Saint Gobain - Registration document 2016

9 FINANCIAL AND ACCOUNTING INFORMATION 1. 2016 Consolidated Financial Statements

Net debt 8.3 Long- and short-term debt 8.3.1 Long-term debt a)

Default Swap) level of each counterparty. reasonable levels, taking into account the relative CDS (Credit risk are also closely monitored to ensure that they remain at Poor’s or A3 or above from Moody’s. Concentrations of credit To limit the Group’s exposure to credit risk, the Treasury and with a long-term rating of A- or above from Standard & Financing Department deals primarily with counterparties Net financial expense 8.2 costs, income from cash and cash equivalents, interest cost for Net financial expense includes borrowing and other financing the return on plan assets, and other financial income and pension and other post-employment benefit obligations, net of expense such as exchange gains and losses and bank charges.

liabilities and the fair value of interest rate hedging derivatives. Long-term debt includes bonds, perpetual bonds, types of long-term financial liabilities, including finance lease participating securities, long-term securitizations and all other securities are classified as debt. rather than their legal form. As a result, participating equity is based on the substance of the contracts concerned Under IAS 32, the distinction between financial liabilities and interest rate derivatives) is measured at amortized cost. At the end of the reporting period, long-term debt (excluding effective interest method. Premiums and issuance costs are amortized using the derivatives related to debt, and accrued interest on borrowings. and other short-term bank borrowings, the fair value of commercial paper, short-term securitizations, bank overdrafts Short-term debt, excluding derivatives related to debt, is period. Premiums and issuance costs are amortized using the measured at amortized cost at the end of the reporting effective interest rate method. Cash and cash equivalents c) Cash and cash equivalents mainly consist of bank accounts with maturities of less than three months), highly liquid and marketable securities that are short-term (i.e., generally and subject to an insignificant risk of changes in value. investments readily convertible into known amounts of cash profit or loss. Marketable securities are measured at fair value through described above, short-term financing programs such as Short-term debt includes the current portion of long-term debt Short-term debt b)

2016

2015

(in € millions)

Borrowing costs, gross

(376)

(444)

Income from cash and cash equivalents

27

25

BORROWING COSTS, NET

(349)

(419)

Interest cost – pension and other post-employment benefit obligations

(387)

(393)

Return on plan assets

278

297

BENEFIT OBLIGATIONS, NET OTHER POST-EMPLOYMENT INTEREST COST – PENSION AND

(109)

(96)

Other financial expense

(111)

(131)

Other financial income

28

17

AND EXPENSE OTHER FINANCIAL INCOME

(83)

(114)

NET FINANCIAL EXPENSE

(541)

(629)

9

243

SAINT-GOBAIN - REGISTRATION DOCUMENT 2016