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RISKS | 12 Months Ended
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Dec. 31, 2023
Notes and other explanatory information [abstract] |
RISKS | NOTE 6: RISKS 6.1 Critical accounting estimates and judgments The preparation of financial statements requires the Company’s Management to make future estimates and assessments, to apply critical judgment and to establish assumptions affecting the application of accounting policies and the amounts of disclosed assets and liabilities, income and expenses. The applied estimates and accounting judgments are evaluated on a continuous basis and are based on past experiences and other reasonable factors under the existing circumstances. Actual future results might differ from the estimates and evaluations made at the date of preparation of these Consolidated Financial Statements. The estimates which have a significant risk of producing adjustments on the amounts of the assets and liabilities during the following year are detailed below: 6.1.1 Impairment of non-financial long-lived assets Non-financial long-lived assets, including identifiable intangible assets and right-of-use assets, are reviewed for impairment at the lowest level for which there are separately identifiable cash flows (CGU). For this purpose, each assets group with independent cash flows, each subsidiary, associate and each jointly controlled company has been considered a single CGU, as all of their assets jointly contribute to the generation of cash inflows, which are derived from a single service or product; thus cash inflows cannot be attributed to individual assets. In order to evaluate if there is evidence that a CGU could be affected, both external and internal sources of information are analyzed. Specific facts and circumstances are considered, which generally include the discount rate used in the estimates of the future cash flows of each CGU and the business condition as regards economic and market factors, such as the cost of inventories, oil and gas prices, international petrochemical product’s price, the regulatory framework for the energy industry, the projected capital investments and the evolution of the energy demand. The value in use of each CGU is estimated on the basis of the present value of future net cash flows expected to be derived on the UGE. Management uses approved budgets up to one year as the base for cash flow projections that are later extrapolated into a term consistent with the assets’ remaining useful life, taking into consideration the appropriate discount rates. The discount rates used to discount future net cash flows is the WACC, for each CGU a specific WACC was determined which considered the business segment and the country conditions where the operations are performed. In order to calculate the fair value less the costs of disposal, the Company Management uses the estimated value of the future cash flows that a market participant could generate from the appropriate CGU, less the necessary costs to carry out the sale of the corresponding CGU. The Company Management is required to make judgments at the moment of the future cash flow estimation. The actual cash flows and the values may differ significantly from the expected future cash flows and the related values obtained through discount techniques. 6.1.2 Current and deferred Income tax The Company’s Management periodically evaluates tax treatments affecting the determination of taxable profit regarding uncertain tax treatment under tax law considering the acceptability of a particular tax treatment by the relevant taxation authority, and, if applicable, recognizes tax provisions to reflect the effect of the uncertainty for each tax treatment based on the amount estimated to be paid to the tax authorities. If the final tax resolution regarding uncertain tax treatments differs from recognised figures, such differences will have an effect on income tax and deferred income tax at the year of such determination. Deferred tax asset is reviewed at each reporting date and reduced in accordance with the probability that the sufficient taxable base will be available to allow and for the total or partial recovery of these assets. In assessing the recoverability of deferred tax assets, Management considers if it is likely that a portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income in the periods in which these temporary differences become deductible. To make this assessment, Management takes into consideration the scheduled reversal of deferred tax liabilities, the projections of future taxable income and tax planning strategies. The generation of future taxable profits may differ from these estimated affecting the deductibility of deferred tax assets. 