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FINANCIAL STATEMENTS
6
CONSOLIDATED FINANCIAL STATEMENTS
CASH FLOW HEDGES
A cash flow hedge is a hedge of the exposure to variability in cash flows that is attributable to a particular risk associated with a
recognised asset or liability or a highly probable forecast transaction and could affect profit.
The Group applies cash flow hedge accounting when the following conditions are met:
●
there is formal designation and documentation of the hedging relationship;
●
the hedge is highly effective; and
●
the forecast transaction that is the subject of the hedge is highly probable and presents an exposure to variations in cash flows that
could ultimately affect profit.
The portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is recognised in other comprehensive
income and the ineffective portion is recognised in the income statement. If the hedging instrument expires, or is sold, cancelled or
exercised, the gain or loss initially recognised in other comprehensive income continues to be recorded separately in other comprehensive
income until the forecast transaction occurs. If the commitment no longer exists or the forecast transaction is no longer expected to
occur, any related cumulative gain or loss on the hedging instrument that had been recognised directly in other comprehensive income
is reclassified to profit.
CURRENCY DERIVATIVES
During 2016 the Group pursued its currency hedging strategy (see
Section 5.3 – Liquidity and market risk, in Chapter 5 of this Registration
Document) by setting up new hedges comprising currency forwards
and swaps.
At 31 December 2016, the Group’s currency derivatives had a negative
fair value of €0.8 million, which was recorded under “Other short-
term debt and current financial liabilities” (compared with a positive
€0.2 million recorded under “Other current assets” at 31 December
2015).
The application of hedge accounting to these derivatives resulted in
the recognition of a €1.0 million fair value loss in other comprehensive
income in 2016.
8.4 Net debt
Cash and debt consist of (i) cash and cash equivalents and current and non-current derivatives (included in other financial assets)
on the assets side of the statement of financial position, and (ii) bond debt, other debt and financial liabilities, and the fair value of
derivatives on the liabilities side.
Net debt corresponds to gross debt (bond debt, other long- and short-term debt and current and non-current financial liabilities and derivatives
recorded under current and non-current liabilities) less cash and cash equivalents and derivatives recorded under current and non-current assets.
Net debt breaks down as follows:
In millions of euros
At
31 December
2016
Maturity schedule
2017
2018
2019
2020
2021
Beyond
5 years
Bond debt
14.4
14.4
–
–
–
–
–
Bank borrowings
80.8
80.5
0.3
–
–
–
–
Sundry financial liabilities
6.3
2.2
0.7
0.6
0.6
0.6
1.6
Gross debt
101.5
97.1
1.0
0.6
0.6
0.6
1.6
Cash and cash equivalents
85.4
85.4
–
–
–
–
–
Cash, cash equivalents and derivatives
recorded under assets
85.4
85.4
–
–
–
–
–
Net debt
16.1
11.7
1.0
0.6
0.6
0.6
1.6
ASSYSTEM
REGISTRATION DOCUMENT
2016
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