sain t-gobain annu al report 2008 annual report

Embedded derivatives
Saint-Gobain regularly analyzes its contracts in order to separately
identify financial instruments classified as embedded
derivatives under IFRS. At December 31, 2008, no embedded
derivatives deemed to be material at Group level were
identified.
Interest rate repricing schedule
for financial assets and debt
The table below shows the interest rate repricing schedule at
December 31, 2008 for debt and financial assets after hedging:
Within 1 to Beyond Total
(in € millions) 1 year 5 years 5 years
Group debt structure
The weighted average interest rate on total debt under IFRS,
after hedging (using currency swaps and interest rate swaps)
was 5.2% at December 31, 2008 (December 31, 2007: 5.1%).
The average internal rates of return for the main components
of long-term debt before hedging were as follows in 2008,
2007 and 2006:
Internal rate of return on long-term debt
at December 31 (in %)
2008 2007 2006
Bonds and Medium Term Notes 4.96 4.96 5.07
Perpetual bonds
and participating securities 5.92 5.98 5.55
Acquisition-related bank borrowings 5.47 - 4.10
The table below presents the breakdown by currency and by
interest rate (fixed or variable) of the Group’s net debt at
December 31, 2008, after giving effect to interest rate swaps
and currency swaps.
Breakdown of net debt
After hedging
(in € millions) Variable rate Fixed rate Total
EUR 1,674 8,144 9,818
GBP 101 628 729
USD 358 36 394
SEK 286 4 290
Other currencies 45 141 186
Total 2,464 8,953 11,417
22% 78% 100%
Fair value of related derivatives (16)
Accrued interest 278
Total net debt 11,679
Gross debt 5,764 4,742 3,110 13,616
Impact of interest rate swaps (1,250) 1,250 0
Cash and cash equivalents (1,937) (1,937)
Net debt after hedging 2,577 5,992 3,110 11,679
NOTE 20
Financial assets and liabilities
Financial assets and liabilities are classified as follows in
accordance with IFRS 7:
Dec. 31, Dec. 31, Dec. 31,
(in € millions) Notes 2008 2007 2006
Loans and receivables
Trade and other accounts
receivable (9) 7,071 7,692 7,691
Loans and deposits (7) 214 199 219
Available-for-sale
financial assets
Available-for-sale
and other securities (7) 70 126 51
Financial assets at fair value
through profit or loss
Derivatives with a positive
fair value (assets) (19) 75 37 19
Cash and cash equivalents (18) 1,937 1,294 1,468
Financial liabilities
at amortized cost
Trade and other accounts
payable (16) (9,003) (9,177) (8,855)
Long- and short-term debt (18) (13,468) (11,080) (13,058)
Financial liabilities at fair value
Long- and short-term debt (18) (164) (159) (18)
Derivatives recorded
in liabilities (19) (59) (20) (10)
169 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Saint-Gobain – Financial Report 2008