6.1.3 Provision for contingencies The Company is subject to various claims, lawsuits and other legal proceedings that arise during the ordinary course of its business. The Company’s liabilities with respect to such claims, lawsuits and other legal proceedings cannot be estimated with certainty. The Company reviews the status of each contingency and assesses potential financial liability, applying the criteria indicated in Note 4.21, for which elaborates the estimates mainly with the assistance of legal advisors, based on information available to the Management at Consolidated Financial Statements date, and taking into account the litigation and resolution/settlement strategies. Contingencies include outstanding lawsuits or claims for possible damages to third parties in the ordinary course of the Company’s business, as well as third party claims arising from disputes concerning the interpretation of legislation. The Company evaluates whether there would be additional expenses directly associated with the ultimate resolution of each contingency, which will be included in the provision if they may be reasonably estimated. The final resolutions of the litigation could differ from Management's estimates, generating current provisions to be inadequate, which could have a material adverse effect on the statement of financial position, comprehensive income, changes in equity and cash flows. 6.1.4 Asset retirement obligations and decommissioning of wind turbines Asset retirement obligations in oil and gas areas after completion of operations require the Company’s Management to estimate the number of wells, long-term well abandonment costs and the time remaining until abandonment. In the same way, the obligations related to the decommissioning of wind turbines in wind farms require the Company’s Management to estimate long-term dismantling costs and the time remaining until the dismantling. Technology, costs and political, environmental and safety considerations constantly change and may result in differences between actual future costs and estimates. Asset retirement obligations’ and the decommissioning of wind turbines’ estimates are adjusted at least once a year or more frequently if there are changes in the assumptions considered in the assessment. 6.1.5 Impairment of financial assets and other credits The Group is exposed to losses for uncollectible receivables. The Company Management estimates the final collectability of the accounts receivable. The accounting of expected credit losses for trade receivables and other receivables with similar risk characteristics is based on the Company's best estimate of the default risk and the calculation of the expected credit losses rates, based on historical information of the behavior of the Company's clients, current market conditions and forward-looking estimates at the end of each reporting period. In order to estimate collections related to the sale of gas and energy in the spot market and revenues associated with natural gas production promotion plans, the Company mainly considers CAMMESA’s and federal government’s capacity to meet its payment obligations to generators and producers, including the resolutions issued by the SE, which allow the Company to collect its receivables through different mechanisms. Future adjustments to the allowance may be necessary if future real economic conditions differ substantially from the assumptions used in the assessment for each year. 6.1.6 Actuarial assumptions in defined benefit plans Commitments with defined benefit plans to employees are recognised as liabilities in the statement of financial position based on actuarial estimates revised annually by an independent actuary, using the projected unit credit method. The present value of defined benefit pension plan depends on multiple factors that are determined according to actuarial estimates, net of the fair value of the plan assets, when applicable. For this purpose, certain assumptions are used including the discount rate and wage growth rate assumptions. It may be necessary to make adjustments in the future if future real economic conditions materially differ from the assumptions used in the valuation of each year. 6.1.7 Oil and gas reserves Reserves include oil and gas volumes (in m3 of oil equivalent) that are economically producible, in the areas where the Company operates or has a direct or an indirect interest and over which the Company has exploration and exploitation rights. There are numerous uncertainties in estimating proved and unproved reserves, future production profiles, development costs and prices, including several factors beyond the producer’s control. Reserve engineering is a subjective process of estimating underground accumulations involving a certain degree of uncertainty. Reserves estimates depend on the quality of the available engineering and geological data as of the estimation date and on the interpretation and judgment thereof. Periodic revisions and adjustments to the estimated oil and gas reserves and related future net cash flows may be necessary as a result of changes in a number of factors, related to reservoir performance, new drilling, oil and gas prices, cost, technological advances, new geological or geophysical data, and other economic factors or at least once a year. The Company’s estimates of oil and gas reserves have been developed by the Company’s internal specialists, specifically petroleum engineers, and audited by independent specialists engaged by Company. The Company uses the information obtained from the calculation of reserves in the determination of depreciation of properties, plant and equipment used in oil and gas areas, as well as assessing the recoverability of these assets and including, when applicable, goodwill allocated to the oil and gas segment (see Notes 4.6 to 4.9). 