130 131
27.
Financial risk management (continued)
Financial risk factors (continued)
(d)
Capital risk
The Trustee-Manager’s objective when managing capital is to optimise the Group’s capital structure within the
borrowing limits set out in the Trust Deed to fund future acquisitions and asset enhancement works at the Group’s
properties. To maintain or achieve an optimal capital structure, the Trustee-Manager may issue new units or source
for additional borrowing from both financial institutions and capital markets.
The Trustee-Manager monitors capital based on gearing ratio. As provided for in the Trust Deed, the maximum
gearing ratio is 40% or up to a maximum of 60% only if a credit rating is obtained. During the financial year, the
gearing ratio is calculated as total effective borrowings, which takes into account the derivative financial instruments
used to hedge borrowings, divided by value of Trust Property. Previously, borrowings did not take into account the
value of derivative financial instruments.
2015
2014
$'000
$'000
Total effective borrowings
312,148 234,363
Value of Trust Property
1,256,820 1,062,645
Gearing ratio
25%
22%
Trust Property consists of all property and rights of any kind whatsoever which are held on trust for the Unitholders,
in accordance with the terms of the Trust Deed.
The Group is in compliance with the borrowing limit requirements imposed by the Trust Deed and all externally
imposed capital requirements for the financial years ended 31 March 2015 and 2014.
