Euronext - 2019 Universal Registration Document

Financial Statements

Consolidated Statement of Changes in Equity

NOTE 22 OTHER CURRENT ASSETS AND ASSETS HELD FOR SALE

Other current assets

2019 12,057

2018 9,240

In thousands of euros

Prepayments

Other

-

-

TOTAL

12,057

9,240

The increase in prepayments is primarily due to the acquisition of subsidiaries in 2019.

Assets held for sale

2019 8,760 8,760

2018

In thousands of euros

Investment in associate held for sale

- -

TOTAL

On 10 December 2019, the Group announced that it entered into binding agreements to sell its 20% minority stake in EuroCCP to CBOE Global Markets, alongside the other current EuroCCP

shareholders. The transaction is expected to close in the first half of 2020. The Group expects to receive net proceeds of approximately €8.8 million from the sale of its minority stake in EuroCCP.

NOTE 23 DERIVATIVES FINANCIAL INSTRUMENTS

There is an economic relationship between the hedged item and the hedging instrument as the terms of the interest rate swaps match the terms of the fixed rate Bond (i.e., notional amount, maturity, payment and reset dates). The Group has established a hedge ratio of 1:1 for the hedging relationships as the underlying risk of the interest rate swap is identical to the hedged risk component. To assess the hedge effectiveness, the Group compares the changes in the fair value of the hedging instrument against the changes in fair value of the hedged item attributable to the hedged risk. The hedge ineffectiveness can arise from: n different interest rate curve applied to discount the hedged item and hedging instrument; n differences in timing of cash flows of the hedged item and hedging instrument; n the counterparties’ credit risk differently impacting the fair value movements of the hedging instrument and hedged item.

The Group may use derivative instruments to manage financial risks relating to its financial positions or risks relating to its ongoing business operations. The Group’s risk management strategy and how it is applied to manage risk is further explained in Note 37.

Derivatives Designed as Hedging Instruments

Fair Value Hedge At 31 December 2019, the Group had three interest rate swap agreements in place with a total notional amount of €500.0 million (2018: €500.0 million) whereby the Group receives an annual fixed interest rate of 1% and pays a variable rate of six-month EURIBOR, plus a weighted average spread of 0.3825%. At 31 December 2019, the rate applicable to the floating leg of the swap for the aggregated notional amount of €500.0 million was 0.029%. The swaps are being used to reduce the variability of the fair value of the 1% fixed rate Bond (Senior Unsecured Note #1) attributable to the change in interest rate, allowing it to transform the fixed rate exposure to floating rate.

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2019 UNIVERSAL REGISTRATION DOCUMENT