Trade and other
payables 24,678 24,678 24,678 - - - -
Other liabilities 20,295 21,772 326 21,298 148 - -
150,081 234,569 49,142 52,269 19,340 40,681 73,137
The following are the contractual maturities of financial
liabilities, including interest payments as at 31 December
2013:
Contractual cash flows
----------------------------------------------------------------
More
Carrying 2 months 2 - 12 1 - 2 2 - 5 than
amount Total or less months years years 5 years
(in thousands
of USD)
Secured bank
loans 72,668 94,082 1,051 15,307 19,232 43,282 15,210
Unsecured loans
from related
parties 30,309 30,309 29,808 501 - - -
Unsecured loans
from third parties 37 37 37 - - - -
Finance lease
liability 11,337 75,751 148 1,296 1,146 4,245 68,916
Trade and other
payables 13,745 13,745 204 13,541 - - -
Other liabilities 20,373 21,939 - 11,346 10,593 - -
148,469 235,863 31,248 41,991 30,971 47,527 84,126
(e) Market risk
Market risk is the risk that changes in market prices, such as
foreign exchange rates, interest rates and equity prices will
affect the Group's income or the value of its holdings of financial
instruments. The objective of market risk management is to manage
and control market risk exposures within acceptable parameters,
while optimising the return.
(i) urrency risk
Group entities located in Ukraine
The Group entities, that are located in Ukraine, are exposed to
currency risk on sales, purchases and borrowings that are
denominated in a currency other than the Ukrainian hryvnia (UAH),
primarily the U.S. Dollar (USD), but also the Euro (EUR).
Interest on borrowings is denominated in the currency of
borrowing. Generally, borrowings are denominated in USD which does
not always match the cash flows generated by the underlying
operation of the Group, primarily executed in UAH.
Exposure to currency risk
The exposure to foreign currency risk is as follows based on
notional amounts:
30 June 2014 31 December 2013
---------------------------- -------------------- -------
USD EUR USD EUR GBP
(unaudited) (unaudited)
(in thousands of USD)
Cash and cash equivalents 14 - 168 1 -
Restricted deposits 575 - 575 - -
Secured bank loans (66,339) - (72,668) - -
Trade and other payables (165) (3,043) (1,631) (741) (302)
Net short position (65,915) (3,043) (73,556) (740) (302)
Sensitivity analysis
A 10 percent weakening of the Ukrainian hryvnia against the
following currencies would have decreased net profit or loss and
equity by the amounts shown below. This analysis assumes that all
other variables, in particular interest rates, remain constant.
Profit Equity Profit Equity
or loss as at 30 or loss as at 31
for six June 2014 for the December
months year ended 2013
ended 30 31 December
June 2014 2013
(unaudited) (unaudited)
(in thousands of USD)
USD (5,405) (5,405) (5,958) (5,958)
EUR (250) (250) (60) (60)
GBP - - (24) (24)
A 10 percent strengthening of the Ukrainian hryvnia against
these currencies would have had the equal but opposite effect to
the amounts shown above, on the basis that all other variables
remain constant.
Intra-group borrowings
The Group entities located in Ukraine are exposed to currency
risk on intra-group borrowings, eliminated in these consolidated
interim condensed financial statements, that are denominated in a
currency other than the Ukrainian hryvnia (UAH), primarily the U.S.
Dollar (USD). These borrowings are treated as part of net
investment in a foreign operation with foreign exchange gains and
losses recognised in other comprehensive income and presented in
the translation reserve in equity.
The exposure to foreign currency risk on these borrowings is USD
233,000 thousand and USD 221,160 thousand as at 30 June 2014 and 31
December 2013, respectively.
A 10 percent weakening of the Ukrainian hryvnia against the USD
would have decreased other comprehensive income (loss) for the six
months ended 30 June 2014 and equity as at 30 June 2014 by USD
19,106 thousand (other comprehensive income (loss) for the year
ended 31 December 2013 and equity as at 31 December 2013 by USD
17,914 thousand). This analysis assumes that all other variables,
in particular interest rates, remain constant.
A 10 percent strengthening of the Ukrainian hryvnia against
these currencies would have had the equal but opposite effect to
the amounts mentioned above, on the basis that all other variables
remain constant.
Group entities located in the Autonomous Republic of Crimea
The Group entity, located in the Autonomous republic of Crimea,
is exposed to currency risk on purchases and borrowings that are
denominated in a currency other than the Russian Rouble (RUB),
primarily the Ukrainian hryvnia (UAH).
Exposure to currency risk
The exposure to foreign currency risk is as follows based on
notional amounts:
30 June 2014 31 December 2013
-------------- ------------------
UAH UAH
(unaudited)
(in thousands of USD)
Trade and other payables (6,291) -
Net short position (6,291) -
Sensitivity analysis
A 10 percent weakening of the Russian Rouble against the
Ukrainian hryvnias would have decreased net profit or loss and
equity by the amounts shown below. This analysis assumes that all
other variables, in particular interest rates, remain constant.
Profit or Equity Profit Equity
loss for as at or loss as at
six months 30 June for the 31 December
ended 30 2014 year ended 2013
June 2014 31 December
2013
(unaudited) (unaudited)
(in thousands of USD)
UAH (516) (516) - -
A 10 percent strengthening of the Russian Rouble against the
Ukrainian hryvnia would have had the equal but opposite effect to
the amounts shown above, on the basis that all other variables
remain constant.
(ii) Interest rate risk
Changes in interest rates impact primarily loans and borrowings
by changing either their fair value (fixed rate debt) or their
future cash flows (variable rate debt). Management does not have a
formal policy of determining how much of the Group's exposure
should be to fixed or variable rates. However, at the time of
obtaining new financing management uses its judgment to decide
whether a fixed or variable rate would be more favourable to the
Group over the expected period until maturity.
Refer to notes 7, 12, 13 and 14 for information about maturity
dates and effective interest rates of fixed rate and variable rate
financial instruments. Re-pricing for fixed rate financial
instruments occurs at maturity of fixed rate financial
instruments.
Profile
The interest rate profile of interest-bearing financial
instruments is as follows:
30 June 31 December
2014 2013
(unaudited)
(in thousands of USD)
Fixed rate instruments
Loans receivable 48,785 48,071
Loans and borrowings (76,359) (79,072)
Other liabilities (20,147) (20,151)
Finance lease liability (9,400) (11,337)
(57,121) (62,489)
Variable rate instruments
Loans and borrowings (18,874) (23,441)
(18,874) (23,441)
Fair value sensitivity analysis for fixed rate instruments
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