Download the Tanzania Breweries Ltd 2010 Annual ... - SABMiller

Notes to Financial Statements
For the year ended 31 March 2010
(All amounts in Tshs M)
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
Prudent liquidity risk management includes maintaining sufficient cash and cash equivalents, the availability of funding from an adequate amount of
committed credit facilities and the ability to close out market positions. Due to the dynamic nature of the underlying businesses, the group maintains
flexibility in funding by maintaining availability under committed credit lines and through inter-company short term advances. Management monitors
rolling forecasts of the group’s liquidity reserve on the basis of expected cash flows.
The table below shows the availability of funding from Banks and their related utilisation at the balance sheet dates.
Company 31 March 2010 31 March 2009
Credit limit Utilised Credit limit Utilised
Banks
Stanbic Bank Tanzania Limited 9,000 7,269 9,000 7,327
Standard Chartered Bank Tanzania Limited 30,000 27,447 20,000 17,767
Citibank Tanzania Limited 9,000 584 33,175 24,567
National Bank of Commerce Limited 21,000 13,262 11,000 7,079
CRDB Bank Plc 26,000 19,747 28,500 23,210
National Microfinance Bank Plc 39,780 33,194 30,000 25,608
134,780 101,503 131,675 105,558
The table below analyses the group’s financial liabilities which will be settled on a net basis into relevant maturity groupings based on the remaining
period at the balance sheet to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances
due within 12 months equal their carrying balances as the impact of discounting is not significant.
Group
Within 1
year
Between
2 and 5
years
Within 1
year
Company
Between
2 and 5
years
At 31 March 2010
Borrowings 101,503 41,842 101,503 41,482
Interest 10,150 1,832 10,150 1,832
Trade and other payables 79,456 - 75,861 -
At 31 March 2009
Borrowings 105,702 - 105,702 -
Interest 12,684 - 12,684 -
Trade and other payables 67,608 - 67,608 -
Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for
shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group
may adjust the amount of dividends paid to shareholders, issue new capital or sell assets to reduce debt.
Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio. The gearing ratio is calculated as net debt divided
by total capital. Net debt is calculated as total borrowings less cash and cash equivalents. Total capital is calculated as equity plus net debt.
During the year ended 31 March 2010 the Group and Company’s strategy, which was unchanged from the prior year, was to maintain a gearing ratio
of below 100%. The gearing ratios at 31 March 2010 and 2009 were as follows:
Group Company
Note 2010 2009 2010 2009
Total borrowings 25 143,345 105,702 142,495 105,557
Less: cash at bank and in hand 20 (8,027) (9,274) (6,141) (7,813)
Net debt 135,318 96,428 136,354 97,744
Total equity 201,225 156,855 195,059 153,803
Total capital 336,543 253,283 331,413 251,547
Gearing ratio 40% 38% 41% 39%
Page 34
Tanzania Breweries Limited