Annual Report and Accounts 2008
29 Interest-bearing loans and borrowings
The effective interest rates on loans and borrowings at the balance sheet date were as follows.
| 2008 £m |
Maturity | Effective interest rate | 2007 £m |
Maturity | Effective interest rate | |
|---|---|---|---|---|---|---|
| Sterling loan notes | 0.8 | On demand | LIBOR + 1.0% | 0.8 | On demand | LIBOR + 1.0% |
| Loan notes | 0.8 | 0.8 | ||||
| Sterling bank loans | 17.9 | 2012–2015 | LIBOR + 0.2% | 17.5 | 2012–2015 | LIBOR + 0.2% |
| Sterling bank loans | 600.0 | June 2011 | LIBOR + 0.5% | – | – | – |
| Short term Sterling bank loans | 10.0 | 2009 | LIBOR + 0.5% | – | – | – |
| Short term US dollar bank loans | – | – | – | 5.0 | January 2008 | LIBOR + 1.0% |
| US dollar bank loans subject to interest rate hedge | – | – | – | 50.0 | June 2011 | 7.3% |
| US dollar bank loans unhedged | – | – | – | 25.0 | June 2011 | LIBOR + 0.4% |
| Euro bank loans unhedged | 8.0 | 2009–2015 | EURIBOR + 0.6% | 8.7 | 2008 | EURIBOR + 0.5% |
| Euro bank loans unhedged | – | – | – | 216.8 | April 2008 | EURIBOR + 0.5% |
| Euro bank loans subject to interest rate hedge | – | – | – | 150.7 | April 2008 | 4.6% |
| Euro bank loans subject to interest rate hedge | 514.9 | September 2010 | 4.9% | 473.7 | June 2011 | 4.6% |
| Bank loans | 1,150.8 | 947.4 | ||||
| US dollar finance leases at fixed rate | 40.3 | 2009–2012 | 4.0% | 18.1 | 2009–2012 | 3.6% |
| US dollar finance leases at floating rate | 26.1 | November 2009 | LIBOR – 0.3% | 21.9 | 2009–2012 | LIBOR – 0.3% |
| Euro finance leases at floating rate | 36.9 | 2009–2016 | EURIBOR + 0.5% | 40.3 | 2008–2013 | EURIBOR + 0.5% |
| Sterling finance leases at fixed rate | 30.6 | 2009–2018 | 5.4% | 34.1 | 2008–2018 | 5.4% |
| Sterling finance leases at floating rate | – | – | – | 5.4 | 2008 | LIBOR + 3.0% |
| Finance leases | 133.9 | 119.8 | ||||
| Euro loans | 1.1 | 2009–2011 | – | – | – | – |
| Other debt payable | 1.1 | – | ||||
| Total | 1,286.6 | 1,068.0 |
During the year €604.0m and $150.0m of debt were exchanged for £600.0m of sterling debt to reduce the Group's exposure to changing foreign exchange rates. Additionally, the euro facility was further extended to September 2009, with a one year extension to September 2010 at the Group's option.
Details of the Group's interest rate management strategy and interest rate swaps are included in notes 30 and 31.
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 maximum net debt to EBITDA and minimum EBITDA to interest.
The following table sets out the carrying amount, by maturity of the Group's financial instruments that are exposed to interest rate risk.
| As at 31 December 2008 | < 1 year £m |
1–2 years £m |
2–3 years £m |
3–4 years £m |
4–5 years £m |
> 5 years £m |
Total £m |
|---|---|---|---|---|---|---|---|
| Fixed rate | |||||||
| Bank loans | – | (514.9) | – | – | – | – | (514.9) |
| Finance leases | (10.4) | (9.8) | (11.2) | (7.2) | (6.8) | (25.5) | (70.9) |
| Net interest rate swaps | (13.4) | (11.4) | (2.0) | (3.4) | – | – | (30.2) |
| Other debt payable | (0.3) | (0.6) | (0.2) | – | – | – | (1.1) |
| Floating rate | |||||||
| Cash assets | 105.9 | – | – | – | – | – | 105.9 |
| Loan notes | (0.8) | – | – | – | – | – | (0.8) |
| Bank loans | (18.1) | (6.3) | (607.6) | (2.4) | (0.7) | (0.8) | (635.9) |
| Finance leases | (42.0) | (10.2) | (5.6) | (2.1) | (1.1) | (2.0) | (63.0) |
| As at 31 December 2007 | < 1 year £m |
1–2 years £m |
2–3 years £m |
3–4 years £m |
4–5 years £m |
> 5 years £m |
Total £m |
|---|---|---|---|---|---|---|---|
| Fixed rate | |||||||
| Bank loans | (155.7) | – | – | (523.6) | – | – | (679.3) |
| Finance leases | (9.5) | (5.7) | (5.3) | (4.6) | (3.3) | (23.8) | (52.2) |
| Net interest rate swaps | (1.7) | – | (4.5) | – | 0.8 | – | (5.4) |
| Floating rate | |||||||
| Cash assets | 157.2 | – | – | – | – | – | 157.2 |
| Loan notes | (0.8) | – | – | – | – | – | (0.8) |
| Bank loans | (228.8) | (4.9) | (2.7) | (27.6) | (2.6) | (1.5) | (268.1) |
| Finance leases | (20.9) | (14.4) | (10.0) | (6.9) | (4.5) | (10.9) | (67.6) |