[13] Financial expenses
Financial expenses break down as follows: > TABLE 057
in € million |
2019 |
2018 |
|---|---|---|
Interest expense from loans |
15.4 |
22.9 |
Interest expense from promissory notes |
17.6 |
16.3 |
Interest expense from leases |
57.4 |
51.3 |
Interest expense from procurement leases |
15.3 |
16.9 |
Net interest expense from defined benefit plans |
19.9 |
19.4 |
Amortisation of finance costs |
3.6 |
4.5 |
Foreign currency exchange rate losses (financing) |
56.1 |
55.2 |
Other interest expenses and similar charges |
15.4 |
10.7 |
Total financial expenses |
200.6 |
197.3 |
In 2019, financial expenses rose by €3.3 million year on year.
Interest expense from loans decreased due to the corporate actions carried out in 2019 and 2018, whereas the interest expense from promissory notes increased.
Interest expense from leases, which totalled €57.4 million (2018: €51.3 million), was attributable both to liabilities from financing the direct and indirect lease business and to liabilities from financing the short-term rental fleet. Leases entered into with customers in connection with these financing transactions that constitute operating leases resulted in interest expense of €23.3 million (2018: €18.9 million). The income from corresponding customer leases is a component of the rental and lease payments received and is therefore reported within revenue rather than as interest income.
Foreign currency exchange rate expenses predominantly arise in connection with foreign currency positions in internal financing and the related hedging transactions that are not part of a formally documented hedge.