The financial expense is comprised of the following:
|
Financial expense | ||
|
€ thousand |
2011 |
2010 |
|
|
|
|
|
Interest expense from loans |
135,737 |
167,347 |
|
Foreign currency exchange rate losses (financing) |
52,264 |
53,877 |
|
Interest cost of defined benefit obligation |
42,436 |
41,434 |
|
Interest cost of leases |
37,738 |
35,951 |
|
Interest cost of shareholder loan |
27,882 |
27,882 |
|
Interest expense from corporate bond |
25,395 |
− |
|
Amortisation of finance costs |
11,359 |
8,333 |
|
Interest cost of non-current financial liabilities |
2,574 |
3,263 |
|
Other interest expense and similar charges |
10,324 |
16,318 |
|
Total financial expense |
345,709 |
354,405 |
Interest expense include interest cost of €117,273 thousand arising from variable-rate loan liabilities under the senior facilities agreement (2010: €129,260 thousand) and losses of €18,464 thousand on interest-rate swaps (2010: €38,087 thousand).
The foreign currency exchange rate losses include a loss of €19,022 thousand on the translation of a foreign-currency loan denominated in US dollars (2010: €38,219 thousand) and losses of €31,843 thousand on derivative financial instruments (2010: €15,641 thousand).
The interest cost of the defined benefit obligation is the annual interest expense in connection with the change in the non-current pension obligations.
The interest cost of leases relates to the interest portion of lease payments in financial services transactions in which risks and rewards are borne by KION Group companies as the lessee (finance leases). Sale-finance leaseback-operating sub-leases (SALB-FL-OL) incurred interest expense of €19,587 thousand (2010: €16,615 thousand). This interest expense was not directly offset by any interest income. The interest income is a component of the lease payments reported within revenue.
