176 / 220
170
/
Annual Accounts /
Notes to the Consolidated Accounts
For the years 2013 to 2017, Cofinimmo projects to maintain a property port-
folio partially financed through debt. The company will thus owe an inter-
est flow to be paid, which forms the element covered by the derivative
financial instruments described above.
At 31.12.2013, Cofinimmo has a debt of €1,244 million which is covered by
derivative instruments such as cash flow hedging instruments. Based
on future projections, this debt will amount to €1,288 million at 31.12.2014,
€1,344 million at the end of 2015 and €1,442 million at the end of 2016
1
.
Fair value hedges
Cofinimmo Luxemburg has contracted an Interest Rate Swap whereby
the company pays the Euribor three months +0.80% and receives a fixed
interest rate of 5.25% corresponding to the payable coupon related to the
€100 million bond maturing on 15.07.2014 that it issued in 2004.
Cofinimmo SA/NV has contracted an Interest Rate Swap whereby the com-
pany pays the Euribor three months +2.22% and receives a fixed interest
rate of 5.00% corresponding to the payable coupon related to the €100mil-
lion bond maturing on 25.11.2014 that it issued in 2009.
Effective part of the changes in the fair value of the derivative financial instruments, qualified as cash flow hedge
(x €1,000)
2013
2012
AT 01.01
-157,113
-116,379
Changes in the effective part of the changes in the fair value of derivative financial instruments
29,613
-51,009
Transfer to the income statement of the intrinsic value of derivative financial instruments active during the period
27,679
634
AT 31.12
-99,821
-166,754
Ineffective part of the changes in the fair value of the derivative financial instruments, qualified as cash flow hedge
(x €1,000)
2013
2012
AT 01.01
-20,942
-9,862
Changes in the ineffective part of the changes in the fair value of derivative financial instruments
619
-11,080
AT 31.12
-20,323
-20,942
Cash flow hedge
Period
Option
Exercise price
Notional amount
(x €1,000)
2013
CAP bought
3.75%
1,000,000
2014
CAP bought
4.25%
1,000,000
2015
CAP bought
4.25%
1,000,000
2016
CAP bought
4.25%
1,000,000
2017
CAP bought
4.25%
1,000,000
2013
FLOOR sold
3.00%
1,000,000
2014
FLOOR sold
3.00%
1,000,000
2015
FLOOR sold
3.00%
1,000,000
2016
FLOOR sold
3.00%
1,000,000
2017
FLOOR sold
3.00%
1,000,000
Change in the fair value of the fair value hedging instruments
(x €1,000)
2013
2
2012
AT 01.01
11,069
11,488
Changes in the fair value of the fair value hedging instruments
-6,806
-418
AT 31.12
4,263
11,070
At 31.12.2013, Cofinimmo had a floating-rate debt for a notional amount of
€1,224 million. This amount was hedged against interest rate risks with
CAPs for a notional amount of €1.0 billion, FLOORs sold forming a collar
with CAPs for a notional amount of €1.0 billion, and Interest Rate Swaps for
a notional amount of €140 million.
The value of the CAPs effective from 15.01.2013 to 15.01.2014 was zero for
an exercise price at 3.75%, far above the Euribor three months, which
amounted to 0.287% at 31.12.2013.
1
Cofinimmo took advantage of the low interest rates to refinance with fixed-rate instruments instead of floating-rate instruments. FLOORs were cancelled to avoid overhedging. CAPs,
which are out-of-the-money and have a value of €0, give an exercise right, not an exercise obligation, and were not cancelled.
2
The important “Changes in the fair value of the fair value hedging instruments” in 2013 is the result of the fact that a bond swapped into floating rate with a nominal value of €50 million
was replaced by a fixed-rate bond with a nominal value of €50 million.