the know-how to efficiently manage the projects developed by it.

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THE COMPANY

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A N N U A L R E P O R T

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REVENUE BY COUNTRY/AREA (*)

ARGENTINA

BRAZIL

MEXICO

PERU

CHILE

ECUADOR

EUROPE, MIDDLE EAST AND AFRICA

OTHERS

33%

16%

14%

14%

9%

7%

4%

3%

PERSONNEL

DEC 2013

20,750

KEY FIGURES

REVENUE

EBITDA

EBITDA %

PROFIT

PROFIT / REVENUE

TOTAL EQUITY

ROE(PROFIT / EQUITY)

2,316.1

172.2

7%

83.2

4%

843.1

9.9%

USD MILLIONSDEC 2013

DEC 31, 2013 (*)

(12 MONTHS)

(*) Europe, Middle East and Africa were

consolidated since November 2013.(*) Europe, Middle East and Africa were

consolidated since November 2013.

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INDEX

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2 0 1 3BOARD OF

DIRECTORS’ REPORT

SPECIAL CONSOLIDATEDFINANCIAL STATEMENTS

Structure of TECHINT E&C

Overview of the twelve-month period

Prospect for the Fiscal Year 2014

Economic and Financial Information

Major Works in Progress per Country / Area

TECHINT E&C in the world

Argentina

Chile

Uruguay

Brazil

Mexico

Central America and the Caribbean

Peru

Ecuador

Colombia

Panama

Europe and Commonwealth of Independent States (CIS)

Middle East Africa

Engineering

Procurement

TECHINT E&C Equipment Division

Health, Safety and Environment (HSE)

Quality

Technology and IT Systems

Human Resources

Board of Directors

Legal Information

Report of the Auditors

Special Consolidated Statement of Financial Position

Special Consolidated Income Statement

Special Consolidated Statement of Comprehensive Income

Special Consolidated Statement of Changes in Equity

Special Consolidated Statement of Cash Flows

Index to the Notes to the Special Consolidated Financial

Statements

09

10

13

16

21

23

24

27

28

29

31

33

33

34

34

34

34

3637

38

40

40

40

41

42

43

45

51

52

54

56

57

58

60

63

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BOARD OFDIRECTORS’ REPORT

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Norte II Combined-Cycle Thermal Powerplant in Chihuahua, Mexico, with a constant generating capacity of 433MW.

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STRUCTURE OF TECHINT E&C

The Company was organized on July 4, 2012, originally

under the name PROSAT S.A. On August 26, 2013, a Special

Shareholders’ Meeting resolved to change the original

corporate name to Techint E&C Sociedad Anónima.

During this twelve-month period, ended December 31, 2013,

a corporate restructuring was implemented.

On March 14, 2013, the Company acquired all the outstanding

shares of TEI&C S.A. (TEIC), a company organized under

Uruguayan laws. By virtue of the a new business guidelines,

TEIC provided for a dividend in kind to be paid to TECHINT

E&C, through which payment it transferred all the interests of

the Spanish subsidiaries Techint Ingeniería y Construcciones

SL (TIC) and PREGLOSID SL. On July 24, 2013, the merger of

TIC with PREGLOSID SL was registered with the Business

Registry of Madrid, effective as from January 1, 2013.

During the second half of 2013, a process of management

integration started between the Company and the Italian

company Techint - Compagnia Tecnica Internazionale S.p.A.

(TEMIL) in the segments of engineering & construction, in

order to create synergies in the exploitation of the skills and

the markets under a global perspective, and the study of new

strategic planning.

The integration process was executed in several stageswhich led to the review of the corporate organization, the

optimization of internal processes and the adjustment of

procedures to ensure a greater effectiveness of TEMIL

activities. This organizational integration was implemented

for the purpose of grant the Company a high capacity of

exploiting the business synergies. The ability of offering,

on a global basis, its expertise in a particular range of

products and services in order to introduce itself as a single

and integrated point of reference for the client along the

entire chain of value of EPC projects. Thanks to the know-

how gained in these years by TEMIL, this company can

offer an even more comprehensive value proposal which

derives from being part of a global network and from the

combination of supplementary skills.

As a consequence of this strategic decision, on November 11,

2013 TECHINT E&C, through its dutch subsidiary TE&C

Invesments Netherlands B.V. (formerly known as B.V. de

Nieuwe Weg), acquired shares of TEMIL, a company that in

turn holds participating interests in other companies in Europe,

Africa, and the Middle East. As from such date, TECHINT E&C

consolidates the operations of TEMIL and its subsidiaries.

TEMIL is recognized especially for its skills in the field of

regasification plants of liquefied natural gas, due to the

important references to the energy and petrochemical sector,

but also due to the conceptual engineering and design skills

for civil infrastructure works.

After such process, the family tree for the Company(including the most important operative companies) at

December 31, 2013 is:

Techint Ingenieria y

Construcciones SL

(Spain)

TEI&C S.A.

(Uruguay)

TEI&C E&C S.A.

(Uruguay)

Techint Engenharia e

Construção S/A (Brazil)

Techint Chile S.A.

(Chile)

Techint SAC

(Peru)

Techint SA de CV

(Mexico)

Techint Cia. Tec Int

SACI (Argentina)

Techint SpA

(Italy)

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OVERVIEW OF THE TWELVE-MONTH PERIOD

TECHINT E&C recorded consolidated revenues for USD

2,316.1 million.

In Argentina, in the mining area, the Company through

the subsidiary Techint Compañía Técnica Internacional

S.A.C.I. (TEARG), continued with the procurement and

construction management activities in the Cerro Negro

Project for Oroplata S.A. (a subsidiary of Goldcorp Inc. of

Canada). During the period, the scope of the works was

extended, and it also included engineering, procurement

and construction management of a High Voltage line and the

respective Substation.

The client Barrick Exploraciones Argentinas S.A., an affiliate

of Barrick Gold Corp. of Canada, announced the suspension

of the Pascua Lama project during the implementation of

Phase III, not mentioning anything about new deadlines for

completion.

In the energy sector, the Company continued with the works

for the construction of the Punta Negra dam for Energía

Provincial Sociedad del Estado (EPSE).

Regarding the infrastructure works segment, as regards the

Expansion of Subway Line H, for Subterráneos de Buenos

Aires Sociedad del Estado (SBASE), throughout this period,

it was possible to achieve the completion of the excavationof the Tunnel of tranche C2 and the commencement of final

structural concrete works. In turn, works were also started

for the first stage of the Parque Patricios workshop.

As to iron & steel projects, works have been intensified

through TEARG and Sidernet S.A. in projects both at the

Campana plant for Siderca S.A.I.C., and at the San Nicolás

plant for Siderar S.A.I.C.

Regarding engineering services, the Company continuedwith concept, basic and detail engineering of contracts for

engineering services mainly related to projects in progress

and for clients to whom only engineering services are

provided. Besides, assistance continued to be provided for

the development of technical specifications and assessment

of investment projects.

In Chile, Techint Chile S.A. (TECHI), the Company’s

subsidiary, renewed its contract with Minera Escondida

Limitada for Mechanical Maintenance Service until

September 2014. TECHI also continued working with Sierra

Gorda Sociedad Contractual Minera for the construction

of stations and pipelines for seawater supply. Besides, in

September 2013, all works were completed at Valle de

Huasco Plants (for CAP Minería - Compañía Minera del

Pacífico S.A.). Also during 2013, negotiations were conducted

with Bechtel Chile Limitada, which company invited TECHI

to participate, on a jointly basis, in the execution of the

Escondida Water Supply (EWS) project which belongs to

Minera Escondida Limitada; a contract was signed and the

project will be executed under a joint venture where TECHI

holds a 40% participating interest. The scope includes the

construction of two parallel water pipelines, three pumping

stations, three electrical substations located at each pump

station, and a high voltage - line.

In Uruguay, Techint Compañía Técnica Internacional S.A.C.I.

(TEURU), TECHINT E&C’s subsidiary, completed the

following works: Maldonado Sewage System for Obras

Sanitarias del Estado (OSE), and Construction of Water

Intake and Effluent Outfall Pipeline for Celulosa y Energía

Punta Pereira S.A. Besides, works at Puerto Montes del Plata

continued during the period.

Also in Uruguay, but through the subsidiary TEARG, the

Company continues developing the “San Carlos – Melo

Electricity Interconnection” project for Administración

Nacional de Usinas y Transmisiones Eléctricas de Uruguay.

During the period, the supply of materials was completed

and all the construction phases along the project layout

were launched, with several difficulties of different nature

during execution that have significantly affected the project’s

profitability margin.

In México, through the subsidiary Techint S.A. de C.V.

(TEMEX), the Company continued in the oil & gas segment

with the works for a compression station and facilities in the

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Tamazunchale Gas Pipeline and the Naranjos Compressor

Station project, both projects for Transportadora de Gas

Natural de la Huasteca S. de R.L. de C.V. During the period,

works were completed in the Tuxpan Compressor Station for

Energía Occidente de México S. de R.L. de C.V.

In the pipelines segment, progress continued to be made

in developing the Ethane Pipeline Project for Gasoductos

del Sureste S. de R.L. de C.V., and in the energy area, the

substantial completion was achieved of Norte II Combined

Cycle Power Plant project for KST Electric Power Company.

In addition, works continued at the plants of Ternium de

México S.A. de C.V. and of Tubos de Acero de México S.A. de

C.V. with Sidernet Mexicana S.A de C.V.

On the other hand, during 2013, the Company started

to operate in the United States, under a construction

management contract for a project located in Bay City

(Matagorda County, Texas), which is developed by Tenaris.

This project consists in the building of a seamless tubing

manufacturing facility for the fabrication of a line of products

related to seamless tubes in compliance with the American

Petroleum Institute (API)’s specifications.

In Brazil, the Company’s subsidiary Techint Engenharia e

Construção S.A. (TEBRA) continued working in the Retarded

Coke Unit Complexo Petroquímico do Rio de Janeiro Project

(COMPERJ). Besides the Company was awarded a projectfor the client Petrobras Netherlands B.V. for the construction

of modules and integration of such modules for Platform

FPSO Petrobras-76 (P-76) to be installed by the client in the

Santos Basin (off shore area), approximately 210 km from

the Brazilian shore. In turn, the project Wellhead Platforms

(WHP) 1 and 2 Project for OSX WHP 1 & 2 Leasing Group

B.V. was suspended in August 2013 upon the client’s failure

to pay and entering into Judicial Reorganization (more details

in section Major Works per Country – Brazil).

In Peru, Techint S.A.C. (TESAC), the Company’s subsidiary,

continued working on the Camisea Pipeline Maintenance

Project, the Camisea Well Head Compression Project and

the Toromocho Project for Minera Chinalco Perú S.A. During

the twelve month-period, the Fénix Power Plant and Loops

del Sur Project were completed. Also during this period,

TESAC was awarded the Kepashiato Compression Plant for

Transportadora de Gas del Perú S.A.

In Ecuador, the Company, through its subsidiary,

Construcciones y Prestaciones Petroleras S.A. (CPP),

continues rendering specialized technical services relating

to engineering, procurement management and work

construction at the Shushufindi Aguarico Field, province of

Sucumbíos, eastern Ecuador, for Consorcio Shushufindi,

formed initially by Schlumberger (65%), Tecpetrol (25%)

and KKR (10%). The client’s main goal is to increase the

production of the whole field.

With respect to activities in progress executed by TEMIL, the

following may be highlighted:

In northernFrance

, works are being developed for

construction of one of the largest liquefied natural gas (LNG)

regasification plants in Europe, located in Dunkerque, for

Électricité de France (EDF).

In Poland, engineering works are about to reach the final

phase and construction works represented more than 60%

of the LNG plant of Swinoujscie, for Gaz System (a Polish

State-owned company).

In Russia, TEMIL is making progress with the works on thefront end engineering design (FEED) for construction of a

new plant for reduction of sulfur dioxide pollution caused by

plants in Norilsk (Siberia), for Norilsk Nickel. Design works

related to the nickel plant are already completed; works

associated to the copper plant are in progress.

The LNG plant in Zeebrugge (Belgium) for Fluxys LNG, has

gone through the early stages of development of the project;

progress has been made in engineering works and the

construction stage is just commencing on site.

In Saudi Arabia, the projects YANBU-Solid Handling System,

for Saudi AramcoOil Company and KJO-Upgrading Hout

Onshore Crude Facilities are about to reach the final stages.

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In addition, in the United Arab Emirates, the first train of

Etihad Railways is the first railway line ever built in the

country, and goes through the “Sulfur Handling Terminal 2”

plant that TEMIL is currently completing for Abu Dhabi GasIndustries Ltd. (Gasco).

In Egypt, the power plant in El Ain Sokhna, executed by TEMIL

for the Egyptian Ministry of Electricity is about to be completed.

Parallel to the oil & gas and energy initiatives, TEMIL continues

its activities in the engineering and design of infrastructure

projects, especially focusing on the design of hospitals in

Italy. Among such projects, the following stand out: the new

hospital in Legnano, the Istituto Clinico Humanitas in Rozzanoand the hospital in San Giovanni Rotondo.

TEMIL keeps on fully developing its capability as provider

of engineering services to several types of areas. Also,

from the offices in Mumbai (India), the Company has gained

strength in specialized engineering activities.

Among the most important projects awarded, there is

the project for revamping of an isobutane plant located in

Rotterdam (The Netherlands) for LyondellBasell, a leading

client in the petrochemical industry.

All the operational activities conducted by TECHINT E&C

in the different geographical areas around the world were

carried out paying maximum attention to, and in furtherance

of, the regulations in terms of environmental sustainabilityand the ongoing development of quality and safety aspects.

In El Ain Sokhna, Egypt, Techint E&C is building a steam generating thermal power plant, the first of its type in that region.

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PROSPECTS FOR THE FISCAL YEAR 2014

TECHINT E&C expects to maintain its presence and

operating activities in the relevant markets, paying special

attention to countries it considers more interesting for the

number and type of opportunities in key areas where the

Company wishes to offer added value.

In Latin America, the Company expects to maintain its

presence and activity level in the Latin American (LATAM)

countries where it is currently doing businesses. The

market should continue to be active in terms of engineering

and construction in the oil & gas and power generation

segments. Our extensive deployment in this region, and

the knowledge of clients’ local needs and engineering and

construction practices in these countries will be key and

positive distinctive factors for TECHINT E&C.

In the Southern Region, in the mining area, TECHI will be

active through the execution of the Escondida Water Supply

(EWS) Project –a major mining investment in the Region–

recently awarded to Bechtel Chile, which company partnered

with TECHI, and important opportunities are foreseen in this

market segment, including other major pipeline and station

projects and service/facility maintenance projects as well,

which would be tendered during 2014.

In Argentina, in oil & gas, the segment in which more activity

is envisioned, TEARG will keep on developing its activitiesthrough the provision of engineering and construction

services. Higher investments are anticipated in refining

areas, in which the Company has been working on several

engineering initiatives, so as to gain a better positioning in

view of such investments. In addition, there are business

prospects associated to the development of shale gas

in Argentina. In the infrastructure works segment, the

Company will try to participate in large projects such as

dams, tunnels and other similar works, by assessing, on a

selective basis, the opportunities allowing the Company tokeep its share in areas in which it has been taking part, with

clients that have been developed in recent years and others

that might be developed in the future.

The Company maintains the constant development of

the engineering area as a differentiating factor and for the

development of business at early stages, specifically in the

areas of oil & gas and mining.

In Mexico, the Congress approved a bill to put an end to

a seven-decade long state oil monopoly. In coming years,

foreign companies will be able to invest in Mexico’s oil sector,

thanks to new rules that will allow for production sharing.

These changes will create new opportunities in Mexico.

TEMEX is pursuing some new business opportunities in the

mining sector, in which this company has been creating a

business structure and alliances with related companies.

TEMEX is also seeking to increase its presence in the pipeline

sector where, and based on the ongoing project and the

experience in several bidding processes during the period, it will

take advantage of TECHINT E&C’s subsidiaries’ know-how and

expertise in order to seek business opportunities in public bids,

always on the basis of projects in progress and the experience

gained in several bidding processes during the period.

Also, the Company is expecting to consolidate the know-how

and experience gained during the development of the Norte

II Combined Cycle Power Project for the construction of a

Power Plant being developed by other related companies,that consists in the design, engineering, procurement,

construction, installation, commissioning, testing and

completion of a combined cycle gas turbine power plant

with a net capacity of approximately 840 MW in Monterrey,

Mexico. The commercial strategy in this sector is to increase

its share by developing new opportunities in the future.

In Brazil, for the upcoming year, TECHINT E&C will face the

accomplishment of critical milestones of its projects backlog,

such as, for the project Platform FPSO Petrobras-76 (P-76)initiated in 2013, the achievement of significant advances

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for the Engineering and Procurement, as well as the start

of the Construction phase at the UOT (Unidade Offshore

Techint) yard. Nevertheless a weaker perspective on several

segments of the brazilian economy, including construction,

the Company will maintain its strategic focus on the oil and

gas sector (for offshore, refining, piping projects) as well as

other well-known markets, such as mining, steel and power

plants, by carrying on investments such as the extension

of the UOT yard’s quay and the continuous enhance of its

operational capacity, searching for strategic partnerships and

following closely and actively the demands from traditional

clients, such as Petrobras, Usiminas and Vale, and potential

new opportunities from other companies on these sectors.

In the Andean Region, the Company expects to focus

its activities on key clients, providing a wider range

of services, including not only EPC (Engineering,

Procurement and Construction) or Construction, but also

conceptual and basic engineering, EPCM (Engineering,

Procurement, and Construction Management) and Facilities

Maintenance services.

Additionally we will continue to be active in the oil & gas

and power generation segments, with some decline in the

mining sector.

Regarding the mining sector, we foresee that the

implementation of certain projects may be delayed waiting

for better commodity prices. However, in Peru, we expect toparticipate in selected relevant plant expansions and grass

root copper projects, such as Freeport/Cerro Verde, Chinalco/

Toromocho II, Southern Peru (Grupo México)/Tía María-

Cuajone-Toquepala and Vale’s Bayovar, as well as exploring

maintenance services. In turn, in Colombia and Ecuador,

TECHINT E&C will be analyzing opportunities in the incipient

mining market.

In the oil & gas industry, where TECHINT E&C´s subsidiaries

have actively participated for several years, in Peru weforesee important projects of new cross country pipelines for

Proinversión, TGP Systems’ loops and compression plants.

In Bolivia, we will be targeting mainly engineering efforts

for key clients such as Pluspetrol, Yacimientos Pertrolíferos

Fiscales Bolivianos (YPFB) Transporte and YPFB Andina on

gas treatment and gas pipeline systems.

In the works related to the Shushufindi Project in Ecuador,

the Company expects to maintain at least same level of

activity for the construction of facilities or improved wells, to

increase the execution of flow lines and to continue with the

execution of the several investment projects as well as to

complete the Water Injection Pilot Plant.

Regarding Ecuador and Colombia, we will focus on certain

special pipeline opportunities as well as on refineries for

PetroEcuador, PetroAmazonas, Refinería del Pacífico,

Enbridge, Ocensa, Ecopetrol and Pacific Rubiales, to

maximize our chances of re-starting TEIC’s EPC works in

these countries, in addition to the continued provision of

engineering services. Shale oil & gas opportunity studies may

be commenced in Colombia after the implementation of new

regulations, and TECHINT E&C expect to be present.

In the power generation segment, TECHINT E&C will

continue screening projects to focus on those where it has

the highest chances of success.

In North America, the Company will provide to Tenaris

qualified and specialized personnel to perform supervision andcontrol management activities during the whole execution

of the project located in Bay City (Matagorda County, Texas).

With this project, the Company expects to gain experience in

the American construction market to look for new business

opportunities and increase its presence in the USA.

The target markets of Europe, the Middle East and Africa,

show an encouraging growth rate for the future, and

investments are planned in the sectors of interest for the

Company; however, there are some fundamental variablesto be taken into consideration. The first one is the current

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socio-political situation in some key markets (such as North

Africa) which prevents us from predicting, with some degree

of certainty, the development of investments in these areas.

The second variable is linked to the strong competition that

characterizes the area of engineering and construction,

especially in markets such as the Middle East.

Taking into account the aforesaid, TECHINT E&C, through

its subsidiaries, has the goal of maintaining its primary

role as an engineering company and general contractor in

the different segments (energy, oil & gas, petrochemical,

infrastructure) and geographical areas that the Company

considers a target (Africa, the Middle East, Europe) in the

context of a market for industrial plants posing more and

more challenges.

The commercial and executive commitment in the short

to medium term will focus on the geographical areas

with strong potential for opportunities in engineering and

construction, getting to countries such as Nigeria and Egypt,

but always maintaining a constant presence in its area of

expertise (e.g., Europe and the Middle East).

One of TECHINT E&C’s hallmarks lies in its location capability;

in fact, the TEMIL plans to keep the commercial and

operational branch offices it already owns in key countries,

such as Russia, Saudi Arabia, United Arab Emirates, Egypt

and Nigeria. This location capability allows TECHINT E&C

to maintain direct contact with the client throughout theexecution of activities on site. A deep knowledge of local

markets and suppliers ensures a thorough analysis and

selection of the best partners for execution activities.

In Europe, the Company expects to consolidate its leadership

in the design and construction of systems for regasification

of liquefied natural gas, having strong past and present

references (e.g., plants of Dunkerque EDF, Zeebrugge

Fluxys, Swinoujscie Polskie, Rotterdam Gate). In Europe, the

Company will try to increase its commitment and presencein other core sectors, such as petrochemical and energy,

depending on the type and volume of investments planned

in the short term in the European Union.

The area comprising Russia and the Community of

Independent States (CIS) offers interesting opportunities,

especially in the upstream/downstream and mining segments.

The Company will closely monitor the developments in these

areas, focusing on engineering services and revamping of

existing refinery plants. From the point of view of mining

opportunities, it will plan collaborations with other related

companies bringing expertise and supplementary skills in

order to provide the client with a complete service at the

different stages of design and construction.

In the Middle East, the Company plans to take advantage

of its experience in the field of Solid Handling. In addition,

thanks to its presence in Saudi Arabia and the United Arab

Emirates, the Company will monitor the progress in the

upstream and downstream areas, since the Middle East

is one of the major markets in terms of the number and

importance of oil & gas investments. TECHINT E&C’s aim is

also to access to bidding processes for LNG regasification

as part of its overall strategy, with the goal of increasing its

market share. The Company estimates that the LNG sector

in the Middle East will become increasingly active with

significant investments in the medium term.

The Company expects a positive development of the pipelines

market both in Eastern Europe and in the Middle East in thenear future, and to such effect it shall make good use of the

experience of the American sector in such market.

In Egypt and Nigeria, the Company is planning to carry out

activities in energy and petrochemical areas, as well as in oil &

gas onshore projects.

TECHINT E&C’s capability to provide timely and creative

solutions to critical projects, under safety and quality worldwide

standards, will be the Company’s key pillar to become leader inthe countries where it develops its activities.

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ECONOMIC AND FINANCIAL INFORMATION

SUMMARY OF SPECIAL CONSOLIDATED INCOME STATEMENT

USD MILLIONS

Revenues from construction contracts and other services

Cost of revenue

Gross profit

General, administrative and selling expenses

Other operating results

Net financial result

Result from investments accounted for using the equity method

Income before income tax

Income taxNet income

Attributable to:

Equity holder of the Company

Non-controlling interests

EBITDA (1)

EBITDA margin (% of revenues)

DEC 31, 2013

2,316.1

(2,005.9)

310.2

13%

(180.2)

(12.2)

12.1

5.8

135.7

(52.5)

83.2

4%

78.9

4.3

172.2

7%

(1) EBITDA is equivalent to Gross profit plus General, administrative and selling expenses minus Depreciation and amortization.

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Net income for the twelve-month period was USD 83.2 million,

representing 4% of revenues.

Gross profit for this period was USD 310.2 million, accounting

for 13% of the revenues.

EBITDA (Earnings before Interest, Tax, Depreciation and

Amortization) for this period was USD 172.2 million,

representing 7% on revenues.

General, administrative and selling expenses represented

8% of the revenues.

The other operating results showed a loss for USD 12.2 million,

mainly due to the loss of sale investment in TEMIL and the

TEMIL restructuring costs net of reversals of provisions of

certain defined benefit plans unfunded.

Financial results showed a gain of USD 12.1 million

mainly originated in the financial result from accrual of the

Reference Stabilization Index (Coeficiente de Estabilización

de Referencia - CER ) of the balance to be collected from the

Argentine Government by TEARG in its capacity as a member

of the JV Techint Compañía Técnica Internacional S.A.C.I.

– Impregilo S.p.A. (Sucursal Argentina) – Iglys S.A. and the

restatement and interest on claims.

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T E C H I N T

E & C

S . A .

Equity at the end of the twelve-month period amounted to

USD 843.1 million with a Capital Stock of USD 709 million.

The Equity increased mainly due to the Capital increase,

the net income for the twelve-month period, the irrevocable

contributions and the net revaluation of PP&E net of thecurrency translation differences.

Working capital as of December 31, 2013 was

USD 426.9 million.

SUMMARY OF CONSOLIDATED

STATEMENT OF FINANCIAL POSITION

USD MILLIONS

Assets

Non-current assets

Current assets

Total Assets

Equity

Majority Shareholders

Non-Controlling interests

Total Equity

Liabilities

Non-current liabilities

Current liabilitiesTotal Liabilities

Total Equity and Liabilities

DEC 31, 2013

768.8

1,562.4

2,331.2

828.3

14.8

843.1

352.6

1,135.5

1,488.1

2,331.2

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SUMMARY OF SPECIAL CONSOLIDATED

STATEMENT OF CASH FLOWS

Cash and cash equivalents reaching USD 565.8 million at the

end of the twelve-month period.

The Company generated operating funds for USD 117.7

million. This generation of funds, derived from the result of

the twelve-month period, the items that do not generate

movement of funds and the changes in trade accounts

receivable and tax assets net of other liabilities payments

and the income tax payment.

Among investment activities, the effect of group´s

restructure operation and the increase due to business

combination, net of the purchase of PP&E resulted in a

cash increase of USD 416.4 million.

