Q3 profit update, MNOK 390 non-cash profit from hedge instrument

[sail4fun]

In August 2007 Norwegian Air Shuttle ASA entered into a purchase agreement with The Boeing Company for the acquisition of 42 Boeing 737-800 HGW aircraft. To reduce the exposure to foreign exchange rate risk, the company at the same time entered into a hedge contract (the hedge instrument), securing approximately 39% of the contract value. The hedge instrument has been recognized as fair value hedge accounting according to IFRS 39.
The company has until this date booked non-cash loss of approximately MNOK 68 for inefficiencies in the hedge instrument (from Q3 07 to Q2 08). Due to recent developments in foreign exchange rates, the hedge instrument has in its entirety become inefficient as defined by IFRS 39 by the end of Q3 08. The hedge instrument does not qualify for hedge accounting according to IFRS 39 and the related effects will for Q308 be booked in the income statement under financial items as non-cash profit of an estimated amount of MNOK 390. Fair value of the hedge instrument was estimated at a USD/NOK rate of 5.83 with a net value of the hedge instruments of MNOK 52.
The company has restructured the hedge instrument into term contracts and options. The term contracts and the options are now separated allowing for hedge accounting for the term contracts and fair value accounting for the options booked to the income statement going forward. The company’s exposure to exchange rate risk is maintained at previous levels
The restructured instruments currently in place guarantees the company a maximum USD/NOK rate of approximately 6, and enables the company to benefit from falling spot exchange rates until predetermined levels. Once the exchange rate falls below the predetermined levels, the instruments change to a binding forward transaction at the maximum rate described above.
The above mentioned effects are a result of IFRS accounting principles, and have during this period no effect on cash-flows, exposure to exchange rate risk or the underlying performance of the company.
For further information contact:
Frode E. Foss, CFO
+47 6759 3078 / +47 916 31 645
Anne Grete Ellingsen, Director Corporate Communications
+47 6759 3043/ +47 915 37 079

[LeftSaidFred]

Synes det var vanskelig å få ut budskapet fra den meldinga der? Noen som kan forklare.

[Someone]

Norwegian har tatt en ikke kontant gevinst (ren finansiell gevinst som ikke påvirker kontantstrømmen) på 390MNOK på en valutasikring. Dette har strengt tatt mest å gjøre med regnskapsregler og er en slags papirgevinst

[OJB]

Riktig E.... , men dog meget positivt.

[ENGM RAMP]

Hmmmm, ifølge Fruen her hjemme er jeg en dåårlig økonom så derfor, kan noen som skjønner litt mere av dette utdype litt mere enn det Espen (Someone) gjør litt lengre opp? Som OJB skriver "meget positivt" ? På hvilken måte?

På forhånd takk!

[LN-TIB]

Om jeg tolker dette riktig så vil Q3 tallene inneholde en regnskapsmessig gevinst på valutasikring på nevnte beløp. Dette skyldes den senere tids oppgang på dollar. Dette har i praksis ingen betydning før transaksjonen gjennomføres og dersom dollaren synker fremover, så vil denne gevinsten som nå taes tapsføres.

[Someone]

http://www.iasb.org/NR/rdonlyres/1D9...AA/0/IAS39.pdf

Kort fortalt så blir det hverken mer eller mindre penger i kassen pga dette, derimot så styrkes balansen (evt gjeld/forpliktelser reduseres) til selskapet.

[Someone]

http://www.hegnar.no/bors/article327597.ece'

Men nå har de faktisk solgt hedgen og kan putte 324 mill i banken.....eller snart inn på Boeing sin konto for å være nøyaktig