Annual report 2008 - Altarea Cogedim
Annual report 2008 - Altarea Cogedim
Annual report 2008 - Altarea Cogedim
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CONSOLIDATED FINANCIAL STATEMENTS<br />
n Liquidity risk<br />
The main financial covenants to be satisfied relate to the credit facilities provided by Ixis CIB, the acquisition loan for <strong>Cogedim</strong><br />
and, to a lesser extent, the loans obtained to finance shopping centres in operation or under development.<br />
• The covenants specific to the €726 million corporate credit facility are as follows:<br />
A contract amendment signed on 26 April 2007 raising the ceiling on outstanding debt from €517 million to €726<br />
million.<br />
Principal covenants covering the ALTAREA group<br />
– Ratio of the Group’s net debt to net asset value (consolidated ALTAREA LTV ratio = 2 (2.6 in <strong>2008</strong>)<br />
• The covenants specific to the €300 million acquisition loan for <strong>Cogedim</strong> are as follows:<br />
Principal covenants covering the ALTAREA group<br />
– Ratio of net debt to net asset value of ALTAREA (consolidated ALTAREA LTV ratio) =< 65% (53.4% in <strong>2008</strong>)<br />
– Ratio of the Group’s EBITDA on recurring activities to net finance costs (consolidated ALTAREA Interest Cover Ratio (ICR))<br />
>= 2 (2.6 in <strong>2008</strong>)<br />
Principal covenants covering <strong>Cogedim</strong><br />
– Gearing: Ratio of net debt to EBITDA for <strong>Cogedim</strong> and its subsidiaries == 2 (3 in <strong>2008</strong>)<br />
– DSCR: Ratio of EBITDA/debt servicing costs for <strong>Cogedim</strong> and its subsidiaries => 1.1 (2.63 in <strong>2008</strong>)<br />
• Covenants specific to the loans obtained to finance shopping centres in operation or under development<br />
– DSCR = Net rental income of the Group/(net finance costs + principal repayment) > 1.10 (or 1.15 or even 1.20 on certain<br />
loans)<br />
– LTV ratio in operation = Loan To Value ratio = Net debt of the company/Net asset value of the company < 75% (or 80% on<br />
certain loans)<br />
At 31 December <strong>2008</strong> and at 31 December 2007, the Group was in compliance with all of its covenants.<br />
n Counterparty risk<br />
The use of derivatives to limit interest-rate risk exposes the Group to a possible default by a counterparty. To curb this risk,<br />
the Group enters into hedging transactions only with the largest financial institutions.<br />
n Currency risk<br />
Because the Group operates almost exclusively in the euro zone, it has not entered into any currency hedges.<br />
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