Financing activities generated funds for USD 48.9 million

mainly due to the shareholders contribution net of the cash

flow for borrowings proceeds-repayment. The effect of

exchange rate changes were USD 17.2 million.

USD MILLIONS

Cash and cash equivalents at the beginning of the year

Net cash generated by operating activities

Net cash generated by investing activities

Net cash generated by financing activities

Net increase in cash and cash equivalents

Effect of exchange rates changes

Cash and cash equivalents at the end of the twelve-month period

DEC 31, 2013

–

117.7

416.4

48.9

583.0

(17.2)

565.8

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T E C H I N T

E & C

S . A .

Some important ratios are the following:

Financial solvency (Assets / Liabilities)

Liquidity (Current Assets / Current Liabilities )

Indebtedness (Liabilities / Equity)

Solvency (Equity/Liabilities)

Immobilization of Capital

(Non Current Assets / Assets)

Profitability (Net Income / Equity)

DEC 31, 2013

1.6

1.4

1.8

0.6

0.3

9.9%

INDICATORS

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MAJOR WORKS IN PROGRESS PER COUNTRY / AREA

AFRICA

El Ain El Sokhna – Supercritical Thermal Power Plant (Egypt)

ARGENTINA

Subway Line H Expansion

Punta Negra Hydroelectric Power Station

Works and Services in siderurgical plants

BRAZIL

Retarded Coke Unit Complexo Petroquímico

do Rio de Janeiro (COMPERJ)

Modules for P-76 Platform

CHILE

Escondida Water Supply (EWS) Project

Construction of Stations and Pipeline for Seawater Supply

Mechanical Maintenance Service

ECUADOR

Shushufindi Services

EUROPE

Polskie LNG (Poland)Dunkerque LNG (France)

Norilsk – Copper and Nickel Plant (Siberia, Russia)

Zeebrugge LNG (Belgium)

Isobutano Rotterdam (Netherlands)

East Delta Electricity Production Company (EDEPC)

Subterráneos de Buenos Aires S.E. (SBASE) /

Ministerio de Desarrollo Urbano (MDU)

Energía Provincial S.E.

Siderar S.A.I.C. - Siderca S.A.I.C.

COMPERJ Petroquímicos Básicos S.A.

Petrobras Netherlands B.V.

Betchel Chile Limitada

Sierra Gorda Sociedad Contractual Minera

Minera Escondida Limitada

Consorcio Shushufindi

Polskie LNG (Gaz System)Électricité de France (EDF)

Norilsk Nickel

Fluxys LNG

LyondelBasell

CONTRACT

TOTAL AMOUNT

(USD MILLION)

COUNTRY / AREA

PROJECT

CLIENT

69

476

399

167

1,569

871

691

193

142

136

782765

124

103

11

(a) Proyects under a consortium/JV. The amount corresponds to total contract amount at 100%.

See note 20 to the Special Consolidated Financial Statements.

(b) The amount corresponds to annual revenues.

(a)

(a)

(b)

(a)

(a)

(a)

(b)

(b)

(a)

(a)

(a)

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T E C H I N T

E & C

S . A .

MEXICO

Works and Services in siderurgical plants

Ethane Pipeline Project

Tamazunchale Facilities

Naranjos Compressor Station

Petacalco Project - Maintenance and Operational Contract

MIDDLE EAST

Ruwais Sulfur Handling Terminal 2

(Abu Dhabi, United Arab Emirates)Yanbu – Solid Handling System (Saudi Arabia)

Upgrading Hout Onshore Crude Facilities (Saudi Arabia)

PERU

Toromocho Project

Kepashiato Compression Plant Project

Camisea Pipeline Maintenance

URUGUAYPuerto Montes del Plata

San Carlos – Melo Electricity Interconnection

Route 9

Environmental Works in Maldonado and Punta del Este

Ternium de México S.A. de C.V. -

Tubos de Aceros de México S.A. de C.V.

Gasoductos del Sureste S. de R.L. de C.V.

Transportadora de Gas Natural de la Huasteca

S. de R.L. de C.V.

Transportadora de Gas Natural de la Huasteca

S. de R.L. de C.V.

Comisión Federal de Electricidad (CFE)

GASCO (ADNOC)

YASREF

Al-Khafji Joint Operations (KJO)

Minera Chinalco Perú S.A.

Transportadora de Gas del Perú S.A. (TGP)

Compañía Operadora de Gas del Amazonas S.A.

(COGA)

Zona Franca Punta Pereira S.A.

Administración Nacional de Usinas

y Transmisiones Eléctricas

Corporación Vial del Uruguay S.A.

Obras Sanitarias del Estado (OSE)

COUNTRY / AREA

PROJECT

CLIENT

278

242

70

39

39

331

269

178

247

132

95

171

89

19

15

MAJOR WORKS IN PROGRESS PER COUNTRY / AREA

(CONT’D.)

(b)

(a)

(a)

(a)

(b)

CONTRACT

TOTAL AMOUNT

(USD MILLION)

(a) Proyects under a consortium/JV. The amount corresponds to total contract amount at 100%.

See note 20 to the Special Consolidated Financial Statements.

(b) The amount corresponds to annual revenues.

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TECHINT E&C IN THE WORLD

Regional Headquarters

Engineering Centers

Commercial & Operating Centers

Centers Offshore Yard

Paraná

MexicoCity

Quito

Lima

Santiago

Buenos Aires

Milan

Moscow

São Paulo

Rio de Janeiro

Montevideo

Lagos

Cairo

AbuDhabi

Damman

Mumbai

Bogotá

During this period, the Company determined and carried out

different undertakings in the oil & gas field, pipelines as well as

infrastructure works for mining companies and other civil works.

Projects were developed from different offices around

the world:

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T E C H I N T

E & C

S . A .

TECHINT E&C SUBSIDIARIES’ ACTIVITIES FOR THE

TWELVE-MONTH PERIOD ENDED DECEMBRE 31, 2013

ARGENTINA

During the twelve-month period, activities in Argentinawere developed by Argentinian subsidiaries TEARG,

Sidernet S.A. and Ferroexpreso Pampeano S.A.

Concesionaria (FEPSA).

Punta Negra Hydroelectric Station – Energía Provincial S.E.

The contract was executed between Energía Provincial

S.E. and the JV formed by Techint Compañía Técnica

Internacional S.A.C.I. and Panedile Argentina S.A., in

which the Company holds a 75% participating interest.

This project is on the San Juan River, 20 Km. downstreamLos Caracoles project, and it is intended to increase the

regulation of this river, which is essential for San Juan’s

economy, and to add 65 MW to the generation system of

the Province.

Works were commenced in January 2010, the river deviation

channel was executed in August 2011 and, at present, the

different works to be executed are in progress. The updatedcontract amount is approximately USD 399 million, and

works are estimated to be completed in November 2015.

As of December 31, 2013, the progress rate was 69%.

Subway Line H Expansion - Subterráneos de Buenos Aires S.E.

(SBASE) / Ministerio de Desarrollo Urbano (MDU)

On August 15, 2011, SBASE awarded to the Techint – Dycasa

Joint Venture (in which the Company holds a 60% participating

interest) the integral construction and commissioning in

conditions of commercial exploitation of the current SubwayLine H. The project includes 4.5 km of tunnels with six

stations, workshops, parking lots and a rectifier substation.

Techint E&C is developing in Argentina, together with the Dycasa company, the expansion of the H Line for Subterráneosde Buenos Aires S.E. The work will add 4 km to the transportation network, benefiting more than 65,000 people.

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The project comprises civil and electromechanical works,

including tracks, power installations, pulling, signaling,

communications, mechanical stairs, elevators and

station equipment.

The contract between the JV and SBASE was signed on

September 16, 2011. The Acknowledgement of Commencement

was granted on October 4, 2011, for a total term of 43 months.

The delay in passing a resolution with respect to the legal

action (for the protection of constitutional rights) filed by a

NGO, which resulted in the suspension of works in one of

the stations, in addition to client’s failure to define certain

aspects in the South tranche, as well as on the execution of

the workshop and parking space, have led SBASE and the JV

to execute a Memorandum of Understanding to adjust the

initial contract amount, establishing a contractual extension

for an additional 24-month term (until April 2017).

Additionally, in July 2013, SBASE and the Government of

the City of Buenos Aires (GCBA) entered into an agreement

which established the transfer of the Technical Direction of

the works to the Ministry of Urban Development (MDU). That

notwithstanding, SBASE keeps all the rights and duties deriving

from the contractual relationship and its capacity as Principal.

As of December 31, 2013, the progress rate was 11%. The

contract amount, including the Memorandum of Understanding,

and taking into account the last price adjustment of June 2013,

reaches approximately USD 476 million.

Works in Plants - Siderar S.A.I.C. (San Nicolás)

The following works carried out in 2013 can be highlighted:In steel-making, works were started for the new

Continuous Casting, the new water plant; in addition, the

electromechanical works related to Vacuum Degassing (RH

Furnace) were continued.

The new Continuous Casting requires works for construction,

assembly and start-up, the main function of which is to

transform liquid steel in order to give it a geometrical shape

making it possible to perform the subsequent forming

processes, to produce 2,500,000 tons of steel slabs each

year. Such works in Continuous Casting include peripheralprojects necessary for installation and operation, such as

the Shim Steel Cyclone, the structural reinforcement of

the Steel-making Area and the modification of the tundish

(molten metal holder) repair area. During execution of the

project, 19,355 cubic meters of concrete were poured,

structures were assembled for 1,496 tons, mechanical

assembly works were executed for 2,273 tons, 268 km of

cable were installed and piping was mounted for 236 tons.

The RH Furnace consists in a degassing station for liquid

steel through recirculation of such steel inside a container

submitted to vacuum conditions, with oxygen blow by means

of a water-cooled lance and also comprises the supply

system of common ferroalloys. For construction 1,240 cubic

meters of concrete, 1,517 tons of structures, and 1,215 tons

of mechanical assembly were used, and 80 km of cables

were installed.

Total income for this period was approximately USD 81 million,

using 3,100,000 man-hours.

Works in Plants - Siderca S.A.I.C. (Campana)

The main works executed during this period include the plant

extraordinary repair (REX) 2013, where works were mostly

carried out in steel-making and in the continuous cold strip mill

(LACO) 2.

Total income for this period was approximately USD 29

million, using 1,265,000 man-hours.

Services in Plant - Siderar S.A.I.C. (San Nicolás) y Siderca

S.A.I.C. (Campana)

During the period, Sidernet S.A. and TEARG executed these

main services:Heavy duty cleaning and recycling of iron & steel sub-products.

Steel and tinplate reel packing.

Light duty cleaning.

Total income for this period was approximately USD 57 million.

Pascua Lama - Barrick Exploraciones Argentinas S.A.

This is a bi-national mining undertaking (gold and silver),

located in the border between Chile and Argentina. The

Company is associated under a JV, on a 50%/50% basis,

with Fluor Argentina Inc. Sucursal Argentina to carry out theworks divided into three phases: Phase I - Consolidation

of Basic Engineering and Feasibility Study of the Project;

>

>

>

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The works were suspended in December 2012, and on

March 12, 2013, the client notified the JV of the cancellation

of the project and the resulting unilateral termination of the

contract for construction of the plant, and it requested the

Company to cease the provision of goods and services.Therefore, TEARG and its partners took the relevant steps

and implemented a closing plan, taking into consideration

economic, legal and contractual conditions; in turn,

demobilization measures were taken for the whole project.

Agreements and acknowledgements of completion were

executed with all subcontractors and suppliers, all liabilities

as of the closing date were cancelled, and the final

settlement and payment was made to all the Company’s

personnel working for the JV, under a detailed schedule. The

client accepted all the costs associated to the demobilizationworks and contractual termination.

Phase II - Detail Engineering and Procurement Management,

and Phase III – integral Construction Management and

Construction of the Processing Plant. Phase I was completed

in 2007, and Phase II, during 2011.

In October 2013, during execution of Phase III, the clientnotified the suspension of the project, not mentioning

anything about new deadlines for completion, as a result of

which demobilization works were performed.

Potasio Río Colorado – Potasio Río Colorado S.A.

On October 25, 2010, a Joint Venture was created between

Constructora Norberto Odebrecht (45%), Odebrecht

Argentina (15%) and TEARG (40%) for management and

construction of Phase I of the Potasio Río Colorado plant,

comprising the facilities for extraction, processing andcommercialization of potassium chloride.

Pascua-Lama: bi-national mining project on the Argentine-Chilean border, for the development of an open-pit goldmine, located at more than 4,000 masl.

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SERVICES

Cargo Railway Transportation

Ferroexpreso Pampeano S.A. (FEPSA), a company under the

control and corporate decision of TEARG through Compañía

Inversora Ferroviaria S.A.I.F. (COINFER), is the holder of the

cargo railway transportation concession providing services

towards the ports of Bahía Blanca, Rosario, San Lorenzo

and San Martín to exporters, storage companies and large

producers of a vast area of the Wet Pampas region.

During the twelve-month period, 3.7 million tons were

transported, down 12% against the volume transported in

the previous period.

This reduction of transported volume is mainly due to the

stop of trade operations by the producers, who withhold

goods expecting an improvement of trade conditions.

This has resulted in a reduction of transportation to export

terminals and to grinding facilities, and this situation

prevails to date.

CHILE

During the period, TECHI has increased its revenues.

Works have been executed in the following projects:

Escondida Water Supply (EWS) Project – Betchtel Chile Limitada.

Bechtel Chile Limitada invited Techint Chile S.A. to participate

on a jointly basis in the construction of part of the project“Escondida Water Supply Project” (EWS Project), for the

client Minera Escondida Limitada. This project is managed by

Bechtel Chile Limitada. For such purposes, the companies

became associated, where TECHI participation is 40%.

In December 2013, two contracts were executed: one

construction contract for the execution of: two parallel 42"

water pipelines and 177 km long each one; three pumping

stations; three electric substations located at the site of each

one of the three pumping stations; a 220 KV high voltage

line; two 36" water pipelines for distribution to the mine, witha total length of 23 km; and a reservoir. The other contract

includes the procurement of equipment and minor tools

required for construction.

The estimated amount of both contracts is USD 691 million.

As of this date, no progress rate can be provided for this

project, since it is at the stage of studies and coordination

with the partner, prior to construction.

Construction of Stations and Pipeline for Seawater Supply –

Sierra Gorda Sociedad Contractual Minera

On November 16, 2012, a contract was signed between the

client Sierra Gorda Sociedad Contractual Minera (SGSCM)

and TECHI for the “Construction of Stations and Pipeline for

Seawater Supply” [“Construcción de Estaciones y Pipeline

Conducción Agua de Mar ”], located 4.5 km to the Northwest

of the Sierra Gorda town, in Antofagasta.

The contract comprises the instal lation of piping for seawater

drive and supply to be used in the mining process in the

mine sector and the processing plants, which will connect

the Mina-Planta and Mejillones sectors, approximately

145 km long. The seawater drive works for the Sierra

Gorda project encompass the construction of a system

consisting of GFRP (glass-fiber reinforced plastic) tubing

and carbon steel tubing, both of them with a 36” diameter,

laid underground (for GFRP tubing) and over the surface (for

carbon steel tubing), a capture and lift station located inside

the thermal power plant at Mejillones, two main pumping

stations located along the outline and a terminal station

located inside the mine site, at Sierra Gorda.

As of December 31, 2013, the contract amount is USD 193million and the project records 96% progress.

Mechanical Maintenance Service – Minera Escondida Limitada.

In November 2009, a contract was entered into with Minera

Escondida Limitada. This contract corresponds to the

mechanical maintenance service of concentration plants and an

oxide plant located in Antofagasta. In November 2013, it was

agreed with the client to extend the contract for maintenance

services until September 30, 2014. This extension increased

the sale value up to a total of USD 142 million, approximately.As of December 31, 2013, the project recorded 83% progress.

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Valle de Huasco Plants – CAP Minería – Compañía Minera del

Pacífico S.A.

In December 2010, TECHI was awarded an EPCM project to

increase the capacity of Los Colorados plants for pellets (iron

ore). These works comprise the execution of several phases

of the contract, such as management, review and validation

of basic engineering, detail engineering development,

procurement management, construction administration,

commissioning and start-up. All works were completed

during September 2013. As of December 31, 2013, this

project is subject to the contract closing process.

URUGUAY

During the period, the works developed in road, water and

civil projects were as follows:

San Carlos – Melo Electricity Interconnection - Administración

Nacional de Usinas y Transmisiones Eléctricas

During December 2011, TEARG (Sucursal Uruguay) entered

into a contract with Administración Nacional de Usinas

y Transmisiones Eléctricas de Uruguay (UTE) for a sum

equivalent to USD 89 million for the construction of a 500

kV high voltage line, 348 km long. The project comprises

the development of engineering, supply of materials and

construction of the transmission line under a Lump Sum

Turn Key contract. During this period, the supply of materials

was completed and all construction phases along the project

layout were launched. The development of this project

was adversely affected by changes of design caused bydeficiencies in the topographic survey furnished by the client,

the winter weather conditions, and trade union issues as

well. In October 2013, an agreement was executed with the

client, mainly for the partial recognition of extra costs and an

extension of the deadline for completion until June 30, 2014.

As of December 31, 2013, the progress rate was 74 %.

Maldonado Sewage System – Obras Sanitarias del Estado (OSE)

In December 2013, the Company completed the works of

the project “Treatment and final disposal of Maldonado and

Punta del Este sewage system”. The contract, executed

by the joint venture formed by TEURU, TEARG Sucursal

Uruguay, Montec and Belfi, and OSE, comprised the

construction of 35 km of tubing, a 4-km land outfall, civil

and architecture works in seven pumping stations (works

executed by Techint), and a 1 km long off-shore outfall

(executed by Montec and Belfi). Works started in January

2010 and ended in December 2013.

Puerto Montes del Plata – Zona Franca Punta Pereira S.A.

In June and July 2011, Zona Franca Punta Pereira S.A.

awarded the Company two contracts for the preliminary

works for the terminal at Conchillas Port, Department of

Colonia, and the construction of such terminal. For the

execution of these works, a joint venture was created

between Constructora Belfi S.A. Sucursal Uruguay (60%

participating interest) and TEURU (40% participating interest).

Both contracts amount to an aggregate of USD 171 million,

and as of December 2013, the works recorded 78% progress.

The project completion is scheduled for September 2014.

Route 9 – Corporación Vial del Uruguay S.A.

TEURU was awarded by Corporación Vial del Uruguay S.A.

the works for the Reinstatement and Maintenance by

services levels of Route 9, section: Pan de Azucar – Rocha.

The term for the project is 60 months and the contract

amount is USD 19 million.

Environmental Works in Maldonado and Punta del Este – ObrasSanitarias del Estado (OSE)

The contract for OSE includes four groups of works:

works for the maintenance of sewage and drinkable water

networks at Maldonado, Punta del Este and other locations

within the Department of Maldonado; sanitation works in the

city of Maldonado; sanitation works in the city of Piriápolis,

and an effluent treatment plant in Punta Fría (Piriápolis).

In this year, the Company continued with part of the works

scheduled for the extension of the contract with the UDG

(Unidad de Gestión Desconcentrada ) in Maldonado. The total

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contract amount is USD 15 million, records 92% progress and

it is expected to be completed next year upon the execution

of sanitation works in Maldonado, and with maintenance

works for the sewage network in such same city.

Construction of Water Intake and Effluent Outfall Pipeline –

Celulosa y Energía Punta Pereira S.A.

In January 2012, the above-mentioned joint venture was

awarded a contract by Celulosa y Energía Punta Pereira S.A.

for the construction of the water intake and effluent outfall

pipeline of a paper pulp plant.

The contract comprised the supply of labor, tools,

equipment, materials and accessory elements necessary

for construction.

In December 2013, the project reached 100% progress.

BRAZIL

TEBRA and its subsidiaries perform activities related to

engineering, construction, erection, project management,

petrochemical facilities, off-shore projects, power generation,

transmission and distribution, iron and steel units,transportation systems and infrastructure works in general.

During the current year, works were performed in the

following projects:

Retarded Coke Unit Complexo Petroquímico do Rio de Janeiro

(COMPERJ) - COMPERJ Petroquímicos Básicos S.A.

In April 2010, a contract was executed with Petrobras

for the preparation of the consistency review of the

basic engineering, preparation of the detail engineering,

Puerto Montes del Plata project, Uruguay: the Techint E&C- Belfi consortium has built the port terminal for the newcellulose plant of Montes del Plata.

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T E C H I N T

E & C

S . A .

partial supply of equipment, supply of bulk material, civil

construction, electromechanical erection, interconnections,

commissioning, pre-commissioning, and technical assistance

during the pre-operation and assisted operation start-up of

the Retarded Coke Unit (U2200), Manipulation and Storage

Yard (U6821) and two electrical substations.

TEBRA is part of the TE-AG JV with Andrade Gutiérrez, with a

50% participating interest each, under the leadership of TEBRA.

The total value of the contract is USD 1.57 billion (at 100% of the

JV) and the estimated date for completion is December 2016.

The general progress of the project is 82%.

Modules for P-76 Platform – Petrobras Netherlands B.V.

In April 2013, a contract was executed with Petrobras

Netherlands B.V. (PNBV) for the construction of modules

and integration of such modules for Platform FPSO

Petrobras-76 (P-76) to be installed by the client in the

Santos Basin off shore area, approximately 210 km from

the Brazilian shore, with a production capacity of 150,000

barrels/day (oil) and 7 MM3/day (gas).

The contract modality is lump sum EPC Turn-key, and

includes FEED endorsement, detail engineering, supply of

materials and partial supply of equipment, manufacturing,

construction and assembly of the elements for the modules,

and integration of such modules to the hull. The contract also

includes conditioning and commissioning, inclination tests,

transportation from worksite to the entrance to Paranaguá

Bay, pre-operation, start-up and certification of the Platform.

TEBRA is part of the TTP-76 JV with Technip, with a 50%participating interest each partner, under the leadership of Technip.

Engineering and procurement works are carried out in the

city of Rio de Janeiro, and the construction and integration

works will be executed at the yard owned by TEBRA in

Pontal do Paraná, State of Paraná, which was properly

conditioned for execution of this project.

The contract amount is USD 871 million, and it is estimated

that works will be completed in June 2017.

WHP 1 and WHP 2 Platforms - OSX WHP 1 & 2 Leasing Group

B.V. (“OSX”)

In June 2011, a contract was executed with OSX for the

supply of two drilling and operation fixed platforms (WHP1

and WHP2), to be installed by the client at the Campos

Basin, approximately 90 km off the Brazilian shore. The

contract included the execution of basic engineering, detail

engineering, materials and equipment supply, manufacture,

construction and erection of the elements of these platforms.

Up to June 2013, the contract was duly performed by the

Company, and all contractual obligations were fully complied

with within the schedule timelines. However, progress in

the projects, as measured in measurement reports (BMs) in

June (BM 32), July (BM33) and August (BM34) 2013, was not

paid by OSX on the respective due dates.

In July 2013, the client cancelled the construction of the

WHP-1 Platform.

The project was suspended in August 2013 upon the client’s

failure to pay. When the works were suspended, the progress

rate for construction of the WHP-2 Platform was 45%.

A Contractual Amendment dated September 27, 2013,

formally cancelled the services and supply relating to

platform WHP 1, and the Company's rights arising from such

termination were maintained.

On October 02, 2013, Company initiated judicial proceedings

aiming to receive the amounts due under BM´s 32 and 33.

On October 30, 2013, OSX started an arbitration process

against TEBRA in order to discuss the termination of the

contract for the construction of WHP-2. On November 8,2013, OSX sent TEBRA the notice to inform that the contract

has been terminated by TEBRA´s exclusive fault, and to

reiterate that the BMs are not payable.

On November 11, 2013, a counter-notification was sent

which alleged that OSX was the sole responsible for the

termination of the contract.

On that same day, OSX requested Judicial Reorganization

for its Brazilian group of companies, which was granted

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MÉXICO

During this year, the Company’s subsidiary in Mexico, Techint

S.A. de C.V. (TEMEX), completed two projects: the Tuxpan

Compressor Station project for Energía de Occidente de

México S. de R.L. de C.V. and the Norte II Combined CyclePower Plant for KST Electric Power Company.

The main project executed during the period are:

Tamazunchale Facilities – Transportadora de Gas Natural de la

Huasteca S. de R.L. de C.V.

This project consists in the engineering, procurement,

construction and commissioning of one compressor station,

by the Courts of Rio de Janeiro, preventing the creditors

to receive the amounts due. Therefore, the judicial

proceedings initiated aiming to receive payment for the

BMs 32 and 33 were suspended.

On December 20, 2013, the defense in the arbitrationprocess was filed, together with a counterclaim related to the

construction of WHP-2. The arbitration process against OSX for

discussing the termination of WHP-1 started on this same date.

Given this scenario, the Company discontinued the

performance of the contract and limited revenue from this

project to those amounts that had been actually collected.

Also, the Company recognized costs incurred and measured

up to December 31, 2013.

Techint was chosen to build in Mexico the Compression Station and the expansion of existing facilities of theNaranjos - Tamazunchale Natural Gas Pipeline. This work will allow the expansion of the 123-km pipeline from465 MMSCFD to 886 MMSCFD.

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and five additional stations for control, measurement and

regulation purposes. These works are being performed in

Tamazunchale (San Luis Potosi State), El Cardonal (Hidalgo

State) and El Sauz (Queretaro State). The total contract value

is USD 70 million. As of December 31, 2013, the overall

progress of the project was 83%.

Naranjos Compressor Station – Transportadora de Gas Natural

de la Huasteca S. de R.L. de C.V.

This project consists in the design, engineering, procurement,

construction and commissioning of one compressor station

at Km 18 of the Tamazunchale Pipeline in Naranjos (Veracruz

State). It also includes the expansion of the measurement,

reception and control station in Naranjos site and the delivery

station in Tamazunchale. The total amount of the contract

is USD 39 million. As of December 31, 2013, the overall

progress of the project was 58%.

Tuxpan Compressor Station – Energía Occidente de México S.

de R.L. de C.V.

The project, whose completion was achieved in January

2013, consisted in the engineering, procurement and

construction of facilities for the assembly and commissioning

of the compressor station. The client was in charge of the

procurement activities related to the compressor.

