Net financial debt

Net financial debt of the Company (€ 4,203.8 million) as of 31 December 2010 can be broken-down as follows:

In millions of euros 31 Dec. 2010 31 Dec. 2009 Change
A. Medium- and long-term debt      
Bonds (1) 2,728.2 2,643.5 84.7
Floating-rate loans (1) 2,419.3 1,555.7 863.6
Derivative financial instruments (2) -153.2 -40.6 -112.6
Loan to TELAT (3) -500.0 -500.0 0.0
Total A 4,494.3 3,658.6 835.7
B. Short-term debt (liquidity)      
Floating-rate loans (current portion) (4) 59.7 59.7 0.0
Short-term loans 73.1 40.0 33.1
Short-term securities 0.0 -500.0 500.0
Net current a/c position of intercompany treasury -18.6 2.7 -21.3
Cash and cash equivalent (5) -150.1 -0.1 -150.0
Total B -35.9 -397.7 361.8
Total financial debt of continuing operations 4,458.4 3,260.9 1,197.5
Total financial debt of discontinued operations and assets held for sale -254.6 0.0 -254.6
Total 4,203.8 3,260.9 942.9
In the statement of financial position:
(1) this balance corresponds to the “Long-term loans” caption;
(2) this balance corresponds to the “Non-current financial liabilities” and “Non-current financial assets” caption for the value
of FVH derivatives (€ 200.3 million);
(3) this figure is included under “Non-current financial assets”;
(4) this balance corresponds to the “Current portion of long-term loans” caption;
(5) the balance is included in "Cash and cash equivalents".

 

Net financial debt increased by € 942.9 million. This change is due primarily to the following:

  • an increase in the fair value of bond loans (€ 84.7 million);
  • an increase in variable rate loans for € 863.6 million, mainly due to the use in September of the revolving credit facility of 2006 (€ 550 million) and the supply of new loans by the European Investment Bank (totalling € 373 million). The change also incorporates the repayment of the portions due of loans in place (€ 59.7 million);
  • an increase in the net asset balance of derivative instruments (+€ 112.6 million) as a result of:
    • change in fair value hedges of bonds for € 77.1 million, mainly ascribable to the decrease in interest rates in 2010;
    • a reduction in the cash flow hedges that cover floating-rate loans by € 35.5 million;
  • taking out of a short-term loan for € 50 million and lesser net use of cash elasticity (-€ 16.9 million);
  • realisation of the investment made in 2009 in short-term securities issued by UBS and MPS (€ 500 million);
  • a € 21.3 million decrease in the net position on the intercompany current accounts held with TELAT, SunTergrid and RTS for the purposes of centralised treasure management;
  • a € 150.0 million increase in the Company’s cash and cash equivalents.

The debt of discontinued operations and assets held for sale, amounting to -€ 254.6 euro is represented by the loan of Terna to RTR (€ 500 million), granted during the period and net of the liability of the treasury current a/c (€ 254.4 million).