AMPER, SA and Subsidiaries Consolidated Financial Statements for ...

26. Other contingencies
The Amper Group is exposed to certain market risks, which it manages through the application of
systems of identification, measurement, concentration limitation and supervision.
The main basic principles defined by the Amper Group when establishing its policy of risk management
are the following:
Interest rate risk
Interest rate fluctuations change the fair value of assets and liabilities that accrue a fixed interest rate, and
also the future flows from assets and liabilities tied to floating interest rates.
The aim of managing the interest rate risk is to achieve a balanced debt structure that allows these risks
to be minimised, while also minimising the cost of debt.
Depending on estimates by the Group and the debt structuring objectives, hedging transactions are
carried out by arranging derivatives that mitigate the risks.
At 31 December 2011 and 2010 the Group's bank borrowings and other financial liabilities were tied to
floating interest rates, and the benchmark interest rate was mainly Euribor.
If interest rates at 31 December 2011 had been 100 basis points lower / higher while all other variables
remain constant, the consolidated profit after tax would have been 2,005,000 Euros greater / lower,
mainly due to a lower / greater financial expense for the variable rate debt.
Exchange rate risk
Exchange rate risk mainly corresponds to the debt contracted by the Group in Latin America.
Traditionally, the risk arising from this debt has not been significant, so the Amper Group did not consider
it necessary to undertake swaps, forward rate agreements or currency forwards. This has not been the
case in this financial year, following the acquisition of the eLandia Group whose functional currency is
the U.S. dollar, so the Company is now analysing a number of measures in this area. The risk of the
exchange rate on the net assets of the foreign operations of the Group in U.S. Dollars is primarily
managed with borrowings denominated in the same currency. The Group also endeavours to achieve a
balance between the cash collections and payments relating to its assets and liabilities denominated in
foreign currencies.
At 31 December 2011, if the Euro had depreciated by 10% with respects to the U.S. dollar and with
respects to the Brazilian Real while the rest of the variables remained constant, the consolidated profit
after tax would have been greater by 364,000 Euros, primarily as a result of the conversion of the trade
receivables and debt instruments classified as financial assets available for sale. The conversion
differences included in another overall result would have been greater by 1,957,000 Euros, primarily as
a result of the conversion differences of foreign operations.
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