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For the three months ended March 31, 2013, compensation expense related to deferred, restricted and performance share units included in cost of sales and operating expenses was an expense of $19.1 million (2012 -$14.1 million). This included an expense of $15.7 million (2012 - expense of $10.3 million) related to the effect of the change in the Company's share price for the three months ended March 31, 2013.
9. Changes in non-cash working capital:
Changes in non-cash working capital for the three months ended March 31, 2013 were as follows:
Three Months Ended ---------------------- Mar 31 Mar 31 2013 2012--------------------------------------------------------------------------------------------------------------------------------------------------------Decrease (increase) in non-cash working capital: Trade and other receivables $ (24,428) $ (941) Inventories (33,127) 13,364 Prepaid expenses 3,891 921 Trade, other payables and accrued liabilities, including long-term payables included in other long-term liabilities 37,708 (56,777)---------------------------------------------------------------------------- (15,956) (43,433)Adjustments for items not having a cash effect and working capital changes relating to taxes and interest paid (377) 16,071----------------------------------------------------------------------------Changes in non-cash working capital having a cash effect $ (16,333) $ (27,362)----------------------------------------------------------------------------These changes relate to the following activities: Operating $ (15,037) $ (40,194) Investing (1,296) 12,832----------------------------------------------------------------------------Changes in non-cash working capital $ (16,333) $ (27,362)----------------------------------------------------------------------------
10. Financial instruments:
Financial instruments are either measured at amortized cost or fair value. Held-to-maturity investments, loans and receivables and other financial liabilities are measured at amortized cost. Held-for-trading financial assets and liabilities and available-for-sale financial assets are measured on the Consolidated Statement of Financial Position at fair value. Derivative financial instruments are classified as held-for-trading and are recorded on the Consolidated Statement of Financial Position at fair value unless exempted. Changes in fair value of held-for-trading derivative financial instruments are recorded in earnings unless the instruments are designated as cash flow hedges.
The euro hedges and the Egypt interest rate swaps designated as cash flow hedges are measured at fair value based on industry-accepted valuation models and inputs obtained from active markets.
The Egypt limited recourse debt facilities bear interest at LIBOR plus a spread. The Company has interest rate swap contracts to swap the LIBOR-based interest payments for an average aggregated fixed rate of 4.8% plus a spread on approximately 75% of the Egypt limited recourse debt facilities for the period to March 31, 2015. The Company has designated these interest rate swaps as cash flow hedges. These interest rate swaps had an outstanding notional amount of $329 million as at March 31, 2013. The notional amount decreases over the expected repayment period. At March 31, 2013, these interest rate swap contracts had a negative fair value of $25.9 million (2012 - $32.7 million) recorded in other long-term liabilities. The fair value of these interest rate swap contracts will fluctuate until maturity.
