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The Company applies hedge accounting and documents the hedging relationships and the
measurement of their effectiveness as required by current legislation. In all cases, these
include the cash flow hedges of firm commitments, of which the EUR/USD forward exchange
rate exposures to possible variations in the cash flows payable in euros associated with
broadcasting rights is hedged.
For 2014, due to the commencement of the period in which the broadcasting rights being
hedged come into force, EUR 635 thousand was capitalised to inventories from equity. For
2013, inventories were reduced by EUR 52 thousand with a charge to equity. The changes in
the fair value of the derivatives arranged by the Company depend on the change in the
EUR/USD exchange rate and on the euro yield curve.
At 31 December 2014, the Company had arranged instruments to hedge its foreign currency
asset and liability positions amounting to USD 230,233 thousand, at a weighted average
exchange rate of EUR 1.3279/USD 1. At 31 December 2013, the Company had arranged
hedging instruments amounting to USD 89,863 thousand, at a weighted average exchange
rate of EUR 1.3117/USD 1.
At the end of 2014 and 2013, the total amount of outstanding forward currency contracts
entered into by the Group is as follows (the terms reflect the moment in which the hedged
portion is recognised and in which the value of the hedging instruments is adjusted in equity
as an increase in/reduction of inventories):
Fair value
(thousands of euros)
Classification
Type
Maturity
Amount
arranged
(thousands
of euros)
Ineffectiveness
recognised in
profit or loss
(thousands
of euros)
Assets
Liabilities
Foreign currency
hedges
Foreign currency
hedge
Purchase of USD
2015
151.142
-
11.740
8
Foreign currency
hedges
Foreign currency
hedge
Purchase of USD
2016
72.103
-
3.982
6
Foreign currency
hedges
Foreign currency
hedge
Purchase of USD
2017
6.988
-
415
1
The information in this connection at 31 December 2013 is as follows:
Fair value
(thousands of euros)
Classification
Type
Maturity
Amount
arranged
(thousands
of euros)
Ineffectiveness
recognised in
profit or loss
(thousands
of euros)
Assets
Liabilities
Foreign currency
hedges
Foreign currency
hedge
Purchase of USD
2014
62,520
-
698
3,025
Foreign currency
hedges
Foreign currency
hedge
Purchase of USD
2015
7,313
-
-
189
Foreign currency
hedges
Foreign currency
hedge
Purchase of USD
2016
8,053
-
-
18
At 31 December 2014, the fair value of the Company’s foreign currency derivatives, which are
designated and are effective as cash flow hedges, was estimated to be positive by EUR 16,224
thousand and negative by EUR 15 thousand (31 December 2013: positive by EUR 698
thousand and negative by EUR 3,232 thousand). This amount was deferred and recognised in
equity.
The derivatives were measured by estimating the present value of the future cash flows that
will arise under the terms and conditions arranged by the parties in the derivative contract.
The cash price is taken to be the reference exchange rates of the European Central Bank on