english - About Heraeus

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(27) Free cash flow Free cash flow includes all cash flows from operating activities as well as investing activities performed in connection with operating business. Not included in free cash flow are pure financial investments and similar monetary deposits of more than three months, which are also to be reported as cash flows from investing activities under IFRS. FinanCial Risk manaGement and HedGe aCCoUntinG In connection with its operating activities and in financing, the Heraeus Group is particularly exposed to interest rate, currency, price, default, and liquidity risks. Both the Group’s risk management system and its financial management system are responsible for measuring, controlling, and monitoring these risks. Corporate Treasury and Precious Metal Trading are responsible for limiting the risks explained in greater detail below by entering into hedging transactions, if appropriate. The use of these hedging trans actions is subject to clear, Group-wide guidelines, the content of which is constantly monitored and adapted as needed. Heraeus is not exposed to any significant risk concentrations from financial transactions. Interest rate risk An interest rate risk is present when interest rate changes have a negative impact on the assets and earnings position of the Heraeus Group. The priority is primarily on avoidance of interest rate risks; however, advantage is also taken of the income potentials of interest rate changes. The long-term financing of the Group rests primarily on the issue of promissory notes, a bond, and a privately placed promissory note. Interest derivatives derived from the underlying transactions are used to support interest rate management. When using derivatives, customary instruments are used. These include interest rate swaps and interest options for the stipulation of upper and lower interest limits (caps, floors, collars). 65
66 Interest rate swaps come under the framework of hedge accounting. As a result of the fact that Heraeus concludes interest-bearing instruments in euros, there is no significant risk from the interest rate development of other currencies. Heraeus is not exposed to any significant interest rate risk from liabilities because the investments entered into consist primarily of fixed-interest investments or financing. The nominal value of variable interest-bearing investments totaled € 60.0 million as of the balance sheet date. Currency risk Due to its international orientation, the Heraeus Group is exposed to a currency risk resulting from the exchange rate fluctuations of various foreign currencies. In this case as well, the avoidance of risks has priority over the taking advantage of opportunities resulting from exchange rate fluctuation. The goal is hedging based on an observation period of one to two years (previous year: of one to two years). Each hedge refers to existing or clearly expected underlying transactions. As of the balance sheet date, there were significant currency risks totaling USD 532.1 million and CNY 1,847.2 million, which for the most part are hedged against changes in the exchange rate risk. Derivative financial instruments derived from the underlying transactions are used to support currency management. In addition to spot deals, primarily foreign exchange forward contracts, currency swaps, and – to a lesser degree – currency options (collars), as well as non-deliverable forwards (NDF), are used. Foreign exchange forward contracts primarily serve to hedge clearly expected operating cash flows from delivery and purchase transactions. Currency swaps are primarily concluded in connection with intercompany loans in foreign currency. Other price risks Typical hedging instruments are used to hedge price risks to which the Heraeus Group is exposed primarily due to its precious metal trading. These instruments include precious metal leases, cash and carry transactions, forwards, and futures.
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Consolidated Financial statements 2
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02 Consolidated Balance sheet of He
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04 Consolidated income statement of
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06 Consolidated Cash Flow statement
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08 notes to the Consolidated Financ
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10 lead to a shift between two item
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12 In business combinations, the ac
Page 15 and 16: 14 Application of new or amended st
Page 17 and 18: 16 aCCoUntinG poliCies Cash and cas
Page 19 and 20: 18 The precious metal trading stock
Page 21 and 22: 20 asset item UseFUl liFe in YeaRs
Page 23 and 24: 22 The classification depends on th
Page 25 and 26: 24 If hedging transactions used to
Page 27 and 28: 26 Pension Regulation II 2001, whic
Page 29 and 30: 28 Scope of consolidation The conso
Page 31 and 32: 30 of Midwest Instrument Company, a
Page 33 and 34: 32 It was possible to cover the pre
Page 35 and 36: 34 (3) The following table shows th
Page 37 and 38: 36 (5) Intangible assets in € mil
Page 39 and 40: 38 Other intangible assets At € 0
Page 41 and 42: 40 In financial year 2012, impairme
Page 43 and 44: 42 (8) (9) Other non-current assets
Page 45 and 46: 44 (10) Trade payables Trade payabl
Page 47 and 48: 46 Non-current provisions for perso
Page 49 and 50: 48 The provisions for pensions and
Page 51 and 52: 50 The fair value of the plan asset
Page 53 and 54: 52 Of the total expenses for pensio
Page 55 and 56: 54 in € million deC. 31, 2012 deC
Page 57 and 58: 56 notes to tHe Consolidated inCome
Page 59 and 60: 58 (17) Other operating income Othe
Page 61 and 62: 60 (20) Financial result The financ
Page 63 and 64: 62 The following deferred tax asset
Page 65: 64 The item “Change in other net
Page 69 and 70: 68 addition, credit lines with vari
Page 71 and 72: 70 Values of derivative financial i
Page 73 and 74: 72 in € million deC. 31, 2012 FIN
Page 75 and 76: 74 Notes to the income statement Th
Page 77 and 78: 76 Analysis of maturities The follo
Page 79 and 80: 78 otHeR disClosURes Contingent lia
Page 81 and 82: 80 Auditor’s expenses The expense
Page 83 and 84: 82 name oF CompanY ReGisteRed oFFiC
Page 85 and 86: 84 name oF CompanY ReGisteRed oFFiC
Page 87 and 88: 86 aUditoR’s RepoRt We have audit
Page 90: Heraeus Holding GmbH Corporate Comm
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