Notes to the combined and consolidated financial statements - Mondi

Notes to the combined and
consolidated financial statements continued
for the year ended 31 December 2009
22 Derivative financial instruments
128 Annual report and accounts 2009 Mondi Group
2009 2008
Notional Notional
E million Asset Liability amount Asset Liability amount
Current derivatives
Held for trading1 Foreign exchange contracts2 7 (19) 1,102 65 (6) 964
Interest rate swaps – (1) 263 – (3) 414
Total held for trading 7 (20) 1,365 65 (9) 1,378
Cash flow hedges
Foreign exchange contracts – – 1 8 (19) 244
Interest rate swaps – (9) 350 – (1) 150
Commodity price derivatives – (3) 7 – (9) 22
Total cash flow hedges – (12) 358 8 (29) 416
Total current derivative financial
instruments 7 (32) 1,723 73 (38) 1,794
Non-current derivatives
Cash flow hedges
Foreign exchange contracts – – – – – 1
Interest rate swaps – (19) 391 – (24) 638
Commodity price derivatives – – – – (10) 13
Total cash flow hedges – (19) 391 – (34) 652
Call option 3 – – – – (5) 5
Total non-current derivative
financial instruments – (19) 391 – (39) 657
Notes:
1
There were no held for trading derivative assets and liabilities, classified as current in accordance with IAS 1, ‘Presentation of Financial Statements’, which are due to
mature after more than one year, for both the years presented.
2
Of the E1,102 million (2008: E964 million) aggregate notional amount presented, E900 million (2008: E716 million) relates to the economic hedging of foreign
exchange exposures on short-term intercompany funding balances, which are fully eliminated on consolidation.
3
Mondi Packaging South Africa has a call option to purchase a minority interest within the next two to eight years. The call option was valued based on an EBITDA
multiple multiplied by the forecasted EBITDA for the next eight years discounted back to present value.
The notional amounts presented represent the aggregate face value of all foreign exchange contracts, interest rate swaps and
commodity price derivatives outstanding at the year-end. They do not indicate the contractual future cash flows of the derivative
instruments held or their current fair value and therefore do not indicate the Group’s exposure to credit or market risks. Note 38
provides an overview of the Group’s management of financial risks through the selective use of derivative financial instruments and
also includes a presentation of the undiscounted future contractual cash flows of the derivative contracts outstanding at the
reporting date.