10. Fair Value Adjustments, Net Currency Exchange Differences and Other Financial Income/Expenses
The following table summarizes fair value adjustments and net currency exchange differences, and other financial income and expenses for the years ended December 31, 2024 and 2023.
|
Year ended December 31 |
|
|---|---|---|
(thousands of €) |
2024 |
2023 |
Fair value adjustments and net currency exchange differences: |
|
|
Net unrealized currency exchange gain/loss (-) |
22,727 |
(20,544) |
Net realized currency exchange loss |
(678) |
(1,118) |
Fair value re-measurement of warrants |
4 |
18 |
Fair value loss on financial assets held at fair value through profit or loss |
- |
(390) |
Fair value gain on current financial investments |
73,742 |
38,286 |
Total fair value adjustments and net currency exchange differences |
95,795 |
16,252 |
|
|
|
Other financial income: |
|
|
Interest income |
89,378 |
79,290 |
Discounting effect of non-current R&D incentives receivables |
1,132 |
617 |
Discounting effect of other non-current liabilities |
395 |
318 |
Other finance income |
223 |
24 |
Total other financial income |
91,128 |
80,249 |
|
|
|
Other financial expenses: |
|
|
Interest expenses |
(911) |
(1,770) |
Other finance charges |
(759) |
(843) |
Total other financial expenses |
(1,670) |
(2,613) |
|
|
|
Total net financial result |
185,253 |
93,888 |
The net currency unrealized exchange gain in 2024 of €22.7 million primarily consisted of an unrealized exchange gain of €22.2 million on cash and cash equivalents and current financial investments at amortized cost held in U.S. dollars, as compared to an unrealized net exchange loss in 2023 of €20.4 million on cash and cash equivalents and current financial investments at amortized cost held in U.S. dollars. We have cash, cash equivalents and current financial investments held in U.S. dollars, which could generate foreign currency exchange gain or loss in our financial results in accordance with the fluctuation of the EUR/U.S. dollar exchange rate as our functional currency is EUR.
The fair value gain on the current financial investments in 2024 reflected the exchange differences on the money market funds, the interest on these money market funds and the effect of the re-measurement at fair value of our money market funds on December 31, 2024. These re-measurement gains were mainly the result of the positive returns on the EUR denominated money market funds.
Interest income was related to interests on treasury bills, term deposits and notice accounts. Net interest income increased due to increasing interest rates. Other financial income for 2024 and 2023 also comprise the discounting effect of other non-current liabilities as milestones payables related to the acquisition of subsidiaries.
Interest expenses were mainly related to interests on leases of buildings and cars and to interests related to defined benefit obligations.