TUI AG The above-named reduction of subscribed capital increased the capital reserve by EUR919.0m. Furthermore the capital reserve was increased by the share premium of the capital increase of EUR58.8m. The expenses of capital procurement incurred for the capital increase and the silent participation were offset against capital reserves in the amount of EUR32.9m. Furthermore in the first half of the financial year a corporate bond with option rights was issued to WSF. The value of option rights increased the capital reserve by EUR34.5m.
In the first half of the financial year 2021, two silent participations were issued to the WSF. In accordance with IAS 32 both silent participations are disclosed in equity.
The first silent participation in the amount of EUR420.0m was fully paid. It is convertible at any time, in whole or in part, into shares in TUI AG at a conversion price of EUR1.00, provided that the participation of the WSF resulting from the conversion does not exceed 25% plus 1 share in TUI's share capital. The second silent participation is non-convertible. The maximum amount of the second silent participation amounts to EUR671.0m. As at 31 March 2021 EUR500.0m were paid.
In the first half of the financial year 2021, TUI AG paid no dividend (previous year EUR318.1m).
TUI Group's loss in the first half of the financial year is primarily attributable to the present COVID-19 crisis in the current year.
The proportion of gains and losses from cash flow hedges for future cash flows includes an amount of EUR53.9m (pre- tax) carried under other comprehensive income in equity outside profit and loss (previous year EUR-444.4m).
The revaluation of pension obligations is also carried under other comprehensive income in equity outside profit and loss. 20. Financial instruments
Carrying amounts and fair values according to classes and measurement categories according to IFRS 9 as at 31 Mar 2021
Category according to IFRS 9
At Fair value with no Fair value with no Fair value Fair value
EUR million Carrying amortised effect on profit and effect on profit and through of financial
amount cost loss without recycling loss with recycling profit and instruments
loss
Assets
Trade receivables
and other - - - - - -
receivables
thereof
instruments 576.0 576.0 - - - 575.5
within the scope
of IFRS 9
thereof
instruments 10.8 - - - - 11.2
within the scope
of IFRS 16
Derivative
financial
instruments
Hedging 2.7 - - 2.7 - 2.7
transactions
Other derivative
financial 31.2 - - - 31.2 31.2
instruments
Other financial 23.0 12.9 8.0 - 2.1 23.0
assets
Cash and cash 1,399.7 1,399.7 - - - 1,399.7
equivalents
Liabilities
Financial 4,847.8 4,847.8 - - - 4,762.5
liabilities
Trade payables 1,190.4 1,190.4 - - - 1,190.4
Derivative
financial
instruments
Hedging 20.0 - - 20.0 - 20.0
transactions
Other derivative
financial 71.9 - - - 71.9 71.9
instruments
Other financial 401.7 401.7 - - - 401.7
liabilities
Carrying amounts and fair values according to classes and measurement categories according to IFRS 9 as at 30 Sep 2020
Category according to IFRS 9
At Fair value with no Fair value with no Fair value Fair value
EUR million Carrying amortised effect on profit and effect on profit and through of financial
amount cost loss without recycling loss with recycling profit and instruments
loss
Assets
Trade receivables
and other - - - - - -
receivables
thereof
instruments 875.2 875.2 - - - 847.1
within the scope
of IFRS 9
thereof
instruments 13.5 - - - - 39.2
within the scope
of IFRS 16
Derivative
financial
instruments
Hedging 22.3 - - 22.3 - 22.3
transactions
Other derivative
financial 74.0 - - - 74.0 74.0
instruments
Other financial 25.5 14.9 8.5 - 2.1 22.5
assets
Cash and cash 1,233.1 1,233.1 - - - 1,233.1
equivalents
Liabilities
Financial 4,269.0 4,291.4 - - - 4,022.8
liabilities
Trade payables 1,611.5 1,611.5 - - - 1,611.5
Derivative
financial
instruments
Hedging 61.3 - - 61.3 - 61.3
transactions
Other derivative
financial 257.5 - - - 257.5 257.5
instruments
Other financial 429.2 431.3 - - - 430.8
liabilities
The amounts shown in the previous table as at 30 September 2020 in the column "Carrying amount" (as shown in the balance sheet) may differ from those in the other columns of a given row, as these columns include all financial instruments. This means that these columns include financial instruments that are part of the disposal groups in accordance with IFRS 5. Further details on this can be found in the 2020 Annual Report.
The fair values of other current receivables, financial liabilities and other financial liabilities were determined, taking into account yield curves and the respective credit risk premium (credit spread).
The fair values of non-current trade receivables and other receivables correspond to the present values of the cash flows associated with the assets, taking account of current interest parameters which reflect market and counter party-related changes in terms and expectations. In the case of cash and cash equivalents, current trade receivables, other financial assets and current trade payables, the carrying amount approximates the fair value due to the short remaining term.
The current market conditions arising from the COVID-19 pandemic have been taken into account for all financial instruments for which fair values have been calculated by adjusting the underlying parameters.
The COVID-19 pandemic significantly impacted business operations and the existing hedging strategy for currency risks and fuel price risks. It led to a temporary suspension of all travel operations and flight bans. As a result, the occurrence of numerous hedged underlying transactions can no longer be assessed as highly likely, causing a rapid decline in fuel price and foreign currency hedge requirements and therefore requiring the prospective termination of these hedges.
For the hedges affected, occurrence of the underlying transactions can no longer be expected for a future point in time, either, so that all accrued amounts from the change in the value of the hedging instruments were reclassified from cash flow hedge reserve (OCI) to the cost of sales in the income statement. Accordingly, reclassifications of EUR-27.5m from fuel price hedges and EUR-9.6m from foreign currency hedges were effected as at 31 March 2021.
All future changes in the value of these de-designated hedges are taken to the cost of sales in the income statement through profit and loss and recognised as other derivative financial instruments from the date of the termination of the cash flow hedge accounting. As at 31 March 2021, the fair value of these reclassified fuel price hedges totalled EUR-3.5m at a nominal volume of EUR96.1m, while the fair value of the reclassified foreign currency hedges totalled EUR-9.6m at a nominal volume of EUR398.5m.
Furthermore, the strong increase in TUI's credit risk had a direct impact on the retrospective hedge effectiveness testing. As a result, additional fuel price, interest rate and foreign currency hedges had to be terminated as they no longer met the effectiveness requirements of IAS 39 and were outside the admissible 80-125% effectiveness bandwidth.
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