NOTE B5 Underlying net financial charges - 2017 Annual Integrated Report

In € million

FY 2017

FY 2016

(1)

Underlying net financial charges include the coupons on perpetual hybrid bonds, which are accounted as dividends under IFRS, and thereby excluded from the income statement, as well as the financial charges and realized foreign exchange losses in the RusVinyl joint venture, which under IFRS are part of the earnings from associates & joint ventures and thereby included in the IFRS EBITDA.

Net cost of borrowings

(170)

(224)

Coupons on perpetual hybrid bonds

(111)

Interests and realized foreign exchange gains (losses) on the RusVinyl joint venture

(24)

(26)

Cost of discounting provisions

(89)

(103)

Result from available-for-sale financial assets

–

Net financial charges⁽¹⁾

f = a+b+c+d+e

(394)

(464)

Underlying net financial charges totaled €(394) million, 15% lower year on year. Net cost of borrowings fell as gross debt was reduced throughout 2016 and 2017, and as discounting costs on pensions dropped on lower discount rates.