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Consolidated Financial Report |
EXPLANATORY NOTES
2014 Annual Report
Prysmian Group
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Credit Agreements:
As at the date of 31 December 2014, the Prysmian Group has
the following Credit Agreements in place:
Credit Agreement 2011
The Credit Agreement 2011 is an agreement, entered into by
Prysmian on 7 March 2011 with a syndicate of major banks, for
Euro 800 million with a five-year maturity. This agreement
comprises a loan for Euro 400 million (the “Term Loan
Facility 2011”) and a revolving facility for Euro 400 million
(the “Revolving Credit Facility 2011”). The entire amount of
the Term Loan Facility 2011 is scheduled for repayment on
7 March 2016; the loan has therefore been classified in non-
current liabilities.
As at 31 December 2014, the Revolving Credit Facility 2011
was not being used (like at 31 December 2013).
The fair value of the Credit Agreement 2011 at 31 December
2014 approximates its related carrying amount. Fair value
has been determined using valuation techniques that refer to
observable market data (Level 2 of the fair value hierarchy).
Syndicated Revolving Credit Facility 2014
On 27 June 2014, Prysmian S.p.A. signed an agreement
(the “Credit Agreement 2014”) under which a syndicate of
premier banks made available a long-term credit facility for
Euro 1,000 million (the “Syndicated Revolving Credit Facility
2014”). The facility, which expires on 27 June 2019, can also
be used for the issue of guarantees. The new revolving
facility is intended to refinance the Revolving Credit Facility
2010 and to finance the Group’s other operating activities.
As at 31 December 2014, this facility was not being used. On
27 June 2014, Prysmian S.p.A. therefore extinguished early
the Revolving Credit Facility 2010, originally due to expire
on 31 December 2014 and carrying a maximum permitted
drawdown of Euro 400 million. The Term Loan Facility 2010,
also maturing on 31 December 2014, had been extinguished
early on 28 February 2014 with repayment of the outstanding
balance of Euro 184 million.
In addition to the Credit Agreements described above, the
Group’s other major credit agreements are as follows:
Revolving Credit Facility 2014
On 19 February 2014, Prysmian S.p.A signed a credit
agreement for Euro 100 million (the “Revolving Credit Facility
2014”) with Mediobanca - Banca di Credito Finanziario S.p.A..
Under this five-year agreement, Mediobanca has provided
the Group with a line of credit intended to refinance existing
debt and working capital requirements.
As at 31 December 2014, the Revolving Credit Facility 2014
had been drawn down by Euro 30 million.
EIB Loan
On 18 December 2013, Prysmian S.p.A. entered into a loan
agreement with the European Investment Bank (EIB) for
Euro 100 million, to fund the Group’s European research &
development (R&D) programmes over the period 2013-2016.
The EIB Loan is particularly intended to support projects
developed in the Group’s R&D centres in six countries
(France, Great Britain, the Netherlands, Spain, Germany and
Italy) and represents about 50% of the Prysmian Group’s
planned investment expenditure in Europe during the period
concerned.
The EIB Loan was received on 5 February 2014; it will be repaid
in 12 equal half-yearly instalments starting on 5 August 2015
and ending on 5 February 2021.
The fair value of the EIB Loan at 31 December 2014 approxi-
mates the related carrying amount. Fair value has been de-
termined using valuation techniques that refer to observable
market data (Level 2 of the fair value hierarchy).