Norte II CCC Power Project - KST Electric Power Company

The completion of this project was achieved in December

2013. The project consisted in the design, engineering,procurement, construction, installation, commissioning,

testing and completion of a combined cycle gas turbine

power plant with a net capacity of at least 433 MW in

Chihuahua, Mexico. The contract was developed under a JV

with Samsung Engineering, where TEMEX’s participating

interest was 19%.

Ethane Pipeline Project - Gasoductos del Sureste S. de R.L. de C.V.

The project scope includes the engineering, procurement,

construction, commissioning, testing and start up of the 24’,

20’ and 16’ ethane gas and liquid pipeline, approximately

236 km long, and related facilities, which begins near Ciudad

Pemex (Tabasco State) and ends at the delivery point next

to Ethylene XXI Plant (Veracruz State). The contract amount

for this project is USD 242 million. As of December 31, 2013,

the overall progress of the project was 26%.

Construction Works - Ternium de México S.A. de C.V.

Professional services for placement of personnel and

materials for the execution of construction works (including

civil and electromechanical works) and structure mountings.

During this year, the most important activities were

performed for the Greenfield Pesqueria Project. This Project

entails a Galvanizing Plant to provide the automotive industry

with steel products, and a Cool Rolling Plant to process

the Hot Rolled pickled strips. As of December 31, 2013 the

overall progress was about 95%.

Additionally, TEMEX executed different works in Ternium

plants all over Monterrey City.

Total income for this period was USD 225 million.

Construction Works – Tubos de Aceros de México S.A. de C.V.

This contract provides professional services for placement

of personnel and materials for the execution of construction

works (including civil and electromechanical works), structure

mounting and maintenance with an average of 600 people

working on a direct basis, in Veracruz State. Total income for

this period was USD 45 million.

Heavy Duty Cleaning Service – Tubos de Aceros de México S.A.

de C.V.

This service is being provided through Sidernet S.A. de

C.V. since April 2005, and it comprises the reception of raw

materials in the scrap yard, transportation and processing of

slag, and the recovery, cutting and classification of metal junk.

During this period, this contract had an average of 180

people working on a direct basis. Total revenue for the year

was approximately USD 8 million. The current contract was

awarded in 2009 for a nine-year term.

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additional orders is USD 247 million. As of December 31,

2013, the works recorded 98% progress.

Camisea Pipeline Maintenance – Compañía Operadora de Gas

del Amazonas S.A. (COGA)

The Company provides the maintenance of this gas pipeline.

In December 2013, the contract was renewed for a 24-month

period and for an amount of USD 95 million.

Kepashiato Compression Plant Project – Transportadora de Gas

del Perú S.A. (TGP)

TESAC (60%) and the company Graña y Montero S.A.

(GyM) (40%) created in Peru the joint venture Consorcio

Construcciones y Montajes (CCM) for the sole purpose of

signing for and executing the works of engineering, partial

procurement and construction of a natural gas compression

plant which will be located at kilometric mark 127 of TGP’s

Natural Gas Transportation System.

In September 2013, the joint venture signed the above-

mentioned contract with Transportadora de Gas del Perú S.A.

(TGP). The works will be executed at Kepashiato (Department

of Cusco) and the mobilization stage for this project

commenced in October 2013, and the term for development

will extend until December 2015. The contract amount is

USD 132 million.

Camisea Well Head Compression Project

EPC 30 – Pluspetrol Perú Corporation S.A.

In December 2011, the Company received from PluspetrolPerú Corporation S.A. a Letter of Intent and a Notice to

Proceed with the engineering and procurement of main

materials and the installation of two gas compression trains.

The works were commenced in January 2012 and were

completed in May 2014.

Fénix Power Project – Fénix Power Perú S.A.

In October 2011, the Company was awarded a contract for

the above ground mechanical instal lation for Fénix Power

Perú S.A. This includes the installation of the steam turbine

Petacalco Project, Maintenance and Operational Contract -

Comisión Federal de Electricidad (CFE)

Carbonser, S. A. de C.V., of which TEMEX owns 50%, was

established on August 8, 1994, and its main activity is

to provide services for loading and transportation of coal

from Lázaro Cardenas port to the President Plutarco Elias

Calles power plant, located in Petacalco Guerrero. During

this twelve-month period ended December 31, 2013, the

Company unloaded 5.6 million tons of coal and delivered

5.8 million tons. Total revenue for this year amounted to

USD 39 million.

CENTRAL AMERICA AND THE CARIBBEAN

During the twelve-month period ended December 31, 2013,

the Company continued working in the Central American

Interconnection System (SIEPAC), focusing on performing

pending issues during the guarantee period of the project.

During this period, TEMEX is expecting to receive the

final acknowledgement of the project after the end of the

guarantee period.

PERU

TESAC, the Company’s subsidiary in Peru, continues

increasing its sales during this period.

The most outstanding projects in progress executed during

the period are the followings:

Toromocho – Minera Chinalco Perú S.A.In March 2012, the Company was awarded a contract by

Minera Chinalco Perú S.A. for the partial procurement and

complete construction of concrete placement; structural

steel, architectural, mechanical, piping, painting, electrical and

instrumentation services for the hydromet plant, filter plant

and offloading and storage facilities in the rail yard area, as

well as the procurement and construction of all electrical and

instrumentation works of several areas for the same project.

The project started in March 2012 and it is estimated to

be completed in June 2014. The contract amount plus any

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generator, steam surface condenser, steel structures, piping,

and all balance of plant equipment.

At the end of December 2011, TESAC was awarded an

extension of the main contract for the installation of all

the above ground electrical package. In October 2013, the

Company received the Certificate of Substantial Completion,

effective on June 26, 2013.

ECUADOR

Shushufindi Services – Consorcio Shushufindi

The Company, through its subsidiary, Construcciones y

Prestaciones Petroleras S.A. (CPP), renders specialized

technical services relating to engineering, procurement

management and work construction at the Shushufindi

Aguarico field, province of Sucumbíos, eastern Ecuador, for

Consorcio Shushufindi (formed initially by Schlumberger

(65%), Tecpetrol (25%) and KKR (10%)). The client aims at

increasing the production of the whole field.

During this period, the following activities were executed:

construction of facilities and 43 new wells on new platforms

or extension of existing ones, improvement of facilities and

20 existing wells on old platforms, execution of 28 km in flow

lines for testing and conduction (4" and 6"), and execution of

10 km of electricity lines, 15 KVA.

Besides, it is important to highlight the commencement of

construction of a Water Injection Pilot Plant at the Northern

Station for secondary recovery of 40,000 Bpd.

Total income for the twelve-month period was approximately

USD 136 million, using 1,700,000 man-hours.

COLOMBIA

Oleoducto Al Pacífico Project – Enbridge (Colombia) S.A.S.

Enbridge awarded the Colombian branch a contract for the

conceptual engineering of a pipeline to transport heavy crude

along 700 km from the Llanos basin to the Pacific coast.

During 2013, the Company continued with the first stage of

the Environmental Diagnosis of Alternatives. This contract

was awarded in February 2013 and it was completed in

June 2013. In August 2013, a new contract was signed forExtended Engineering Phase I.

PANAMA

EPCM – Mina de Cobre Panama Project – Minera Panama S.A.

(MPSA)

This project was executed by Joint Venture Panama INC. (JVP),

the company was created between The Company (15%),

SNC Lavalin (70%) and Graña y Montero (15%). The scope of

the works involved basic engineering for a processing plant,

tailings management facility, port facility, coastal road and

utility corridor from the port facility to the processing plant,

filtration plant, concentrate storage facility, together with all

associated civil and earthworks and all ancillary and supporting

structures, improvements and interconnections, related to

the development of the Mina de Cobre Panama; as well as

basic engineering for all earthworks related to the power

plant, and detailed engineering, procurement and construction

management services for all aspects of the project, other than

the processing plant.

During 2013, MPSA informed that First Quantum had

acquired its control shares. Immediately after that takeover,

MPSA ordered the suspension of the works, and therefore

instructed JVP to begin with demobilization actions. As of

the date of this Annual Report, JVP is subject to a process of

contractual termination with the client.

EUROPE AND COMMONWEALTH OF INDEPENDENT

STATES (CIS)

Projects developed by TEMIL and their subsidiaries:

Dunkerque LNG (France) - Électricité de France (EDF)This contract, awarded in 2011, is an engineering, procurement

and construction (EPC) contract under a Lump Sum Turn Key

formula (LSTK) for a regasification terminal for liquefied natural

gas (LNG) located in Dunkerque (France) for the customer EDF

(Électricité de France). The plant has a regasification capacity

equal to 13 billion m3 a year. The terminal comprises three

cryogenic tanks with a storage capacity of 190,000 m3 each

and a jetty for the berthing of LNG tank ships with a capacity

of up to 70,000 m3. Approximately 2,400,000 direct hours

are budgeted for construction.TEMIL leads the joint venture with the Spanish company,

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Baltic Sea), in the northwest of Poland.

At December 31, 2013, the physical part of the project is

78% completed. The project is scheduled for completion at

the beginning of 2015.

Zeebrugge LNG (Belgium) - Fluxys LNG

The project was awarded to TEMIL in April 2013 by the

customer Fluxys LNG, the main Transmission System

Operator (TSO) of gas in Belgium and one of the biggest in

Europe. This is an EPC LSTK contract for the expansion of the

LNG regasification terminal, including the commissioning,

start-up and the performance test, at the port of Zeebrugge

in Belgium. Specifically, the scope of the work includes

the construction of the loading arms on the second quay

(including related civil works), interconnecting to the plantand expansion of the fuel gas system.

Sener Ingeniería y Sistemas S.A., in building the plant,

including marine works.

The contract amount is USD 765 million, TEMIL´s share is 50%.

At December 31, 2013, works recorded 40% progress. The

conclusion of the project is scheduled for the end of 2015.

Polskie LNG (Poland) - Polskie LNG (Gaz System)

The scope of the work involves the construction of an LNG

terminal for a regasification capacity of 5 billion m3 a year,

with two tanks with a capacity of 160,000 m3 each and a

jetty. This is an EPC LSTK contract. TEMIL participates in the

project in an agreement with Saipem and the Polish company

PBG. The client is Polskie LNG (owned of Gaz-System S.A.).

The contract was signed in July 2010 and is approximately

worth USD 782 million, TEMIL’s share is USD 261 million.The LNG terminal is being built in Swinoujscie, (a port on the

Dunkerque project (France): Techint E&C, in consortium with Sener, is building an LNG regasification terminal forElectricité de France with an annual capacity of 13 million cubic meters, equivalent to 20 % of the Belgian and Frenchannual consumption of natural gas.

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At the level of the execution plan, TEMIL is in a 50%/50%

joint venture with Sener Ingeniería y Sistemas S.A. The

duration of the project up to when the terminal will be taken

over by the client is expected to be 26 months. The contract

is worth USD 103 million (TEMIL share is USD 51,5).

At December 31, 2013 works recorded 8% progress.

Norilsk – Copper and nickel Plant (Siberia, Russia) - Norilsk Nickel

The project consists of the development of the Front End

Engineering Design (FEED) and obtaining the relevant

permits for the construction of two plants for reducing

emissions of sulfur dioxide (SO2) produced by two existing

copper and nickel treatment plants. These plants are located

in Norilsk, a Siberian city located beyond the Arctic Circle.

The customer, Norilsk Nickel, is one of the world's leading

manufacturers of nickel and palladium and has the largest

reserves in the world of nickel and copper. The contract value

of the project is approximately USD 124 million.

The activities on the copper plant are scheduled for

completion by the end of 2015. At December 31, 2013 total

activities on the copper plant are 63% completed.

Isobutano Rotterdam (Netherlands) - LyondelBasell

For the client LyondelBasell, TEMIL is performing services

for the engineering, procurement and management of the

activities on site, in particular the construction supervision and

commissioning assistance. The scope of the work is a plant

revamping to double capacity with an increase of 63,000 kg/h.

The project is worth more than USD 11 million and completionis scheduled for 2015.

MIDDLE EAST

Yanbu – Solid Handling System (Saudi Arabia) - YASREF

(JV formed by Saudi Aramco Oil Company and China

Petrochemical Corporation (Sinopec))

The Yanbu Export Refinery Project (YERP) includes the

construction of a new grass roots refinery capable of processing

400,000 barrels/day. TEMIL scope includes Engineering,

Procurement, Construction, Commissioning Support and Start-

up of the package related to the movement system for sulfur

and coke, which comprises the following units: Sulfur Pelletizer

& Transport & Storage, Coke Transport & Storage and Industrial

Port Storage & Loadout Facilities.

The molten sulfur is solidified, reduced in pellets and

transported to a loading station. The coke is transported

from the Coke Delayed Coker (outside the work scope) to a

loading station. Finally, coke and the sulfur solids are stored

and loaded on a ship with a ship loader.

The project is worth more than USD 269 million. The client

is YASREF. The project started in October 2010 and at

December 31, 2013 is 91% completed. Conclusion of the

work is estimated for August 2014.

Ruwais Sulfur Handling Terminal 2 (Abu Dhabi, United Arab

Emirates) – Abu Dhabi Gas Industries Ltd. (GASCO) – Abu Dhabi

National Oil Company (ADNOC)

The project is located in Al Ruwais, Abu Dhabi, United Arab

Emirates, and includes engineering, procurement, construction

and commissioning for the construction of a plant for storage

and handling of 11,000 tn of sulfur per day (both liquid and

solid). The project was commissioned by GASCO, an important

Oil & Gas company, which is part of the ADNOC group. The

value of the project is approximately USD 331 million.

Solid sulfur is transported by rail from the GASCO plants,

where it is solidified into pellets. Once unloaded from the

trains, the sulfur is stored in the storage buildings andsubsequently prepared for export through a system of

movement consisting of conveyor belts and a ship loader.

The project started in January 2011, and at December

31, 2013 is 94% completed. The project is scheduled for

completion in the second half of 2014.

Upgrading Hout Onshore Crude Facilities (Saudi Arabia) - Al-Khafji

Joint Operations (KJO)

The project covers the EPC for the upgrading of a petrochemical

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AFRICA

El Ain El Sokhna – Supercritical Thermal Power Plant (Egypt) -

East Delta Electricity Production Company (EDEPC)

The project includes the balance of mechanical plant for

the supercritical thermal power plant at El Ain El Sokhnacomposed of two 650-MW units (about 60 km south of

Suez in Egypt)

The project is worth more than USD 69 million.

The customer is East Delta Electricity Production Company

(EDEPC), owned and controlled by the Egyptian Ministry of

Electricity and Energy. The work began in May 2011 and at

December 31, 2013 is more than 98% complete.

The project is scheduled for completion in September 2014.

plant located in Khafji (Saudi Arabia), near the border with

Kuwait, aimed at maintaining the current production capacity of

50,000 barrels a day.

The process consists of the separation of the emulsified

water and hydrogen sulfide, found in always higherpercentages in extracted crude oil.

The customer is Al-Khafji Joint Operations (KJO), a

partnership between ARAMCO Gulf Operations Company

(AGOC) and Kuwait Gulf Oil Company (KGOC).

This is an EPC LSTK contract worth more than USD 178 million.

Engineering and procurement activities were successfully

completed, and construction activities recorded 94%

progress. The project is expected to be completed by the

second half of 2014

Ruwais project: in the Arab Emirates Techint E&C is building a sulphur handling terminal. The project consists of aterminal to receive, store and export 22,000 Tons per day of granulated sulphur coming from Habshan and Shah plantsvia rail network.

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ENGINEERING

The engineering department, with the incorporation of

Milan and India offices, is currently structured to executed

about 1,7 million man-hours per year.

The main engineering works performed are related to

projects under development and others already completed,

among which the following are highlighted:

Punta Negra Hydroelectric Station (Argentina): Development

of detail engineering of the dam and other facilities of the project.

Axion Energy (Argentina): Feasibility studies; concept

engineering; basic and/or extended basic engineering; processunits and services of the Campana Refinery Expansion Project.

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LimaPerú

Santiago

Chile

Buenos Aires

Argentina

MilánItalia

São PauloBrasil

BombayIndia

BogotáColombia

OUR ENGINEERING OFFICES

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YPF (Argentina): Development of engineering (concept / basic

/ extended basic) at new facilities and/or plants or modifications

to existing facilities and/or plants, belonging to the different

YPF’s business units in Argentina.

Comperj (Brazil): Engineering of the project for execution of

the Delayed Coking Unit, Power Substations and other works

for Rio de Janeiro Petrochemical Complex.

Platform P-76 (Brazil): Engineering services including

technical analysis of FEED and basic engineering under a JV

with Technip for Petrobras.

Direct Reduced Iron (DRI) Plant – Vale (Brazil): Engineering

studies for a steel production plant based on Direct Reduced

Iron (DRI).

Solvents Extraction and Electrowinning Plant - Antucoya

Project for Bateman Chile S.A. (Chile): Detail engineering

for final client Minera Antucoya, including engineering on

Extraction Trains, Loaded Organic Matter Ponds, Refining and

Electrolyte Post Decanters, Electrolyte Pumping Systems,

Electrolytic, Rectifying Transformers and Bar Systems, Gantry

Cranes, Cathode Washing and Removing Machine.

Consulting Services Project – Oleoducto Central S.A.

(Colombia): Concept engineering, including analysis and

selection of alternatives. This contract was awarded in March

2013 and it was completed in September 2013.

Shushufindi Field Project (Ecuador): Development of

engineering (basic or detail) in new facilities and/or plants,

or in changes to existing facilities and/or plants, in relation to

hydrocarbon exploitation fields; preparation of documents

necessary for: specification of equipments and materials, sub-

contracts for accessory/supplementary works and services

(civil, electricity, mechanical, etc.), and the relevant assembly.

Basic Engineering for Pesquería Thermal Power Plant(Mexico): Development of basic engineering for a power

generation plant consisting in a Combined Cycle Power

Plant with a 3 x 1 arrangement, related to a 400kW

Power Substation. Basic engineering for transmission line

between the 400kW Power Substation and the Ternium

Pesquería Plant.

Cangrejera Ethane Pipeline (Mexico): Detail engineering

according to the client’s design bases, technical procurement

for material and equipment, management of tests on site

and ex works (at the factory).

Naranjos Facilities (Mexico): Detail engineering for this

project including, among other activities, facilities design, on-

site assistance during construction, testing, commissioning

and performance test; material specifications, issuance of

BOM, HAZOP, etc.

Gas Compression Station KP127 (Peru): Basic and detail

engineering, procurement management of main equipment

for Transportadora de Gas del Peru.

Norilsk Copper - Sulfur Recovery Plant: Completion of

tests on pilot plants, engineering activities for Front End

Engineering Design.

ENEL (Ente Nazionale per l´Energia elettrica ) Nuclear

Plant Mochovce - Auxiliary Unit Design: Project validation

task completion, completing tasks of detail engineering

for piping and supports. Other engineering services at thetechnical department of the site and ENEL offices.

APG (Associated Petroleum Gas) SIBUR: Preliminary

project for LPG recovery from the associated gas.

LNG Dunkerque: Continuation of the detail design activities

for the regasification terminal.

Sulfur Terminal 2 Ruwais: Technical office activities on site,

functional tests for Distributed Control System (DCS) andtelecommunication system.

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PROCUREMENT

The main actions of Procurement were related to the projects

in progress stated in the section Engineering and Construction,

and also to the bidding processes carried out in this period.

The goals set for this twelve-month period go deeper into

the global strategy of Procurement and the continuous

improvement process started in previous stages, focusing

on enhancing the Company’s competitiveness based on the

following initiatives:

Global: Permanent improvement in IT tools and systems

tools applied to the management, getting efficiency,

standardization of processes and procedures and uniformity.

Thorough analysis of the competitors in the market,

identifying both technical and commercial opportunities for

the Company, with the goal of increasing our potential in bids

and our efficiency in the projects in progress (environment,

safety, productivity, reliability, etc.).

Such activity is supported by a scouting and sourcing

process, which started in 2011 and which was instrumented

through the execution of long-term agreements with

alternative supply sources.

Policies and Procedures: The Company kept on developing

new procedures and processes jointly with the AuditDepartment and the Improvement Committee, which ensure

the global application of best practices so as to optimize

management transparency and cost efficiency.

Workshops: several activities were conducted, with a

focus on keeping practices and processes aligned and

strengthening the implementation of IT tools, such as the

Suppliers’ Portal, the bidding portal, and the bid system

(PReMO), in order to intensify their use.

Full revision of the methodologies used in European Sector,

in order to take all the appropriate actions necessary to

achieve full alignment with the Company.

Involvement of the Procurement department in the bid phase

Such activities and principles will be reinforced so as to keep

on identifying opportunities, at Company level as well as in

the market.

TECHINT E&C EQUIPMENT DIVISION

During the period, the Equipment Management sector

completed the implementation of a reengineering process

for this area, aimed at optimizing investment in construction

equipments and their allocation to projects, reducing

operating costs, by means of the improvement, among

other aspects, of efficiency and efficacy of repairs, building

a differentiating and competitive improvement factor, and

increasing productivity in projects.

This Division completed the implementation of new control

tools , and this enabled the follow-up of this management

through key performance indicators.

The investment value in equipment, machinery and vehicles

for the twelve-month period was USD 35 million.

HEALTH, SAFETY AND ENVIRONMENT (HSE)

TECHINT E&C has consolidated its preventive management(industrial safety, occupational health and environmental

protection) as an intrinsic value of its activities, by assigning

high priority to such management. The Company focused

on the effectiveness and productivity of preventive tools, by

means of the implementation of the Integrated Management

System (IMS).

The IMS is based on the principles of self-management

and good practices, which are possible taking into account

a key factor: thoroughness and discipline in operations,thus promoting the culture of prevention, starting with

self-reflection and effective actions to apply the IMS on a

constant and effective basis in each scenario.

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The IMS, endorsed by our clients, has been certified

under the most stringent international standards set forth

in ISO 14.001:2004 and OHSAS 18.001:2007, for all the

projects of the Company.

The sustainable reduction of global accident rates proves

the IMS to be sound and shows the strong commitment to

prevention at all Company levels, which is acknowledged as

a value by all clients.

Management’s leadership has strongly contributed to

creating commitment in the entire Organization so as to

minimize the recurrence of incidents and accidents, in

addition to taking actions related to equipment and facilities

as well as safety at the workplace.

We must state that preventive actions in the period have

achieved the following:

Safety: low loss results.

Predictability: planning and compliance with such plans.

Thoroughness: in preventive tools with high Company’s

standards.

Transparency: timely communication, participative discussionand traceability of decisions.

Professionalism: rational and methodic actions.

HR Development: preventive training, awareness and

opportunity for growth.

Consolidation in the use of indicators: to improve

performance and a timely decision-making.

QUALITY

The Company established and sustains a Management

Policy focusing its efforts on meeting and exceeding the

expectations of its clients, shareholders, collaborators,

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In Argentina, Techint E&C is carrying out the management of the Cerro Negro mining project, which includes theconstruction management of 60 km of a 132 kV line and a transforming station.

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suppliers and the communities where it operates.

In particular, the Company has specially focused on

improving the reliability of the products offered and services

rendered.

The Company is clearly oriented to continuous improvement,

and it pays special attention to efficiency, simplification of

processes and value added in each of its operations.

During 2013, the following actions have been completed,

among others:

Increasing progress in the Knowledge Management Project,

including tools for capturing lessons learned in projects at

all levels.

Development of a new model of simplified performance

indicators scorecard to be implemented in all Company’s

processes.

Systematic analysis of client’s satisfaction in the different

projects, and reporting to the Management for the purposes

of centralized decision-making.

Consolidation of staff teams for projects. Rotations

and training.

During 2013, the Company received two external audits from

Det Norske Veritas to verify compliance with standards ISO

9001:2008, with positive results.

The Company has maintained and consolidated a directionfocused on the adoption for its projects of standardized

methodologies based on experience, as well as the

reliance on truthful, updated and transparent information

so as to minimize risks, avert problems and ensure

the predictability of results in order to comply with its

commitment to meet and exceed the expectations of all

related stakeholders.

TECHNOLOGY AND IT SYSTEMS

During the period, progress continued to be made in

several IT internal projects related to improvements in

technological infrastructure, upgrade to new software

versions and implementation of new solutions to cover

different business processes. The most outstanding IT

projects were the following:

Completion of the project for the implementation of new

SAP modules for HR management.

Internal scorecards for the Procurement and HSE-MASS areas.

Launching of a project for control and follow-up of purchases.

Expediting system.

Progress was made in the implementation of the Company’s

new Web Site.

Progress was also made in an internal review project to

detect needs for implementation of new tools, with a

higher integration for Engineering, Material Management,

Procurement, Planning, Management Control, and Document

Management processes.

Launching of the project for integration of Engineering tools

2D / 3D Intergraph SmartPlant and completion of the 4D

pilot project, integrating Smartplant Schedule Review with

Primavera.

Completion of the implementation of the SAP – GRC Access

Control solution, to facilitate and improve access control and

permit allocation within SAP.

SAP“Go Live

” to replace the SAP system which was used in

the European Sector; as a consequence of such launching, may

training activities are being conducted which involve all users.

In order to offer standalone technological infrastructure and to

increase its level of reliability, it was decided to install a new

Data Center, which is administered by a subcontractor company

located in Milan, having a Tier 3+ certification; such Data Center

will become integrated to the corporate information system.

>

>

>

>

>

>

>

>

>

>

>

>

>

>

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44

T E C H I N T

E & C

S . A .

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46

T E C H I N T

E & C

S . A .

In San Juan, Argentina, Techint E&C is carrying out the Punta Negra Hydroelectric Station project, constituted by a dam that willgenerate a reservoir with a surface of 1,214 hectares, and a hydroelectric powerplant with two turbines of 31.1 MW each.

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2 0 1 3

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48

T E C H I N T

E & C

S . A .

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2 0 1 3

SPECIALCONSOLIDATEDFINANCIAL STATEMENTS

TWELVE-MONTH PERIOD ENDED DECEMBER 31, 2013

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50

T E C H I N T

E & C

S . A .

In the northwest of the province of Santa Cruz, Argentina, the location of the Deseado Massif, the source ofmineralizations bearing gold and silver, Techint E&C is managing the work of the contractors of the client GoldCorp.

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52

T E C H I N T

E & C

S . A .

