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360T - Workshop in Praha Alpiq Holding Ltd, 6th October 2009 André Boppart, Corporate Treasury + Insurance.

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Presentation on theme: "360T - Workshop in Praha Alpiq Holding Ltd, 6th October 2009 André Boppart, Corporate Treasury + Insurance."— Presentation transcript:

1 360T - Workshop in Praha Alpiq Holding Ltd, 6th October 2009 André Boppart, Corporate Treasury + Insurance

2 360T workshop in Praha; 6th October André Boppart Treasury Manager of Alpiq Holding AG since February 1, 2007 Responsibilities: act as in-house bank for intercompany transactions such as financing, hedging, cash-pooling usw. optimize short-term liquidity assure and maintain an efficient payment system assure a sound liquidity forecast work on project

3 360T workshop in Praha; 6th October Alpiq Holding AG Facts and figuers CHF 16‘032 Mio. annual turnover in 2007 CHF 1‘800 Mio. EBITA in 2007 Energy production of approx. 20 TWh in 2007  53% produced in Switzerland  Energy production by fossil (41.5%), hydraulic (28.5%), nuclear (29.0%) and renewable energy (1.0%) More than 10‘000 employees

4 360T workshop in Praha; 6th October Organization of corporate treasury Alpiq Holding AG Corp. Treasury Switzerland Local Treasury Trading Local Treasury East Local Treasury West Local Treasury Energy Services Local Treasury GAH, Heidelberg AIT Zürich Milano, Italy Paris, France Madrid, Spain Oslo, Norway for: S, N, DK and FIN Prague, Czech Rep. for: GR, A, PL, CZ, SK, HU, RO, LV, BG, SCG, AL, usw. Total approx. 100 independent companies accross Alpiq World 24 Swiss companies reporting to Olten, Lausanne or Zürich 70 companies/legal entities located in Europe

5 360T workshop in Praha; 6th October External transactions Internal transactions Corporate Treasury in facts and figures Maintaining ca. 40 bank relations Bonds ca. 2’150 Mio. Private placements ca. 550 Mio. Committed credit lines ca. 400 Mio. Uncommitted credit lines ca. 350 Mio. FX transactions and Swaps ca. 2’500 Mio. p.a. Parent company guarantees ca. 1’500 Mio. Bank guarantees ca. 300 Mio. Insurance premiums ca. 20 Mio. Corporate Treasury & Insurance Equity Intercompany loans Subordinated ic-loans Various cash-pooling facilities Committed ic-credit lines Letter of credit transaction FX hedging Project financing Damage processing Insurance coverage all amounts in CHF

6 360T workshop in Praha; 6th October Treasury CEE Center Main tasks  Guarantees  Cash and liquidity management  FX Hedging  Relations with banks  Reporting  More than 25 bank accounts managed  Petty Cash  Planned agenda: – Bank Guarantees – Parent Company Guarantees, LoC – Payments (domestic, foreign) – Cashpooling, IC Loans, Money Market – Foreign exchange transactions (SPOT and FORWARD) – Deutsche Bank, Unicredit Group, ING and other local banks – Maintenance of contracts – Monthly reporting (cashflow forecast, guarantees overview, cashpooling position, IC Loans...) – In different currencies (EUR, CZK, RON, RSD, HRK, BGN, PLN, HUF, MKD...) – Atel Energy AG,org.sl, Atel Česká republika s.r.o. – Insurance and Investments

7 360T workshop in Praha; 6th October Treasury policy – hedging strategies The policy says: „whenever local treasury is aware of a funds flow, different from local reporting currency, local treasury has to hedge this foreign currency flow with corporate treasury“ It is up to the discretion of corporate treasury to transfer the currency risk to the market. Actual most hedging activities of our subsidiaries are hedged against the market except of EUR/CHF exposure.

8 360T workshop in Praha; 6th October FX hedging CEE – 1 FX position = difference between assets and liabilities values in each currency => FX revaluation Position can be created by: Natural position = services costs in different currency Conversion = asset and liability from trade have different currencies Hedging of: CBTC (daily, monthly or yearly auction) End consumer offers Office expenses

9 360T workshop in Praha; 6th October FX hedging CEE – 3 FX forward rates – updated daily Larger energy deals (above EUR equiv.) – prompt information from sales department after deal commit – FX hedge done immediately Small energy deals - daily monitoring of Energy position vs FX position, if amount exceeds certain limit – FX hedge done

10 360T workshop in Praha; 6th October T Trading activities Saving or the difference between the BEST and the second best quote 2008 total difference equals to approx. CHF 320‘ total difference equals to approx. CHF 70‘000

11 360T workshop in Praha; 6th October T – The next steps inter-company dealing Phase 1: Set up of a pilot subsidiary – Atel Ceska  getting more experience and confidence in 360T Phase 2: Set up of HU-Atel and PL-Atel (ic-dealing by Prague) Phase 3: Planned to set up other major sub-treasuries such as: Energie Ouest Suisse, Lausanne  FX dealing with banks Alpiq Norway AS, Oslo  FX dealing with banks Alpiq Energia Italia (ic-dealing) Phase 4: In case of enough trading volume tend to go for STP

12 360T workshop in Praha; 6th October T – Inter-Company dealing Goal Major goals: Larger volumes lead to more competitive FX pricing for Alpiq Improve transparency Having a contol tool as well as a risk measurement tool vs. those dealing now with banks instead ic Having a group wide standard process in place that all FX activities are centralized in Coporate Treasury Olten Basis for group wide FX reporting

13 360T workshop in Praha; 6th October T Advantages and disadvantages Advantages: good/competitive FX pricing good comparison tool of our banks getting very accurate indications  market rates IC-dealing  good transparency for transfer pricing problematic (tax issue) Disadvantages: not yet all our favorite banks participate/quote on 360T small/local banks shy away from 360T in the middle of the financing turmoil  less competive forward pricing in „exotic“-cee currencies due to large safety spreads

14 360T workshop in Praha; 6th October Corporate treasury – Administration FX-Settlement Maintaining good bank relations  sound understanding of business model Exchange of standard settlement instruction for FX/MM Chinese Wall At execution of FX/MM deals  capture deal in accounting system (SAP) and deal gets signed by group treasurer  4 eyes control Banks are instructed to send MM/FX confirmation to our B/O B/O checks external confirmation with our system  mismatch call to F/O 2 days before maturity F/O effects payment  4 eyes control

15 Contact Alpiq Holding AGAndré Boppart phone phone


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