2007 Reference document (PDF) - Valeo

3 Consolidated
PAGE 98
fi nancial statements at December 31, 2007
Notes to consolidated financial statements
3.4. Cost of net debt
(In millions of euros)
2007 Reference document - VALEO
2007 2006
As restated
2005
As restated
Interest expense (82) (83) (76)
Interest income 31 32 31
Cost of net debt (51) (51) (45)
The cost of net debt for the Group remained stable year-on-year despite the rise in interest rates in 2007.
The negative impact of the rise in interest rates was offset by the fall in interest expense over 2007 following the redemption of 500 million
euros in bonds in July 2006. The redemption was partly funded by commercial paper issued at variable interest below the rate accruing on
the bonds.
3.5. Other fi nancial income and expenses
(In millions of euros)
2007 2006
As restated
2005
As restated
Interest expense on unwinding of discount on pension obligations (1) (48) (49) (54)
Expected return on pension plan assets (1) 21 19 17
Currency gains (losses) on cash flow hedges - - -
Currency losses on other transactions (9) - (6)
Ineffective portion of cash flow hedges (commodities) - 1 2
Gains (losses) from fair value hedges (interest rate) - - -
Charges to provisions for credit risk (4) (4) (6)
Gains (losses) on disposal of financial assets - 27 -
Unwinding of discount on provisions (excluding pension obligations) (4) (4) (1)
Miscellaneous (2) 2 (2)
Other financial income and expenses (46) (8) (50)
(1) See note 4.9.2.
Currency losses incurred on other transactions in 2007 chiefly arose on operations carried out by the Group in Eastern Europe and Turkey.
The “Gains (losses) on disposal of financial assets” caption in 2006 mainly includes proceeds from the sale of Parrot amounting to 24 million
euros (see note 2.2.2).
3.6. Income taxes
3.6.1. Income tax expense
(In millions of euros)
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2007 2006
As restated
2005
As restated
Current taxes (84) (75) (67)
Deferred taxes 1 8 7
Income taxes (83) (67) (60)
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