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54

T E C H I N T

E & C

S . A .

ALL AMOUNTS IN USD THOUSANDS

ASSETS

Non-current assets

Property, plant and equipment (PP&E)

Intangible assets

Investments accounted for using the equity method

Other investments

Non-current tax assets

Trade and other receivables

Deferred income tax assets

Total non-current assets

Current assetsInventories

Derivative financial instruments

Current tax assets


Construction contracts work in progress

Assets of disposal group classified as held for sale

Other investments

Cash and cash equivalents

Total current assets

Total Assets

354,478

10,687

10,066

7,567

33,319

271,114

81,572

768,803

41,782

4,119

70,568

797,188

72,276

165

12

576,242

1,562,352

2,331,155

4

5

6

7

8

15

9

26

8

11

7

12

DEC 31, 2013 (*)

SPECIAL CONSOLIDATED STATEMENT

OF FINANCIAL POSITION

Twelve-month period ended December 31, 2013

NOTES

(*) See note 2.a

The accompanying notes are an integral part of these special consolidated financial statements.

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56

T E C H I N T

E & C

S . A .


Revenues from construction contracts and other services

Cost of revenue

Gross profit

General administrative and selling expenses


Operating income

Financial income

Financial costs



Income tax expense

Net Income (1)

(1) Attributable to:

Equity holders of the Company


Net Income

2,316,134

(2,005,873)

310,261

(180,215)

(12,235)

117,811

34,852

(22,741)

5,848

135,770

(52,509)

83,261

78,974

4,287

83,261

27

27

29

28

28

6

30

DEC 31, 2013 (*)NOTES

SPECIAL CONSOLIDATED INCOME STATEMENT


(*) See note 2.a The accompanying notes are an integral part of these special consolidated financial statements.

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57


2 0 1 3

Net Income

Other comprehensive income:

Items that will not be reclassified to profit or loss

Increase of revaluation of PP&E net of tax

Decrease of revaluation of PP&E net of tax

Pension Plan Benefits

Subtotal items that will not be reclassified to profit or loss

Items that may be subsequently reclassified to profit or loss

Currency translation differences

Cash flow hedgeSubtotal items that may be subsequently reclassified to profit or loss

Other comprehensive income for the twelve-month period, net of tax

Total comprehensive income for the twelve-month period (2)

(2) Attributable to:

Equity holders of the Company

Non-controlling interest

83,261

59,358

(2,798)

(1,935)

54,625

(83,676)

830

(82,846)

(28,221)

55,040

53,936

1,104

55,040

4

4


OF COMPREHENSIVE INCOME


ALL AMOUNTS IN USD THOUSANDS NOTES DEC 31, 2013 (*)

(*) See note 2.a The accompanying notes are an integral part of these special consolidated financial statements.

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58

T E C H I N T

E & C

S . A .

Balance at December 31, 2012

Net income for the twelve-month period

Other comprehensive income

Increase of revaluation of PP&E net of tax

Decrease of revaluation of PP&E net of tax

Depreciation of reserve for PP&E revaluation surplus net of tax Decrease of reserve for revaluation surplus due to PP&E disposal net of tax

Pension Plan Benefits

Cash flow Hedge

Currency translation differences

Total comprehensive income for the twelve –month period

Capital increase approved by the Extraordinary Shareholders’ meeting held on 03.15.13

Incorporation of subsidiary – TEIC

Resolution of the Shareholder´s meeting held on 10.21.13:

Board of Directors' fees Legal Reserve

Reserve for future dividends

Incorporation of subsidiary - TEMIL

Irrevocable contributions approved by the Board of Director´s meeting held on 12.06.13

Changes in non-controlling interests – Dividend distribution

Balance at December 31, 2013

LEGAL

RESERVE

–

–

–

–

–

–

–

–

–

–

–

–

–1,216

–

–

–

–

1,216

CAPITAL

STOCK

3

–

–

–

–

–

–

–

–

–

709,178

–

––

–

–

–

–

709,181

IRREVOCABLE

CONTRIBUTIONS

–

–

–

–

–

–

–

–

–

–

–

–

––

–

–

67,300

–

67,300


OF CHANGES IN EQUITY

Twelve-month period ended December 31, 2013(*)


4

4

4

4

1

1

NOTES

(*) See note 2.a

The accompanying notes are an integral part of these special consolidated financial statements

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59


2 0 1 3

CAPITAL

SURPLUS

–

–

–

–

–

–

–

–

–

–

–

94,654

––

–

(3,631)

–

–

91,023

CUMULATIVE

TRANSLATION

DIFFERENCES

–

–

–

–

–

–

–

–

(80,143)

(80,143)

–

(129,142)

––

–

1,870

–

–

(207,415)

RESERVE

FOR PP&E

REVALUATION

SURPLUS

–

–

59,287

(2,798)

(7,133)

(3,174)

–

–

–

46,182

–

34,300

––

–

–

–

–

80,482

RETAINED

EARNINGS

–

78,974

–

–

7,133

3,174

–

–

–

89,281

–

–

(21)(1,216)

(29,000)

–

–

–

59,044

RESERVE

FOR CASH

FLOW HEDGE

–

–

–

–

–

–

–

830

–

830

–

188

––

–

7

–

–

1,025

RESERVE FOR

PENSION

PLAN

BENEFITS

–

–

–

–

–

–

(2,214)

–

–

(2,214)

–

–

––

–

(317)

–

–

(2,531)

RESERVE

FOR FUTURE

DIVIDENDS

–

–

–

–

–

–

–

–

–

–

–

–

––

29,000

–

–

–

29,000

TOTAL

3

78,974

59,287

(2,798)

–

–

(2,214)

830

(80,143)

53,936

709,178

–

–

(21)–

–

(2,071)

67,300

–

828,325

NON -

CONTROLLING

INTERESTS

–

4,287

71

–

–

–

279

–

(3,533)

1,104

–

19,460

–

––

–

862

–

(6,678)

14,748

TOTAL

EQUITY

3

83,261

59,358

(2,798)

–

–

(1,935)

830

(83,676)

55,040

709,178

19,460

–

(21)–

–

(1,209)

67,300

(6,678)

843,073

ATTRIBUTABLE TO THE COMPANY´S EQUITY HOLDERS

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60

T E C H I N T

E & C

S . A .

Cash flows from operating activities

Net Income for the twelve-month period

Adjustments to reconcile net income to cash flow operations

PP&E depreciation

Intangible amortization

Construction contracts in progress

Net provisions

Net allowance for doubtful accounts

Inventories valuation allowance

Income Tax accrued

Gain from the sales of PP&EImpairment loss

Interest accrued from trade and other receivables

Interest accrued from borrowings

Result from other investments


Other, including currency translation differences

Changes in balances corresponding to:

Trade accounts receivable and tax assets

InventoriesTrade and other payables and tax liabilities


Income tax payments

Other liabilities

Board of Director´s fees

Changes in non-controlling interests

Net cash generated by operating activities

83,261

50,244

4,167

(5,985)

(12,276)

18,858

10,905

52,509

(5,510)

5,535

(2,941)

5,101

(391)

(5,848)

(4,569)

89,697

21,290(27,384)

864

(42,219)

(110,929)

(21)

(6,678)

117,680

4

5

8

9

30

29

4

7

6


OF CASH FLOWS


ALL AMOUNTS IN USD THOUSANDS DEC 31, 2013 (*)NOTES

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61


2 0 1 3

Cash flows from investing activities

Proceeds from disposal of PP&E

Purchases of PP&E

Purchases of intangible assets

Other investments and investment accounted for using the equity method (net)

Dividend collected from investments accounted for using the equity method

Effect of Group’s restructure operation

Increase due to business combination

Net cash generated by investing activities

Cash flow from financing activities

Shareholders contributionProceeds from borrowings

Repayments of borrowings

Net cash generated by financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents at the beginning of the twelve- month period

Effect of exchange rate changes

Cash and cash equivalents at the end of the twelve-month period

Non-cash transactions

Capital Increase

Increase of revaluation of PP&E, net of tax effects

Decrease on revaluation of PP&E, net of tax effects

Pension plan benefits

Finance leases

Cash flow hedge

19,708

(55,643)

(4,301)

15,027

1,091

268,088

172,440

416,410

67,300

46,282

(64,681)

48,901

582,991

–

(17,168)

565,823

709,178

59,358

(2,798)

(1,935)

(5,434)

830

5

1

1

12

4

4


OF CASH FLOWS (cont’d.)


ALL AMOUNTS IN USD THOUSANDS DEC 31, 2013 (*)NOTES

(*) See note 2.a

The accompanying notes are an integral part of these special consolidated financial statements

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T E C H I N T

E & C

S . A .

In Argentina, the Punta Negra Hydroelectric Station project is advancing successfully on all working fronts, enriched by the experience of a great team of co-workers.

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2 0 1 3

INDEX TO THE NOTES TO THE SPECIAL

CONSOLIDATED FINANCIAL STATEMENTS

Basis of preparation

Consolidation

Foreign currency translation

Use of estimates


Intangible assets

Impairment of non-financial assets

Financial assets

Offsetting financial instruments


Inventories

Construction contracts work

in progress

Other investments


Trade and other payables


Equity

Borrowings

Current and deferred income tax

Employee benefits

Provisions

Revenue recognitionLeases

Assets of disposal group classified

as held for sale

General Information

Accounting policies

1.

2.

a.

b.

c.

d.

e.

f.

g.

h.

i.

j.

k.

l.

m.

n.

o.

p.

q.

r.

s.

t.

u.

v.w.

x.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.16.

17.

18.

19.

20.

21.

22.

23.

24.

25.26.

27.

28.

29.

30.

31.

32.

33.34.

Financial risk management


Intangible assets

Investments accounted for using

the equity method

Other investments


Inventories

Financial instruments by category

Assets of disposal group classified

as held for sale


Capital stock

Borrowings

Deferred income taxesTrade and other payables

Other liabilities

Provisions

Employee benefits

Participation in Joint Ventures

Contingencies and commitments

Restricted assets

Claims Receivables

Related party transactions

Principal SubsidiariesDerivative financial instruments

Cost of revenue and expenses by nature

Financial results


Income tax

Main contracts in progress

Contract with customer under judicial

recovery - WHP 1 and WHP 2 Platforms -

OSX WHP 1 & 2 Leasing Group B.V. (“OSX”)

Group´s restructure operationSubsequent events

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T E C H I N T

E & C

S . A .

NOTES TO THE SPECIAL CONSOLIDATED FINANCIAL STATEMENTSALL AMOUNTS ARE SHOWN IN USD THOUSANDS, UNLESS OTHERWISE STATED.

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>

NOTE 1.

GENERAL INFORMATION

LEGAL INFORMATION

Techint E&C Sociedad Anónima (Ex PROSAT S.A.) (“TECHINT

E&C”), a company controlled by Techint Investments N.V. is

a part of the Techint Group (“TG”). TECHINT E&C’s purpose

is to engage in investments by holding equity interests

in companies or organizations whose corporate purpose

includes engineering, construction and services. References

in these special consolidated financial statements to

“TECHINT E&C” or “Company” refer to TECHINT E&C S.A.

and its consolidated subsidiaries.

The Company was organized on July 4, 2012, originally

under the name PROSAT S.A., and its by-laws were written

according to the rules and regulations in force in Uruguay and

approved by the Uruguayan Domestic Audit Office (Auditoría

Interna de la Nación - AIN) on August 10, 2012.

In February 2013, a Special General Shareholders’ Meeting of

the Company changed the end of the Company’s fiscal year

to December 31 each year, and such change was effective as

from this year. On August 26, 2013, a Special Shareholders’

Meeting resolved to change the original corporate name of

the Company to Techint E&C Sociedad Anónima, and this

resolution was approved by AIN on May 14, 2014.

The Company holds the following direct investments:TEI&C S.A. (hereinafter, “TEIC”): Uruguayan company (100%)

Techint Ingeniería y Construcciones S.L.U. (hereinafter,

“TIC”): Spanish company, (100%), company merged with

Preglosid S.L.U. on July 24, 2013.

These special consolidated financial statements were approved

for issue by the Company’s Board of Directors on April 29, 2014.

CHANGES IN TECHINT E&C

On March 14, 2013, the Company acquired all the outstandingshares of TEIC, a company organized under Uruguayan laws,

and by virtue of this transaction it assumed a debt payable

to the controlling shareholder, Techint Investments N.V. On

March 15, 2013, a Special General Shareholders’ Meeting of

the Company decided to accept the capital contribution by

means of capitalization of a debt.

By virtue of the new business guidelines, TEIC provided for

a dividend in kind for the sum of USD 349,568 to be paid to

TECHINT E&C, through which payment it transferred all the

interests of the Spanish subsidiaries TIC and PREGLOSID

SLU, which companies consolidate the provision of

engineering, construction and management services mainly

of their subsidiaries in Argentina, Ecuador, Canada, Central

America, Netherlands and Mexico.

As a result of these transactions, TEIC focussed on

engineering, construction and management services,

especially of its subsidiaries in Brazil, Chile, Colombia, Peru,

and Uruguay.

CHANGES IN TECHINT E&C´SUBSIDIARIES

In April 2013, Techint S.A. de C.V. (“TEMEX”) acquired 100%

of a subsidiary in the United States of America, Techint

Engineering Technical and Commercial Services LLC, which

company has not started to operate yet. Also in April 2013,

the Special and Regular General Shareholders’ Meeting of

the ecuatorian company Construcciones y Prestaciones

Petroleras S.A. (“CPP”) capitalized contributions made by TIC.

On June 3, 2013, the Company decided to increase the

capital stock of TIC in Euro 13,804 thousand, equivalent to

USD 17,595 and this was charged to “Other shareholders’

contributions.”

On June 28, 2013, Techint Ingeniería y Construcción Bolivia

S.A. (“TEBOL”), increased its Capital for the amount of

USD 19.9 million by the partial capital ization of Techint

International Construction Corp. (TENCO) (“TENCO”)’s

last year contribution. Then TEBOL reduced its Capital byoffsetting accumulated losses in USD 19.7 million.

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On July 24, 2013, the merger of TIC with Preglosid SLU was

registered with the Business Registry of Madrid, effective

as from January 1, 2013. Such merger took place within a

restructuring process intended to concentrate the equity

and activity in the absorbing company, with the resulting

simplification of management and administration of the

business, by means of the adjustment of legal structures into

a single corporate unit.

On October 9, 2013, at a Board of Director’s Meeting,

TENCO decided to subscribe and register all the capital

stock of a new subsidiary in Uruguay, under the name of

“Wisdery S.A.”.

On November 11, 2013, as a consequence of a Group’s

strategic decision, TE&C Investments Netherlands B.V.

(formerly known as B.V. de Nieuwe Weg.) (“TE&C”) acquired

from two related companies 100% of their shares in the italian

company Techint Compagnia Tecnica Internazionale S.pA.

(“TEMIL”), which company, in turn, holds participating interests

in other companies in Europe, Asia and Africa.

On December 6, 2013, TIC received from the Company a

new contribution to its own funds for USD 68,000.

On December 9, 2013, Techint Chile S.A. (“TECHI”) and

Bechtel Chile Ltda, created two new companies in Chile:

“Ingeniería y Construcción Bechtel Techint EWS Ltda.” and

“Bechtel Techint Servicios Complementarios Ltda.”, being inboth cases TECHI’s participation 40% and Bechtel’s 60%.

On such same date, TEMIL became the owner of 100% of

Verrinvest Luxembourg S.A.

For the purposes of reestablishing the working capital of

TEMIL, on December 18, 2013, TE&C made a contribution for

USD 48,121 to cover accumulated losses, and on December

20, it also granted a financial loan for Euro 15 million.

On December 19, 2013, 100% of the investment in TechbauS.p.A. held by TEMIL was sold to third parties, which resulted

in a loss of Euro 10,192 equivalent to USD 13,894, included in

“Other operating results.”

On December 20, 2013, TENCO decided to make a

contribution for the amount of USD 12 million in the

uruguayan subsidiary Flinwok S.A. in order to reinforce

the financial position of its Uruguayan subsidiary Techint

Compañía Técnica Internacional S.A.C.I. (“TEURU”), Flinwok

used such funds to make a contribution for the total amount

of USD 13 million. On such same date, TEMIL sold the

whole investment in Limited Liability Company TMR –

Federazione Russa.

During this twelve-month period, the argentine company

Techint Compañía Técnica Internacional S.A.C.I. (“TEARG”)

increased its capital stock through the capitalization of

irrevocable contributions as partial payment for future

subscriptions of capital stock made in October 2012, and a

new contribution received from the controlling shareholder

in September 2013. Besides, the argentine holding Techint

Inversiones S.A.I.F. (“TEINVA”) capitalized irrevocable

contributions as partial payments for future subscriptions

of capital stock made by its shareholders in October 2012.

NOTE 2.

ACCOUNTING POLICIES

The principal accounting policies applied in the preparationof these special consolidated financial statements are set

out below.

a. BASIS OF PREPARATION

COMPARATIVE INFORMATION

The Company began to operate upon the incorporation of

TEIC (see Note 1), which was made effective based on the

consolidated financial statements of TEIC as of December

31, 2012. These special consolidated financial statements

comprise the special twelve-month period ended onDecember 31, 2013.

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T E C H I N T

E & C

S . A .


During the first period of activity, from July 4, 2012 to

December 31, 2012, the Company only received a capital

contribution commitment for incorporation purposes; it made

no other transactions.

The information of the Company’s balances, on a comparative

basis, as of the December 31, 2012 is shown below:


OF FINANCIAL POSITION

For the period ended December 31, 2012


OF CHANGES IN EQUITY

For the period ended December 31, 2012



Assets

Current assets


Other receivables

Total Assets

Equity

Capital Stocks

Total Equity

Initial Capital

Balance at December 31. 2012

DEC 31, 2012

3

3

3

3

3

3

3

CAPITAL

STOCK

3

3

TOTAL

3

3

NON -

CONTROLLING

INTERESTS

–

–

TOTAL

EQUITY

3

3

ATTRIBUTABLE TO THE COMPANY´S

EQUITY HOLDERS

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2 0 1 3


ACCOUNTING POLICIES

These special consolidated financial statements are prepared

in accordance with International Financial Reporting Standards

(“IFRS”), as issued by the International Accounting Standards

Board (“IASB”), under the historical cost convention, as

modified by the revaluation of machinery, equipment and

vehicles (“Revaluation of PP&E”), available-for-sale assets,

financial assets and liabilities (including derivative instruments)

at fair value through profit or loss, and translation of

subsidiaries whose functional currency is the currency of a

hyperinflationary economy. The special consolidated financial

statements are presented in thousands of U.S. dollars

(“USD”), which is the functional currency of TECHINT E&C.

The preparation of consolidated financial statements in

conformity with IFRS requires the use of certain critical

accounting estimates. It also requires management to

exercise its best judgment in the process of applying the

Company’s accounting policies. The areas involving a higher

degree of judgment of complexity, or the areas where

assumptions and estimates are significant to the special

consolidated financial statements, are disclosed in note 2.d.

CHANGES IN ACCOUNTING POLICY AND DISCLOSURES

Standards and amended standards mandatory for the first time

for the Financial Statements beginning January 1, 2013 and

adopted by the Company

IFRS 10, “Consolidated financial statements”

In May 2011, the IASB issued IFRS 10, “Consolidatedfinancial statements”. IFRS 10 replaces all of the guidance

on control and consolidation in IAS 27 and SIC-12. The new

definition of control sets out the following three elements:

power over the investee; exposure, or rights, to variable

returns from involvement with the investee; and the ability

to use power over the investee to affect the amount of the

investor’s returns. The adoption of the standard did not have

a material impact on the presentation of the Company’s

results of operations, financial position or cash flows.

International Accounting Standard (“IAS”) 1 (amended 2011),

“Presentation of financial statements”

In June 2011, the IASB issued IAS 1 (amended 2011),

“Presentation of financial statements”. The amendment

requires entities to separate items presented in Other

Comprehensive Income into two groups, based on whether

or not they may be recycled to profit or loss in the future.

See impact of the application in the special consolidated

statement of comprehensive income

IFRS 11 “Joint Arrangements” and IAS 28 (amendment)

“Associates and Joint Ventures”

In May 2011, the IASB issued IFRS 11, “Joint Arrangements”.

IFRS 11, supersedes the current IAS 31 about joint ventures,

and under this standard investments in joint arrangements are

classified either as joint operations or joint ventures, depending

on the contractual rights and obligations each investor has rather

than just the legal structure of the joint arrangement. Joint

operations arise where a joint operator has rights to the assets

and obligations relating to the arrangement and hence accounts

for its interest in assets, liabilities, revenue and expenses. Joint

ventures arise where the joint operator has rights to the net

assets of the arrangement and accounts for its interest under

the equity method. Proportional consolidation of joint ventures

is no longer allowed. The adoption of the standard did not have a

material impact on the presentation of the Company’s results of

operations, financial position or cash flows.

IAS 28 has been amended to include the requirements for

joint operation to be accounted for under the equity methodfollowing the issuance of IFRS 11.

IFRS 12, “Disclosures of interest in other entities”

In May 2011, the IASB issued IFRS 12, “Disclosures

of interest in other entities”. This standard includes the

disclosure requirements for all forms of interest in other

entities. The adoption of the standard did not have a material

impact on the presentation of the Company’s results of

operations, financial position or cash flows.

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IFRS 13, “Fair value measurement”

In May 2011, the IASB issued IFRS 13, “Fair value

measurement”. IFRS 13 explains how to measure fair value

and aims to enhance fair value disclosures. According to IFRS

13, this standard has been applied prospectively from the

beginning of the annual period in which it is initially applied.

The disclosure requirements of this IFRS do not need to be

applied to compare information provided for periods prior to

the initial application of this IFRS. The main impact relates to

new disclosures and there is no impact on the presentation

of the Company’s results of operations, financial position or

cash flows. See note 10 “Determining fair values”.

IAS 19 (amended 2011), “Employee benefits”

In June 2011, the IASB issued IAS 19 (amended 2011),

“Employee benefits”, which makes significant changes to the

recognition and measurement of defined benefit pension

expense and termination benefits and to the disclosures for

all employee benefits. The standard did not have a material

impact on the Company’s results of operations, financial

position or cash flows.

There are not other standards, amendments to standards and

interpretations to existing standards which are effective for

the Company for the twelve-month period ended December

31, 2013 relevant to the operation of the Company, and

therefore, no impact resulted from the application of those

standards, amendments and interpretations on these special

consolidated financial statements.

Standards, amendments and interpretations to existing

standards that are not yet effective and have not been early

adopted by the Company

The following standards, amendments and interpretations

to existing standards have been published and are not yet

effective for the Company in the twelve-month period ended

December 31, 2013:

IFRS 9 “Financial Instruments”In November 2009 and October 2010, the IASB issued IFRS 9.

This addresses the classification and measurement of financial

assets and it is likely to affect the Company’s accounting for its

financial assets. The standard is not applicable until January 1,

2015, but is available for early adoption.

IAS 32 (amendment) “Financial instruments: Presentation”,

offsetting of financial assets and financial liabilities

The IAS 32 amendment is mandatory for periods beginning on

or after January 1, 2014 and it is to be applied retroactively.

IAS 36 (amendment) “Impairment of assets”, recoverable

amount disclosures for non-financial assets”

The IAS 36 amendment is mandatory for periods beginning

on or after January 1, 2014.

IAS 39 (amendment) “Financial instruments: Recognition and

Measurement”, “Novation of Derivatives and Continuation of

Hedge Accounting”

The IAS 39 amendment is mandatory for periods beginning

on or after January 1, 2014.

The Company is currently in the process of evaluating the

impact on the Consolidated Financial Statement derived from

the application of these new standards.

b. CONSOLIDATION

SUBSIDIARY COMPANIES

Subsidiaries are all entities over which TECHINT E&C has

control. TECHINT E&C controls an entity when it is exposed

to, or has rights to, variable returns from its involvement withthe entity and has the ability to affect those returns through

its power over the entity. Subsidiaries are fully consolidated

from the date on which control is exercised by the Company

and are no longer consolidated from the date control ceases.

The purchase method of accounting is used to account for

the acquisition of subsidiaries by TECHINT E&C.

The cost of an acquisition is measured as the fair value of the

assets given, equity instruments issued and liabilities incurredor assumed at the date of acquisition. Acquisition-related

costs are expensed as incurred. Identifiable assets acquired,

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liabilities and contingent liabilities assumed in a business

combination are measured initially at their fair values at the

acquisition date. Any non-controlling interest in the acquiree is

measured either at fair value or at the non controlling interest’s

proportionate share of the acquiree’s net assets.

The excess of the aggregate of the consideration transferred

and the amount of any non-controlling interest in the acquiree

over the fair value of the identifiable net assets acquired is

recorded as goodwill. If the cost of acquisition is less than

the fair value of the net assets of the subsidiary acquired, the

difference is directly recognized in the income statement.

If the companies acquired were under common control, the

assets and liabilities of such companies (and their respective

subsidiaries) are accounted for at the predecessor’s cost,

reflecting the carrying amount of such assets and liabilities

contributed to the Company. Accordingly, the special

consolidated financial statements include the financial

position of the abovementioned companies at historical

book values and no adjustment has been made to reflect

fair values at the time of the contribution. The difference

between the price paid and the historical book value was

charged to equity as capital surplus.

In case of disposal related to companies under common

control, the assets and liabilities of such companies (and

their respective subsidiaries) are accounted for at the

predecessor’s bookvalues, reflecting the carrying amountof such assets and liabilities disposed of the Company.

Accordingly, the special consolidated financial statements

exclude the financial position of the abovementioned

companies at their carrying book values and no adjustment

has been made to reflect fair values at the time of disposal.

The difference between the considerations paid and the

carrying book value of the assets and liabilities of the entities

derecognized is charged to equity.

Material intercompany transactions, balances and unrealizedgains (losses) on transactions between TECHINT E&C

and its subsidiaries have been eliminated in consolidation.

Accounting policies of subsidiaries have been changed

where necessary to ensure consistency with the policies

adopted by TECHINT E&C.

According to the laws of the countries of certain subsidiaries,

a portion of the profit of the year is separated to constitute

statutory reserves until they reach statutory capped

amounts. These legal reserves are not available for dividend

distribution and can only be released to absorb losses.

