Wacker Chemie AG - Annual Report 2010 - 15 Financial Liabilities

download table

¹	Liabilities from leasing arrangements mainly include liabilities relating to leasing the headquarters building in Munich and the Burghausen plant’s CCGT power station.

€ million

2010

2009

Total

Of which
noncurrent

Of which
current

Total

Of which
noncurrent

Of which
current

Liabilities to banks

494.8

385.6

109.2

391.6

331.8

59.8

Of which > 5 years

–

304.7

–

42.9

–

Liabilities from lease obligations¹

34.4

21.5

12.9

44.5

32.0

12.5

Of which > 5 years

–

5.1

–

7.8

–

Other financial liabilities

4.2

–

4.2

3.6

–

3.6

Of which > 5 years

–

Financial liabilities

533.4

407.1

126.3

439.7

363.8

75.9

Of which > 5 years

–

309.8

–

50.7

–

In 2010, Wacker Chemie AG paid back promissory notes (Schuldscheine) totaling €151.0 million and, in December of that year, it accessed the first installment of an investment loan from the European Investment Bank of €200.0 million.

No collateral exists for financial liabilities. Some of the liabilities to banks are fixed-interest and others have variable interest rates. Some of the liabilities to banks were granted on condition that particular covenants be complied with.

As of the reporting date, the future minimum lease payments under finance lease agreements amount to:

download table

€ million	2010		2009
	Nominal value	Present value	Nominal value	Present value

Minimum lease payment within a year	14.4	12.9	14.7	12.5
Minimum lease payment within one and five years	19.4	16.4	28.0	24.2
Minimum lease payment over five years	5.5	5.1	8.2	7.8
	39.3	34.4	50.9	44.5
Total expected minimum lease payments from subtenancies	2.5	–	2.9	–

There are no conditional lease payments from finance leases.

There is a finance lease for the headquarters building in Munich used by the Group. The contract with the lessor expires in 2012. After that, WACKER’s pension fund or some company specified by it shall have the right to purchase the building at a price that has already been fixed. Wacker Chemie AG has also capitalized a finance lease for the leased CCGT (combined-cycle gas turbine) power station at its Burghausen site. The lease for the power station is due to expire in 2019 at the latest. WACKER has the right to acquire the power station at a price oriented to book values in accordance with German commercial law. If WACKER acquires this power station, it may not be sold to a third party for five years.

The lease agreements serve to simplify the procurement and financing of operating materials and fixed assets. The long-term commitment that they involve, however, leads to a constant future outflow of cash from which the company cannot extract itself.