Derivative Financial Instruments

12 Months Ended

Dec. 31, 2021

Derivative Financial Instruments [Abstract]

29 Derivative financial instruments

A significant portion of the Group’s revenue and costs are denominated in currencies other than the Euro. Consequently, a significant portion of its revenue and costs is exposed to fluctuations in the exchange rates between the Euro and other currencies. The Group uses forward exchange contracts (known in Italy as domestic currency swaps) to reduce its exposure to the risks of short-term decrease in the value of its foreign currency denominated revenue. The Group uses such derivative instruments to protect the value of its foreign currency denominated revenue, and not for speculative or trading purposes. Despite being entered into such domestic currency swaps with the intent to reduce the foreign currency exposure risk for trade receivables and expected sales, the Group’s derivative financial instruments do not qualify for being accounted for as hedging instruments according to IAS 39. Therefore, the Company reflects the positive or negative changes in the fair value of those derivatives through profit or loss in the caption “Net exchange rate gains/(losses)”.

The tables below summarise in euro equivalent the contractual amounts of forward exchange contracts used to hedge principally future cash flows from trade receivables and sale orders as at December 31, 2021 and 2020.


	31/12/21		31/12/20
U.S. dollars		20,532		854
British pounds		14,723		8,760
Euro		12,192		11,385
Australian dollars		1,826		1,459
Japanese yen		1,152		1,293
Canadian dollars		812		2,301
Swedish kroner		99		203
Total		51,336		26,255

The following tables present information regarding the contract amount in euro equivalent amount and the estimated fair value of all of the Group’s forward exchange contracts. Contracts with net unrealized gains are presented as “assets” and contracts with net unrealized losses are presented as “liabilities”.


	2021					2020
	Contract amount		Unrealised gains/(losses)			Contract amount		Unrealised gains/(losses)
Assets		18,159		96			12,587		112
Liabilities		33,177		(691	)		13,668		(253	)
Total		51,336		(595	)		26,255		(141	)

As at December 31, 2021 and 2020, the forward exchange contracts have a net unrealized expense of 595 and 141, respectively. These amounts are recorded in net exchange rate gains/(losses) in the consolidated statements of profit or loss (see note 37).