12.Financial Result
Result from investments in affiliated companies
The result from investments in affiliated companies comprised mainly the loss of €20 million (previous year: loss of €23 million) from PO JV, LP, Wilmington, Delaware (USA), an associate accounted for using the equity method, and the gain of €7 million from Paltough Industries (1998) Ltd., Kibbuz Ramat Yochanan (Israel), accounted for using the equity method (previous year: gain of €1 million). In addition, this item includes €1 million (previous year: €2 million) in dividend income from other investments.
Net interest expense
Net interest expense was comprised as shown in the following table:
|
|
|
|
|
|
|
2019 |
|
2020 |
|---|---|---|---|---|
|
|
€ million |
|
€ million |
Expenses |
|
|
|
|
Interest and similar expenses |
|
(48) |
|
(50) |
Interest expenses for FX derivatives |
|
(37) |
|
(23) |
Income |
|
|
|
|
Interest and similar income |
|
7 |
|
6 |
Interest income from FX derivatives |
|
33 |
|
20 |
Total |
|
(45) |
|
(47) |
Interest and similar expenses primarily resulted from interest expenses from leases totaling €28 million (previous year: €33 million) and bonds issued by Covestro AG totaling €20 million (previous year: €14 million). Interest expense and interest income from forward exchange contracts included interest rate-induced fair value changes and the forward element.
Other financial result
The other financial result was comprised as shown in the following table:
|
|
|
|
|
|
|
2019 |
|
2020 |
|---|---|---|---|---|
|
|
€ million |
|
€ million |
Interest portion of interest-bearing provisions |
|
(27) |
|
(19) |
Exchange gain |
|
5 |
|
3 |
Miscellaneous financial expenses |
|
(4) |
|
(16) |
Total |
|
(26) |
|
(32) |
The interest portion of interest-bearing provisions mainly comprised €24 million (previous year: €31 million) in interest expense for pension and other post-employment benefit provisions plus €5 million in effects of interest income (previous year: €4 million) from interest rate fluctuations for other provisions and corresponding overfunding in fiscal 2020.
Miscellaneous financial expenses included losses from the decline in the fair values of money market funds and a contingent purchase price receivable (€4 million), expenses from the early termination of the syndicated credit facility (€2 million), expenses for financing the purchase price associated with the announced acquisition of the Resins & Functional Materials (RFM) business of Koninklijke DSM N.V., Heerlen (Netherlands), (€2 million), and negative interest income from money market funds (€2 million).