Tiscali 2009 Annual Report Download - page 107

Tiscali Group: Annual Report 2009
106
Net financial income (charges) (note 9)
A breakdown of net financial income (charges) for the year, presenting a negative balance of EUR 13.9
million, is provided below.
31 December 2009 31 December 2008
Restated
(EUR 000)
Financial income
Interest on bank deposits 171 3,402
Facility D2 write-off 42,322 -
Other financial income 226 2,512
Total 42,719 5,914
Financial charges
Interest and other charges due to banks 43,836 58,061
Other financial charges 12,766 36,248
Total 56,602 94,309
Net financial income (charges) (13,883) (88,395)
This item mainly includes income from the Facility D2 write-off from Senior Lenders amounting to EUR 42.3
million, including interest calculated to 18 November 2009.
The write-off was provided for by contract based on agreements reached with the Financial Institutions on 3 July
2009 (Rights Issues Memorandum and Subscription Agreement), and was subject to the positive outcome of
the share capital increase. Indeed, the agreement provided that for ever EUR subscribed by the market for the
increase the Senior Lenders would write off about 32 cents of the Senior Debt up to a maximum of EUR 46.5
million. On 11 November 2009, since the increase was successful with the subscription of about 99.99% of the
shares offered on the stock exchange, the condition mentioned above was met so on 1 December 2009 the
Financial Institutions wrote off the entirety of Facility D2, for a total amount of EUR 42.3 million (EUR 41.5 million
plus interest).
The item Financial Charges, amounting to EUR 56.6 million, is essentially attributable to the following
factors:
• payable interest, amounting to EUR 41.4 million, on the loan from Senior Lenders. This loan was
restructured on 2 July 2009, for a nominal amount of EUR 158.5 million;
• interest payable on financial leases for about EUR 2 million attributable to Tiscali Italia S.p.A.;
• interest payable on the shareholders’ loan (Andalas) for EUR 1.5 million;
• effects of the valuation at fair value of the IRS relating to the Banca Intesa San Paolo & JPMorgan debt,
before restructuring, which presents a negative balance of EUR 7.2 million;
• bank fees amounting to EUR 2.5 million;
• other financial charges amounting to EUR 2 million.
The dynamics of this item are linked to restructuring the Group’s debt on 3 July 2009, which resulted in a
different breakdown and cost of debt.