Annual Report 2023

6. Net financial costs

Accounting policies

Net financial costs represent interest on borrowings, interest on investments made, dividends, foreign exchange gains and losses in financial operations, gains and losses resulting from changes of financial assets measured at fair value through profit and loss, and costs and income with financing operations.

Net financial costs are accrued in the income statement in the period in which they are incurred.






Loans interest expense





Leases interest expense





Interest received





Net foreign exchange





Net foreign exchange on leases





Other financial gains and losses





Fair value of financial investments held for trade:





Derivative instruments (note 13)










Interest expense includes the interest on loans measured at amortised cost and interest on derivatives of fair-value hedge and cash flow hedge (note 13).

Net foreign exchange on leases refer to the exchange rate update, reported on 31 December, on the euro-denominated lease contracts of the subsidiaries JMP (Biedronka) and JMDiF (Hebe), compared to the amount recognised at the end of the previous year.

Other financial gains and losses include costs with debt issued by the Group, recognised in results through effective interest method.

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