6.1.8 Environmental remediation The costs incurred to limit, neutralize or prevent environmental pollution are only capitalized if at least one of the following conditions is met: (a) such costs relate to improvements in safety; (b) the risk of environmental pollution is prevented or limited; or (c) the costs are incurred to prepare the assets for sale and the book value of such assets does not exceed their respective recoverable value. Liabilities related to future remediation costs are recorded when, on the basis of environmental assessments, such liabilities are probable to materialize, and costs can be reasonably estimated. The actual recognition and amount of these provisions are generally based on the Company’s commitment to an action plan, such as an approved remediation plan or the sale or disposal of an asset. In general, the provision is recognised on the basis that a future remediation commitment may be required. The Company measures liabilities based on its best estimation of present value of future costs, using currently available technology and applying current environmental laws and regulations as well as the Company’s own internal environmental policies. 6.1.9 Fair value of financial assets that are not traded in active markets The fair value of financial instruments that are not traded in active markets is determined using valuation techniques. These valuation techniques consider estimates based on information available to the Management at Consolidated Financial Statements date, for those significant variables that cannot be observed in the market, including the discount rate, among others. Future adjustments may be necessary if future real economic conditions differ substantially from the assumptions used in the valuation for each period. 6.1.10 Business Combinations The acquisition method involves the measurement at fair value of the identifiable assets acquired and the liabilities assumed in the business combination at the acquisition date. For the purpose to determine the fair value of identifiable assets, the Company uses the valuation approach considered the most representative for each asset. These include: i) the income approach, through indirect cash flows (net present value of expected future cash flows) or through the multi-period excess earnings method, ii) the cost approach (replacement value of the good adjusted for loss due to physical deterioration, functional and economic obsolescence) and iii) the market approach through comparable transactions method. Likewise, in order to determine the fair value of liabilities assumed, the Company’s Management considers the probability of cash outflows that will be required for each contingency, and elaborates the estimates with assistance of legal advisors, based on the information available and taking into account the strategy of litigation and resolution / liquidation. Management critical judgment is required in selecting the approach to be used and estimating future cash flows. Actual cash flows and values may differ significantly from the expected future cash flows and related values obtained through the mentioned valuation techniques. 6.2 Financial risk management 6.2.1 Financial Risk Factors The Company’s activities are subject to several financial risks: market risk (including the exchange rate risk, the interest rate risk and the price risk), credit risk and liquidity risk. Financial risk management is encompassed within the Company’s global policies, there is an integrated risk management methodology, where the focus is not placed on the individual risks of the business units’ operations, but there is rather a wider perspective focused on monitoring risks affecting the whole portfolio. The Company’s risk management strategy seeks to achieve a balance between profitability targets and risk exposure levels. Financial risks are those derived from financial instruments the Company is exposed to during or at the closing of each fiscal year. The Company uses derivative instruments to hedge certain risks when it deems it necessary according to its risk management internal policies. Financial risk management is controlled by the Financial Department, which identifies, evaluates and covers financial risks. Risk management systems and policies are reviewed on a regular basis to reflect changes in market conditions and the Company’s activities, and have been applied consistently during the periods included in these Consolidated Financial Statements. This section includes a description of the main risks and uncertainties which may adversely affect the Company’s strategy, performance, operational results and financial position. 6.2.1.1 Market risks 6.2.1.1.1 Foreign exchange risk The Company’s results of operations and financial position are exposed to changes in the exchange rate between the Company’s functional currency, which is the U.S. dollar and other currencies, primarily with respect to the Argentine peso (which is the legal currency in Argentina). In some cases, the Company may use derivative financial instruments to mitigate the associated exchange rate risk. In fiscal year 2023, the U.S. dollar recorded an approximate 356.3 % increase against the Argentine peso, from $ 177.16 in December 2022 to $ 808.45 in December 2023, and taking into consideration that during the year the Company mostly had a net passive position in Argentine pesos, as of December 31, 2023 the Company recorded net foreign exchange gain in the amount of US$ 123 million. Taking into account the net active financial position in Argentine pesos as of December 31, 2023, the Company estimates that provided all other variables remain constant, a 10% revaluation/(devaluation) of U.S. dollar as compared to the Argentine peso would generate in absolute values a (decrease)/increase of US$ 6 million in the 2023 fiscal year’s income, before income tax. The Group´s exposure to other foreign currency movements is not material. 