Business Context and Reporting Period
Company: CEMENTOS PACASMAYO S.A.A. (Pacasmayo Cement Corporation)
Filing Type: Form 6-K (Report of Foreign Issuer)
Reporting Period: Information as of December 31, 2016, filed on January 12, 2017.
Jurisdiction: Republic of Peru
Subject: Monthly Position of Financial Derivatives.
Key Financial Metrics
The filing focuses exclusively on financial derivative instruments and does not provide consolidated revenue, profit, cash flow, or general liquidity metrics.
| Metric | Value (PEN) | Notes |
|---|---|---|
| Derivative Notional Amount | USD 300 Million | Cross Currency Swaps hedging corporate bond liability. |
| Fair Value (Current Month) | 69,912,000 | As of December 31, 2016. |
| Fair Value (Previous Month) | 126,321,000 | As of November 30, 2016. |
| Total Accumulated Profit/Loss (2016) | (55,817,000) | Net loss for the year. |
Material Changes and Composition of Loss
The total cumulative loss of PEN 55,817,000 for 2016 is composed of the following components:
- Decline in Fair Value: PEN 54,858,000 loss (recorded in equity/other comprehensive income).
- Unrealized Exchange Rate Gain: PEN 15,900,000 gain on holding dollar-denominated bonds (recorded in equity/other comprehensive income).
- Deferred Income Tax: PEN 10,941,000 benefit (recorded in equity/other comprehensive income).
- Swap Commissions: PEN 27,800,000 expense (recorded as interest expense in the profit and loss account).
The fair value of the Cross Currency Swaps decreased significantly from the previous month (PEN 126.3M to PEN 69.9M).
Guidance, Risks, and Unusual Items
Valuation Methodology: Fair values are estimated internally in accordance with International Financial Reporting Standards (IFRS) using market data-based valuation techniques.
Contingency: The filing explicitly states that amounts relating to the fair value of the Cross Currency Swaps are subject to change and are preliminary.
Management Commentary: No forward-looking guidance or operational outlook is provided in this specific filing.
Investor Verification Checklist
- Verify the final audited impact of the PEN 27.8 million commission expense on the 2016 net income.
- Confirm the final fair value of the Cross Currency Swaps once preliminary estimates are finalized.
- Review the full 20-F annual report for consolidated revenue and operating margins, as this 6-K only covers derivatives.
- Assess the exposure of the USD 300 million corporate bond liability to future currency fluctuations.