See note 25 to the special consolidated financial statements

for the list of principal consolidated subsidiaries.

TRANSACTIONS AND NON-CONTROLLING INTERESTS

The Company treats transactions with non-controlling interests

as transactions with equity owners of TECHINT E&C. For

purchases from non-controlling interests, the difference

between any consideration paid and the relevant share acquired

of the carrying value of net assets of the subsidiary is recorded

in equity. Gains or losses on disposals to non-controlling

interests are also recorded in equity. When TECHINT E&C

ceases to have control or significant influence, any retained

interest in the entity is remeasured to its fair value, with the

change in carrying amount recognized in profit or loss.

ASSOCIATED COMPANIES

Associated companies are entities in which TECHINT E&C has

significant influence but not control, generally accompanying

a shareholding of between 20% and 50% of the votingrights (see note 6). Investments in associated companies

are accounted for by the equity method of accounting and

are initially recognized at cost. The Company’s investment

in associated companies includes goodwill identified on

acquisition, net of any accumulated impairment loss.

The Company’s share of its associated companies’ post-

acquisition profits or losses is recognized in the income

statement, and its share of post-acquisition movements in

reserves is recognized in reserves. The cumulative post-acquisition movements are adjusted against the carrying

amount of the investment.

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When the Company’s share of losses in an associated

company equals or exceeds its interest in such company,

including any other unsecured receivables, the group does

not recognize further losses, unless it has incurred obligations

or made payments on behalf of the associated companies.

Unrealized gains on transactions between TECHINT E&C and its

associated companies are eliminated to the extent of TECHINT

E&C’s interest in the associated companies. Unrealized losses

are also eliminated unless the transaction provides evidence

of an impairment indicator of the asset transferred. Financial

statements of associated companies have been adjusted

where necessary to ensure consistency with IFRS.

JOINT ARRANGEMENTS

A joint arrangement is a contractual agreement whereby the

parties engage in a business activity which is subject to joint

control. There is joint control only when the decisions on

relevant activities require the unanimous consent of the parties.

Under IFRS 11, “Joint arrangements”, and IAS 28,

”Investments in associates and joint ventures”, investments

in which two or more parties have joint control must be

classified as a "joint operation", when the parties have rights

to the assets and obligations relating to the arrangement

or, as a "joint venture" when the parties have rights to the

net assets of the arrangement. Taking into account such

classification, joint operations are consolidated line by line

according to TECHINT E&C’s interest, whereas joint venturesare recorded according to the equity method.

Investments classified as joint ventures are included in the

account “Investments accounted for using the equity method”

in the Special Consolidated Statement of Financial Position.

Under the equity method of accounting, interests in joint

ventures are initially recognized at cost and adjusted

thereafter to recognize the Company’s share of the post-

acquisition profits or losses and movements in othercomprehensive income. When the Company’s share of

losses in a joint venture equals or exceeds its interests in the

joint ventures (which includes any long-term interests that,

in substance, form part of the Company’s net investment in

the joint ventures), the Company does not recognize further

losses, unless it has incurred obligations or made payments

on behalf of the joint ventures.

Unrealized gains on transactions between the Company

and its joint ventures are eliminated to the extent of the

Company’s interest in the joint ventures. Unrealized losses

are also eliminated unless the transaction provides evidence

of an impairment of the asset transferred.

Accounting policies of the joint ventures have been changed

where necessary to ensure consistency with the policies

adopted by the Company.

c. FOREIGN CURRENCY TRANSLATION

i. FUNCTIONAL AND PRESENTATION CURRENCY

Items included in the special consolidated financial statements

of each entity in which TECHINT E&C holds participating

interests are measured using the currency that best

reflects the economic substance of the underlying events

and circumstances relevant to that entity (“the functional

currency”). The special consolidated financial statements

are presented in thousands of USD, which is the functional

currency of TECHINT E&C. The consolidated companies’ first

record transactions using their functional currency and their

financial statements are then translated to USD with the only

purpose of being consolidated by TECHINT E&C.

ii. BALANCES AND TRANSACTIONS IN CURRENCIESOTHER THAN THE FUNCTIONAL CURRENCY

Transactions in currencies other than the functional currency

are accounted for at the exchange rates prevailing on the date

of the transactions, and the corresponding exchange gains and

losses are recognized in the special income statement.

Monetary assets and liabilities in currencies other than

the functional currency are translated at the period-end

exchange rate.

iii. TRANSLATION OF BALANCES AND RESULTS

OF CONSOLIDATED COMPANIES

The results and financial position of all the consolidated

companies that have a functional currency different from

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the Company’s presentation currency are translated into the

presentation currency as follows:

assets and liabilities of each balance sheet are translated at

the closing rate on the date of that balance sheet;

income and expenses for each income statement are

translated at an average exchange rate; (unless this average

is not a reasonable approximation of the cumulative effect of

the rates prevailing on the transaction dates, in which case

income and expenses are translated at the rate on the dates

of the transactions);

all resulting exchange differences are recognized as a

separate component of equity.

In the case of sale or other disposition of any such subsidiary,

any accumulated translation adjustment would be recognized

in the income statement as part of the gain or loss on sales.

The financial statements of subsidiaries companies whose

functional currency is the currency of ahyperinflationary economy

are adjusted for inflation in accordance with the procedure

described in the following paragraph prior to their translation to

USD. Once restated, all the items of the financial statements are

converted to USD using the closing exchange rate.

To determine the existence of hyperinflation, TECHINT E&C

assesses the qualitative characteristics of the economic

environment of the country, such as the trends in inflation

rates over the previous three years. The financial statementsof companies whose functional currency is the currency

of a hyperinflationary economy are adjusted to reflect the

changes in purchasing power of the local currency, such

that all items in the special statement of financial position

not expressed in current terms (non-monetary items) are

restated by applying a general price index at the financial

statement closing date, and all income and expense, profit

and loss are restated monthly by applying appropriate

adjustment factors. The difference between initial and

adjusted amounts is taken to profit or loss.

d. USE OF ESTIMATES

The preparation of consolidated financial statements requires

Management to estimate and evaluate both recorded and

contingent assets and liabilities as of a certain date, as well

as income and expenses recorded during the reporting

period. The future actual results may differ from estimates

made as of the date of preparation of these special

consolidated financial statements.

Estimates and judgments are continually evaluated and are

based on historical experience and other factors, including

expectations of future events that are believed to be

reasonable under the circumstances.

There follows a description of the most relevant estimates used

to prepare these special consolidated financial statements:

PERCENTAGE OF COMPLETION METHOD

The Company uses the percentage-of-completion method in

accounting for its contract revenues and expenses. Use of

the percentage-of-completion method requires the Company

to estimate the services performed to date as a proportion

of the total services to be performed. Furthermore, in

determining the contract revenue, TECHINT E&C considers

the estimated outcome for each of the construction

contracts which are in progress.

INCOME TAXES

The Company is subject to income taxes in numerous

jurisdictions. Significant judgment is required in determining

the worldwide provision for income taxes. There are

transactions and calculations for which the ultimate taxdetermination is uncertain. TECHINT E&C recognizes

liabilities for anticipated tax audit issues based on estimates

of whether additional taxes will be due. Where the final tax

outcome of these matters is different from the amounts

that were initially recorded, such differences will impact the

current and deferred income tax assets and liabilities in the

period in which such determination is made.

MEASUREMENT OF CLAIMS RECEIVABLES

The Company reviews its financial assets and financialliabilities including its terms, maturities and discount

rates in order to adjust them to its realizable value or its

settlement value considering the time value of money

and other factors.

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ALLOWANCES FOR DOUBTFUL ACCOUNTS

Management maintains an allowance for trade and other

receivables to account for estimated losses resulting

from the inability of clients to make required payments.

When evaluating the adequacy of an allowance for trade

receivables, Management bases its estimates on the aging

of accounts receivable balances and historical write-off

experience, client credit worthiness and changes in cl ient

payment terms.

OTHER ESTIMATIONS

In addition, the Company’s Management makes estimations

to calculate, at certain moment the recoverable amounts of

assets, the depreciation and amortization, the provision for cost

and contingencies, the pension plans provision and to assess

annually whether an impairment of long-live assets exists.

According to the Group’s accounting policies, on December

31, 2013, a technical evaluation was carried out by qualified

external experts in relation to construction equipment,

machinery and vehicles, based on the valuations of assets

made from time to time so that they do not substantially

differ from their fair value as of the date of the consolidated

special financial statements (see Note 4).

e. PROPERTY, PLANT AND EQUIPMENT (PP&E)

MACHINERY, EQUIPMENT, VEHICLES AND OTHERS

As a general rule, TECHINT E&C has adopted historical

acquisition or construction cost less accumulateddepreciation as the measurement criterion for PP&E.

However, in the case of machinery, equipment and vehicles

used in the construction business, TECHINT E&C has

adopted fair value as the measurement criterion (see note 4).

LAND AND BUILDINGS

Land and buildings are stated at historical cost. Buildings

are depreciated using the straight-line method, by applying

annual ratios sufficient to terminate the value of each item asof the end of their estimated useful life.

FIXED ASSETS OF FERROEXPRESO PAMPEANO S.A.C. (“FEPSA”)

These assets represent improvements on the assets

received under concession by FEPSA, as well as those

devoted to service rendering, which will be transferred to the

assignor upon termination of the concession.

Such assets were valued at their acquisition or construction

cost less accumulated depreciation.

The straight-line method had been used to calculate

depreciation, by applying annual ratios sufficient to terminate

the value of each item as of the end of their estimated useful

life or upon termination of concession, whichever occurs first.

USEFUL LIVES USED TO CALCULATE DEPRECIATION

CHARGES ARE AS FOLLOWS:

The residual values and useful lives of significant machinery,

construction equipment and vehicles are reviewed, and

adjusted if appropriate, at each period-end date.

Where the carrying amount of an asset is higher thanits estimated recoverable amount, it is written down

immediately to its recoverable amount.

Gains and losses on disposals are determined by comparing

proceeds with carrying amounts. When revalued assets

are sold, the amounts included in the reserve for PP&E

revaluation surplus are transferred to retained earnings.

Repairs and maintenance expenses are charged to the

consolidated income statement during the financial period inwhich they are incurred.

Buildings and improvements

Production equipmentVehicles, furniture and fixtures,

and other equipment

Land

20-60 years

2-20 years2-12 years

Not depreciated

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f. INTANGIBLE ASSETS

SYSTEMS DEVELOPMENT

Acquired computer software licenses are capitalized on

the basis of the costs incurred to acquire and bring to use

the specific software. These costs are amortized over their

estimated useful lives (three to five years).

Costs associated with developing or maintaining computer

software programs are charged to expenses as incurred.

Costs that are directly associated with the production of

identifiable and unique software products controlled by

TECHINT E&C and that will probably generate economic

benefits exceeding costs beyond one year, are recognized

as intangible assets. Direct costs include the software

development employee costs and an appropriate portion

of relevant overhead.

Computer software development costs recognized as

assets are amortized over their estimated useful lives (not

exceeding three years).

OTHER

Compañía Inversora Ferroviaria S.A.I.F. (“COINFER”)

Other intangible assets represent the greater cost derived

from the investment in the subsidiary FEPSA as a result of

the compulsory subscription and payment of the portion

of capital corresponding to Ferrocarriles Argentinos (16%)

and the portion corresponding to staff (4%) pursuant to the

concession contract.

It is valued at original cost, less accumulated amortization;

it was calculated over the term of the concession of the

service provided by FEPSA.

g. IMPAIRMENT OF NON-FINANCIAL ASSETS

Property and equipment and other non-current assets

subject to depreciation, including intangible assets, are

reviewed for impairment losses whenever events or changes

in circumstances indicate that the carrying amount may notbe recoverable.

An impairment loss is recognized for the amount by which

the carrying amount of the asset exceeds its recoverable

amount, which is the higher of an asset net selling price and

its value in use. For the purposes of assessing impairment,

assets are grouped at the lowest levels for which there are

separately identifiable cash flows.

h. FINANCIAL ASSETS

The Company classifies its financial assets in the following

categories: at fair value through profit or loss, loans and

receivables, and available for sale. The classification depends

on the purpose for which the financial assets were acquired.

Management determines the classification of its financial

assets at initial recognition.

Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are

financial assets held for trading. A financial asset is classified

in this category if acquired principally for the purpose of

selling in the short-term. Derivatives are also categorized

as held for trading unless they are designated as hedges.

Assets in this category are classified as current assets.

Loans and receivables

Loans and receivables are non-derivative financial assets with

fixed or determinable payments that are not quoted in an active

market. They are included in current assets, except for maturities

greater than 12 months after the date of the statement of

financial position. These are classified as non-current assets.

Available-for-sale financial asset

Available-for-sale financial assets are non-derivatives that are

either designated in this category or not classified in any of

the other categories. They are included in non-current assets

unless management intends to dispose of the investment

within 12 months of the end of the reporting period.

RECOGNITION AND MEASUREMENT

Regular purchases and sales of financial assets are recognizedon the trade - date - the date on which the Company commits

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to purchase or sell the asset. Investments are initially

recognized at fair value plus transaction costs for all financial

assets not carried at fair value through profit or loss. Financial

assets carried at fair value through profit or loss are initially

recognized at fair value and transaction costs are expensed in

the income statement.

Financial assets are derecognized when the rights to

receive cash flows from the investments have expired or

have been transferred and the Company has transferred

substantially all risks and rewards of ownership. Available-

for-sale financial assets and financial assets at fair value

through profit or loss are subsequently carried at fair value.

Loans and receivables are carried at amortized cost using

the effective interest method.

The Company assesses at each balance sheet date whether

there is objective evidence that a financial asset or a group of

financial assets is impaired.

i. OFFSETTING FINANCIAL INSTRUMENTS

Financial assets and liabilities are offset and the net amount

reported in the special statement of financial position when

there is a legally enforceable right to offset the recognized

amounts and there is an intention to settle on a net basis, or

realize the asset and settle the liability simultaneously.

j. DERIVATIVE FINANCIAL INSTRUMENTS

Derivatives are initially recognized at fair value on the date aderivative contract is entered into and are subsequently re-

measured at their fair value.

The method of recognizing the resulting gain or loss depends on

whether the derivative is designated as a hedging instrument,

and if so, the nature of the item being hedged. The Company

adopts hedge accounting and designates derivatives as either:

Hedges of the fair value of recognized assets or liabilities or a

firm commitment (fair value hedge).Hedges of a particular risk associated with a recognized

asset or liability or a highly probable forecast transaction

(cash flow hedge).

Hedges of a net investment in a foreign operation (net

investment hedge).

The Company documents at the inception of the transaction

the relationship between hedging instruments and hedged

items, as well as its risk management objectives and strategy

for undertaking various hedging transactions. TECHINT E&C

also documents its assessment, both at hedge inception

and on an ongoing basis, of whether the derivatives that are

used in hedging transactions are highly effective in offsetting

changes in fair values or cash flows of hedged items.

CASH FLOW HEDGE

Trading derivatives are classified as a current asset or liability.

The full fair value of a hedging derivative is classified as a non-

current asset or liability if the remaining maturity of the hedged

item is more than 12 months and, as a current asset or liability,

if the maturity of the hedged item is less than 12 months.

The effective portion of changes in the fair value of derivatives

denominated and qualified as cash flow hedging is disclosed

in Other Comprehensive Income. The gain or loss related

to the ineffective portion is immediately disclosed in the

consolidated income statement.

The amounts accumulated in equity are disclosed in the

consolidated income statement in the period in which the

hedged item affects gains and losses.

When a hedging instrument expires or is sold, or when a

hedge no longer meets the criteria for hedge accounting, any

cumulative gain or loss existing in equity at that time remains

in equity and is recognized when the forecast transaction is

ultimately recognized in the consolidated income statement.

When a forecast transaction is no longer expected to occur,

the cumulative gain or loss that was reported in equity is

immediately transferred to the consolidated income statement.

FORWARD FOREIGN EXCHANGE CONTRACTSThe hedged highly probable forecast transactions denominated

in foreign currency are expected to occur at various dates

during the next 12 months. Gains and losses recognized in

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the hedging reserve in equity on forward foreign exchange

contracts as of 31 December 2013 are recognized in the

special income statement in the period or periods during

which the hedged forecast transaction affects the special

income statement. In general, this happens within 12 months

following the date of the special consolidated financial

statements, unless the loss or gain would have been included

in the amount initially recognized for the purchase of fixed

assets, in which case such recognition is made throughout the

useful life of the asset.

k. INVENTORIES

Inventories are stated at the lower of cost or net realizable

value less the corresponding allowance for obsolescence.

Net realizable value is the estimated selling price in the

ordinary course of business, less the costs of completion

and direct selling expenses. In general, cost is determined

by using weighted average price.

The allowance for obsolescence has been calculated based

on Management’s analysis of aging.

l. CONSTRUCTION CONTRACTS WORK IN PROGRESS

A construction contract is a contract specifically negotiated for

the construction of an asset or a combination of assets that are

closely interrelated or interdependent in terms of their design,

technology and functions or their ultimate purpose or use.

When the outcome of a construction contract can bereliably estimated, contract revenue and contract costs are

acknowledged by the percentage of completion method.

The stage of completion is measured by reference to the

relationship contract costs incurred for work performed

to date bear to the estimated total costs for the contract.

When it is probable that total contract costs will exceed

total contract revenue, the expected loss is immediately

recognized as an expense.

When the outcome of a construction contract cannot bereliably estimated, contract revenue is recognized to the extent

of contract costs incurred where it is probable those costs will

be recoverable. Contract costs are recognized when incurred.

Costs incurred in the period in connection with future

activity on a contract are excluded from contract costs in

determining the stage of completion. They are presented

as inventories, prepayments or other assets, depending on

their nature.

When a construction contract includes reimbursable works

and the Company is responsible for providing design,

engineering and construction services and labor and all

equipment and materials, construction equipment and

supplies, the amount of these works is recognized in

revenues and costs.

TECHINT E&C shows as an asset (within Construction

contracts work in progress) the gross amount due from clients

for construction contracts for all contracts in progress for

which costs incurred plus recognized profits (less recognized

losses) exceed progress billings.

TECHINT E&C presents as a liability (within Construction

contracts work in progress) the gross amount due to clients

for construction contract for all contracts in progress for which

progress billings exceed costs incurred plus recognized profits

(less recognized losses).

m. OTHER INVESTMENTS

Other investments consist primarily of deposits in investments

funds and equity instruments where the Company holds a

minor equity interest and does not exert significant influence.All other investments are classified as financial assets “loans

and receivables” or “available for sale”.

For Investments in companies in which TECHINT E&C

has less than 20% of the voting rights, the Company

usually chooses to use the historical cost because its costs

approximates to their fair value.

n. TRADE AND OTHER RECEIVABLES

Trade and other receivables are initially measured at theirfair value, which is generally their nominal value, unless the

effect of discounting is material, subsequently measured at

amortized cost less provision for impairment.

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An allowance for doubtful accounts is established when

there is objective evidence that the Company will not be

able to collect all amounts due according to the original

terms of receivables.

SERVICE CONCESSION ARRANGEMENTS

A service concession arrangement is an arrangement involving

an operator for the construction, improvement or management

of the infrastructure used to provide a public service for a

specified period of time. The operator is paid for its services over

the period of the arrangement. The arrangement is governed by

a contract that sets out performance standards, mechanisms

for adjusting prices and arrangements for arbitrating disputes.

The grantor controls the infrastructure, and the operator is

required to return to the grantor the infrastructure at the end of

the arrangement. The operator has an unconditional contractual

right to receive payments from the grantor, irrespective of the

amount of use made of the infrastructure.

Techint E&C recognises a financial asset arising from a

service concession arrangement to the extent that it has an

unconditional right to receive cash from or at the direction of

the grantor, for the construction improvement or management

of concession assets. Financial assets recognised as a result

of the service concession arrangement are measured at fair

value upon initial recognition. Subsequent to initial recognition,

the financial asset is accounted for in accordance with IAS 39

(Financial Instruments: Recognition and Measurement) and,

therefore, at amortized cost or at fair value through profit or loss.

Financial assets arising from a service concession arrangement

are included within “Trade and other receivables”. The financial

income calculated on the basis of the effective interest rate is

recognised under operating income.

This model applies to the rights to collect of local Health

Service Agencies by virtue of concession contracts regulating

the management of exclusive activities of the execution of

non-sanitary services and commercial services of the “NewHospital of Legnano” through the company Genesi Uno

SpA. and the “New Hospitals of Toscana” in Apuane. Lucca,

Pistoia and Prato through the company SA.T. S.p.A.

o. TRADE AND OTHER PAYABLES

Trade and other payables are obligations to pay for goods or

services that have been acquired in the ordinary course of

business from suppliers. Accounts payable are classified as

current liabilities if payment is due within one year or less. If

not, they are presented as non-current liabilities.

Trade and other payables are recognized initially at fair value

and subsequently measured at amortized cost.

p. CASH AND CASH EQUIVALENTS

Assets recorded in cash and cash equivalents are carried at

fair market value or at historical cost which approximates fair

market value. For the purposes of the special consolidated

statement of cash flows, cash and cash equivalents

comprise cash on hand, demand deposits with banks and

other short-term highly liquid investments with original

maturities of three months or less and bank overdrafts.

Bank overdrafts are included within borrowings in

current liabilities in the special consolidated statement of

financial position.

q. EQUITY

Ordinary shares are classified as equity. The balances of

the special consolidated statement of changes in equity at

December 31, 2013 include:

The value of capital stock, irrevocable contributions, capitalsurplus, reserve for PP&E revaluation surplus, reserve for

cash flow hedge, legal reserve, reserve for pension plan

benefits, reserve for future dividends and retained earnings

in accordance with IFRS.

The currency translation differences of TECHINT E&C’s

subsidiaries.

Non-controlling interests in subsidiaries.

Dividends distributions are recorded in the Company’s

financial statements when Company’s shareholders have the

right to receive the payment, or when interim dividends are

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approved by the Board of Directors in accordance with the

by-laws of the Company.

r. BORROWINGS

Borrowings are initially recorded based on the fair value

of the net proceeds. Borrowings are subsequently stated

at amortized cost using the effective yield method; any

difference between proceeds (net of transaction costs) and

the redemption value is recognized in the income statement

over the life of the borrowings.

Borrowings are classified as current liabilities unless

TECHINT E&C has an unconditional right and firm intention

to defer settlement of the liability for at least twelve months

after the balance sheet date.

s. CURRENT AND DEFERRED INCOME TAX

The current income tax charge is calculated on the basis of

the tax laws in force in the countries in which TECHINT E&C

and each one of its subsidiaries operate.

Deferred income tax is recorded in full, using the liability

method, on temporary differences arising between the tax

basis of assets and liabilities and their carrying amounts in the

special consolidated financial statements. Currently enacted

tax rates are used in the determination of deferred income tax.

Deferred tax assets are recognized to the extent that it is

probable that future taxable profit will be available to offsettemporary differences.

Deferred income tax is provided on temporary differences

arising on investments in subsidiaries, associated companies

and joint ventures, except where the timing of the reversal

of the temporary difference can be controlled and it is

probable that the temporary difference will not reverse in the

foreseeable future.

The tax expense for the period comprises current anddeferred tax. Tax is recognized in the Special Consolidated

Income Statement, except to the extent that it relates to

items recognized in the Special Consolidated Statement

of Comprehensive Income. In this case, the tax is also

recognized in the Special Consolidated Statement of

Comprehensive Income.

Consequently, as of December 31, 2013, the Company

recorded a Provision for Income Tax for USD 3,227 to cover

the liability resulting of deferred taxes on reserves for future

dividends of the Argentine subsidiaries of TECHINT E&C.

t. EMPLOYEE BENEFITS

PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS

Certain TECHINT E&C’s subsidiaries have in force benefit

plans under the modality of “non-funded defined benefits”

and “other long-term benefits” which, subject to certain

conditions established by such companies, are granted

during the term of employment and after retirement, which

plans are recorded following the guidelines of accounting

rules and regulations in force and effect.

The provisioned liabilities for such employee benefits are

recorded at the current value of the future flows of funds,

the amount being charged during the relevant employees’

remaining years of services up to the moment when the

conditions necessary for the granting of each benefit are

satisfied. Such liabilities are calculated by independent

actuaries, at least once a year, using the “Projected credit

unit” method.

Actuarial gains and losses arising from experienceadjustments and changes in actuarial assumptions are

charged or credited to equity in other comprehensive income

in the period in which they arise. Past-service costs are

recognized immediately in income. Actuarial gains and losses

arising from other post-retirement benefits are recognized

immediately in income.

Certain TECHINT E&C’s subsidiaries officers are covered

by a specific employee retirement plan designed to provide

retirement, termination and other benefits to those officers.

Retirement costs are assessed using the projected unit

credit method: the cost of providing retirement benefits is

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charged to the statement of income over the service lives of

employees based on actuarial calculations. This provision is

measured at the present value of the estimated future cash

outflows, using applicable interest rates.

Benefits provided by the plan are calculated on a seven-year

salary average.

Certain TECHINT E&C’s subsidiaries are accumulating assets

for the ultimate payment of those benefits in the form of

investments. The investments are not part of a particular

plan, nor are they segregated from TECHINT E&C’s other

assets. Due to these conditions, the plan is classified as

“unfunded” under IFRS.

The laws in the different countries in which TECHINT E&C’s

subsidiaries carry out their operations provide for pension

benefits to be paid to retired employees from government

pension plans and/or private funds managed plans. Amounts

payable to such plans are generally calculated based on a

percentage of employee salaries and are accounted for on an

accrual basis.

TERMINATION BENEFITS

Termination benefits are payable whenever an employee’s

employment is terminated before the normal retirement date

or whenever an employee accepts voluntary redundancy in

exchange for these benefits.

TECHINT E&C’s subsidiaries recognize termination benefits

when it is demonstrably committed to either terminating

the employment of current employees according to a

detailed formal plan without possibility of withdrawal, or

providing termination benefits as a result of an offer made to

encourage voluntary redundancy. Benefits falling due more

than twelve months after balance sheet date are discounted

to present value.

