18. Financial liabilities

The CHF 250 million bond for 2011 to 2017 was repaid on 30 June 2017. To refinance this bond and for general corporate financing purposes, new variable and fixed-interest debt in Swiss francs and euros have been issued. On 21 June 2017 a variable-interest bond between 0.00 % and 0.05 % was issued in the amount CHF 100 million with a term of 2 years and a fixed-interest bond at 0.50 % was issued also in the amount of CHF 100 million with a term of 12 years. On 21 July 2017 Schuldscheine (promissory notes) denominated in euro totaling 100 million were paid up (EUR 70 million variable based on a 6-month EURIBOR at initially 0.50 %, and EUR 30 million for 7 years fixed at 1.42 %).

18.1 Bonds

The CHF 2.4 million expenses incurred in connection with the issuance of the bond were capitalised under prepayments and accrued income on 30 June 2011. This accrual will be released over the term of the bond. The actual interest rate on the bond is thereby increased from 2.125 % to 2.285 % per year.

The CHF 2.1 million expenses incurred in connection with the issuance of the bond were capitalised under prepayments and accrued income on 12 July 2013. This accrual will be released over the term of the bond. The actual interest rate on the bond is thereby increased from 1.625 % to 1.72 % per year.

The CHF 0.2 million expenses incurred in connection with the issuance of the bond were capitalised under prepayments and accrued income on 21 June 2017. This accrual will be released over the term of the bond. The issue price at 100.8 % led to an agio-revenue of CHF 0.8 million. The realisation of the capitalised agio resulted in an effective interest rate of -0.29 % on the bond.

The CHF 0.4 million expenses incurred in connection with the issuance of the bond were capitalised under prepayments and accrued income on 21 June 2017. This accrual will be released over the term of the bond. The issue price at 100.4 % led to an agio-revenue of CHF 0.4 million. The actual interest rate on the bond is thereby increased from 0.50 % to 0.51 % per year.

18.2 Maturing structure of financial liabilities

Bank loans with residual terms up to one year are usually set at variable interest rates. Bonds and the major part of the long-term financial debts are set at fixed terms. In accordance with the terms of the credit agreement, some bank loans are linked to financial covenants such as net equity ratio and net-debt-to-EBITDA ratio. In the current year as well as in the previous year, Emmi Group clearly complied with all the financial covenants.

In the year under review, financial liabilities increased by CHF 70.2 million. Due to the new Schuldscheindarlehen (promissory notes) of EUR 100 million the stake of funding in foreign currencies increased. 65.7 % (previous year 83.5 %) of the financing is denominated in Swiss Francs, mainly through the three bonds in the amount of CHF 400.0 million. 22.8 % (previous year 3.6 %) of the financial liabilities is denominated in Euro, 7.8 % (previous year 9.9 %) in US dollars and 3.7 % (previous year 3.0 %) in other currencies such as Chilean peso or Tunisian dinar.