Econocom - 2019 Universal registration document

06 consolidated financial statements

notes to the consolidated financial statements

At 31 ژ December 2019, some of the Group’s debt is at floating rates and comprises short-term borrowings (credit lines and commercial paper), and short-term factoring agreements. The interest rate sensitivity analysis shows that a 1% (100 basis point) rise in short-term interest rates would result in a €2.1 million impact on in profit before tax. PRICE RISK 19.2.3. The Group is exposed to the risk of fluctuations in the residual interests of leased equipment within the scope of its Technology Management & Financing business. It deals with this risk by calculating the future value of equipment using the diminishing balance method, thereby guarding against the risk of obsolescence. This method is described in note ژ 11.1.

The method is regularly compared with actual transactions, and annual statistics are compiled to validate the suitable and prudent nature of the selected method. LIQUIDITY RISK 19.2.4. The Financing Department is responsible for ensuring that the Group has a constant flow of sufficient funding: by analysing and updating cash flow • forecasts on a monthly basis for the Group’s 15 main companies; by negotiating and maintaining sufficient • outstanding lines of financing; by optimising the Group’s cash pooling • system in order to offset cash surpluses and internal cash requirements.

The credit lines and commercial paper in place at 31 ژ December 2019 are shown below:

Total amount available

Total amount drawn down

2019 in € millions

102.5

ژ -

Unconfirmed credit lines (1)

151.1

ژ 8.9

Confirmed credit lines

Sub-total: credit lines

253.6

ژ 8.9

450.0

ژ 278.5

Commercial paper

Sub-total: commercial paper

450.0

ژ 278.5

Total credit lines and commercial paper

703.6

287.5

Repayment schedule not defined. (1)

The credit lines ensure that the Group has the liquidity needed to fund its assets, short-term cash requirements and development at the lowest possible cost. In October ژ 2015, Econocom set up a commercial paper programme on the French market. At 31 ژ December 2019, the amount outstanding under this

programme (capped at €450 million) was €278.5 million. The characteristics of bond debt are set out in note ژ 14.2. Based on its current financial forecasts, Econocom Management believes it has sufficient resources to ensure the continuity of its activities.

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2019 annual report