Universal Registration Document 2021

6. Financial statements

Note 7 Other income and expenses

Other income and expenses amount to €(1,123) million in 2021. They principally comprise:

  • an amount of €505 million received in application of the agreement signed by AREVA and EDF on 29 June 2021 (see note 2) for a settlement payment of €563 million, less certain amounts, principally payments collected for third parties and assets previously included in the balance sheet;
  • exceptional additional costs relating to work for repairs to the main secondary circuit welds at the Flamanville 3 EPR, totalling €(573) million at 31 December 2021 (these are defined by IAS 16.22 as abnormal costs and cannot be included in the cost of assets in progress);
  • the net loss on the sales of Dalkia Wastenergy and the investment in CENG, amounting to a total €(286) million (see note 3.1);
  • costs relating to the early closure of Dungeness B, amounting to €(164) million including impairment of fuel inventories and spare parts, and provisions for penalties due under the capacity mechanism (see notes 2 and 10.8);
  • provisions relating to proceedings before the civil, administrative and criminal courts concerning the sale by Montedison of Ausimont (the Bussi site) in Italy to Solvay in 2002 (see note 17.3.5);
  • a provision relating to litigation proceedings in process.

Other income and expenses includes restructuring expenses in certain Group entities, and other items which are operating income and expenses by nature but of non-significant amounts individually.

Other income and expenses amounted to €(487) million for 2020. They principally comprised exceptional additional costs relating to repair work on the main secondary circuit welds in the Flamanville 3 EPR, totalling €(397) million in 2020.

Note 8 Financial result

8.1 Cost of gross financial indebtedness

Details of the components of the cost of gross financial indebtedness are as follows:

(in millions of euros) 2021 2020
(in millions of euros)

Interest expenses on financing operations*

 2021

(1,494)

 2020

(1,699)
(in millions of euros)

Change in the fair value of derivatives and hedges of liabilities

 2021

15

 2020

90
(in millions of euros)

Change in the fair value of derivatives and hedges of liabilities

 2021

32

 2020

(8)
(in millions of euros)

Net foreign exchange gain on indebtedness

 2021

(12)

 2020

7
COST OF GROSS FINANCIAL INDEBTEDNESS COST OF GROSS FINANCIAL INDEBTEDNESS2021(1,459) COST OF GROSS FINANCIAL INDEBTEDNESS2020(1,610)

* Interest expenses on financing operations includes interest on the IFRS 16 lease liability amounting to €(75) million in 2021 and €(80) million in 2020.

8.2 Discount effect

The effect of unwinding the discount primarily concerns provisions for the back-end of the nuclear cycle, decommissioning and last cores, and long-term and post employment employee benefits.

Details of the final discount effect are as follows:

(in millions of euros) 2021 2020
(in millions of euros)

Provisions for long-term and post-employment employee benefits

(1)		 2021

(498)

 2020

(637)
(in millions of euros)

Provisions for the back-end of the nuclear cycle, decommissioning and last cores

(2)		 2021

(2,109)

 2020

(2,679)
(in millions of euros)

Other provisions and advance

 2021

(63)

 2020

(417)
DISCOUNT EFFECT DISCOUNT EFFECT2021(2,670) DISCOUNT EFFECT2020(3,733)

(1) See note 16.1.3.

(2) Including the effect of discounting the receivable corresponding to amounts reimbursable by the NLF (see note 18.1.3).

The decrease in the effect of unwinding the discount on nuclear provisions is largely explained by the 10bp decrease in the real discount rate in 2021 (versus a 20bp decrease in 2020) applied to nuclear provisions in France (see note 15.1.1).

The decrease in the effect of unwinding the discount on “Other provisions and advances” is largely explained by a change of method introduced in 2020 for determining the discount rates to be used in calculating provisions (particularly provisions for onerous contracts).