14 Financial Liabilities

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€ million

 

2018

 

2017

 

 

Total

 

Of which
noncurrent

 

Of which
current

 

Total

 

Of which
noncurrent

 

Of which
current

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities to banks

 

675.0

 

582.9

 

92.1

 

633.5

 

499.8

 

133.7

Liabilities from lease obligations

 

26.3

 

22.2

 

4.1

 

29.8

 

25.6

 

4.2

Other financial liabilities

 

295.9

 

289.6

 

6.3

 

338.3

 

275.0

 

63.3

Financial liabilities

 

997.2

 

894.7

 

102.5

 

1,001.6

 

800.4

 

201.2

In 2018, a new promissory note (German Schuldschein) of €300 million was issued. Bank loans in the amount of US$250 million (€218.7 million) and CNY 100 million (€12.7 million) were repaid prematurely. As planned, the first installment of the private placement of US$70 million (€61.2 million) was repaid and a promissory note of €50 million refinanced. Ongoing repayments of investment loans totaled €16 million.

No collateral exists for the financial liabilities, nor are they secured through liens or similar rights. Some of the liabilities to banks are fixed-interest while others have variable interest rates. In certain cases, WACKER has fixed-interest loans with exercisable termination options. Due to the high penalties payable on early termination, these options currently have no positive value and their fair value is negligible. Thus, WACKER does not recognize these for reasons of immateriality. Moreover, some of the liabilities to banks were granted on condition that particular covenants be complied with.

The liabilities to banks comprise the following:

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€ million

 

2018

 

2017

 

 

Currency

 

Carrying amount € million

 

Of which with variable interest rates

 

Maturity by

 

Currency

 

Carrying amount € million

 

Of which with variable interest rates

 

Maturity by

*

Of which €16 million will be due in the following year.

 

 

 

 

 

 

 

 

 

 

 

Investment loan*

 

EUR

 

32.0

 

32.0

 

2020

 

EUR

 

48.0

 

48.0

 

2020

Investment loan

 

EUR

 

200.0

 

 

2022

 

EUR

 

200.0

 

 

2022

Promissory note (German Schuldschein)

 

EUR

 

50.0

 

 

2023

 

EUR

 

50.0

 

 

2018

Promissory note (German Schuldschein)

 

EUR

 

150.0

 

105.5

 

2023

 

 

 

 

 

Promissory note (German Schuldschein)

 

EUR

 

150.0

 

43.0

 

2025

 

 

 

 

 

Bank loan

 

KRW

 

22.0

 

22.0

 

2019

 

KRW

 

15.7

 

15.7

 

2018

Bank loan

 

USD

 

 

 

2019

 

USD

 

208.9

 

208.9

 

2019

Bank loan

 

CNY

 

30.8

 

30.8

 

2019

 

CNY

 

33.4

 

33.4

 

2019

Bank loan

 

CNY

 

12.7

 

12.7

 

2020

 

CNY

 

25.7

 

25.7

 

2020

Operating loan

 

CNY

 

12.4

 

12.4

 

2019

 

CNY

 

38.3

 

38.3

 

2018

Other

 

 

 

15.1

 

2.7

 

 

 

 

13.5

 

2.5

 

Total

 

 

 

675.0

 

 

 

 

 

 

 

633.5

 

 

 

 

Fair value

 

 

 

678.1

 

 

 

 

 

 

 

633.5

 

 

 

 

Other financial liabilities comprise the following:

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€ million

 

2018

 

2017

 

 

Currency

 

Carrying amount € million

 

Of which with variable interest rates

 

Maturity by

 

Currency

 

Carrying amount € million

 

Of which with variable interest rates

 

Maturity by

 

 

 

 

 

 

 

 

 

 

 

Private placement (1st installment)

 

USD

 

 

 

2018

 

USD

 

58.5

 

 

2018

Private placement (2nd installment)

 

USD

 

113.5

 

 

2020

 

USD

 

108.4

 

 

2020

Private placement (3rd installment)

 

USD

 

174.5

 

 

2023

 

USD

 

166.6

 

 

2023

Sundry other financial liabilities

 

 

 

7.9

 

 

 

 

 

 

4.8

 

 

 

Total

 

 

 

295.9

 

 

 

 

 

 

 

338.3

 

 

 

 

Fair value

 

 

 

287.4

 

 

 

 

 

 

 

331.3

 

 

 

 

The carrying amounts of the current financial liabilities correspond to the repayment amounts. With the exception of the euro-denominated investment loan totaling €32 million and another loan in the amount of €1.9 million, all the loans fall due on maturity.

The following table shows the future repayment and interest payments for the bank liabilities and other financial liabilities.

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€ million

 

2019

 

2020

 

2021

 

2022

 

2023 to 2025

 

 

 

 

 

 

 

 

 

 

 

Repayment

 

98.4

 

145.6

 

3.4

 

200.0

 

523.5

Interest

 

16.5

 

12.0

 

10.6

 

9.9

 

5.4

There are also unused long-term lines of credit amounting to €600.0 million (€901.1 million a year earlier), where all the conditions for utilization are met.

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

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€ million

 

2018

 

2017

 

 

Nominal
value

 

Interest

 

Present
value

 

Nominal
value

 

Interest

 

Present
value

 

 

 

 

 

 

 

 

 

Minimum lease payment within a year

 

6.6

 

2.5

 

4.1

 

6.8

 

2.6

 

4.2

Minimum lease payment between one and five years

 

16.2

 

8.0

 

8.2

 

19.7

 

8.3

 

11.4

Minimum lease payment over five years

 

24.9

 

10.9

 

14.0

 

26.4

 

12.2

 

14.2

Total

 

47.7

 

21.4

 

26.3

 

52.9

 

23.1

 

29.8

There are no conditional lease payments from finance leases.

Wacker Chemie AG has 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.

In addition, there are leases for some technical facilities that qualify as finance leases and have been capitalized by WACKER. Here, too, the Group in some cases has rights of preemption and rental extension options.

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.

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