26. FINANCIAL LIABILITIES
The table describes the Group’s non-current and current financial liabilities.
MEUR 2015 2014
FINANCIAL LIABILITIES
Non-current financial liabilities
Financial liabilities measured at amortised cost
Non-current finance lease liabilities 59.8 64.4
Non-current loans from credit institutions 3.2 6.5
Liabilities recognised at fair value through profit or loss
Contingent consideration liabilities arising from the acquisition of business operations 0.2
Other liabilities 0.2 0.3
Total 63.4 71.2
Current financial liabilities
Based on amortised cost
Finance lease liabilities 5.2 5.1
Other interest-bearing liabilities 22.4 7.0
Liabilities recognised at fair value through profit or loss
Foreign currency derivatives 0.0
Commodity derivatives 0.1 0.1
Interest rate derivatives 0.7 0.7
Contingent consideration liabilities arising from the acquisition of business operations 0.2
Total 28.5 12.8
Financial liabilities total: 91.9 84.0
The Group’s financial liabilities are denominated in euro and carry a variable interest rate. The company’s main financial instruments in 2015 were non-current finance leases, current commercial papers and financial loans. The hedging of the interest rate risk is described in more detail in Note 27, Financial risks.
The average interest rate of the Group’s financial liabilities in 2015 was 2.3% (2.4% in 2014).
The Group has categorised items recognised at fair value through profit or loss according to the following hierarchy of fair values:
Level 1 2015 2014
Foreign currency derivative 0.0
Commodity derivatives 0.1 0.1
Level 2
Interest rate derivatives 0.7 0.7
Level 3
Contingent consideration liabilities arising from the acquisition of business operations 0.3
Level 1 includes the quoted (unadjusted) prices of identical liabilities in active markets
The fair values of Level 2 instruments are, to a significant degree, based on inputs other than quoted prices included in Level 1, but nevertheless on data that can be either directly or indirectly verified for the asset or liability in question.
Level 3 includes inputs concerning liabilities that are not based on observable market data (unobservable inputs)
No transfers between the fair value hierarchy levels have taken place during the ended financial period and the previous financial period.
Contingent consideration liabilities arising from the acquisition of business operations on the balance sheet on 31 December 2015 are based on the companies’ revenue in 2015 and 2016.
The book values of financial liabilities correspond to their fair values. The table below separately describes the fair values of derivative contracts and the value of the underlying instruments.
Derivative contracts:
MEUR 2015 2014
Commodity derivatives (electricity forwards)
Fair value -0.1 -0.1
Value of underlying instruments 0.3 0.4
Interest rate derivatives
Fair value -0.7 -0.7
Value of underlying instruments 19.5 19.7
Foreign currency derivatives
Fair value -0.0 0.0
Value of underlying instruments 2.4 1.5
The fair values of forward exchange contracts are determined using the market prices for contracts of similar duration on the balance sheet date. The fair values of interest rate swaps have been determined using a method based on the present value of future cash flows, supported by market interest rates and other market information on the balance sheet date. The fair values of commodity derivatives are determined using publicly quoted market prices. The fair values correspond to the prices the Group would pay or receive in an orderly transaction for the derivative contract in the prevailing market conditions on the balance sheet date.
The maturity distribution of financial liabilities is described in more detail in Note 27.
Maturities of finance lease liabilities
The effective interest rate of finance lease liabilities is 2,5.
MEUR 2015 2014
Finance lease liabilities – total minimum lease payments
2015 6.8
2016 6.7 5.8
2017 5.5 5.9
2018 5.5 5.9
2019 5.5 5.9
2020 5.6 55.6
Later 50.6
Total 79.4 85.9
Finance lease liabilities – present value of minimum lease payments
2015 5.1
2016 5.2 4.3
2017 4.1 4.4
2018 4.1 4.4
2019 4.2 4.5
2020 4.3 46.8
Later 43.2
Total 65.0 69.5
Financial expenses accruing in the future 14.4 16.4