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Consolidated
Financial Statements
| Statutory Auditors’ Report on the Financial Statements | Statutory Financial Statements
Note 22. Financial instruments and management of financial risks
Derivative financial instrument values on the Statement of Financial Position
(in millions of euros)
Note
December 31, 2014
December 31, 2013
Assets
Liabilities
Assets
Liabilities
Interest rate risk management
22.2.3
75
(12)
88
(7)
Pay-fixed interest rate swaps
-
(12)
-
(7)
Pay-floating interest rate swaps
75
-
88
-
Foreign currency risk management
22.2.4
43
(21)
17
(19)
Other
21
-
21
-
Derivative financial instruments
139
(33)
126
(26)
Deduction of current derivative financial instruments
(40)
21
(17)
19
Non-current derivative financial instruments
99
(12)
109
(7)
22.2.1.
Investment risk and counterparty risk management
Vivendi’s policy for investments mainly aims to minimize its exposure
to counterparty risk. Consequently, Vivendi is mainly committed
within highly rated mutual funds and commercial banks, and allocates
investments among selected banks and limits the amount of each such
investment.
As of December 31, 2014, outstanding cash and cash equivalents of
Vivendi amounted to €6,845 million, of which €6,524 million is held by
Vivendi SA and invested in the following financial institutions with at
least an A2/A rating:
p
p
€4,754 million in ten UCTIS monetary funds, managed by five
management companies; and
p
p
€1,770 million in term deposits and interest-bearing current accounts
within eight banks. Term deposits with initial maturities greater than
three months contain an option to terminate at any time and present
an insignificant risk of changing in value.
As of December 31, 2014, the average interest rate on Vivendi’s
investments was 0.49%.
In addition, Vivendi does not consider there to be a significant risk of
non-recovery of trade accounts receivable for its business operations:
the large individual customer base, the broad variety of customers and
markets, as well as the geographic diversity of its business operations
(mainly Canal+ Group and Universal Music Group) enable to minimize the
risk of credit concentration related to trade accounts receivable.
22.2.2.
Equity market value risk management
Vivendi’s cash investment policy prohibits equity investments. However,
following divestiture or acquisition, Vivendi may hold non-consolidated
interests as part of an opportunist strategy in more or less long term.
As of December 31, 2014, Vivendi held shares in the following listed
companies, recognized as “Available-for-sale securities” in the
Consolidated Statement of Financial Position, for an aggregate amount
of €4,676 million:
p
p
97.4 million Numericable-SFR shares, i.e., a 20% interest held
following the sale of SFR to Numericable Group on November 27,
2014, valued at €3,987 million as of December 31, 2014. These
shares are notably subject to a lock-up provision: please refer to
Note 3.1; and
p
p
41.5 million Activision Blizzard shares valued at €689 million as of
December 31, 2014. These shares were subject to a lock-up provision,
which matured on January 7, 2015: please refer to Note 3.4.
Vivendi is thus exposed to the risk of fluctuation in the value of these
shares. As of December 31, 2014, the unrealized gain with respect to
these shares amounted to €1,015 million, directly recognized in equity.
An unfavorable and uniform change of 10% in all of these shares would
have a negative impact of €468 million on Vivendi’s equity.
In addition, Canal+ Group holds 95 million shares in TVN (free-to-air TV
in Poland) indirectly held by N-Vision and consolidated under the equity
method by Canal+ Group. On October 16, 2014, Canal+ Group and ITI
Group announced they were jointly considering strategic options in
respect of their interest in TVN (please refer to Note 13).
Finally, as part of the plan to sell GVT, which is expected to be completed
during the second quarter of 2015 (please refer to Note 3.2), Vivendi
should receive Telefonica Brasil (VIVO/GVT) and Telecom Italia shares,
valued at €1,830 million and €960 million, respectively, based on the
stock market price and currency exchange rate on August 28, 2014
(starting date of the exclusive negotiations with Telefonica), representing
an aggregate amount of €2.8 billion.
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