ADP // 2021 Universal Registration Document

F I NANC I AL I NFORMAT I ON

GROUPE ADP CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 DECEMBER 2021

9.5.3 Analysis of risks related to financial instruments RATE RISKS

amount of interest at variable rates, calculated on a nominal loan amount agreed between the parties. These swaps are assigned to loan hedging. The Group enters into interest rates swaps where the critical terms match exactly with the terms of the hedged item. Therefore, the hedging relationship is qualified as 100% effective. If changes in the circumstances affect the terms of the hedged item such that the critical terms no longer match exactly with the critical terms of the hedging instrument, the Group uses the hypothetical derivative method to assess the amount of ineffectiveness. Hedge ineffectiveness may occur due to: ◆ the value adjustment on the interest rate swaps which is not matched by the hedged item; and ◆ differences in critical terms between the interest rate swaps and the loans hedged.

In addition to its available cash flow, the Group resorts to debt to finance its investment programme. The Group’s exposure to interest rate risk is essentially a result from its financial debt, and to a lesser extent its portfolio of rates derivatives. The risk rate relating to the debt is managed by modulating the respective proportions of fixed rates and variable rates in line with market developments. The management of this risk depends on the implementation or cancellation of interest rate operations (swaps). The Group’s policy consists of managing its interest charge by using a combination of fixed rate and variable rate loans. The Group’s policy is that 50% to 100% of its debt should be at fixed rates. In line with this objective, the Group puts in place interest rate swaps through which it exchanges, at specific intervals, the difference between the amount of interest at fixed rates and the

The breakdown of financial debt at fixed and variable rate is as follows:

As at 31 Dec. 2021

As at 31 Dec. 2020

6

Before hedging

After hedging

Before hedging

After hedging

%

%

(in millions of euros)

Fixed rate

9,252 1,023

9,747

95%

9,617 1,290

10,166

93%

Variable rate

528

5%

741

7%

Debt (excluding derivatives)

10,275

10,275

100%

10,907

10,907

100%

As of 31 December 2021 the Group holds rate and exchange based derivative financial instruments (swaps), with a zero fair value, appearing on the assets under other current financial assets, and €38 million appearing on the liabilities under financial debt.

The notional amounts of fair value hedging derivatives may be analysed as follows:

Maturity between 1 & 5 years

As at 31 Dec. 2021

Maturity > 5 years

Maturity < 1 year

Fair value

(in thousands of euros)

Derivatives classified as cash flow hedges

4

382

109

495 400 895

(38)

Derivatives not classified as hedges

-

400 782

-

-

TOTAL

4

109

(38)

The portfolio of non-hedging derivatives is made up exclusively of return swaps with a fixed margin. This part of the derivatives portfolio is therefore not very sensitive to change in interest rates. An immediate 1% decrease in interest rates as at 31 December 2021 would not result in a significant increase in the fair value of derivatives.

343

AÉROPORTS DE PAR I S / UN I VERSAL REG I STRAT I ON DOCUMENT 202 1