PROFIT-SHARING AND BONUS PLANSA liability for employee benefits in the form of profit-sharing

and bonus plans is recognized in other provisions when

there is no realistic alternative but to settle the liability and

provided at least one of the following conditions is met:

there is a formal plan and the amounts to be paid are

determined before the time of issuing the financial

statements; or

past practice has created a valid expectation in employees that

they will receive a bonus/profit-sharing and the amount can be

determined before the financial statements are issued.

Liabilities for profit-sharing and bonus plans are expected to

be settled within twelve months and are measured at the

amounts expected to be paid when they are settled.

CONTRIBUTION PLANS

A defined contribution plan is a pension plan under which

the companies pay fixed contributions to a separate entity.

Companies have no further payment obligations once the

contributions have been paid. The contributions are recognized

as employee benefit expense when they are due. Prepaid

contributions are recognized as an asset to the extent that a

cash refund or a reduction in the future payments is available.

Contributions by the companies include: (a) Basic

contribution – Companies are committed to contribute

amounts equal to the amounts contributed by the employees

up to certain limits, (b) Extraordinary contributions- are non-

mandatory contributions that can be made on a voluntary

basis either by the companies or the employees.

TEBRA has implemented a supplementary pensionbenefit plan with two programs: “PGBL - Plano Gerador

de Benefício Livre” and “ VGBL - Programa de Seguro de

Vida com Cobertura por Sobrevivência”. These programs

are generally funded through payments by the subsidiaries

to independent insurance companies. Both programs are

defined contribution plans.

LONG-TERM INCENTIVE

TECHINT E&C adopted a long-term retention and incentive

program for some employees of certain subsidiaries.According to such program, certain senior executives of such

subsidiaries shall receive a number of units valued at the book

value of the Shareholders’ Equity per share of TECHINT E&C

(excluding the non-controlling interest).

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>

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>Units shall accrue within a 4-year period and the

applicable subsidiaries shall pay them upon the lapsing of

a 10-year period from the date of receipt, with the option

for the employee to request them as from the seventh

year, or when the employee leaves the subsidiary in

charge of payment, at the book value of the controlling

Shareholders’ Equity per share of TECHINT E&C at the

time of payment. The beneficiaries shall also receive

amounts in cash equivalent to the dividend paid per share,

every time TECHINT E&C pays any dividend in cash to its

shareholders.

As of December 31, 2013, TECHINT E&C has acknowledged

non-current liabilities for USD 8,316. The charge to profits as

of December 31, 2013 for the sum of USD 3,348 , is stated

in the line “Labor Costs” in note 27 and in “Net foreign

exchange transaction results” in note 28.

u. PROVISIONSProvisions are recognized when TECHINT E&C has a present

legal or constructive obligation as a result of past events, it

is probable that an outflow of resources will be required to

settle the obligation, and a reliable estimate of the amount

can be made. When TECHINT E&C expects a provision to be

reimbursed, for example under an insurance contract, the

reimbursement is recognized as a separate asset but only

when the reimbursement is virtually certain.

v. REVENUE RECOGNITIONREVENUES AND COST RECOGNITION FOR LONG-TERM

CONSTRUCTION CONTRACTS

See note 2.l.

SALES OF SERVICES

The Company sells maintenance services. The revenue is

generally recognized in the period the services are provided,

using a straight-line basis over the term of the contract.

OTHER REVENUESOther revenues earned by TECHINT E&C are recognized on

the following bases:

Interest income: on the effective yield basis.

Dividend income from investments in other companies:

when TECHINT E&C’s right to collect is established.

w. LEASES

Leases in which a significant portion of the risks and

rewards of ownership are transferred from the lessor

to TECHINT E&C are classified as finance leases. At

the commencement of the lease term, TECHINT E&C

recognizes finance leases as assets and liabilities in the

special statement financial position at amounts equal to the

value of the leased property or, if lower, the present value

of the minimum lease payments, each determined at the

inception of the lease. The discount rate used in calculating

the present value of the minimum lease payments is the

interest rate implicit in the lease should this be practicable

to determine; otherwise, the lessee’s incremental borrowing

cost is used. Any initial direct costs of the lessee are added

to the amount recognized as an asset.

Each lease payment is allocated between the liability and

finance charges. The corresponding rental obligations, net of

finance charges, are included in borrowing. The interest element

of the finance cost is charged to the income statement over

the lease period so as to produce a constant periodic rate of

interest on the remaining balance of the liability for each period.

The property, plant and equipment acquired under finance

leases is depreciated over their estimated useful lives.

See amounts of assets and liabilities held under financeleases in note 22.

Leases in which a significant portion of the risks and rewards of

ownership are retained by the lessor are classified as operating

leases. Payments made under operating leases (net of any

incentives received from the lessor) are charged to the income

statement on a straight-line basis over the period of the lease.

x. ASSETS OF DISPOSAL GROUP CLASSIFIED AS HELD

FOR SALEAssets of disposal group are classified as “assets classified as

held for sale” when their carrying amount is to be recovered

principally through a sale transaction and a sale is considered

highly probable.

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They are stated at the lower of carrying amount and fair value

less costs to sell if their carrying amount is to be recovered

principally through a sale.

NOTE 3.

FINANCIAL RISK MANAGEMENT

The nature of TECHINT E&C’s operations as well as its

multinational character expose the Company to a variety of

risks, including the effects of changes in foreign currency,

exchange rates, capital risk, concentration of credit risk,

liquidity risk and interest rates risk. The nature of its contracts

implies that TECHINT E&C has to manage risks regarding

uncertain conditions in the hiring of procurement, which is

usually a large part of the scope of work.

To manage the high volatility related to these financial

matters, Management evaluates exposures on a

consolidated basis to take advantage of its global and

multinational activity.

For some of these exposures, the Company or its subsidiaries

enter into derivative transactions in order to manage potential

adverse impacts on the Company’s financial performance.

a. CAPITAL RISK

The Company seeks to maintain an adequate debt to total

equity ratio considering the risks involved in the industry and

the markets where it operates. The twelve-month period-

end ratio of debt to total equity (where “debt” comprises

all financial borrowings and “equity” is the sum of financial

borrowings and equity) is 0.21 as of December 31, 2013. The

Company does not have to comply with regulatory capital

adequacy requirements.

b. FOREIGN EXCHANGE RISK

TECHINT E&C’s business activities are conducted in

the respective functional currencies of the subsidiaries.

However, the Company transacts in currencies other than

the respective functional currencies of the subsidiaries. There

are significant monetary balances held by the Company at

the twelve-month period-end that are denominated in USD.

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The following tables show a breakdown of the TECHINT E&C’s

net monetary position in various currencies for the main

functional currency in which the Company operates:

USD

EUR

ARS

UYU

SAR

PLN

JPY

Others

DECEMBER 31, 2013

FUNCTIONAL CURRENCY (IN THOUSAND USD)

115,996

3,566

(293)

(19)

822

(8,785)

(10,106)

(632)

100,549

TOTAL

(2,542)

2,408

–

(19)

–

–

–

277

124

OTHERS

(9,235)

(68)

(293)

–

–

–

–

–

(9,596)

UYU

2,552

(254)

–

–

–

–

–

(1)

2,297

SAR

55,172

–

–

–

–

–

–

–

55,172

PEN

26,081

1,084

–

–

–

–

–

–

27,165

MXN

(1,929)

–

–

–

822

(8,785)

(10,106)

(908)

(20,906)

EUR

44,830

–

–

–

–

–

–

–

44,830

CHL

21,342

–

–

––

–

–

–

–

21,342

BRL

(20,275)

396

–

–

–

–

–

–

(19,879)

ARSNET MONETARY POSITION ASSET / (LIABILITY)

The Company estimates that the impact under IFRS on the

net exposure at December 31, 2013 of a simultaneous 1%

favorable or unfavorable movement in the main exchangerates would result in a maximum pre-tax gain or loss of

approximately USD 1,005.

The Company’s net exposure to the currency other than the

functional currency is managed on a case-by-case basis, partly

by hedging certain expected cash flows with foreign exchange

derivative contracts.

The Company performed a sensitive analysis of the

Derivative Financials Instruments of a 10% favorable or

unfavorable movement of the Mexican Peso against theUSD at December 31, 2013. The impact would have been,

in the case of strengthening (USD 5,937) in equity and

(USD 2,734) in profit or (loss) and in the case of weakening

USD 7,256 in equity and USD 3,341 in profit or (loss).

JPY: Japanese Yen

EUR: Euro

SAR: Saudi Riyal

PLN: Polish Zloty

UYU: Uruguayan Peso

Ref:

ARS: Argentinian Peso

BRL: Brazilian Real

MXN: Mexican Peso

PEN: Peruvian Nuevo Sol

CHL: Chilean Peso

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c. PRICE RISK

The Company has no significant risk from the fluctuation in

the market prices.

The group´s investments in equity, classified on the special

consolidated balance sheet as available for sale, are not

publicly traded and are valued at cost.

Cash and cash equivalents and other investments classified as

fair value through profit or loss, are carried at fair market value

or at historical cost which approximates fair market value.

d. CREDIT RISK

Most accounts receivable relate to clients operating in a

range of industries and countries with contract which require

ongoing payments as the development project progresses,

upon the rendering of services or upon completion and

The credit quality of financial assets that are neither

past due nor impaired can be assessed by reference to

historical information about counterparty default rates. The

total unimpaired trade receivables are related to existing

customers and related parties with no defaults past due.

At the date of this special consolidated financial statements

most credits past due have been collected.

e. LIQUIDITY RISK

Management maintains sufficient cash and cash

equivalents to finance normal operations and believes that

TECHINT E&C also has access to market for short-term

working capital requirements.

TECHINT E&C financing strategy is to maintain adequate

financial resources and access to additional liquidity. During the

delivering of the project. It is normal practice that the

Company reserves the right to suspend the project if there

is a remarkable breach of the contract term, in particular the

non-payment of amounts owed.

In general the greatest risk for such assets is the risk of not

collecting a trade account receivable. This is because, a) it

may be a significant value in the development of works or

in the provision of services; b) it is beyond the Company’s

control. However, the risk of customers being unable to

make a payment in such contracts is considered to be low,

and typically relate to problems characterized as technical

matters, i.e. relating to the risk inherent in the service

rendered, under the Company’s control.

The following table sets forth details of the age of trade

receivables:

December 31, 2013

Trade Receivables

Allowance for doubtful accounts

Net Value

26,082

(10,286)

15,796

495,624

(39)

495,585

93,924

(240)

93,684

615,630

(10,565)

605,065

> 180 DAYS1 - 180 DAYS

PAST DUENOT DUETRADE

RECEIVABLES (*)

8

NOTES

(*) It does not include Allowance for doubtful accounts recorded in current

other receivables-net (USD 19,095).

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twelve-month period-ended December 31, 2013, TECHINT E&C

has counted on cash flows from operations as well as additional

bank financing to fund its transactions.

TECHINT E&C has a conservative approach to the management

of its liquidity, which consists of cash and cash equivalents,

comprising cash in banks, short-term money market funds and

highly liquid short-term securities.

TECHINT E&C holds its cash and cash equivalents primarily

in USD. Liquid financial assets as a whole are 25% of total

assets at December 31, 2013.

See note 14 for the maturity of borrowings, note 16 for the

maturity of trade and other payables and note 17 for the

maturity of other liabilities.

f. INTEREST RATE RISK MANAGEMENT

The Company’s financing strategy is to manage interest

expense using a mixture of fixed-rate and variable-rate debt.

The proportions of variable-rate and fixed-rate debt at the

end of the twelve-month period are included in note 14.

As the Company has no significant interest-bearing

assets, the Company’s income and operating cash flows

are substantially independent from changes in market

interest rates.

The Company estimated that, if interest rates would have

been 100 basis points higher, with all other variables held

constant, total profit for the twelve-month period ended

December 31, 2013 would have been USD 701 lower.

G) FAIR VALUE ESTIMATION

The carrying amount of financial assets and liabilities

with maturities of less than one year approximates to their

fair value.

See note 10 – “Determining fair values”

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NOTE 4.

PROPERTY, PLANT AND EQUIPMENT (PP&E)

The item evolution is as follows:

The item consists in the following:

Beginning of the twelve-month period


Increase due to business combinations

Additions

Disposals

Depreciation

Translation differences

Changes in reserve of PP&EDecrease due to business combinations

Impairment loss

December 31, 2013

Land and buildings

Equipment and machinery

Vehicles

Other assets

Total December 31, 2013

–

61,208

18

17,116

(2,426)

(11,031)

(11,308)

764

(2,204)

(191)

51,946

(23,463)

(151,406)

(47,557)

(72,108)

(294,534)

–

42,215

2,951

10,506

(1,454)

(10,215)

(5,779)

27,948

(2,286)

(222)

63,664

104,624

309,113

111,221

124,054

649,012

–

122,852

7,848

24,656

(9,975)

(25,745)

(14,333)

53,492

4,034

(5,122)

157,707

–

81,327

7,389

8,799

(343)

(3,253)

(12,665)

–

(93)

–

81,161

–

307,602

18,206

61,077

(14,198)

(50,244)

(44,085)

82,204

(549)

(5,535)

354,478

81,161

157,707

63,664

51,946

354,478

NON-CURRENT

ACCUMULATEDDEPRECIATION

ORIGINALVALUE

TOTAL

DEC 31, 2013

NET VALUEDEC 31, 2013

OTHER

ASSETS (1)

VEHICLESEQUIPMENT AND

MACHINERY

LANDS AND

BUILDINGS

(1) It includes deferred costs of our subsidiary FEPSA and miscellaneous assets.

1

1

1

NOTES

Lease rentals amounting to USD 88,594 relating to the lease

of machinery, construction equipment and vehicles, are

included in the special consolidated income statement.

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TECHNICAL APPRAISAL OF PP&E

On December 31, 2013, a technical appraisal was performed by

external professionally qualified valuation specialists in relation

to machinery, construction equipment and vehicles, based on

periodic valuations of the assets in order not to differ materially

from their fair value at the special financial statements date.

The Company’s Directors believe that recording machinery,

construction equipment and vehicles at fair value results in a

more appropriate presentation of these assets in the special

consolidated financial statements of the Company.

Revaluations are performed by independent qualified valuers

on a regular basis. In the intervening periods between

independent revaluations, the Company reviews the carrying

values of machinery, construction equipment and vehicles

and adjustment is made where the carrying value exceeds

from fair value.

Management believes that the resulting value approximates

fair value. As per International Accounting Standard No. 16

“Property, plant and equipment” (“IAS 16”), when an item

of property and equipment is revalued, the entire class of

property and equipment to which that asset belongs should

be revalued. Machinery, construction equipment and vehicles

corresponding to the subsidiaries that did not make the

abovementioned revaluation are not significant.

The “sales comparison” method was used to obtain the

fair value of these assets for which there is a wide andtransparent secondary market. This approach consists

in obtaining information from recent sales or offers of

assets bearing similar characteristics, age and condition.

Correction factors that take into account the status of the

market offer and demand prevailing as of the date of the

appraisal, the relative age, probable residual useful life, state

of conservation and asset obsolescence are applied to the

sales price. The “cost less depreciation” method was used to

obtain the fair value of assets with a restricted sales market.

Depreciation was computed based on generally used and

accepted engineering criteria which led to establishing the

reasonable value of PP&E. Such criteria take into account

factors such as the age of each asset, probable residual

or expected life, state of conservation and degree of

obsolescence. The market value was obtained by applying

the depreciation ratio to the value of a new asset.

These subsidiaries intend to perform this appraisal with the

frequency required by IAS 16 in order to keep fair values of

appraised assets updated.

The increase in value of machinery, construction equipment

and vehicles resulting from the technical appraisal performed

on December 31, 2013 amounted to USD 85,901 and has

been recorded net of tax effect USD 26,543 in special other

comprehensive income and accumulated in equity under

the heading of “Reserve for PP&E revaluation surplus” and

“Non-controlling interests”.

On December 31, 2013 the net decrease in the value of

machinery, construction equipment and vehicles amounted

to USD 3,697 and has been recorded net of tax effect USD

899 and was attributed to special other comprehensive

income and accumulated in equity under “Reserve for PP&E

revaluation surplus”.

The depreciation of the Reserve for PPE revaluation surplus

net of tax for twelve-month period ended December 31, 2013

amounts to USD 7,133. Additionally, during the twelve-month

period ended December 31, 2013, the company recorded a

decrease of such reserve amounting to USD 3,174 net of tax

due to disposal of PP&E.

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If machinery, equipment and vehicles had been valued at

historical cost, the values would have been the following:

Historical cost

Accumulated depreciation

Residual value

248,398

(151,464)

96,934

DEC 31, 2013

The “Reserve for PP&E revaluation surplus” is reversed, net

of tax effects, through (i) the retirement of the equipment

appraised or (ii) depreciation charges. The difference

between depreciation of appraised assets and depreciation

of the historical values of such assets is charged against

accumulated results.

The straight-line method has been used to calculate

depreciation, by applying annual ratios sufficient to terminate the

value of each item as to the end of their estimated useful life.

The following table analyses the non-financial assets carried

at fair value, by valuation method. The different levels have

been defined as follows:

Quoted prices (unadjusted) in active markets for identical

assets or liabilities (Level 1).

Inputs other than quoted prices included within level 1 that

are observable for the asset or liability, either directly (that is,

as prices) or indirectly (that is, derived from prices) (Level 2).

Inputs for the asset or liability that are not based on

observable market data (that is, unobservable inputs) (Level 3)

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Recurring fair value measurements

Equipment and machinery

Vehicles

Other

At December 31, 2013

–

–

–

–

121,015

42,152

1,364

164,531

–

–

–

–

FAIR VALUE MEASUREMENTS AT 31 DECEMBER 2013 USING

QUOTED PRICES IN

ACTIVE MARKETS FOR

IDENTICAL ASSETS

(LEVEL 1)

SIGNIFICANT OTHER

OBSERVABLE INPUTS

(LEVEL 2)

SIGNIFICANT

UNOBSERVABLE

INPUTS (LEVEL 3)

VALUATION TECHNIQUES USED TO DERIVE LEVEL 2

FAIR VALUES

To estimate the fair value of assets for which there is a wide

and transparent secondary market, the valuation specialists

used the “sales comparison” method, which consists in

obtaining information from recent sales or offer of assets

that are comparable in their characteristics, age and state of

conservation. Furthermore, correction factors are applied over

the sale prices determined following the sales comparison

method. These correction factors are based on the status of

the market demand and supply prevailing as of the date of the

appraisal, the relative age, the estimated residual useful life,

the state of conservation and the obsolescence of assets.

For those assets with a restricted sales market, fair value is

determined based on the “cost less depreciation” method.

Depreciation was computed based on generally used and

accepted engineering criteria, which led to establish the

reasonable value of machinery, construction equipment

and vehicles. Such criteria take into account factors such

as the age of each asset, probable residual life or expected

life, state of conservation and degree of obsolescence. The

market value was obtained by applying the depreciation ratio

to the value of a new asset.

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Decrease due to bussiness combination

Increase due to bussiness combination

Additions

Amortization


December 31, 2013

–

350

(2,147)

2,957

5

(97)

(40)

1,028

–

8,273

–

2,410

4,296

(4,070)

(1,250)

9,659

–

8,623

(2,147)

5,367

4,301

(4,167)

(1,290)

10,687

OTHER INTANGIBLE

ASSETS

ACCUMULATED

AMORTIZATION

SYSTEMS

DEVELOPMENT

ORIGINAL

VALUE

DECEMBER 31, 2013

NOTE 5.

INTANGIBLE ASSETS

The item evolution is as follows:


Systems development

Other intangible assets


(16,984)

(4,457)

(21,441)

26,643

5,485

32,128

9,659

1,028

10,687

NET VALUE AT

DECEMBER 31, 2013

1

1

1

NOTES

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1

1

NOTES

Non-current

Fluor Techint S.R.L. Construcción y Servicios Ltda.(1)

Consorcio Constructor Techint Besalco Ltda

Norpower S.A. de C.V.(2)

Ingeniería y Construcción Bechtel Techint EWS Ltda.

Bechtel Techint Servicios Complementarios Ltda.

Other

Total Investments accounted for using the equity method

50%

50%

40%

40%

40%

Chile

Chile

Mexico

Chile

Chile

1,259

60

5,455

–

–

3,292

10,066

% OF

OWNERSHIP

COUNTRY OF

INCORPORATION

BOOK

VALUE

NOTE 6.

INVESTMENTS ACCOUNTED FOR USING

THE EQUITY METHOD

DECEMBER 31, 2013



Increase due to bussiness combination

Result from investmentsInvestment adquisition and contributions

Dividends earned

Sale and disposal of investments


End of the twelve-month period

(1) Fluor Techint S.R.L. Construcción y Servicios Ltda provides to Compañia Minera Nevada Ltda: basic engineering

services, detail engineering, supply management, construction management and construction.

(2) Pipeline maintenance services.

–

2,401

1,117

5,8482,500

(1,091)

(402)

(307)

10,066

DEC 31, 2013

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T E C H I N T

E & C

S . A .


The result from investments accounted for using the equity

method has arisen from the Company’s participation in the

results of the following companies:

Fluor Techint S.R.L. Construcción y Servicios Ltda.

Consorcio Constructor Techint Besalco Ltda.

Norpower S.A. de C.V.

Others

Total investment accounted for using the equity method

855

28

4,864

101

5,848

The following amounts represent the assets, liabilities, revenues

and results of the most important investment accounted for

using the equity method:

December 31, 2013

Fluor Techint S.R.L. Construcción y Servicios Ltda.

Consorcio Constructor Techint Besalco Ltda.

Norpower S.A. de C.V.

DEC 31, 2013

CURRENT

ASSETS

4,420

203

31,356

TOTAL

ASSETS

4,420

203

34,276

CURRENT

LIABILITIES

1,901

84

20,914

TOTAL

LIABILITIES

1,901

84

20,639

REVENUES

683

–

49,760

RESULTS

1,711

55

12,159

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T E C H I N T

E & C

S . A .


Non-current

Trade receivables

Trade receivables from related parties

Claims receivables

Other receivables from related parties

Other (*)

Total trade and other receivables

Current

Trade receivables – net

Trade receivables from related parties

Other receivables from related parties

Other receivables net (**)

Advanced to suppliers and subcontractorsPrepayments

Total trade and other receivables

17,118

27

148,525

12,836

92,608

271,114

587,947

39,996

14,623

76,539

67,051

11,032

797,188

NOTE 8.

TRADE AND OTHER RECEIVABLES

DEC 31, 2013

24

23

24

24

24

NOTES

(*) They are related, to a large extent, to the recognition, according to IFRIC 12, of the rights to collect

of local Health Service Agencies, by virtue of concession contracts regulating the management of

exclusive activities of non-sanitary services and commercial services for the execution, and the

new hospital of Legnano, through the company Genesi Uno SpA, and the new hospitals of Toscana

in Apuane, Lucca, Pistoia and Prato through the company SA.T. S.p.A.

(**) It includes receivables for canons to be collected by TEARG from the Argentine Government,

outstanding and to expire (Note 21 b).

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2 0 1 3


Non-current


Effect of Group´s restructure operation



Additions

Used


Current


Effect of Group´s restructure operation


Decrease due to business combination


Reversal

Additions

Used

End of the twelve –month period

–

641

916

(161)

53

(404)

1,045

–

9,846

2,540

(927)

(1,566)

(41)

18,846

(83)

28,615

At December 31, 2013 the evolution of the allowance for

doubtful accounts that was deducted from Trade and Other

receivables is:

DEC 31, 2013

1

1

1

1

1

NOTES

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T E C H I N T

E & C

S . A .


Materials and spare parts

Valuation allowance

Total Inventories


Effect of Group's restructure operation


Reversal

Additions

Used


55,308

(13,526)

41,782

–

5,650

(448)

(704)

11,609

(2,581)

13,526

NOTE 9.

INVENTORIES


At December 31, 2013 the evolution of the valuation

allowance that was deducted from Inventories is:

DEC 31, 2013

DEC 31, 2013

1

NOTES

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2 0 1 3


Assets as per special balance sheet


Trade and other receivables (1)

Other investments


Total

Liabilities as per balance sheet

Borrowings

Financial lease liabilities

Trade and other payables (1)


Other liabilities (2)

Total

213,078

4,814

666,452

–

120,473

1,004,817

–

–

–

8,984

–

8,984

213,078

4,814

666,452

8,984

120,473

1,013,801

–

–

73

–

73

AVAILABLE-

FOR-SALE

4,119

–

–

–

4,119

DERIVATIVE

FINANCIAL

INSTRUMENTS

OTHER FINANCIAL

LIABILITIES AT

AMORTIZED COST

DERIVATIVE

FINANCIAL

INSTRUMENTS

4,119

990,219

7,579

576,242

1,578,159

TOTAL

TOTAL

–

990,219

7,506

–

997,725

LOANS

AND

RECEIVABLES

–

–

–

576,242

576,242

ASSETS AT FAIR

VALUE THROUGH THE

PROFIT AND LOSS

DECEMBER 31, 2013

(1) Excluding prepayments and advanced to suppliers and subcontractors.

(1) Excluding social security contributions.

(2) Excluding advances received on construction contracts.

NOTE 10.

FINANCIAL INSTRUMENTS BY CATEGORY

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T E C H I N T

E & C

S . A .


DETERMINING FAIR VALUES

The table below analyzes financial instruments carried at fair

value, by valuation method.

The different methods have been defined as follows:

Level 1- Quoted prices (unadjusted) in active markets for

identical assets or liabilities.

Level 2- Inputs other than quoted prices included within level 1

that are observable for the asset or liability, either directly (that

is, as prices) or indirectly (that is, derived from prices).

Level 3- Inputs for the asset or liability that are not based on

observable market data (that is, unobservable inputs).

The following table presents the assets that are measured

at fair value:

Assets at December 31, 2013


Total

–

–

–

–

576,242

576,242

576,242

576,242

LEVEL 3LEVEL 2LEVEL 1 TOTAL

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2 0 1 3


FAIR VALUE ESTIMATION

Financial assets or liabilities classified as assets at fair value

through profit or loss are measured under the framework

established by the IASB accounting guidance for fair value

measurements and disclosures.

The fair values of quoted investments are generally based

on current bid prices. If the market for a financial asset is not

active or no market is available, fair values are established

using standard valuation techniques.

