Annual Report and Accounts 2008 (pdf-file) - Unibet

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The table below analyses the Group’s financial liabilities based on the remaining period at the balance sheet date. The amounts disclosed in the table are
the contractual undiscounted cash flows.
At 31 December 2008 At 31 December 2007
Less than Between Between Less than Between Between
GBP 000 one year 1 and 2 years 2 and 5 years one year 1 and 2 years 2 and 5 years
Bond and related interest 1 6,527 73,818 – 7,127 7,127 80,602
Bank borrowings – – – 9,687 – –
Trade and other payables 50,026 – – 31,148 – –
1
The amount reported for the bond and related interest does not take account of repurchases of the bond made after 31 December 2008, which total EUR 4.9 million
(GBP 4.667 million at the closing rate).
Note 2 d. Capital risk management
Unibet’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 benefits for other stakeholders and to maintain an optimal capital structure both to reduce the cost of capital and to provide appropriate funding for
expansion of the business.
In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue
new shares or sell assets. As explained in note 17, Unibet is required to comply with certain conditions as a result of the bond issue and has been in full
compliance.
Unibet monitors capital on the basis of the gearing ratio, which is calculated as net debt divided by total capital. Net debt is calculated as total borrowings
(including customer balances) less cash and cash equivalents. Total capital is calculated as ‘equity’ as shown in the consolidated balance sheet plus net debt.
The gearing ratios at 31 December 2008 and 2007 were as follows:
GBP000 2008 2007
Total borrowings (Note 17) 65,926 81,161
Customer balances (Note 16) 25,309 16,797
Less: cash and cash equivalents -53,383 -56,047
Net debt 37,852 41,911
Total equity 100,678 95,566
Total capital 138,530 137,477
Gearing ratio 27% 30%
Note 2 e. Fair value estimation
The carrying value less impairment provision of trade and other receivables and trade and other payables are assumed to approximate their fair values. The
fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that
is available to the Group for similar financial instruments.
Note 2 f. Credit quality of financial assets
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to
historical information about counterparty default rates.
Since Unibet does not have significant trade receivables other than payment solution providers, the credit risk associated with its normal operations is
principally in relation to fraudulent transactions as described in Note 2 c above.
Unibet uses a large number of banks and payment solution providers both in order to provide maximum access to markets and convenience for customers
and also to ensure that credit risk in banking relationships is spread.
Unibet Group plc Annual Report and Accounts 2008