Notes to the financial statements

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35

19 Financial liabilities

Group	Note	2014 £m	2013 £m
Current
Obligations under finance leases	31	1.8	2.4
Loan notes (at amortised cost)	31	25.3	165.7
Debt issuance costs		(0.6)	(0.6)
Financial liabilities – Borrowings		26.5	167.5
Cross currency swaps (cash flow hedges)		2.0	2.2
Forward currency contracts (at fair value: cash flow hedge)	31	–	0.1
Financial liabilities – Derivative financial instruments		2.0	2.3
Current financial liabilities		28.5	169.8
Non-current
Obligations under finance leases	31	–	3.1
Loan notes (at amortised cost)	31	144.2	182.4
Bank loans (at amortised cost)	31	36.0	–
Debt issuance costs		(0.5)	(1.2)
Financial liabilities – Borrowings		179.7	184.3
Cross currency swaps (cash flow hedges)		6.2	3.9
Financial liabilities – Derivative financial instruments		6.2	3.9
Non-current financial liabilities		185.9	188.2

All derivative financial instruments are fair valued at each balance sheet date and all comprise Level 2 valuations under IFRS 7: Financial Instruments – Disclosures, namely, that they are based on inputs observable directly (from prices) or indirectly (derived from prices).

Interest bearing loans and borrowings

The effective interest rates on loans and borrowings at the balance sheet date were as follows:

		Maturity	2014 £m	Effective Interest rate at March 2014	2013 £m	Effective Interest rate at March 2013
Current
Loan notes:	US$ swapped into £	April 2013	–	–	68.7	5.32%
	Euro	April 2014	–	–	21.0	4.74%
	Euro	April 2017	–	–	23.2	4.85%
	Euro swapped into £	April 2014	25.3	4.97%	45.6	5.04%
	Sterling	April 2017	–	–	7.2	5.84%
Finance leases			1.8	5.18%	2.4	5.18%
Debt issuance costs			(0.6)		(0.6)
			26.5		167.5
Non-current
Multi-currency revolving credit facilities:
	Sterling floating	October 2016	36.0	LIBOR +115bps	–	–
Loan notes:	US$ swapped into £	April 2016	73.8	5.31%	81.0	5.31%
	Sterling	April 2016	10.0	5.27%	10.0	5.27%
	Euro swapped into £	April 2017	8.8	5.53%	9.0	4.85%
	Sterling	April 2017	2.8	5.84%	2.8	5.84%
	US$ swapped into £	November 2018	15.0	3.87%	16.5	3.87%
	US$ swapped into £	November 2021	33.8	4.52%	37.1	4.52%
	Euro	April 2014	–	–	8.2	4.74%
	Euro swapped into £	April 2014	–	–	17.8	5.04%
Finance Leases			–	5.18%	3.1	5.18%
Debt issuance costs			(0.5)		(1.2)
			179.7		184.3

On 18 April 2013 the Group repaid €106.9 million (£92.7 million) and £7.2 million of 2007 notes at a combined premium of £8.7 million. £69.2 million of these notes were due for repayment in April 2014 and £30.7 million were due for repayment in April 2017. In addition there was a natural maturity of £59.5 million ($104.3 million) of loan notes and a €60.0 million (£51.0 million) reduction in the revolving credit facility.

The Group is subject to a number of covenants in relation to its borrowing facilities which, if contravened, would result in its loans becoming immediately repayable. These covenants specify a maximum net debt to EBITDA ratio of 3.5 times, and minimum interest cover ratio of 3.0 times. No covenants were contravened in the year ended 31 March 2014 (2013: None). Key covenants under the 2011 revolving credit facility and debt private placement were unchanged from existing covenants.

Details of the Group’s interest rate management strategy and interest rate swaps are included in notes 30 and 31.

Company	2014 £m	2013 £m
Current
Loan notes (at amortised cost)	25.3	165.7
Financial liabilities – Borrowings	25.3	165.7
Cross currency swaps (cash flow hedges)	2.0	2.2
Financial liabilities – Derivative financial instruments	2.0	2.2
Current financial liabilities	27.3	167.9
Non-current
Loan notes (at amortised cost)	144.2	182.4
Bank loans (at amortised cost)	–	–
Financial liabilities – Borrowings	144.2	182.4
Cross currency swaps (cash flow hedges)	6.2	3.9
Financial liabilities – Derivative financial instruments	6.2	3.9
Non-current financial liabilities	150.4	186.3

Interest bearing loans and borrowings

The effective interest rates on loans and borrowings at the balance sheet date were as follows.

		Maturity	2014 £m	Effective Interest rate at March 2014	2013 £m	Effective Interest rate at March 2013
Current
Loan notes:	US$ swapped into £	April 2013	–	–	68.7	5.32%
	Euro	April 2014	–	–	21.0	4.74%
	Euro	April 2017	–	–	23.2	4.85%
	Euro swapped into £	April 2014	25.3	4.97%	45.6	5.04%
	Sterling	April 2017	–	–	7.2	5.84%
			25.3		165.7
Non-current
Loan notes:	US$ swapped into £	April 2016	73.8	5.31%	81.0	5.31%
	Sterling	April 2016	10.0	5.27%	10.0	5.27%
	Euro swapped into £	April 2017	8.8	5.53%	9.0	4.85%
	Sterling	April 2017	2.8	5.84%	2.8	5.84%
	US$ swapped into £	November 2018	15.0	3.87%	16.5	3.87%
	US$ swapped into £	November 2021	33.8	4.52%	37.1	4.52%
	Euro	April 2014	–	–	8.2	4.74%
	Euro swapped into £	April 2014	–	–	17.8	5.04%
			144.2		182.4