4.3.9Net Financing Costs
2024 | 2023 | ||
|---|---|---|---|
Interest income on loans & receivables | 2 | 3 | |
Interest income on investments | 24 | 21 | |
Financial income | 26 | 25 | |
Interest expenses on financial liabilities at amortized cost | (832) | (731) | |
Interest income / (expenses) on hedging derivatives | 167 | 139 | |
Interest expenses on lease liabilities | (5) | (5) | |
Interest addition to provisions | (10) | (1) | |
Net cash flow hedges ineffectiveness | (3) | - | |
Net foreign exchange loss | (8) | (3) | |
Financial expenses | (690) | (601) | |
Net financing costs | (663) | (575) |
The increase in net financing costs is mainly due to (i) increased project financing to fund continued investment in growth on FPSO Almirante Tamandaré, FPSO Alexandre de Gusmão and FPSO ONE GUYANA, (ii) additional interest expense on the Company‘s RCF, (iii) additional interest expense generated by the construction financing of FPSO Jaguar, partially offset by (iv) lower interest expense on FPSOs Liza Unity, Prosperity and Liza Destiny following purchase of the units by the client and the full repayment of the project loans respectively in November 2023, November 2024 and December 2024 and (v) the scheduled amortization of project loans for the fleet under operations.