TITAN

11. Property, Plant and Equipment

Disposal of assets

During 2012, the Group has received the amount of €28.6 mil. from the disposal of tangible assets with total net book value of €25.8 mil. Thus, the Group recognized the gain of €2.8 mil. on disposal of PPE in the consolidated income statement.

The Group's subsidiary in U.S.A. made the majority of the disposals and it received the amount of €27.0 mil. from the disposal of machinery and railcars. The net book value of these assets totaled €23.6 mil., so the gains on the disposals were €3.4 mil.

Impairment of property, plant and equipment:

Assets that have an indefinite useful life (land) are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised, as an expense immediately in other expenses, for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use.

During 2012, the Group has recorded a reversal of impairment amounted to €0.9 mil. mainly due to the reversal of machinery's impairment of the Company, as the reasons for such an impairment were changed.

The total cost of impairment of property, plant and equipment that the Group posted in 2011 was €14.9 mil. The amount of €13.8 mil. was due to the impairment in an investment of an aggregate mining site in USA and the amount of €1.1 mil. was due to the impairment of white cement production line and other machinery of the Company.

Pledge of assets

The assets of the Company have not been pledged. The assets of the Group have a pledge for the amount of €72.5 m (2011: €68.4 m). The pledge relates to the Group's joint venture Adocim Cimento Beton Sanayi ve Ticaret A.S. in Turkey, as a security of its bank credit facilities for an amount up to €48.9 m (2011: €46.3 m) and is on the assets of this entity. As of 31.12.2012, utilization under these credit facilities amounted to € 33.6m..

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