FINANCIAL AND ACCOUNTING INFORMATION indebtedness in foreign currencies other than euro conversion at the average rate applicable to the or enters into foreign exchange derivatives (forward period. On an annualbasis, a 5% increase (or contracts or exchange rate swaps). For the year decrease) of the euro against the main currencies ended December 31, 2017, unreal ized exchange (US dol lar, Canadian dol lar, Australian dol lar and income in other comprehensive income related to British Pound) would lead to a decrease (increase) external borrowings qual ified as net investment in sales of €307.6 million and a decrease (increase) hedges account for €51.9 million before tax. in operating income before other income and other As of December 31, 2017, the notional value of expenses of €10.5 million. foreign exchange derivatives was €40.2 mil l ion The Group’s financial liabilities and shareholders’ (€31.6 mil l ion of forward sales and €8.6 mil l ion equity are l ikewise included on its consol idated of forward purchases). Forward contracts are balance sheet after conversion at the financial recognized at their fair value for a net negative year-end exchange rate. Thus, a 5% appreciation amount of €0.2 million. The change in fair value of (depreciation) of the euro against the other forward contracts for the year ended December 31, currencies as compared to the closing exchange 2017 was recorded as a financial gain of €3.4 million. rates as of December 31, 2017 would result in a corresponding decrease (increase) in financial Sensitivity to changes in foreign exchange rates debt and shareholders’ equity of €33.1 million and The Group’s financial statements are presented in €141.9 million respectively. euros, and it is therefore required to translate into euro those assets, liabilities, revenues and expenses Financial debt per repayment currency denominated in currencies other than the euro. The table below presents the financial debt’s The results of these operations are included in sensitivity to exchange rate changes for each the Group’s consolidated income statement after repayment currency: US CANADIAN AUSTRALIAN NORWEGIAN SWEDISH BRITISH SWISS CHINESE OTHER (in millions of euros) EURO DOLLAR DOLLAR DOLLAR KRONE KRONA POUND FRANC RENMINBI CURRENCIES TOTAL Financial liabilities 1,952.3 260.7 116.4 94.8 0.0 0.4 133.8 (5.0) 46.1 6.3 2,605.9 Cash and cash equivalents (542.7) 157.4 (45.0) 34.4 6.4 (26.4) (145.9) (0.6) (16.1) 14.0 (564.7) Net financial position before hedging 1,409.5 418.1 71.4 129.2 6.4 (26.0) (12.1) (5.6) 30.0 20.3 2,041.2 Impact of hedges (30.2) (8.4) – (0.3) – 31.4 – – – 7.5 (0.0) Net financial position after hedging 1,379.3 409.7 71.4 129.0 6.4 5.4 (12.1) (5.6) 30.0 27.8 2,041.2 Impact of a 5% increase in exchange rates – 20.5 3.6 6.4 0.3 0.3 (0.6) (0.3) 1.5 1.4 33.1 23.3 Liquidity Risk to maintain the level of its cash and cash equivalents The Group’s approach to managing liquidity is to and available credit facilities at an amount in excess ensure that it will have sufficient liquidity to meet its of its cash outflows on financial liabilities over the financial liabilities when they are due. The Group aims next 12 months. REXEL 2017 – REGISTRATION DOCUMENT 262