6.2.1.1.2 Price risk The Company’s financial instruments are not significantly exposed to hydrocarbon international price risks because the current regulatory, economic and governmental policies in force, prevent oil and gas domestic prices to be directly affected in the short-term due to variations in the international market. Additionally, the Company’s investments in financial assets classified as “at fair value through profit or loss” are sensitive to the risk of changes in the market prices resulting from uncertainties as to the future value of such financial assets. The Company estimates that provided all other variables remain constant, a 10% revaluation/(devaluation) of each market price would generate the following increase/(decrease) in the fiscal year’s income, before income tax in relation to financial assets at fair value through profit and loss detailed in Note 12.2 to these Consolidated Financial Statements:
Schedule of exposure to the price risk |  |  |  |  |
|  |  | Increase of the result for the year
Financial assets |  |  | 12.31.2023 |  | 12.31.2022
Shares |  |  | 12 |  | 19
Government securities |  |  | 39 |  | 28
Corporate Bonds |  |  | 8 |  | 12
Mutual funds |  |  | - |  | 3
Variation of the result of the year |  |  | 59 |  | 62
6.2.1.1.3 Cash flow and fair value interest rate risk The management of the interest rate risk seeks to reduce financial costs and limit the Company’s exposure to interest rate increases. Indebtedness at variable rates exposes the Company to the interest rate risk on its cash flows due to the possible volatility they may experience. Indebtedness at fixed rates exposes the Company to the interest rate risk on the fair value of its liabilities, since they may be considerably higher than variable rates. As of December 31, 2023, 5% of the indebtedness was subject to variable interest rates. Furthermore, 58% of the Company’s debt accruing variable interest rates is denominated in U.S. dollars, mainly at SOFR rate plus an applicable spread. It should be pointed out that there has been no material impact on behalf of the replacement of the LIBOR reference interest rate effective by the SOFR rate, as from July 2023, on the Company's indebtedness subject to the mentioned reference rate. The Company seeks to mitigate its interest-rate risk exposure through the analysis and evaluation of: (i) the different liquidity sources available in the financial and capital market, both domestic and (if available) international; (ii) interest rates alternatives (fixed or variable), currencies and terms available for companies in a similar sector, industry and risk than the Company; (iii) the availability, access and cost of interest-rate hedge agreements. On doing this, the Company evaluates the impact on profits or losses resulting from each strategy over the obligations representing the main interest-bearing positions. In the case of fixed rates and in view of the market’s current conditions, the Company considers that the risk of a significant decrease in interest rates is low and, therefore, does not foresee a substantial risk in its indebtedness at fixed rates. As of the date of issuance of these Consolidated Financial Statements, the Company is not exposed to a significant risk of variable interest rate increases since the 95% of the financial debt is subject to fixed rate. The following table shows the breakdown of the Company’s borrowings classified by interest rate and the currency in which they are denominated:
Schedule of borrowings classified by interest rate and currency |  |  |  |  |
|  |  | 12.31.2023 |  | 12.31.2022
Fixed interest rate: |  |  |  |  |
Argentine pesos |  |  | 33 |  | 57
U.S. dollar |  |  | 1,210 |  | 1,173
Yuan R.China |  |  | 5 |  | -
Subtotal loans obtained at a fixed interest rate |  |  | 1,248 |  | 1,230
Floating interest rate: |  |  |  |  |
Argentine pesos |  |  | 30 |  | 140
U.S. dollar |  |  | 41 |  | 149
Subtotal loans obtained at a floating interest rate |  |  | 71 |  | 289
Non interest accrued: |  |  |  |  |
Argentine pesos |  |  | 11 |  | 22
U.S. dollar |  |  | 118 |  | 72
Subtotal loans no interest accrued |  |  | 129 |  | 94
Total borrowings |  |  | 1,448 |  | 1,613
