Note 5: Financing income and expenses

In € millions

 

2012

 

2013

Financing income

 

59

 

32

Financing expenses

 

(239)

 

(221)

Net interest on net debt

 

(180)

 

(189)

 

 

 

 

 

Other interest movements

 

 

 

 

Financing expenses related to pensions

 

(3)

 

(21)

Interest on provisions

 

(29)

 

(8)

Other items

 

7

 

18

Net other financing charges

 

(25)

 

(11)

Net financing expenses

 

(205)

 

(200)

Net financing expenses for the year decreased by €5 million, from €205 million to €200 million. Significant variances are:

  • Net interest on net debt increased by €9 million to €189 million (2012: €180 million), mainly due to lower return on investments held in an escrow account
  • Financing expenses related to pensions increased by €18 million to €21 million (2012: €3 million after restatement) due to lower discount rates reducing the interest income on plan assets
  • Interest on provisions decreased by €21 million to €8 million (2012: €29 million) due to higher discount rates in 2013
  • Other items increased by €11 million to €18 million (2012: €7 million), mainly due to capitalized interest and a 2012 goodwill adjustment

A reduction of €12 million (2012: €8 million) was included in the interest expenses of capital investment projects under construction. The average interest rate used for capitalization of these borrowing costs was 5.6 percent (2012: 6.1 percent).