Finance lease receivables (non-current and current) 10,166 11,506
Other non-current receivables (including current portion) 11,125 8,307
Secured bank loans (22,260) (20,140)
Unsecured bank loans (2) (7,270)
Finance lease liabilities (15,125) (15,808)
Total (16,096) (23,405)
Instruments with a variable interest rate
Cash and cash equivalents 109,407 101,765
Secured bank loans (3,312) (5,920)
Unsecured bank loans (320,685) (318,588)
Bank overdrafts (167,749) (178,694)
Total (382,339) (401,437)
A 1% change in the interest rate as per balance date would mean the result and shareholders’ equity would increase or decrease by the amounts shown below. These figures assume that all other variables, and currency exchange rates in particular, remain constant. Tax effects have also not been taken into account.
Sensitivity analysis Result Shareholders’ equity Amount 1% increase 1% decrease 1% increase 1% decrease 31 December 2009
Instruments with a variable interest rate: Current ◾ ■ (59,697) (597) 597 – – Non-current ◾ ■ (322,642) (3,226) 3,226 – – Total (382,339) (3,823) 3,823 – –
Interest rate swaps – non-current 426,300 4,263 (4,263) 9,507 (9,507)
Cash flow sensitivity (net) 43,961 440 (440) 9,507 (9,507)
31 December 2008
Instruments with a variable interest rate: Current ◾ ■ (78,670) (787) 787 – – Non-current ◾ ■ (322,767) (3,228) 3,228 – – Total (401,437) (4,015) 4,015 – –
Interest rate swaps – non-current 425,500 4,255 (4,255) 13,119 (13,119)
Cash flow sensitivity (net) 24,063 240 (240) 13,119 (13,119)
The interest rate swaps undertaken in 2009 amount to 426.3 million euro and virtually match the drawn portion of the syndicated bank loan (436.0 million euro), which means the interest related to this portion is fixed. The position in respect of the cash, cash equivalents and bank overdrafts, which have variable interest rates and are not hedged, fluctuated throughout the year as the need to finance working capital changed.
Capital management
To safeguard the Company’s future the Group strives for a financially sound foundation. To this end as much use as possible is made of the available credit facilities.
The Group does not have an explicit target with regard to return on capital employed. The Group defines capital as shareholders’ equity. It does strive for an operational EBITA margin of 6%. The target for 2012 is annual revenue of 5 billion euro. In 2008 there were no changes to the capital management approach.
The Group operates a share scheme for the Board of Management and each year grants share options to a select group of employees. The number of shares needed to cover these schemes is purchased. The Group and its subsidiaries are not subject to capital requirements.
118 Fair value
The summary below shows the carrying amounts of the financial instruments:
Carrying amount 2009
Carrying amount 2008
Assets recognised at fair value
Forward currency contracts used for hedging: Assets (non-current) ◾ ■ – 7,343 Assets (current) ◾ ■ 278 587 278 7,930
Assets recognised at amortised cost
Finance lease receivables1 10,166 11,506 Other non-current receivables1+2 11,125 8,307 Trade and other receivables3 958,891 982,502 Cash and cash equivalents 109,407 101,765 1,089,589 1,104,080
Liabilities recognised at fair value
Interest rate swaps used for hedging: Liabilities (non-current)
◾
■ (19,359) (11,472)
Forward currency contracts used for hedging: Liabilities (current) ◾ ■ (4,531) (254) Liabilities (non-current) ◾ ■ (2) – (23,892) (11,726)
Liabilities recognised at amortised cost price
Finance lease liabilities1 (15,125) (15,808) Bank loans1+2 (346,259) (351,918) Trade and other payables2 (960,589) (964,374) Bank overdrafts (167,749) (178,694) (1,489,722) (1,510,794)
1 Non-current and current.
2 Excluding derivatives (shown separately).
3 Excluding current portion of the non-current receivables and derivatives.
The carrying amount of the financial instruments was the same as the fair value on the balance sheet date.
Estimation of the fair value
The most important methods and principles applied when estimating the fair value of financial instruments included in the summary are described below.
Derivatives
Interest rate swaps and forward currency contracts are valued on the basis of their quoted market price or by discounting the difference between the contracted and actual forward price for the remaining term. When applying present value techniques the future cash flows are based on the management’s best estimates and the interest rate is a market-related rate for a comparable instrument as at the balance sheet date.
