14 Financial Liabilities

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:

Other financial liabilities comprise the following:

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.

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:

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.