31.-
SUBSEQUENT DISCLOSURES
On 17 January 2014, Banco Financiero y de Ahorros, S.A. informed the Spanish Securities Market Commission of the sale of 38,834,034 shares, representing its 12.6%
stake in NHHoteles, S.A.
On 28 January 2014, Pontegadea Inversiones, S.L. reported that it had transferred 12,512,971 shares in the Group, which represented 4.059%of the latter’s share capital,
to Tangla Spain, S.L.U., a subsidiary of HNA Group Co. Ltd.
That transfer derives fromHNA Group Co. Ltd. exercising the purchase option granted to it by Pontegadea Inversiones, S.L. on 11 October 2013.
On 24 January 2014, the Argentine Peso was devalued by 12.7% against the euro. At 31 December 2013, the Company had net balances receivable amounting to EUR
5,191
thousand. The estimated impact of this devaluation, which is not estimated to be material, will be recognised in 2014, pursuant to the applicable legislation.
32.-
INFORMATION ON ENVIRONMENTAL POLICY
The management of the integrated water cycle within the Sotogrande development and its surroundings forms part of the operations performed by the Group through
Sotogrande, S.A., which include waste water treatment and purification to minimise damage to the environment.
As part of its treatment and purification operations the Group owns two wastewater treatment plants capable of serving up to 20,000 inhabitants. These plants are
interconnected, so that treated effluent is discharged into the sea through an underwater outfall. These stations are intercommunicated, so that treated effluents are
discharged into the sea through an underwater outfall. Likewise, the Company has built a tertiary treatment system in one of the treatment stations. This further purifies
water, making it suitable to irrigate part of the Real Club deGolf de Sotogrande and the pitches of the SantaMaría PoloClub, withwhomagreements have been signed for
this purpose. The tertiary treatment plant has been in service since July 2003. The entry into service of this tertiary system has increased water resources by 300,000
m
3
/
year.
Furthermore, the Group is currently focusing its actions on urban land with partially approved plans as part of its promotional and development activities for the
Sotogrande Development. In these circumstances, no preliminary environmental impact studies need be conducted on its real estate or tourist developments.
Nonetheless, theGroup’s policy aims to achievemaximumrespect for the environment, and for this purpose it has contracted the services of an environmental consulting
firm to provide environmental diagnoses and consulting on the Company’s actions.
The amount of the environmental assets described net of depreciation at 31 December 2013 amounted to EUR 1,293 thousand (2012: EUR 1,384 thousand).
The Group had not allocated any provisions for environmental contingencies and claims at year end 2013.
33.-
EXPOSURE TO RISK
The Group’s financial risk management is centralised at the Corporate Finance Division. This Division has put the necessary measures in place to control exposure to
changes in interest and exchange rates on the basis of the Group’s structure and financial position, as well as credit and liquidity risks. If necessary, hedges are made on a
case-by-case basis. The main financial risks faced by the Group’s policies are described below:
Credit risk
The Groupmain financial assets include cash and cash equivalents (Note 15), as well as trade and other accounts receivable (Note 13). In general terms, the Group holds
its cash and cash equivalents in institutions with a high level of creditworthiness and part of its trade and other accounts receivable are guaranteed through guarantees,
surety and advance payments by tour operators.
The Group has no significant concentration of third-party credit risk due to the diversification of its financial investments as well as to the distribution of trade risks with
short collection periods among a large number of customers.
Interest rate risk
TheGroup’sfinancialassetsandliabilitiesareexposedtofluctuationsininterestrates,andthismayhaveanadverseeffectonitsresultsandcashflows. Inordertomitigate
this risk, the Group has established policies and has refinanced its debt at fixed interest rates through the issuance of convertible bonds and guaranteed convertible senior
notes. At 31 December 2013, approximately 68% of the net borrowings was tied to fixed interest rates.
In accordance with reporting requirements set forth in IFRS 7, the Group has conducted a sensitivity analysis on possible interest-rate fluctuations in the markets in
which it operates, based on these requirements. In November 2013, the Group closed its debt refinancing process through the issuance of convertible bonds, guaranteed
convertible senior bonds and a new syndicated loan totalling EUR 700 million (Note 17). At 31 December 2013, 68% of the Group’s net consolidated debt was tied to
fixed interest rates.
Aside from the impact any changes in the interest rates could have on financial assets and liabilities which comprise the net cash position, changes could arise in the
valuation of the financial instrument contracted by the Group. The effects of changes in the interest rates on efficient derivatives are booked against equity, while the
effects on inefficient derivatives are booked in the consolidated comprehensive profit and loss statement. The Group has chosen to exclude the temporary value of
designating hedges in order to improve their efficiency. Note 19 of the consolidated annual report attached hereto sets out the sensitivity analysis conducted on the above-
mentioned derivatives in the faces of changes in interest rates.
Lastly, the long-term financial assets set out in Note 11 of this annual report are also subject to interest rate risks.
REPORT ONTHE CONSOLIDATED FINANCIAL STATEMENTS
111
