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2016 REGISTRATION DOCUMENT
HERMÈS INTERNATIONAL
203
CONSOLIDATED FINANCIAL STATEMENTS
5
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 27
OFF BALANCE SHEET COMMITMENTS, CONTINGENT ASSETS AND CONTINGENT LIABILITIES
27.1
Financial commitments
In millions of euros
< 1 year
1 to 5 years
> 5 years
31/12/2016
31/12/2015
Bank guarantees given
4.7
3.7
14.8
23.2
9.3
Bank guarantees received
0.1
0.3
-
0.4
0.3
Commitments to purchase financial assets
-
-
41.3
41.3
20.8
Other commitments
23.4
-
-
23.4
16.3
Future non-cancellable commitments for discounted payments on operating lease agreements for all stores operated by the Group worldwide are as
follows:
In millions of euros
< 1 year
1 to 5 years
> 5 years
Total
Annual
discount rate
Minimum future payments - Status at end of 2016
165.4
495.3
149.9
810.5
7.71%
Minimum future payments - Status at end of 2015
122.7
316.6
117.7
557.0
8.83%
Moreover, future non-cancellable commitments in respect of discounted
minimum payments on the operating leases of the administrative buil-
dings (headquarters, offices) or logistics premises operated by the
Group worldwide amounted to €126 million as at 31 December 2016.
In total, future non-cancellable commitments in respect of discounted
future minimum payments on operating lease contracts amounted to
€937 million as at 31 December 2016.
27.2
Other off balance sheet commitments
The Group has no knowledge of any commitments other than thosemen-
tioned elsewhere herein and that would not be reflected in the financial
statements for the year ended 31 December 2016. To date, there is
no exceptional event or dispute that would be liable to have a likely and
material impact on the Group’s financial position.
Furthermore, in the normal course of its business operations, the Group
is involved in legal actions and is subject to controls. A provision is
recorded when a risk is identified and when its cost can be estimated.
NOTE 28
RELATED-PARTY TRANSACTIONS
28.1
Transactions with equity-accounted
associates
Transactions with equity-accounted associates were not material rela-
tive to the Group’s overall business activities.
28.2
Other related-party transactions
Relationships with other related parties, within the meaning of IAS 24
Related Party Disclosures
can be summarised as follows:
s
RDAI firm: RDAI was commissioned toundertakeadesignassignment
for the application of the architectural concept to all Hermès Group
stores. Fees paid by the Hermès Group amounted to €8.1 million
excluding tax in 2016.
The RDAI firm, as well as the SCI mentioned below, are considered to
be related parties given that certainmembers of GroupManagement
or members of the Supervisory Board have personal interests therein
and exercise significant influence;
s
Émile Hermès SARL, Active Partner: Émile Hermès SARL is a société
à responsabilité limitée à capital variable (limited company with
variable capital). Its partners are the direct descendants of Mr
Émile-Maurice Hermès and his wife. Émile Hermès SARL’s Executive
Chairman is Mr Henri-Louis Bauer. The Company is governed by an
Executive Management Board. Each year, Hermès International
pays 0.67% of the distributable profits to the Active Partner. In addi-
tion, Hermès International charges Émile Hermès SARL for certain
expenses incurred. Hermès International charged back €0.2 million
in this respect in 2016;
s
ARDIAN Holding: as part of the diversification of its investments,
Hermès International has a 11.71% equity interest in the company
ARDIAN Holding, in which a member of the Supervisory Board has
responsibilities. This commitment had been assumed prior to this
person’s appointment.
Certain of the above transactions constitute related-party agreements
according to the definition contained in the French Commercial Code
(
Code de commerce
). For further details, see the description of the pro-
posed resolutions on pages 282 to 304.