12. Other net financial income/(expense) - €(2,786) million

 

Other financial income

Millions of euro

   
 

2019

2018

Change

Interest income from financial assets (current and non-current):

    

- interest income at effective rate on non-current securities and receivables

126

93

33

35.5%

 - interest income at effective rate on short-term financial investments

162

163

(1)

-0.6%

Total interest income at the effective interest rate

288

256

32

12.5%

Financial income on non-current securities at fair value through profit or loss

-

-

-

-

Exchange gains

915

910

5

0.5%

Income on equity investments

4

12

(8)

-66.7%

Other income

1,262

1,190

72

6.1%

TOTAL FINANCIAL INCOME

2,469

2,368

101

4.3%


Financial income, in the amount of €2,469 million, increased by €101 million compared with the previous year, due mainly to an increase in “Other income” as a result of the application to the Argentine companies of IAS 29 related to accounting for hyperinflationary economies (+€179 million).
See note 4.2 of the consolidated financial statements for the year ended December 31, 2019 for more information.
This was partly offset by the effect of the adjustment to fair value in 2018 of Enel Produzione’s financial receivable arising from the sale of 50% of Slovak Power Holding (€134 million).

Other financial expense

Millions of euro

     

2019

2018

Change

Interest expense on financial debt(current and non-current):

- interest on bank borrowings

386

408

(22)

-5.4%

- interest expense on bonds

2,030

1,953

77

3.9%

- interest expense on other borrowings

183

127

56

44.1%

Total interest expense

2,599

2,488

111

4.5%

Exchange losses

1,229

1,378

(149)

-10.8%

Accretion of post-employment and other employee benefits

135

107

28

26.2%

Accretion of other provisions

186

169

17

10.1%

Charges on equity investments

2

1

1

-

Other expenses

1,104

734

370

50.4%

TOTAL FINANCIAL EXPENSE

5,255

4,877

378

7.8%

 

Other financial expense amounted to €5,255 million, a total increase of €378 million compared with 2018. The change reflects the following factors in particular:

  • an increase in other expenses of €370 million, due largely to:
    • an increase of €252 million in financial expense as a result of the application to the Argentine companies of IAS 29 related to accounting for hyperinflationary economies. See note 4.2 of the consolidated financial statements for the year ended December 31, 2019 for more information;
    • the effect of the recognition in 2018 of the reversal of impairment recognized on the financial receivable arising from the sale of 50% of Slovak Power Holding (€186 million);
    • a reduction of €83 million in financial expense due to an increase in the capitalization of charges;
  • an increase in interest expense on financing in the amount of €111 million. This reflected the increase in interest expense on bonds (€77 million) and financial expense from the application of IFRS 16 (€54 million);
  • a decrease of €149 million in exchange rate losses, primarily reflecting developments in the exchange rates associated with net financial debt denominated in currencies other than the euro.