Based on the conducted simulations, and provided all other variables remain constant, a 10% increase/decrease in variable interest rates would generate the following (decrease)/increase in the 2023 fiscal year's income, before income tax, of US$ 4 million. 6.2.1.2 Credit risk The Company establishes individual credit limits according to the limits defined by the Board of Directors and approved by the Financial Department based on internal or external ratings. The Company makes constant credit assessments on its customers’ financial capacity, which minimizes the potential risk for bad debt losses. The credit risk represents the exposure to possible losses resulting from the breach by commercial or financial counterparties of their obligations taken on with the Company. This risk stems mainly from economic and financial factors or a possible counterparty default. The credit risk is associated with the Company’s commercial activity through customer trade receivables, as well as available funds and deposits in banking and financial institutions. The Company, in its ordinary course of business and in accordance with its credit policies, grants credits to a large customer base, mainly large sectors of the industry, including petrochemical companies, natural gas distributors and electricity large users. As of December 31, 2023, the Company’s trade receivables totaled US$ 209 million and is classified as current. With the exception of CAMMESA, which represents approximately 48% of such trade receivables, the Company does not have a significant credit risk concentration, as this exposure is distributed among a large number of customers and other counterparties. The impossibility by CAMMESA to pay these receivables may have a substantially adverse effect on cash income and, consequently, on the result of operations and financial situation which, in turn, may adversely affect the Company’s repayment capacity. The credit risk of liquid funds and other financial investments is limited since the counterparties are high credit quality banking institutions. If there are no independent risk ratings, the Financial Department evaluates the customer’s creditworthiness, based on past experiences and other factors. The Company applies the simplified approach of IFRS 9 to measure the expected credit losses of trade receivables and other receivables in accordance with the policy described in Note 4.10.4. The expected credit loss on financial assets and trade receivables amounted to US$ 1 million as of December 31, 2023, 2022 and 2021 and was determined based on credit loss rates calculated for days past due detailed below:
Schedule of expected credit loss on trade receivables and financial assets rates |  |  |  |  |  |  |  |
12.31.2023 | Undue | 30 days | 60 days | 90 days | 120 days | 150 days | 180 days | + 180 days
Generation | 0.32% | 1.26% | 8.33% | 16.63% | 20.72% | 23.46% | 27.00% | 28.96%
Oil and Gas | 0.06% | 0.30% | 2.19% | 3.83% | 5.06% | 10.14% | 10.14% | 10.21%
Petrochemicals | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 28.96%
Holding | 0.18% | 1.04% | 8.44% | 9.09% | 9.09% | 9.09% | 9.09% | 9.09%
12.31.2022 | Undue | 30 days | 60 days | 90 days | 120 days | 150 days | 180 days | + 180 days
Generation | 0.08% | 0.26% | 2.54% | 7.11% | 14.37% | 21.39% | 27.22% | 33.01%
Oil and Gas | 0.18% | 0.48% | 13.24% | 31.50% | 32.01% | 32.09% | 32.31% | 32.38%
Petrochemicals | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%
Holding | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%
12.31.2021 | Undue | 30 days | 60 days | 90 days | 120 days | 150 days | 180 days | + 180 days
Generation | 0.06% | 0.29% | 2.08% | 2.83% | 4.67% | 6.12% | 6.24% | 6.25%
Oil and Gas | 0.04% | 0.17% | 0.77% | 2.72% | 6.88% | 19.88% | 21.97% | 15.89%
Petrochemicals | 0.00% | 0.00% | 0.01% | 0.05% | 0.12% | 0.52% | 0.52% | 0.54%
Holding | 0.00% | 0.00% | 0.01% | 0.05% | 0.12% | 0.52% | 0.52% | 0.54%
Finally, although cash, cash equivalents and financial assets are also subject to the impairment requirements of IFRS 9, the identified impairment loss is immaterial. Allowance of impairment of financial assets and other credits evolution as of December 31, 2023, 2022 and 2021, is detailed in Note 12.3. The Company’s maximum exposure to credit risk is based on the book value of each financial asset in the Consolidated Financial Statements. On the basis of the change in an assumption, while holding all other assumptions constant, a 5% increase/(decrease) in the estimated trade receivables’ uncollectibility rate would result in US$ 0.05 million (decrease)/increase in 2023 fiscal year’s results, before income tax. 6.2.1.3 Liquidity risk The liquidity risk is associated with the Company’s capacity to finance its commitments and conduct its business plans with stable financial sources, as well as with the indebtedness level and the financial debt maturities profile. The cash flow projection is made by the Financial Department. The Company Management supervises updated projections on liquidity requirements to guarantee the sufficiency of cash and liquid financial instruments to meet operating and financing needs of the Company while keeping at all times a sufficient margin of unused credit facilities. In this way, the aim is that the Company does not breach indebtedness levels or the Covenants, applicable, of any credit facility. Those projections take into consideration the Company’s debt financing plans, the meeting of the covenants and, if applicable, the external regulatory or legal requirements such as, for example, restrictions on the use of foreign currency. Additionally, the Financial Department regularly monitors the available credit for the Company, both in the local and international capital market as well as in the banking