29 Finance costs
millions of € |
|
|
|
||
|
2025 |
2024 |
2023 |
||
|---|---|---|---|---|---|
Interest income |
613 |
927 |
870 |
||
Interest expense |
(6,522) |
(6,613) |
(6,588) |
||
|
(5,909) |
(5,686) |
(5,719) |
||
Of which: from leases |
(1,803) |
(1,888) |
(1,874) |
||
Of which: from financial instruments relating to measurement categories in accordance with IFRS 9 |
|
|
|
||
Debt instruments measured at amortized cost |
142 |
215 |
324 |
||
Debt instruments measured at fair value through profit or loss |
305 |
399 |
251 |
||
Financial liabilities measured at amortized costa |
(4,531) |
(4,375) |
(4,356) |
||
|
|||||
Finance costs amounted to EUR 5.9 billion, putting the figure EUR 0.2 billion below the prior-year level. On the one hand, interest income decreased, primarily due to lower interest income from derivatives to hedge against interest rate risks (EUR 0.2 billion) and due to a decrease in cash on hand invested in interest-bearing money-market investments (EUR 0.1 billion). On the other hand, interest expense decreased slightly due to lower interest expense from derivatives to hedge against interest rate risks (EUR 0.1 billion) and lower interest expense for lease liabilities due to a decline in lease liabilities (EUR 0.1 billion). By contrast, interest expense increased slightly, due to higher debt than in the prior year (EUR 0.1 billion).
Interest of EUR 128 million (2024: EUR 132 million; 2023: EUR 207 million) was capitalized as part of acquisition costs in the reporting year. The amount was calculated on the basis of an interest rate in the average range between 4.3 % at the start of the year and 4.4 % at the end of the year (2024: between 4.2 % and 4.3 %; 2023: between 3.4 % and 4.2 %) applied across the Group.
Interest payments (including capitalized interest) of EUR 7.7 billion (2024: EUR 8.1 billion; 2023: EUR 7.9 billion) were made in the reporting year.
Accrued interest payments from derivatives (interest rate swaps) that were designated as hedging instruments in a fair value hedge in accordance with IFRS 9 are netted per swap contract and recognized as interest income or interest expense depending on the net amount. Finance costs are assigned to the measurement categories on the basis of the hedged item. Only financial liabilities were hedged in the reporting period.