Annual Report 2014

Financial report
Consolidated financial statements
16.2 Financial derivatives
The Group uses derivative financial instruments to hedge its exposure to currency and interest rate risk. In accordance with its treasury
policy, the Group does not hold or issue derivative financial instruments for trading purposes. All derivatives are measured at fair value.
The following table provides an overview of the outstanding derivative financial instruments at 31 December:
IN THOUSANDS OF EUR 2013 2014
Foreign exchange contracts
Assets 1,289 1,844
Liabilities -5,248 -5,835
Cross currency interest rate swaps
Assets 2,299 1,473
Interest rate swaps
Liabilities -22,900 -34,531
Total -24,560 -37,049
The following table indicates in which caption of total comprehensive income, the changes in fair value of the derivative financial
instruments outstanding at 31 December 2014, have been recognised:
IN THOUSANDS OF EUR
COST OF
SALES
PROFIT FOR THE YEAR
INTEREST
EXPENSE
OTHER FINANCIAL
INCOME
OTHER FINANCIAL
CHARGES
OTHER
COMPREHENSIVE
INCOME
Foreign exchange contracts
Assets 88 - - - 491
Liabilities -183 - - - -288
Cross currency interest rate swaps
Assets - - - -826 -
Interest rate swaps
Liabilities - - - - -11,631
Total -95 - - -826 -11,428
A. Cash flow hedges
At 31 December 2014, the Group holds forward exchange contracts designated as hedges of expected future raw material purchases
from suppliers for purchases denominated in US Dollar and Japanese Yen, of expected future sales denominated in Polish Zloty,
and of expected future purchases denominated in euro by companies whose functional currency is the British Pound and Polish Zloty.
At 31 December 2014, the Group had interest rate swap agreements in place with a notional amount of € 250,000 thousand
(€ 280,000 thousand in 2013) whereby it receives a variable interest rate based on Euribor three or six months, as the case may be,
and pays a fixed rate on the notional amount. The swaps are being used to hedge the exposure to interest rate risk on its floating debt.
The floating rate debt and the interest rate swaps have the same critical terms.
The Group did not recognise any ineffectiveness in 2013 and 2014.
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