report

CHF 1000 EUR / CHF USD / CHF
2011 in equity
Derivative financial instruments as cash flow hedges
Average between annual high and low
(25 728) 112 291
exchange rate compared to balance sheet rate 13.0 % 14.0 %
Effect at increasing foreign currency rate (3 345) 15 721
Effect at declining foreign currency rate 3 345 (15 721)
2010 in equity
Derivative financial instruments as cash flow hedges
Average between annual high and low
(79 567) 103 245
exchange rate compared to balance sheet rate 10.0 % 13.0 %
Effect at increasing foreign currency rate (7 957) 13 422
Effect at declining foreign currency rate 7 957 (13 422)
3.2 Interest risks
Charles Vögele Group has no significant interest-bearing assets, so changes in market
interest rates have little effect on earnings or operating cash flows.
Charles Vögele Group’s interest rate risk stems mainly from its bank loans, mortgages
and leasing liabilities. Long-term interest-bearing financial liabilities with variable
interest rates expose the Group to a cash flow interest risk, while fixed-rate liabilities
represent a fair value interest risk. The mortgages, leasing liabilities and loans
are mainly fixed-rate liabilities. Outstanding loans at the end of the year are not
representative of the year as a whole. The company’s funding requirements increase
at the start of a selling season as products are purchased, and then decline
proportionally towards the end of the season (1 March and 1 September respectively)
as the products are sold. At the end of the year, due to the renewal of the syndicated
credit agreement, the financial liabilities with variable interest rates were exceptionally
high. Based on the low interest rate level modified rates would neither have a
significant impact on the income statement nor the statement of changes in equity.
3.3 Credit risks
Credit risks can arise from the following balance sheet positions: cash and cash
equivalents, receivables and advance payments, and financial assets. Charles Vögele
Group is not exposed to any material credit risk since the vast majority of sales to
customers are settled in cash or by the major debit and credit cards. Processing and
payment is carried out through local financial services providers within two or three
days. Any risks arising from cash and cash equivalents are further minimized by the
use of a variety of local financial services providers rather than a single banking
institution.
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Financial Commentary | Income Statement and Balance Sheet | Cash Flow and Changes in Equity | Notes | Statutory Auditors