32. Financial risk management and financial instruments 138 Annual Report 2009 - Heineken N.V. Financial Statements Notes to the consolidated financial statements Interest rate risk In managing interest rate risk, Heineken aims to reduce the impact of short-term fluctuations on earnings. Over the longer term, however, permanent changes in interest rates would have an impact on profit. Heineken opts for a mix of fixed and variable interest rates in its financing operations, combined with the use of interest rate instruments. Currently Heineken's interest rate position is more weighted towards fixed rather than floating. Interest rate instruments that can be used are interest rate swaps, forward rate agreements, caps and floors. Swap maturity follows the maturity of the related loans and borrowings and have swap rates for the fixed leg ranging from 2.0 to 7.3 per cent (2008: from 2.9 to 7.3 per cent). Interest rate risk - Profile At the reporting date the interest rate profile of Heineken's interest-bearing financial instruments was as follows: In millions of EUR2009 2008 Fixed rate instruments Financial assets 157 121 Financial liabilities (4,664) (3,192) Interest rate swaps floating to fixed (2,505) (4,656) CM O r£ (7,727) Variable rate instruments Financial assets 88 817 Financial liabilities (2,947) (6,452) Interest rate swaps fixed to floating 2,505 4,656 (354)(979) Fair value sensitivity analysis for fixed rate instruments During 2009, Heineken opted to apply fair value hedge accounting on certain fixed rate financial liabilities. The fair value movements on these instruments are recognised in the income statement. The change in fair value on these instruments was EUR 73 million in 2009 (2008: EUR 294 million), which was offset by the change in fair value of the hedge accounting instruments, which was EUR(73) million (2008: EUR(288) million). A change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below (after tax). Profit or loss Equity 100 bp too bp too bp too bp In millions of EUR increase decrease increase decrease 31 December 2009 Instruments designated at fair value 45 (48) 45 (48) Interest rate swaps (19) 21 49 (47) Fair value sensitivity (net) 26 (27) 94 (95) 31 December 2008 Instruments designated at fair value 30 33 30 33 Interest rate swaps (3) (63) 94 (159) Fair value sensitivity (net) 27 (30) 124 (126)

Jaarverslagen en Personeelsbladen Heineken

Jaarverslagen | 2009 | | pagina 134