2001 Annual Report - Unibail-Rodamco

CONSOLIDATED FINANCIAL STATEMENTS
Counter-party risks
Because it uses derivatives to minimize its interest rate risk, the Group is exposed to potential counter-party defaults, which could heighten
its earnings sensitivity to an upturn in interest rates. To reduce its counter-party risk, Unibail only relies on major international banks for its
hedging operations.
Note 9 - Sundry transactions
Investment-related debt in the Office Portfolio amounted to € 57m and mainly covered work completed at Cœur Défense (€ 21m), at 108 rue
de Richelieu (€ 1.4m) and at Cité du Retiro (€ 6.6m). Investment-related debt in the Shopping Center Portfolio mainly comprised work on the
two shopping centers Bordeaux Mériadeck (€ 7.2m) and Les Quatre Temps (€ 4.4m). Lastly, work carried out at Paris Expo-Porte de Versailles
accounts for all the investment-related debt incurred by the Convention-Exhibition division (€ 8.9m).
Tax and social security liabilities 1999 2000 2001
Social security liabilities 11.3 15.6 15.1
Value added tax 18.4 29.6 29.4
Other 4.4 1.8 5.6
Total 34.1 47.0 50.1
Deposits and guarantee deposits
This item shows guarantee deposits paid by tenants and, to a lesser extent, payments from finance leasing activities. The increase in this item
in 2001 mainly stems from the guarantee deposits received from tenants of the Coeur Défense complex (€ 6.2m at year-end 2001).
Sundry creditors 1999 2000 2001
Expenses payable 109.5 157.3 190.3
Due to partners 7.3 2.1 6.1
Sundry creditors 17.1 12.6 17.7
Total 133.9 172.0 214.1
The variation in expenses payable between 2000 and 2001 is primarily due to the opening of Coeur Défense during the second quarter of 2001.
Accrued liabilities and deferred income 1999 2000 2001
Deferred income 36.2 97.8 112.8
Financial expenses on off-balance sheet items 3.4 1.9 1.4
Total 39.6 99.7 114.2
2001 deferred income mainly includes sales off-plan for the Carré Sénart shopping center currently under construction, rents and support
services invoiced in advance for certain exhibitions due to be held at Porte de Versailles in 2002, and the amortized gain from the MATIF which
occurred after the release of the interest rate risk hedge implemented for the June 1999 bond issue (this gain is spread over the term of the loan).
Note 10 - Contingencies and other liabilities
The recognition of deferred tax liabilities on first consolidation differences has generated an increase in the value of the assets acquired, offset
by an equivalent deferred tax liability provision. This applies mainly to Paris Expo (portion allocated to property investment activities only),
shopping centers and office properties from the former CPI Group. Figures for previous financial years have been adjusted for comparability.
1999 1999 2000 2000 2001 Reversals Change
reported restated reported restated Allocations used unused in scope 2001
Negative goodwill 0.5 0.5 2.9 2.9 - - -0.1 - 2.8
Provisions for the redemption premium
of the convertible bonds 44.5 44.5 - - - - - - -
Provisions for properties 23.3 23.3 25.7 27.3 8.0 -5.6 -2.1 0.5 28.1 (1)
Deferred tax liability 6.9 321.9 40.1 354.4 3.1 -11.9 - 0.4 346.0 (2)
Other provisions 6.1 6.1 20.6 19.0 3.5 -2.1 -1.2 -3.6 15.6 (3)
Total 81.3 396.3 89.3 403.6 14.6 -19.6 -3.4 -2.7 392.5
(1)
Of which:
• € 12.5m provision for the rent of the Méridien Montparnasse Hotel, corresponding to the difference between billed rent (€ 9.2m on a yearly basis) and the rent estimated by experts
(€ 7.6m) during the statutory rent-setting procedure initiated when the lease expired in 1995.
• € 5.3m provision for disputes resulting from the delayed availability of Coeur Défense.
• € 5.4m provision for outstanding work on the Cnit hotel.
(2)
This € 346m total comprises:
• € 32.0m deferred tax charge already incurred in 2000 on the consolidation difference resulting from the Nice Etoile acquisition.
• € 315m in deferred tax charge adjustments on other consolidation differences. This adjustment has also been applied to 1999 and 2000 figures to ensure comparability.
(3)
Mainly includes the provision for liabilities incurred by the unconsolidated SA Dôme subsidiary in La Défense. This provision is equivalent to the subsidiary’s negative net asset value of
€ 8.6m.
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