Ubisoft 2014 Annual Report Download - page 140

Financial statements
2014
135
2013/2014
2012/2013
Net debt restated for assigned receivables/equity restated for goodwill <
0.80
0.80
Net debt restated for assigned receivables/EBITDA <
1.5
1.5
All covenants are calculated on the basis of the consolidated annual financial statements under IFRS.
As at March 31, 2014, the Company was in compliance with all these ratios and expects to remain so
during the 2014/2015 financial year.
Other borrowings are not governed by covenants.
Analysis of financial liabilities by maturity
03/31/14
Schedule
Carrying
amount
Total contractual
cash flows*
< 1 year
1 to 2 years
3 to 5
years
> 5
years
Current and non-current financial
liabilities
Bank borrowings
127,784
127,784
64,718
860
61,719
487
Borrowings resulting from the
restatement of finance leases
492
492
119
99
189
85
Trade payables*
93,643
93,643
93,596
31
16
-
Other operating liabilities**
128,884
128,884
115,904
642
12,120
218
Current tax liabilities
5,003
5,003
5,003
-
-
-
Cash liabilities
122,336
122,336
122,336
-
-
-
Derivative liabilities
Non-hedge derivatives
2,151
112,924
112,924
TOTAL
480,293
591,066
514,600
1,632
74,044
790
* Liabilities are presented at the closing exchange rate, while variable-rate interest is calculated based on the closing spot rate.
** Others operating debts at more than one year are mainly related to the deferred payments of consideration transferred as part
of business combinations.
Foreign exchange risk
The Group is exposed to foreign exchange risk on its cash flows from operating activities and on its
investments in foreign subsidiaries. The percentage of sales generated outside the euro currency area
is 67%.
The Group only hedges its exposures on operating cash flows in the main significant foreign
currencies (US dollar, Canadian dollar and Pound sterling). Its strategy is to hedge only one year at a
time, so the hedging horizon never exceeds 18 months.
The Group first uses natural hedges provided by transactions in the other direction (development costs
in foreign currency offset by royalties from subsidiaries in the same currency). The parent company
uses foreign currency borrowings, futures or foreign exchange options to hedge any residual
exposures and non-commercial transactions (such as inter-company loans in foreign currencies).
Derivatives for which documentation on the hedging relationship does not meet the requirements of
IAS 39 are not referred to as hedging instruments in the accounts.
As at March 31, 2014, foreign exchange transactions denominated in Canadian dollars meet the cash
flow hedging requirements under IAS 39.
Hedging commitments are made by the parent company’s treasury department in France. No hedging
is taken out at subsidiaries in France or abroad.
The Group uses foreign currency derivatives, measured at fair value in these financial statements,
only with standard banking institutions. These are top tier banking institutions. Also, given the
seasonal nature of the Group’s business activities, there is a limited number of open positions at the
balance sheet date. As a result, the debit value adjustment (entity’s own risk) is deemed to be
immaterial.