For the purpose of estimating the fair value of Cash and cash

equivalents and Other Investments expiring in less than ninety

days from the measurement date, the Company usually

chooses to use the historical cost because the carrying amount

of financial assets and liabilities with maturities of less than

ninety days approximates to their fair value.

The fair value of all outstanding derivatives is determined

using specific pricing models that include inputs that

are observable in the market or can be derived from or

corroborated by observable data. The fair value of forward

foreign exchange contracts is calculated as the net present

value of the estimated future cash flows in each currency,

based on observable yield curves, converted into U.S. dollars

at the spot rate of the valuation date.

Borrowings are comprised primarily of fixed rate debt

and variable rate debt with a short term portion where

interest has already been fixed. They are classified under

other financial liabilities and measured at their carrying

amount. Fair values were calculated using standard

valuation techniques for floating rate instruments and

comparable market rates for discounting flows (See

note 14).

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T E C H I N T

E & C

S . A .


NOTE 12.

CASH AND CASH EQUIVALENTS

Cash at bank and on hand

Short-term bank deposits

Short-term deposits in related parties

Total cash and cash equivalents


Bank overdrafts

Total cash and cash equivalents

191,802

252,122

132,318

576,242

576,242

(10,419)

565,823

Cash, cash equivalents and bank overdrafts include the

following for the purposes of the special consolidated

statement of cash flows:

DEC 31, 2013

DEC 31, 2013

NOTE 11.

ASSETS OF DISPOSAL GROUP CLASSIFIED

AS HELD FOR SALE

ASSETS



Property, plant and equipment

Total held – for – sale assets

165

165

24

14

DEC 31, 2013

NOTES

NOTES

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2 0 1 3


NOTE 13.

CAPITAL STOCK

The composition of the Company’s capital is as follows:

At December 31, 2013 13,446,780,05813,446,780,058

ORDINARY

SHARES

NUMBER

OF SHARES

IN THOUSANDS OF SHARES

The ordinary shares have a value of UYU 1 per share and one

vote per share. All issued shares are fully paid.

On October 21, 2013, the Special Shareholders’ Meeting

resolved to increase the authorized capital stock to UYU

17,500,000,000, which increase was verified by the AIN on

January 21, 2014.

The Company’s Board of Directors’ Meeting held on

December 6, 2013, accepted an irrevocable contribution

as partial payment for future payments of USD 67,300

from the parent company Techint Investment N.V., which

contribution shall be ratified and capitalized by the General

Shareholders’ Meeting.

On March 31, 2014, a Special Shareholders’ Meeting

resolved to increase the paid-in capital, through the

capitalization of the share premium in the sum of UYU

1,758,307,872 and the above-mentioned irrevocable

contribution for future payments of capital equivalent to

UYU 1,434,364,900. Thus, the paid-in capital is now UYU

16,639,452,830 (with a nominal value of UYU 1.- per share).

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100

T E C H I N T

E & C

S . A .


NOTE 14.

BORROWINGS

Non-current

Bank borrowings

Financial leases

Other borrowings

Total Non-Current borrowings

Current

Bank overdrafts

Bank borrowings

Borrowings from related parties

Financial leases

Other borrowings

Total Current borrowings

Total Borrowings

151,892

2,674

524

155,090

10,419

19,382

29,260

2,140

1,601

62,802

5.60%

DEC 31, 2013

DEC 31, 2013

The weighted average interest rates before tax shown bellow

were calculated using the rates set for each instrument in its

corresponding currency as of December 31, 2013.

24

NOTES

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101


2 0 1 3


Breakdown of borrowings by currency and rate is as follows:

NON-CURRENT

ARS

CHL

BRL

EUR

INR

MXN

USD

USD

CURRENT

ARS

CHL

MXNUSD

USD

EUR

EUR

INR

Fixed

Fixed

Variable

Fixed

Fixed

Fixed

Fixed

Variable

Fixed

Fixed

FixedFixed

Variable

Fixed

Variable

Fixed

CURRENCY INTEREST RATE DEC 31, 2013

8,621

2,676

45,530

75,122

6,624

2,132

6,176

8,209

155,090

16,284

2,140

841

24,737

12,071

1,987

4,293

449

62,802

Ref:

ARS: Argentine Peso

BRL: Brazilian Real

CHL: Chilean Peso

MXN: Mexican Peso

EUR: Euro

INR: Indian Rupee

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T E C H I N T

E & C

S . A .


Financial leases

Other borrowings

Total Borrowings

Interest to be accrued

–

12,948

12,948

–

–

15,480

15,480

–

–

86,235

86,235

–

2,037

23,901

25,938

70

2,140

60,662

62,802

452

637

13,852

14,489

5

1 YEAR

OR LESS

1 - 2

YEARS

2 - 3

YEARS

3 - 4

YEARS

4 - 5

YEARS

OVER

5 YEARS

The maturity of borrowings is as follows:

The following table summarizes the proportions of variable rate

and fixed rate debt as of the twelve-month period-end.

The fair value of borrowings equals their carrying amount, as

the impact of discounting is not significant.

The fair values are within level 2 of the fair value hierarchy.

DECEMBER 31, 2013

Fixed rate

Variable rate

68%

32%

147,789

70,103

BORROWINGS PERCENTAGE

DECEMBER 31, 2013

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2 0 1 3


NOTE 15.

DEFERRED INCOME TAXES

As further explained in note 2.s., TECHINT E&C and most

of the Company’s subsidiaries are subject to income taxes.

At December 31, 2013 the Company discloses under the

caption “deferred income tax assets” the net balance

recognized by those subsidiaries that recorded a net deferred

income tax asset, while the net balance recognized by those

subsidiaries that recorded a net deferred income tax liability

has been disclosed under “deferred income tax liabilities” in

the special consolidated statement of financial position.

Deferred income tax assets and liabilities are offset when

(1) there is a legally enforceable right to offset current tax

assets against current tax liabilities and (2) the deferred

income taxes relate to the same fiscal authority.

The main subsidiaries generating deferred income tax

balances are detailed below:

Deferred Income Tax Assets

TEBRA

TENCO’s subsidiaries

TEMEX’ subsidiaries

TEARG

TEINVATEMIL and subsidiaries

Deferred Income Tax Liabilities

TENCO’s subsidiaries

TEMEX and subsidiaries

TEARG’s subsidiaries

TEMIL ´s subsidiaries

Preglosid Argentina

Sidernet MexicanaTIC

44,076

4,250

3,863

18

224

29,141

81,572

27,885

5,389

7,271

3,664

2,681

1,5723,230

51,692

DEC 31, 2013

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T E C H I N T

E & C

S . A .


At December 31, 2013 the deferred tax balance is originated

by the following items:

Deferred Income Tax Assets

Tax-loss carry-forwards

Provisions

Deferred costs/Construction contracts

Other

Subtotal

Deferred Income Tax Liabilities

Committed investment FEPSA

Deferred income/Construction contracts

PP&E revaluation

Inventories

PP&E

OtherSubtotal

Net deferred income tax assets

49,906

65,887

8,766

4,915

129,474

12,488

40,576

28,493

7,580

1,561

8,896

99,594

29,880

DEC 31, 2013

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2 0 1 3


The evolution of net deferred income tax asset / (liability)

during the twelve-month period is as follows:

The amounts shown in the special consolidated statement of

financial position include the following:

Deferred tax assets to be recovered within 12 months

Deferred tax assets to be recovered after more than 12 months

Deferred tax liabilities to be recovered within 12 months

Deferred tax liabilities to be recovered after more than 12 months

Net deferred income tax assets


Effect of Group´s reestructure operation



PP&E revaluation

Other movements

Income statement charge


51,360

78,114

(43,173)

(56,421)

29,880

–

36,681

27,938

(4,179)

(25,644)

(3,329)

(1,587)

29,880

DEC 31, 2013

DEC 31, 2013

1

1

NOTES

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106

T E C H I N T

E & C

S . A .


The evolution of deferred income tax assets and liabilities

during the twelve –month period is as follows:





Other movements

Income statement (charge) / credit






PP&E revaluationOther movements

Income statement charge / (credit)


–

93,605

34,706

(10,812)

(5,575)

17,550

129,474

–

56,924

6,768

(6,633)

25,644(2,246)

19,137

99,594

DEFERRED TAX ASSETS

DEFERRED TAX LIABILITIES

–

25,975

3,818

(177)

–(1,878)

12,838

40,576

DEFERRED

INCOME/

CONSTRUCTION

CONTRACTS

–

37,647

17,855

(4,890)

(6,447)

5,741

49,906

TAX-LOSS

CARRY-

FORWARDS

–

9,552

–

(2,676)

25,644–

(4,027)

28,493

–

53,421

1,853

(5,678)

1,166

15,125

65,887

PROVISIONS

PP&E

REVALUATION

–

2,413

–

979

––

4,188

7,580

–

1,990

9,743

(222)

–

(2,745)

8,766

DEFERRED

COSTS/

CONSTRUCTION

CONTRACTS

INVENTORIES

–

547

5,255

(22)

(294)

(571)

4,915

–

5,652

2,950

(1,140)

–(368)

3,363

10,457

OTHERS

OTHERS

TOTAL

TOTAL

1

1

1

1

NOTES

NOTES

–

13,332

–

(3,619)

––

2,775

12,488

COMMITED

INVESTMENT

FEPSA

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2 0 1 3


The tax loss carry-forwards mature as detailed below:

Year 2015

Year 2016

Year 2017

Year 2018

Without maturity

490

1,393

14,446

22,656

123,927

162,912

The recoverable value of deferred tax assets depends on the

existence of future income subject to income tax, sufficient

to be used before their legal prescription. In this regard,

Management estimates that TECHINT E&C’s subsidiaries

will generate sufficient taxable income in future periods so

as to offset the net balance of deferred income tax assets

recorded at December 31, 2013.

DEC 31, 2013YEAR

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T E C H I N T

E & C

S . A .


NOTE 16.

TRADE AND OTHER PAYABLES

Non-Current

Trade payables

Social security contributions

Total trade and other payables

Current

Trade payables

Social security contributions

Amounts due to related parties

Other payables

Total trade and other payables

816

45,092

45,908

652,682

83,834

11,393

1,561

749,470

The maturity of trade and other payables is as follows:

DEC 31, 2013

24

NOTES

OVER

5 YEARS

4 - 5

YEARS

3 - 4

YEARS

2 - 3

YEARS

1 - 2

YEARS

December 31, 2013


Total Trade and other payables

4,209

4,209

4,209

4,209

4,209

4,209

3,237

3,237

749,470

749,470

16,133

16,133

13,911

13,911

1 YEAR

OR LESS

WITHOUT

DUE DATE

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2 0 1 3


NOTE 17.

OTHER LIABILITIES

Non-current

Provisions

Advances received on construction contracts


Other liabilities

Total other liabilities

Current

Provisions

Advances received on construction contracts


Other liabilities and provisions

Total other liabilities

59,737

29,752

1,197

5,997

96,683

40,722

50,818

179

12,641

104,360

DEC 31, 2013

18

24

18

24

NOTES

The maturity of other liabilities is as follows:

OVER

4 YEARS

3 - 4

YEARS

2 - 3

YEARS

1 - 2

YEARS

1 YEAR

OR LESS

December 31, 2013

Other liabilitiesTotal Other liabilities

3,2903,290

11,69211,692

32,54232,542

104,360104,360

29,41429,414

19,74519,745

WITHOUT

DUE DATE

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T E C H I N T

E & C

S . A .


NOTE 18.

PROVISIONS

The evolution of provisions during the twelve-month period

is as follows:

DECEMBER 31, 2013

Non-current





Reversal

Additions

UsedEnd of the twelve-month period

Current


Effect of Group's restructure operationIncrease due to business combination


Reversal

Additions

Used


–

53,487

10,564

(7,049)

(5,270)

11,189

(3,184)

59,737

–

5,81243,015

55

(17,989)

14,101

(4,272)

40,722

–

91

8,888

84

–

2,202

(61)

11,204

–

496–

160

–

11,222

(52)

11,826

TAXES

LABOR (3)

–

4,607

–

(779)

(1,963)

239

(178)

1,926

–

1,5703,592

59

–

1,368

(1,570)

5,019

CIVILS

TAXES

–

32,897

–

(4,250)

(2,747)

3,714

–

29,614

–

2,534–

(158)

(2,310)

127

(80)

113

LEGAL FEES (1)

CIVILS

–

8,743

1,676

(531)

–

3,158

(2,653)

10,393

–

1,21239,423

(6)

(15,679)

1,384

(2,570)

23,764

OTHERS (2)

OTHERS (4)

TOTAL

TOTAL

1

11

NOTES

NOTES

–

7,149

–

(1,573)

(560)

1,876

(292)

6,600

LABOR

(1) See note 23.

(2) It includes contractual obligations undertaken by the subsidiary Carbonser SA de CV in relation

to the contract for the supply of coal handling services, calculated based on a technical study

which indicates the degree of wear and tear of the main components of the Petacalco Plant, as

well as the amount of expenditures estimated to be made in the future due to the wear and tear

generated by the use of such Plant (USD 6,811).

(3) Labor provision includes the accrual for restructuring activities mainly related to the agreement

reached between Techint S.p.A. Management and local trade union groups and the union

representatives, for management of short-time work plan (Cassa Integrazione straordinaria).

(4) “Provisions for contract risks”, cover liabilities considered certain or probable which at the

balance sheet date are uncertain as to the amount or the date on which they will arise and

include, in particular, provisions set aside for penalties on job orders in the process of being

agreed with clients. (USD 15,600).

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NOTE 19.

EMPLOYEE BENEFITS

The company has the following employee benefits:

NON-FUNDED DEFINED BENEFITS AND OTHER

LONG-TERM BENEFITS.

The amount recognized in the special consolidated

statement of financial position is determined as follows:

There are no due and payable debts as of December 31, 2013.

The amounts recognized in the special consolidated income

statement are as follows:

Liabilities for retirement benefit and other plans

Liability in the special consolidated statement financial position

Current service cost

Interest cost

Transfers and new participants of the plan

OtherTotal included in Labor costs

30,443

30,443

2,416

3,997

205

(39)6,579

DEC 31, 2013

DEC 31, 2013

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T E C H I N T

E & C

S . A .






Transfers and new participants of the plan

Reversal of provisions

Total expense

Contributions paid

Others


–

34,566

8,719

(1,453)

151

(14,307)

6,579

(3,378)

(434)

30,443

The amounts and movements in the liabilities recognized

in the special consolidated statement financial position are

determined as follows:

At December 31, 2013, the main actuarial premises in the

subsidiaries TEARG and Sidernet S.A. used for calculation

of such plans contemplate a discount rate average of 7%

and 6% (real) and a salary increase rate of 2% and 3 %,

respectively. The actuarial premises used in the subsidiary

TEMEX for calculation of such plans contemplate a discount

rate of 7.30% and a salary increase rate of 4.64% at

December 31, 2013. Additionally, the actuarial premises

used in the subsidiary TEMIL for calculation of such plans

contemplate a discount rate of 3.20% and a salary increase

rate of 4% at December 31, 2013.

CONTRIBUTION PLANS

During the twelve-month period ended December 31,

2013 TEBRA contributed USD 1,209 to the defined

contribution plans.

DEC 31, 2013

1

1

NOTES

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T E C H I N T

E & C

S . A .


MAIN JOINT OPERATIONS (J.O.) (CONT’D.)

(1) Controlling interest through TEARG.

(2) Controlling interest through TEMEX.

(3) Controlling interest through TEMIL.

(4) Controlling interest through TEBRA.

(5) Controlling interest through TENCO.

Techint / Black & Veatch - LNG Costa Azul Project (2)

SA.T S.p.A. (3)

Genesi Uno S.p.A. (3)

TS LNG SAS (3)

TS LNG BV (3)

TS LNG BELGIUM BVBA (3)

Holding Investimenti Sanità Infrastrutture S.r.l. (3)

GE. SAT S.C.A.R.L. (3)

Consórcio Techint Confab UMSA - Lot I Tanks Refinería

do Nordeste, Abreu e Lima (RNEST) (4)

Consorcio Andrade Gutierrez - Techint (AG-TECH) Diesel Unit of

Landulpho Alves - Mataripe Refinery (RLAM) (4)

Tamburí Comércio de Máquinas e Serviços de EngenhariaLtda. (Tamburí) (4)

Consorcio Andrade Gutierrez - Techint (TE - AG) (4)

Consorcio Technip - Techint (TTP - 76) (4)

ABB Lummus Techint Bahamas Joint Venture - Gasoline Optimization

Program Upgrade - Petroleum Company of Trinidad and Tobago

Limited - Engineering, Procurement and Management Services (5)

Empresa Constructora Belfi S.A. Sucursal Uruguay - Techint

Compañía Técnica Internacional S.A.C.I. - Uruguay (5)

Consorcio Construcciones y Montajes (5)

50.00%

35.00%

65.00%

50.00%

50.00%

50.00%

20.00%

35.00%

41.00%

50.00%

50.00%

50.00%

50.00%

50.00%

40.00%

60.00%

6,658

229,057

34,362

123,232

3,162

26,880

110

28,574

215

1,906

44

18,482

34,418

–

50,956

9,554

500

255,929

39,603

136,884

6,438

26,862

27,525

28,589

15

686

1,362

69,562

37,488

14,972

49,357

9,836

TOTAL J.O.’S

LIABILITIES

TOTAL J.O.’S

ASSETS

COUNTRY OF

OPERATION

% OF

OWNERSHIP

DECEMBER 31, 2013

Mexico

Italy

Italy

France

Holland

Belgium

Italy

Italy

Brazil

Brazil

Brazil

Brazil

Brazil

Trinidad &

Tobago

Uruguay

Peru

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The following balances represent the J.O.s results

at December 31, 2013:

Constructora Norberto Odebrecht S.A. - Odebrecht Argentina S.A. - Techint Cia

Técnica Internacional S.A.C.e I. - Unión Transitoria de Empresas - Proyecto: Potasio

Río Colorado (1)

Techint Cia Técnica Internacional S.A.C.e I. – Dycasa S.A. - Unión Transitoria de

Empresas - Proyecto: Ampliación Subte H (1)

Techint Cia Técnica Internacional S.A.C.I. - Panedile Argentina S.A. - Unión

Transitoria de Empresas - Complejos “Los Caracoles“ and “Punta Negra” (1)

Techint Cia Técnica Internacional S.A.C.I. - Impregilo S.p.A (Sucursal Argentina) -

Iglys S.A. - Unión Transitoria de Empresas - Complejo Penitenciario Ezeiza (1)

Techint Cia Técnica Internacional S.A.C.e I. - FLUOR Inc. - Unión Transitoria de

Empresas - Proyecto: Pascua Lama(1)

ABB Lummus Techint Trinidad Joint Venture - Gasoline Optimization Program

Upgrade - Petroleum Company of Trinidad and Tobago Limited - Construction

Management Services (1)

MAIN JOINT OPERATIONS

40.00%

60.00%

75.00%

65.00%

50.00%

50.00%

14,250

7,333

13,424

11,913

52,283

(29)

J.O.’S

RESULTS

COUNTRY OF

OPERATION

% OF

OWNERSHIP

DECEMBER 31, 2013

Argentina

Argentina

Argentina

Argentina

Argentina

Trinidad &

Tobago

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MAIN JOINT OPERATIONS (J.O.) (CONT’D.)

(1) Controlling interest through TEARG.(2) Controlling interest through TEMEX.

(3) Controlling interest through TEMIL.

(4) Controlling interest through TEBRA.

(5) Controlling interest through TENCO.

Techint / Black & Veatch - LNG Costa Azul Project (2)

SA.T S.p.A. (3)

Genesi Uno S.p.A. (3)

TS LNG SAS (3)

TS LNG BV (3)

TS LNG BELGIUM BVBA (3)

Holding Investimenti Sanità Infrastrutture S.r.l. (3)

GE. SAT S.C.A.R.L. (3)

Consórcio Techint Confab UMSA - Lot I Tanks Refinería do Nordeste, Abreu e Lima

(RNEST) (4)

Consorcio Andrade Gutierrez - Techint (AG-TECH) Diesel Unit of Landulpho Alves -

Mataripe Refinery (RLAM) (4)

Tamburí Comércio de Máquinas e Serviços de Engenharia Ltda. (Tamburí)(4)

Consorcio Andrade Gutierrez - Techint (TE - AG) (4)

Consorcio Technip - Techint (TTP - 76) (4)

ABB Lummus Techint Bahamas Joint Venture - Gasoline Optimization Program

Upgrade - Petroleum Company of Trinidad and Tobago Limited - Engineering,

Procurement and Management Services (5)

Empresa Constructora Belfi S.A. Sucursal Uruguay - Techint Compañía Técnica

Internacional S.A.C.I. - Uruguay (5)

Consorcio Construcciones y Montajes (5)

50.00%

35.00%

65.00%

50.00%

50.00%

50.00%

20.00%

35.00%

41.00%

50.00%

50.00%

50.00%

50.00%

50.00%

40.00%

60.00%

(854)

(3,720)

911

2,860

(600)

(42)

2,410

–

1,237

67,274

(58)

103,232

3,124

(1)

(4,992)

280

TOTAL J.O.’S

LIABILITIES

COUNTRY OF

OPERATION

% OF

OWNERSHIP

DECEMBER 31, 2013

Mexico

Italy

Italy

France

Holland

Belgium

Italy

Italy

Brazil

Brazil

BrazilBrazil

Brazil

Trinidad &

Tobago

Uruguay

Peru

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NOTE 21.

CONTINGENCIES AND COMMITMENTS

a. GUARANTEES AND BONDS GRANTED

TECHINT E&C and its subsidiaries have entered into a series

of guarantee contracts with third parties through which

they undertake the unconditional and irrevocable obligation

to guarantee the prompt and complete payment and

performance of certain liabilities incurred by related parties.

b. . WORKS EXECUTED UNDER A TRUST, CONSTRUCTION

AND LEASING AGREEMENT

TEARG, as a member of the J.O. Techint Compañía Técnica

Internacional S.A.C.I. – Impregilo S.p.A. (Sucursal Argentina)

– Iglys S.A., has signed a contract with the Argentine

Government for the construction of a penitentiary institution,

under the turnkey system, located in Ezeiza, province of

Buenos Aires, payable in 60 quarterly installments as canon,

nominated in USD 4,650.

The J.O. accepted the pesification of canons at an

ARS 1-USD 1 rate and the application of the Reference

Stabilization Index (RSI) until the effective date of payment,

according to the Agreements executed by the J.O. with the

Ministry of Justice and Human Rights, dated November

19, 2003 and September 9, 2004. The canons collected

plus RSI after the Agreement dated September 9, 2004,

were Nos. 17, 18, 19, 20, 21 and 22. On the other hand,

before execution of such Agreement, canon No. 8 was alsocollected plus RSI in January 2003.

That notwithstanding, the J.O. received from such Ministry

payments for several canons not applying the RSI, which

have been taken by the J.O. as partial payments of the total

amount due and payable arising from the Agreement dated

September 9, 2004.

Thus, from January 2006 to the date of issue of these special

consolidated financial statements, the J.O. received as partial

payment a total amount of USD 36.239 corresponding to

canons 10 to 16 and 23 to 57 at an ARS 1-USD 1 rate, not

applying the RSI. Taking into account this situation, the J.O.’s

Management made a new estimate of the date of probable

collection of the RSI past due and to become due.

Taking into account the Ministry of Justice’s delay as to a

resolution and payment of the overdue debt, Santander

Río Trust S.A., in its capacity as Trustee and Grantor of

the Leasing, on July 4, 2008, following the J.O.’s express

instructions, submitted a note demanding payment of

amounts due. Upon failure to answer by the Ministry of

Justice, on November 28, 2008, an Arbitration Claim was filed

before the International Court of Arbitration of the International

Chamber of Commerce, for the purpose of appointing an

arbitration tribunal consisting of three arbitrators and to hold

the respondent, the Argentine Government, liable for payment

of the amounts claimed plus any interest that may be accrued

and the new terms of the debt to expire during the arbitration

process. The arbitration claim was notified to the Argentine

Government in May 2009, the Arbitral Tribunal was constitutedand the Mission Statement was issued on December 7, 2010.

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In May 2009, the J.O. was informed of the passing of

Executive Order No. 541/09, which empowers UNIREN to

renegotiate the Construction, Trust and Leasing Agreement

executed in 1998 in relation to Penitentiary Complex I

(Ezeiza). The J.O. has not consented to the provisions of such

executive order by virtue of the defects thereof. On June 18,

2009, a letter was submitted through Santander Río Trust

S.A., in its capacity as Trustee and Grantor of the Leasing,

following the J.O.’s express instructions, to the above-stated

respect claiming the unlawful nature of such executive order.

That notwithstanding, and making it clear that this entails no

waiver whatsoever of its rights, including the right to enforce

its rights and defenses in the ongoing arbitration proceeding,

on September 8, 2010, the J.O. executed a Memorandum

of Understanding (MOU) with UNIREN since it believes that

under the terms of such MOU (i) the acknowledgement

made in the Agreement executed with the Ministry of

Justice on September 9, 2004 is ratified, (ii) UNIREN

acknowledges the debt upon failure to apply the RSI and (iii)

the J.O. states its position that as to all the claims and its

intention of suspending the arbitration upon actual payment

by the State of all amounts due.

Following the negotiations with the UNIREN, an Agreement

(“Entendimiento Contractual ”) was executed on November

18, 2011, whereby (i) the MOU dated September 8, 2010,

stated in the preceding paragraph, is ratified and the debt

upon failure to apply the RSI is acknowledged, (ii) the

Legal Board of Juridical Affairs (Dirección Legal de AsuntosJurídicos ) of the Ministry of Economy and Public Finance

concludes that the application of RSI complies with the

provisions under the applicable legal framework upon

the passing of Law No. 25561 and Executive Order No.

214/2002, (iii) the J.O. undertakes to suspend the arbitration

proceeding for 180 days and to obtain the ratification of

such agreement by the Trustee, (iv) the UNIREN undertakes,

upon compliance by the J.O. with the obligation stated in

(iii), to ratify the agreement within 180 days jointly with

the Ministry of Justice and Human Rights (MINJU) andwith the Argentine Executive Branch (PEN) and (v) upon

ratification by the PEN, the MINJU shall have a 90-day term

to cancel the debt, and the J.O. shall abandon the arbitration

proceeding before or after the administrative act stating the

cancellation of the debt is passed by the MINJU, but before

the actual cancellation.