Loans
Finance lease receivables and liabilities
The fair value is estimated on the present value of the future cash flows discounted against the interest rate for homogenous lease agreements. The estimated fair value reflects changes in the interest rate.
Trade and other receivables / trade and other payables
The nominal value of receivables and liabilities that fall due within one year is assumed to reflect the fair value. All other receivables and liabilities are made current to determine the fair value.
Assets and liabilities recognised in the balance sheet
Changes in the fair value of forward currency contracts with which monetary assets and liabilities stated in foreign currencies are hedged in an economic sense and for which hedge accounting is not applied are recognised in the profit and loss account. Both the changes in the fair value of the forward contracts and the currency translation differences relevant to the monetary items are recognised under net finance result. The carrying amount of the financial instruments equals the fair value as at the balance sheet date.
Fair value hierarchy
The table below lists the financial instruments recognised at fair value by valuation method. The various methods can be defined as follows: Level 1: quoted market prices (not corrected) in active markets for identical assets or liabilities
◾ ■
Level 2: input that is not a quoted market price as specified under level 1 and that is verifiable for the asset or liability either directly (in the
◾ ■
form of a price) or indirectly (i.e. derived from a price)
Level 3: input related to the asset or liability that is not based on verifiable market data (non-verifiable input).
◾ ■
31 December 2009 Level 1 Level 2 Level 3 Total
Forward currency contracts used for hedging: Assets (current) ◾ ■ – 278 – 278 Liabilities (current) ◾ ■ – (4,531) – (4,531) Liabilities (non-current) ◾ ■ – (2) – (2)
Interest rate swaps used for hedging: Liabilities (non-current)
◾
■ – (19,359) – (19,359)
– (23,614) – (23,614)
31 December 2008
Forward currency contracts used for hedging: Assets (non-current) ◾ ■ – 7,343 – 7,343 Assets (current) ◾ ■ – 587 – 587 Liabilities (current) ◾ ■ – (254) – (254)
Interest rate swaps used for hedging: Liabilities (non-current)
◾
■ – (11,472) – (11,472)
120
25 Operating lease contracts
Lease contracts whereby the Company is the lessee
The amounts owing in respect of non-cancellable operating lease contracts mature as follows:
2009 2008
< 1 year 80,011 74,222
1 – 5 years 174,248 167,549
> 5 years 51,763 52,154
Total 306,022 293,925
The Group leases buildings and other property, plant and equipment on the basis of operating leases. The lease contracts generally have a term of a limited number of years with an option for extension. None of the lease contracts involve conditional lease instalments.
In the 2009 financial year a liability of 86.4 million euro was recognised in the profit and loss account for operating leases (2008: 78.3 million euro).
26 Related parties
Identity of related parties
There is a related party relationship between the Group and its subsidiaries, Stichting Pensioenfonds Imtech, associates, joint ventures and their managing directors and supervisory directors.
Other transactions with related parties Associates
During 2009 associated companies purchased goods and services from the Group for an amount of 8.9 million euro. Transactions with associated companies are conducted at arm’s length. On 31 December 2009 associates owed the Group 3.1 million euro (2008: 9.0 million euro).
Joint ventures
During 2009 joint ventures purchased goods and services from the Group for an amount of 10.4 million euro (2008: 2.5 million euro). On 31 December 2009 joint ventures owed the Group 3.5 million euro (2008: 2.0 million euro). Transactions with joint ventures are conducted at arm’s length.
31 December 2009 31 December 2008 Assets
1 Property, plant and equipment – 80
2 Intangible assets 159,818 146,601
3 Investments in and receivables from Group companies 1,018,508 898,426
4 Other financial fixed assets 1 876
Total fixed assets 1,178,327 1,045,983
5 Receivables 25,291 30,600
Cash and cash equivalents 1,496 3,039
Total current assets 26,787 33,639
Total assets 1,205,114 1,079,622
Shareholders’ equity
6 Share capital 65,670 64,528
7 Share premium reserve 34,978 36,120
8 Other reserves 271,190 181,946 9 Unappropriated result 126,215 113,341 Shareholders’ equity 498,053 395,935 Liabilities 10 Provisions 14,981 14,922 11 Non-current liabilities 316,450 307,809
Total non-current liabilities 331,431 322,731
Owed to banks 323,843 316,504
Owed to Group companies 7,066 2,208
12 Other liabilities 44,721 42,244
Total current liabilities 375,630 360,956
Total shareholders’ equity and liabilities 1,205,114 1,079,622