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2016 REGISTRATION DOCUMENT
HERMÈS INTERNATIONAL
193
CONSOLIDATED FINANCIAL STATEMENTS
5
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
22.3
Interest rate and liquidity risks
TheHermès Group’s policy is tomaintain a positive treasury position and
to have cash available in order to be able to finance its growth strategy
independently.
The Group’s treasury surpluses and needs are directly managed or
overseen by Hermès International’s Treasury Management department
in accordance with a conservative policy designed to avoid the risk of
capital loss and to maintain a satisfactory liquidity position.
Cash surpluses are invested mainly in money-market mutual funds and
cashequivalentswitha sensitivity of less than0.5%anda recommended
investment period of less than three months.
The items recognised by the Group as “Cash and cash equivalents” stric-
tly correspond with the criteria used in the AMF position, as updated
in 2011. The investments are regularly reviewed in accordance with
Group procedures and in strict compliance with the qualification criteria
as defined by IAS 7
Cash flow statement,
and the recommendations
of the AMF. As at 31 December 2016, these analyses had not led to
changes in the previously adopted accounting classification.
From time to time, the Group uses financial instruments such as swaps
and interest rate derivatives to hedge part of its payables and recei-
vables against interest rate fluctuations.
The risk control and management procedures are identical to those
applied to foreign exchange transactions.
The following interest rate risks involve only items in thenet cashposition.
Moreover, the interest rate risks are not material as concerns the finan-
cial assets and liabilities not included in the net cash position.
In millions of euros
As at 31/12/2016
< 1 year
1 to 5 years
> 5 years
Total
Floating rate
Fixed rate
Financial assets
2,328.9
-
-
2,328.9
2,153.9
175.0
Euro
1,772.0
-
-
1,772.0
1,597.0
175.0
Yuan
72.9
-
-
72.9
72.9
-
US dollar
139.3
-
-
139.3
139.3
-
Yen
21.0
-
-
21.0
21.0
-
Others
323.7
-
-
323.7
323.7
-
Financial liabilities
1
20.2
1.6
1.1
23.0
20.7
2.3
Euro
8.8
0.9
-
9.7
9.2
0.5
Yen
0.1
-
-
0.1
0.1
Others
2
11.4
0.7
1.1
13.2
11.3
1.8
Net cash position before hedging
2,308.7
(1.6)
(1.1)
2,305.9
2,133.3
172.7
Net cash position after hedging
2,308.7
(1.6)
(1.1)
2,305.9
2,133.3
172.7
In millions of euros
As at 31/12/2016
< 1 year
1 to 5 years
> 5 years
Total
Floating rate
Fixed rate
Financial assets
2,328.9
-
-
2,328.9
2,153.9
175.0
Cash and cash equivalents
2,328.9
-
-
2,328.9
2,153.9
175.0
Financial liabilities
1
20.2
1.6
1.1
23.0
20.7
2.3
Medium- and long-term financial debt
-
-
1.1
2.7
0
1.8
Bank overdrafts and short-term debt
20.2
-
-
20.2
20.7
0.5
Current accounts in debit
-
-
-
-
-
Net cash position before hedging
2,308.7
(1.6)
(1.1)
2,305.9
2,133.3
172.7
Net cash position after hedging
2,308.7
(1.6)
(1.1)
2,305.9
2,133.3
172.7
(1) Excluding commitments to buy out non-controlling interests (€18.0 million as at 31 December 2016).
(2) Mainly consists of long-term reducing fixed-rate loans taken out by Hermès India Retail and Distributors, floating-rate loans taken out by Hermès Brazil and foreign
subsidiaries’ bank overdrafts.