The J.O. obtained the ratification by the Trustee and complied

with the arbitration suspension for 180 days. This suspension

was extended several times so that the Argentine

Government would satisfy the commitment to ratify the

agreement undertaken by the Argentine Executive Branch

(PEN). The last extension granted expired on September 30,

2013, and the Arbitration Court, according to the notice from

the Paris International Chamber of Commerce (ICC), had until

February 28, 2014, to issue the award. On February 20, 2014,

the ICC decided to extend such term until April 30, 2014.

The J.O. learnt that the Memorandum of Understanding

executed on November 18, 2011, as of this date is still

awaiting ratification by PEN. In such respect, we must point

out that the Argentine Attorney General’s Office (Procuración

del Tesoro de la Nación), on a letter dated July 29, 2013,

sent to the Court Clerk’s Office of the International Court

of Arbitration of the International Chamber of Commerce,

stated that the relevant administrative proceedings were

being conducted to effectively promote such ratification,

and for such purpose the Ministry of Justice, Security and

Human Rights (MINJU) was seeing to getting the budget

credit to afford any expenditures to be incurred to comply

with the above-mentioned Memorandum of Understanding.

In addition, on February 6, 2014, the Argentine AttorneyGeneral’s Office issued a note to the Assistant Counsel

of the Court Clerk’s Office of the International Court of

Arbitration of the International Chamber of Commerce

stating the Argentine Government’s willingness to settle the

dispute as agreed under the Agreement executed between

the Claimants and the Public Services Contract Analysis

and Renegotiation Unit (UNIREN) and, in addition, on March

12, 2014, the Argentine Attorney General’s Office applied

to the Court Clerk’s Office of the International Court of

Arbitration of the International Chamber of Commerce fora new 6-month extension, and it also attached a note from

the Coordination Secretary of the MINJU asking for the

allocation of budget items to pay the amount set forth in the

above-mentioned Agreement.

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By virtue of the above, the J.O. started to accrue the RSI

again, from January 1, 2009 to November 30, 2013.

On April 16, 2014, the request of the Argentine Attorney

General’s Office was accepted and a 3-month extension

was granted.

On April 29, 2014, the ICC decided to extend such term until

July 31, 2014.

In such respect, the J.O.’s Management and Legal Advisors

believe that, by virtue of application of the legal rules

and regulations regarding pesification (application of the

Reference Stabilization Index (RSI) to overdue canons) which

should be applied to this contractual structure, the J.O. has

a sound legal position to collect its claims in the context of

application of the above-mentioned rules and regulations.

The proportional participation of TEARG in the total balance

receivable of the J.O. with the Argentine Government as of

November 30, 2013 amounts to USD 44,821.

The value of such receivable recorded in these special

financial statements, which results of discounting the above-

stated value from the current value as of November 30, 2013,

and according to the estimate of probable date of collection

of RSI as of November 30, 2014, is USD 39,128.

All these financial credits correspond to the canonsreceivable from the Argentine Government, due and to

become due, which were recorded as per the Agreement

executed on September 9, 2004 with the Undersecretariat

of Coordination and Innovation under the National Ministry of

Justice and Human Rights, in Pesos at a rate of ARS 1-USD 1

and adjusted with RSI up to November 30, 2013.

c. OTHER CONTINGENCIES AND UNCERTAINTIES

Techint E&C´subsidiaries have tax and civil lawsuits for which

the legal advisors do not expect a probable unfavorableoutcome and, therefore, no provision was set up. The

amounts of these contingencies amount as of December 31,

2013 to USD 2,496 for tax contingencies, USD 5,744 for civil

contingencies and USD 951 Others.

NOTE 22.

RESTRICTED ASSETS

TENCO AND SUBSIDIARIES

At December 31, 2013 the net carrying amounts of the PP&E

held under finance lease amount to USD 10,506. At December

31, 2013, liabilities for finance leases amount to USD 4,815.

TEBRA

At December 31, 2013, the Company had assets with a

carrying amount of USD 19 granted as guarantee for different

legal proceedings.

TEARG

At December 31, 2013, there were PP&E with a residual

book value of USD 1,225, which were pledged as guarantee

for liabilities under pledge agreements for USD 1,545 and

USD 528, included in the account “current and non-current

Borrowings“, respectively.

COINCAR S.A.

Under the Credit Facility Agreement entered into by Coincar

S.A. with Banco Santander Río S.A. and Banco de Galicia

y Buenos Aires S.A., Coincar S.A. agreed not to sell nor

cause to be sold, assign in ownership and/or use and/or

usufruct, mortgage, pledge, loan and/or loan for use, levy in

any manner whatsoever, lease and/or enter into a leasing,

grant a security and/or personal interest with respect to,

not to transfer and/or in any manner dispose of, either in atransaction or a series of transactions, all or a substantial

portion of any of its assets, goods and/or rights and/or of its

assets, goods and/or rights to be acquired in the future, nor

to distribute dividends, pay fees to the company’s directors

or consultants, without the prior consent of the majority of

the banks that granted the Credit Facility Agreement.

COINFER

Licensed assets:

In conformity with the regulations established in the bidspecifications and the License Agreement, the subsidiary

FEPSA received from Ferrocarriles Argentinos assets of its

own to be used in the operation (included in “Property, plant

and equipment” non-current). They primarily comprised

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S . A .


infrastructure (main and secondary railway network), real

property (warehouses and buildings), transportation material

(locomotives and coaches), fixed facilities and other. Upon

expiration of the license, the assets would be returned to

Ferrocarriles Argentinos, at no additional cost, in their normal

condition of maintenance, except for the wear and tear over

time and the normal use.

NOTE 23.

CLAIMS RECEIVABLES

During the year ended December 31, 2011 TEBRA recognized

a gain for damages based on a final and irrevocable court

decision issued on April 4, 2011 by the Superior Court of

Justice ("STJ") related to the Civil Construction Contract

entered into in October 1, 1991 with the Ministry of Education

and Sports for the construction of 200 units of the Integrated

Center for Child Support (CIAC according to its acronym

in Portuguese). The claim was brought by TEBRA claiming

reimbursement losses resulting from the unilateral termination

of the contract by the government on September 30, 1996

when only 41 CIACs had already been built.

TEBRA claimed damages for all losses incurred, among

which, additional costs incurred in the production of pre-

molded concrete elements and in the support of the work;

the costs of plant implementation, which could not be

recovered due to the contract termination; loss of profitsdue to the failure of the essential purpose of the contract;

and costs required for the demobilization of the plant, the

building sites and equipment.

The STJ recognized the right of TEBRA to damages for all

the costs incurred based on an expert report plus legal

interest and monetary adjustment. The report of the expert

was issued on July 27, 1999 with amounts updated through

December 31, 1998 and the decision of the STJ issued on

April 4, 2011 determined the amount of damages in the

amount of R$ 93,283 adjusted through December 31, 1998

and subsequently monetarily adjusted according to the criteria

defined in such decision. On July 18, 2011, a request for

execution was filed by TEBRA, accompanied by another expert

report which adjusted the amount of the resulting damages

according to the criteria defined in the final and unappealable

decision to a total of R$ 339,263 on June 30, 2011.

At December 31, 2011 TEBRA recorded upon initial

recognition the amounts recorded under “Claims receivables“

at its present value measured considering its terms which

include adjustment based on INPC/ Brazilian Central Bank

plus interest of 1% per month until the issuance of the

payment order (precatório) by the president of the Superior

Justice Court (the original estimate of management upon

initial recognition was that the payment order would be

issued before June 30, 2013 and currently management has

revised such estimate for such payment order to be issued

before June 30, 2014) and include adjustment thereafter at

0.5% per month until its settlement. Management currently

estimates that the amount will be paid by the Federal

Government from December 31, 2013, on the maximum

legal period of ten annual installments for certificates ofgovernment’s debt issued up to June 30, 2012. The discount

rate used was 9.86% per year in all cases based on the

DIxTR reference rate provided by BM&F BOVESPA.

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The net amount recorded in income for the year ended

December 31, 2011 is as follows:

Details:

Claim restated up to the date of recognition by the final and irrevocable court decision

Restatement for the period between the final and irrevocable court decision

and December 31, 2011 (INPC)

Interest for the period between the final and irrevocable court decision and December 31, 2011 (1% p.m.)

Total amount at December 31, 2011

Adjustment to present value

Total adjusted to present value at December 31, 2011

Provision for legal fees - 20%

Amount recognized as “Gain from claims, net“

339,263

3,359

13,412

356,034

(57,855)

298,179

(59,636)

238,543

187,711

(37,542)

150,169

AMOUNTS IN

R$ THOUSAND

AMOUNTS IN

USD THOUSAND (*)

(*) The amount of the net gain has been translated at the average exchange rate of April 2011 the month on which the final

unappealable decision was issued. The receivable as of December 31, 2013 translated at the period-end exchange rate

amounts to USD 148,525 (see note 8) and the related provision for legal fees amounts to USD 29,614 (see note 18).

On October 25, 2011, having been duly served with

process, the Government filed a motion to stay execution,

questioning, among other matters, the computation

criteria. The motion to stay was judged by the courts on

October 19, 2012. TEBRA believes that the decision of the

first level judge to change the date when the monetary

restatement should start to be computed in six months is

wrong. TEBRA conservatively reduced the amount of theindemnity receivable in the amount of R$ 14,906 reflecting

the court decision.

On September 6, 2012 the Federal Government presented to

the Superior Tribunal de Justiça (“STJ”) a motion to set aside

judgment (ação rescisória), a request to overturn or set aside

the final unappelable ruling on the case.

Under Brazilian law motion to set aside already issued

final and unappelable judgments are only applicable in nine

very narrow circumstances. In the view of management

supported by the opinion of its counsel the probability of the

Federal Government motion being successful is very remote.

At December 31, 2013 the amount of the receivable was

computed assuming that: (a) the estimated date for issuanceof the certificate of government's debt by the judicial authority

up to June 30, 2014 which represents the current best

estimate of the issuance, and (b) the payment by the Federal

Government in up ten equal and annual installments, payable

from December 31, 2015 (the maximum legal payment date

for certificates of government's debt issued up to June 30,

2014). The resulting amount was discounted at present value

based on DI x TR indices reported by BM&FBOVESPA.

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The changes in the amounts recorded in the claims

receivable and in the related provision for legal fees are

presented below:



Translation effect

Increase in the receivable due to application of inflation index (INPC)

and interest (1% p.m.) established in the final court decision

Unwinding of present value adjustment


Amount recognized as “Financial results“

–

165,005

(21,317)

18,572

(13,735)

148,525

4,837

–

(32,897)

4,250

(3,714)

2,747

(29,614)

(967)

CLAIM PROVISION

FOR LEGAL FEES

1

NOTES

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NOTE 24.

RELATED PARTY TRANSACTIONS

TECHINT E&C is controlled by Techint Investments N.V. ,

which owns 100% of the company’s shares. San Faustin S.A

(“San Faustin”), a corporation based in Luxembourg, owned

the company through subsidiaries.

Rocca & Partners Stichting Administratiekantoor Aandelen

San Faustin, a Dutch private foundation (Stichting) (“RP

STAK”) held shares in San Faustin sufficient in number to

control San Faustin.

No person or group of persons controlled RP STAK.

Non-current assets

Other investments in other related parties

Trade receivables from other related parties

Other receivables

Other receivables from associated parties Other receivables from other related parties

Current assets

Trade receivables

Trade receivables from associated parties

Trade receivables from other related parties

Other receivables

Other receivables from associated parties

Other receivables from other related parties


Short-term deposits in related parties

7,494

27

12,197

639

1,916

38,080

10,389

4,234

132,318

DEC 31, 2013

7

8

8

8

8

8

8

8

12

NOTES

TWELVE-MONTH PERIOD BALANCES WITH RELATED

PARTIES OTHERS THAN THE PARENT COMPANY

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Non-current liabilities

Other liabilities

Other liabilities due to subsidiaries

Other liabilities due to other related parties

Current liabilities

Borrowings

Borrowings from subsidiaries

Borrowings from other related parties

Trade and other payables due to other related parties

Other liabilities due to other related parties

405

792

886

28,374

11,393

179

17

17

14

14

16

17

NOTES DEC 31, 2013

Transactions with associated companies

Sales of goods and services

Purchases of goods and services

Transactions with other related companies

Sales of goods and services

Purchases of goods and servicesGeneral administrative and selling expenses

45,604

6,713

388,814

63,49735

DEC 31, 2013

TRANSACTIONS WITH RELATED PARTIES

The aggregate compensation of the directors and executive

officers earned during the twelve-month period ended

December 31, 2013 amounts to USD 14,493.

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NOTE 25.

PRINCIPAL SUBSIDIARIES

Carbonser, S.A. de C.V.

Carbontec, S.A. de C.V.

Compañía Inversora Ferroviaria S.A.I.F.

Constructora Mexicana Electromecánica

y de Instrumentación, S.A. de C.V.

Construcciones y Prestaciones Petroleras S.A. (CPP)

Ferroexpreso Pampeano S.A.C.

Flinwok S.A.

Prestaciones Globales Siderúrgicas S.A.I.F.

Saudi Techint Ltd.Sidernet de Venezuela C.A.

Sidernet Mexicana S.A. de C.V.

Sidernet S.A.

Socominter Sociedade Comercial Internacional Ltda.

Techint Chile S.A.

Techint Compagnia Tecnica Internazionale S.p.A.

Techint Compañía Técnica Internacional S.A.C.I.

Techint Compañía Técnica Internacional S.A.C.I.

Techint Engenharia e Construção S/A.

TEI&C S.A.Techint Iberia S.L.

Techint International Construction Corp. (TENCO)

Techint Ingeniería y Construcciones S.L.

Techint Ingeniería y Construccion Bolivia S.A.

Techint Inversiones S.A.I.F.

Techint S.A.C.

Techint, S.A. de C.V.

Techint Servicios, S.A. de C.V.

TE&C Investments Netherlands BV

TS LNG S.A.S.Wisdery S.A.

50.00%

50.00%

77.14%

100.00%

100.00%

61.71%

100.00%

100.00%

51.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

50.00%

100.00%

DEC 31, 2013 (*)

% OF OWNERSHIP

COMPANY

(1)

(1)

(2)

(3)

Loading and transportation of coal

Personal Services

Holding Company

Personal Services

Engineering and construction

Cargo Railway Transportation Concession

Holding Company

Holding Company

Engineering and constructionCleaning services

Heavy cleaning services

Heavy Cleaning Services

Sale of machinery and equipment






Holding CompanyEngineering and construction

Holding Company

Holding Company


Holding Company



Personal Services

Holding Company

Engineering and constructionTrading Company

MAIN ACTIVITY

Mexico

Mexico

Argentina

Mexico

Ecuador

Argentina

Uruguay

Argentina

Saudi ArabiaVenezuela

Mexico

Argentina

Brazil

Chile

Italy

Argentina

Uruguay

Brazil

UruguaySpain

Bahamas

Spain

Bolivia

Argentina

Peru

Mexico

Mexico

Netherlands

FranceUruguay

COUNTRY

The following is a list of TECHINT E&C’s principal subsidiaries

and its direct and indirect percentage of ownership of each

controlled company at December 31,2013:

(1) TEMEX has the power to govern the financial and operating policies of the entity.

(2) Controlling interest through Compañía Inversora Ferroviaria S.A.I.F.

(3) See note 1

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T E C H I N T

E & C

S . A .


DECEMBER 31, 2013

Non-current

Cash-flow hedge

Total derivative financial instruments – non current

Current

Cash-flow hedge


Total derivative financial instruments - current

–

–

4,119

–

4,119

3,212

3,212

1,871

3,901

5,772

ASSETS LIABILITIES

NOTE 26.

DERIVATIVE FINANCIAL INSTRUMENTS

FORWARD FOREIGN EXCHANGE CONTRACTSThe notional principal amounts of the outstanding forward

foreign exchange contracts at 31 December 2013:

Contract Types

Forwards to sell US dollars vs pesos mexicanos

Forwards to sell US dollars vs euros

Forwards to buy US dollars vs euros

Forwards to sell Polish zloty vs eurosForwards to buy Polish zloty vs euros

Measurement Report (“BM”) 32 in dollars – OSX

Measurement Report (“BM”) 33 in dollars – OSX

32,594

(103,205)

59,482

(52,500)106,557

1,700

2,201

TOTAL NOTIONAL AMOUNT IN CURRENCY OF THE CONTRACT DEC 31, 2013

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NOTE 27.

COST OF REVENUE AND EXPENSES BY NATURE

Labor costs

Taxes, rates and contributions

Fees and technical advice

Sub-contract for services

Purchases of material and supplies

PP&E depreciation

Intangible assets amortization

Work structure expenses

Office structure expenses

Unallocated costs


981,677

42,018

104,798

308,583

513,349

50,244

4,167

42,436

57,844

80,972

2,186,088

887,389

27,854

85,888

295,912

512,419

42,798

3,378

37,601

50,824

61,810

2,005,873

94,288

14,164

18,910

12,671

930

7,446

789

4,835

7,020

19,162

180,215

COST OF

REVENUE

4

5

NOTES GENERAL

ADMINISTRATIVE

AND SELLING

EXPENSES

DEC 31, 2013

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E & C

S . A .


NOTE 28.

FINANCIAL RESULTS

Income

Interests and indexation

Net foreign exchange transaction results

Results from Techint Cía Técnica Internacional S.A.C.I. Impregilo S.p.A. (suc. Arg.)

Iglys S.A. - Unión Transitoria de Empresas – Complejo Penitenciario Ezeiza

Restatement and interest on claims

Other

Costs

Interests and indexation

Net foreign exchange transaction results

ComissionsOther

11,980

8,779

7,866

3,870

2,357

34,852

(12,622)

(7,561)

(807)

(1,751)

(22,741)

DEC 31, 2013

21.b

NOTES

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NOTE 29.

OTHER OPERATING RESULTS

Gain from the sale of PP&E

Impairment loss

Derivative financial instrument

Reversal of provisions

Restructuring Costs TEMIL

Loss of Sale Investment in TEMIL

Other

5,510

(5,535)

(3,894)

14,307

(11,522)

(14,093)

2,992

(12,235)

NOTE 30.

INCOME TAX

Current income tax

Deferred income tax

(50,922)

(1,587)

(52,509)

DEC 31, 2013

DEC 31, 2013NOTES

15

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T E C H I N T

E & C

S . A .


135,770

(45,343)

1,372

4,262

313

1,795

(8,650)

(2,790)

733

2,419

(486)

(6,134)

(52,509)

The net difference between the tax calculated at the rate in

effect in each country and the total charge for the twelve-month

period is generated by the following:


Tax calculated at the applicable rate on the result for the twelve-month period

Effect of restatement in constant currency

Result due to participating interests in subsidiaries and related companies

Dividends earned

Gain from claims

Provision for loss with inventories and advances to suppliers

Tax loss carry - forwards

PP&E

Tax-deductible interest on own capital

Non-deductible expensesOther, net

Income Tax

DEC 31, 2013

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NOTE 31.

MAIN CONTRACTS IN PROGRESS

Peru

Loops del Sur - Preliminary Works

Camisea Well Head Compression Project EPC 30

Toromocho Project

Kepashiato Compression Plant Proyect – Transportadora de gas del Perú S.A. (TGP)

Chile

Construction of Stations and Pipeline for Seawater Supply

Mechanical Maintenance ServiceEscondida Water Supply (EWS) Project – Betchtel Chile Limitada

Uruguay

Melo Electricity Interconnection

Maldonado Sewage System

Puerto Montes del Plata

Brazil

Retarded Coke Unit - Complexo Petroquímico do Río de Janeiro (COMPERJ)

Modules for P-76 Platform

Argentina

Punta Negra Hydroelectric Power Station

Subway Line H Expansion

Potasio Río Colorado

Pascua Lama Fase III

100%

99%

98%

0%

96%

83%

0%

74%

100%

78%

82%

0%

69%

11%

(*)

(**)

85

122

247

132

193

142

691

89

46

171

1,569

871

399

476

–

–

PHYSICAL

PROGRESS

TOTAL CONTRACT

AMOUNT

(USD MILLION)

COUNTRY / AREA

PROJECT

At December 31, 2013 , the main contracts are the following:

(1)

(2)

(2)

(3)

(3)

(4)

(1)

(2)

(3)

DECEMBER 31, 2013

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S . A .


100%

100%

26%

83%

58%

40%

78%

8%

63%

91%

94%

94%

98%

65

26

242

70

39

765

782

103

124

269

331

178

69

PHYSICAL

PROGRESS

TOTAL CONTRACT

AMOUNT

(USD MILLION)

DECEMBER 31, 2013

Mexico

Norte II CCC Power Project

Tuxpan Compressor Station

Ethane Pipeline Project

Tamazunchale Facilities

Naranjos Compressor Station

Europe

Dunkerque LNG

Polskie LNG

Zeebrugee LNG

Norilsk – Cooper and nickel plant

Middle East

Yanbu – Solids handling system

Ruwais – 2° Sulfur handling plant

Hout Onshore – Petrol Improving facilities

Africa

El Ain El Sokhna – Central supercritical thermal

(5)

(3)

(6)

(3)

COUNTRY / AREA

PROJECT

(1) The Company's participation is 60%


(3) The Company's participation is 50%(4) The Company's participation is 75%



(*) The Potasio Río Colorado project was cancelled in March 2013.

(**) In October 2013, the client Barrick Exploraciones Argentinas S.A., an affiliate of Barrick

Gold Corp. of Canada, announced the suspension of the Pascua Lama project during the

implementation of Phase III, not mentioning anything about new deadlines for completion.

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NOTE 32.

CONTRACT WITH CUSTOMER UNDER JUDICIAL

RECOVERY - WHP 1 AND WHP 2 PLATFORMS - OSX

WHP 1 & 2 LEASING GROUP B.V. (“OSX”)

On June 15, 2011, TEBRA was engaged by OSX for the

provision of engineering services, supply of two platforms

named WHP-1 and WHP-2, and related activities, with

anticipated final load-out of platform WHP-2 and platform

WHP-1 on April 29, 2014 and April 29, 2015, respectively.

Up to June 2013, the contract was duly performed by

TEBRA, and all contractual obligations were fully complied

with within the schedule timelines. However, progress in

the projects, as measured in measurement reports (BMs) in

June (BM 32), July (BM33) and August (BM34) 2013, was not

paid by OSX on the respective due dates.

In July 2013, the client cancelled the construction of the WHP-1

Platform. The project was suspended in August 2013 upon

the client’s failure to pay. When the works were suspended,

the progress rate for construction of the WHP-2 Platform

was 45%. A Contractual Amendment dated September 27,

2013, formally cancelled the services and supply relating to

platform WHP 1, and the Company's rights arising from such

termination were maintained.

On October 02, 2013, TEBRA initiated judicial proceedings

aiming to receive the amounts due under BM´s 32 and 33.

On October 30, 2013, OSX started the arbitration process

against TEBRA in order to discuss the termination of the

contract for the construction of WHP-2.

On November 8, 2013, OSX sent TEBRA the notice to

inform that the contract has been terminated by TEBRA´s

exclusive fault, and to reiterate that the BMs are not payable.

On November 11, 2013, a counter-notification was sent

which alleged that OSX was the sole responsible for the

termination of the contract.

On that same day, OSX requested Judicial Reorganization

for the Brazilian companies of the group, which was granted

by the Courts of Rio de Janeiro, preventing the creditors to

receive the amounts due. Therefore, the judicial proceedings

initiated aiming to receive payment for the BMs 32 and 33

were suspended.

On December 20, 2013, the defense in the arbitration

process was filed, together with a counterclaim related to

the construction of WHP-2. The arbitration process against

OSX for discussing the termination of WHP-1 started on this

same date.

Given this scenario, the Company discontinued the

performance of the contract and limited revenue from this

project to those amounts that had been actually collected.

Also, the Company recognized costs incurred and measured

up to December 31, 2013.

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NOTE 33.

GROUP´S RESTRUCTURE OPERATION

As mentioned in Note 1, as results of the reestrucuration, the

total assets recognized amounts USD 1,548,714 and the total

liabilities assumed was equal to USD 820,076.

Below, a detai l is provided of assets and liabilities received:

ASSETS

Non-Current Assets


Intangible assets

Investments accounted for using the equity method

Other investments

Non-current tax assets


Deferred income tax assets

Current Assets

Inventories


Current tax assets


Construction contracts work in progress


Other investments


Total Assets

623,692

925,022

1,548,714

307,602

8,623

2,401

9,952

13,512

219,816

61,786

74,425

194

37,199

478,668

44,359

1,029

16

289,132

NOTES

4

5

6

7

8

15

9

26

8

11

7

12

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NOTE 34.

SUBSEQUENT EVENTS

On February 14, 2014, the company´s Board of Directors

provided for the payment of a dividend in cash for the

sum of USD 29,000, to be paid on such date to its

controlling shareholder.

Except for the situation stated in the previous paragraph

and in note 13 after December 31, 2013, no other events,

situations or circumstances have occurred which might

significantly affect the Company´s equity or financial position,

which have not been adequately contemplated or mentioned

in these special consolidated financial statements.

EQUITY AND LIABILITIES

Equity

Capital and reserves attributable to the Company's equity holders


Total equity

Non-Current Liabilities

Borrowings

Deferred income tax liabilities

Non-current tax liabilities


Other liabilities

Current Liabilities

Borrowings


Derivative financial instrumentsConstruction contracts work in progress

Current tax liabilities

Other liabilities

Total liabilities

Total equity and liabilities

728,638

269,132

550,944

820,076

1,548,714

709,178

19,460

63,971

25,105

1,371

48,370

130,315

67,499

313,318

5

31,529

48,776

89,817

NOTES

14

15

16

17

14

16

17

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TECHINT E&C S.A.

BOARD OF DIRECTORS’REPORT AND CONSOLIDATEDFINANCIAL STATEMENTS

TWELVE-MONTH PERIOD ENDED DECEMBER 31, 2013

fi_2013

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