PERNOD RICARD - 2018-2019 Universal registration document

6.

CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements

Schedule of maturity of floating-rate debt and hedging in EUR (notional value in €million)

> 1 year and < 5 years

At 30.06.2019 € million

< 1 year

> 5 years

Total

Total assets (cash)

243

-

-

243

Total floating-rate liabilities

(128)

(245) (245)

0 0

(373) (130) (540) (670)

NET FLOATING-RATEDEBT BEFOREHEDGING

115

Derivative instruments

(540) (425)

-

-

NET FLOATING-RATEDEBT AFTERHEDGING

(245)

0

Schedule of maturity of floating-rate debt and hedging in USD (notional value in €million)

> 1 year and < 5 years

At 30.06.2019 € million

< 1 year

> 5 years

Total

Total assets (cash)

60

-

- - -

60

Total floating-rate liabilities

(84) (24)

(189) (189)

(273) (214) (377) (591)

NET FLOATING-RATEDEBT BEFOREHEDGING

Derivative instruments

314

(514)

(177)

NET FLOATING-RATEDEBT AFTERHEDGING

289

(703)

(177)

Analysis of the sensitivity of financial instruments to interest rate risk (impact on the income statement) A 50 basis point increase or decrease in interest rates (USD and EUR) would increase or reduce the cost of net financial debt by €8 million. Analysis of the sensitivity of financial instruments to interest rate risk (impact on shareholders’ equity) A relative fluctuation of +/-50 basis point in interest rates (USD and EUR) would generate an equity gain or loss of approximately €1 million as a result of changes in the fair value of the derivatives documented as cash flow hedges (swaps).

Analysis of the sensitivity of financial instruments used to hedge risks related to farmrawmaterials (impact on shareholders’ equity) At 30 June 2019, the sensitivity of the portfolio was not significant. Counterparty risk in financial transactions The Group could be exposed to counterparty default via its cash investments, hedging instruments or the availability of confirmed but undrawn financing lines. In order to limit this exposure, the Group performs a rigorous selection of counterparties according to several criteria, including credit ratings, and depending on the maturity dates of the transactions. However, no assurance can be given that this rigorous selection will be enough to protect the Group against risks of this type, particularly in the current economic context.

Interest rate, foreign exchange and commodity derivatives Note 4.10 Pursuant to the amended version of IAS 9 “Financial Instruments”, all derivative instruments must be recognised in the balance sheet at fair value, determined on the basis of standard market valuation models or external prices issued by financial institutions.

equity. It is recognised in profit and loss when the hedged item is itself recognised in profit and loss. The change in value of the ineffective component of the derivative is however recognised directly in profit and loss. If the derivative is designated as a hedge of a net foreign currency investment, the change in value of the effective portion of the hedge is recognised in shareholders’ equity and the change in value of the “ineffective” portion is recognised in

Where the derivative has been designated as a fair value hedge, changes in the value of the derivative and of the hedged item are recognised in profit and loss for the same period. If the derivative has been designated as a cash flow hedge, the change in value of the “effective” portion of the hedge is recognised in shareholders’

profit and loss.

193

2018-2019

PERNOD RICARD UNIVERSAL REGISTRATIONDOCUMENT