sector. Excess cash and balances above working capital management requirements are managed by the Company’s Treasury Department, which invests them in marketable securities, term deposits and mutual funds, selecting instruments having proper currencies and maturities, and an adequate credit quality and liquidity to meet cash needs estimated in the previously indicated projections. The Company keeps its sources of financing diversified between banks and the capital market, and it is exposed to the refinancing risk at maturity. It should be noted that the Company operates in an economic context in which main variables experience volatility as a result of political and economic events both domestically and internationally, as described in Note 1.2. that may potentially affect the cost of access to finance for emerging markets in general, and particularly for Argentina, and which in turn may potentially affect the Company’s capacity to obtain financing for its operations in a timely manner and under acceptable and efficient terms, costs and conditions in line with the Company’s business needs. Furthermore, the restrictions imposed by the BCRA (see Note 2.5) with the purpose of regulating inflows and outflows in the MLC and other new restrictions which may be imposed in the future may affect the Company’s capacity to access the MLC to acquire the foreign currency necessary to meet its financial obligations, such as debt principal and interest payments (including the CBs debt), and other additional payments abroad, or otherwise affect the Company’s business and the results of its operations. The Company’s Management permanently monitors the evolution of situations affecting its business to determine possible steps to take and identify potential impacts on its assets and financial position. It is worth highlighting that the Company currently has a strong level of liquidity that allows it to properly face such volatility. The determination of the Company’s liquidity index for fiscal years ended December 31, 2023 and 2022 is detailed below:
Schedule of liquidity index |  |  |  |  |
|  |  | 12.31.2023 |  | 12.31.2022
Current assets |  |  | 1,336 |  | 1,343
Current liabilities |  |  | 521 |  | 631
Liquidity ratio |  |  | 2.56 |  | 2.13
The following table includes an analysis of the Company trade receivables, other receivables and financial liabilities, grouped according to their maturity dates and considering the period remaining until their contractual maturity date from the date of the Consolidated Financial Statements. Derivative financial instruments are included in the analysis if their contractual maturities are essential for the understanding of the cash flow calendar. The amounts shown in the table are the contractual undiscounted cash flows.
Schedule of financial liabilities contractual undiscounted cash flows maturity |  |  |  |  |  |  |
As of December 31, 2023 |  |  | Trade and other receivables |  | Trade and other payables (1) |  | Borrowings
Less than three months |  |  | 261 |  | 223 |  | 63
Three months to one year |  |  | 13 |  | 15 |  | 236
One to two years |  |  | 10 |  | 31 |  | 277
Two to five years |  |  | 6 |  | 6 |  | 907
More than five years |  |  | - |  | 9 |  | 306
Non set maturity term |  |  | 24 |  | - |  | -
Total |  |  | 314 |  | 284 |  | 1,789
As of December 31, 2022 |  |  | Trade and other receivables |  | Trade and other payables (1) |  | Borrowings
Less than three months |  |  | 412 |  | 231 |  | 289
Three months to one year |  |  | 19 |  | 50 |  | 361
One to two years |  |  | 6 |  | 12 |  | 1,022
Two to five years |  |  | 12 |  | 3 |  | 313
More than five years |  |  | - |  | 6 |  | 2,102
Non set maturity term |  |  | 41 |  | - |  | -
Total |  |  | 490 |  | 302 |  | 4,087
(1) |  | Includes Lease Liabilities (see Note 19).
6.3 Capital risk management The aims of managing capital are to safeguard its capacity to continue operating as an on-going business with the purpose of generating return for its shareholders and benefits to other stakeholders, and keeping an optimal capital structure to reduce the cost of capital. To keep or adjust its capital structure, the Company may adjust the amount of the dividends paid to its shareholders, reimburse capital to its shareholders, issue new shares, conduct stock repurchase programs or sell assets to reduce its debt. In line with industry practices, the Company monitors its capital based on the leverage ratio. This ratio is calculated by dividing the net debt by the total capital. The net debt equals the total indebtedness (including current and non-current indebtedness) minus cash and cash equivalents and current financial assets at fair value through profit and loss. The total capital corresponds to the shareholders’ equity as shown in the statement of financial position, plus the net debt. Financial leverage ratios as at December 31, 2023 and 2022 were as follows:
Schedule of financial leverage ratios |  |  |  |  |
|  |  | 12.31.2023 |  | 12.31.2022
Total borrowings |  |  | 1,448 |  | 1,613
Less: cash and cash equivalents, and financial assets at fair value through profit and loss |  |  | (730) |  | (692)
Net debt |  |  | 718 |  | 921
Total capital |  |  | 3,122 |  | 3,198
Leverage ratio |  |  | 23.00% |  | 28.80%

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