4.78 MB - Perth Airport

NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2005 (CONTINUED)
NOTE 23. FINANCIAL INSTRUMENTS (CONTINUED)
(a) Interest Rate Risk Exposures (continued)
30 June 2004 Floating Fixed interest Fixed interest Non-interest
interest rate over1 to 5 years over 5 years Bearing Total
$’000 $’000 $’000 $’000 $’000
Financial Liabilities
Bank Loans 6,800 - - - 6,800
AUD Bonds - - 188,390 - 188,390
USD Notes - - 217,265 - 217,265
Other loans 198,250 - - - 198,250
Trade and other creditors - - - 25,864 25,864
Foreign currency hedge liability - - - 16,300 16,300
205,050 - 405,655 42,164 652,869
Weighted Average Interest Rate: 8.92% - 9.32%
Net financial liabilities 189,513 - 405,655 24,936 620,104
Reconciliation of Net Financial Assets to Net Assets
Notes 2005 2004
$’000 $’000
Net financial liabilities as above (644,884) (620,104)
Non-financial assets and liabilities
Inventories 6 66 74
Prepayments 8 107 1,058
Infrastructure, plant and equipment 7,10 425,999 393,344
Lease franchise fee 11 395,821 400,171
Other assets 8,12 33,423 27,079
Provisions 15,18 (2,859) (2,708)
Net assets per statement of financial position 207,673 198,914
(b) Credit Risk Exposures
The credit risk on financial assets of the consolidated entity which have been recognised on the statement of financial position is
generally the carrying amount net of any provisions for doubtful debts.
For unrecognised financial instruments, including derivatives, credit risk also arises from the potential failure of counterparties to meet
their obligations under the respective contracts or arrangements. The consolidated entity’s credit risk exposures in relation to
unrecognised financial instruments is the notional principal amount of the instruments.
(c) Unrecognised Financial Instruments
In the normal course of business, the consolidated entity is party to unrecognised financial instruments in order to hedge exposures to
fluctuations in interest rates and foreign exchange rates.
Interest Rate Swap and Cross Currency Foreign Exchange Swap Contracts
It is a requirement of the consolidated entity’s funding arrangements and the consolidated entity’s risk management process that a
portion of its debt be hedged against movements in interest rates and foreign exchange. Accordingly, the consolidated entity has
entered into a series of interest rate and cross currency foreign exchange swap contracts.
The consolidated entity’s exposure to interest rate risk for each class of unrecognised financial asset and financial liability is set out
below. The balance represents the notional principal amount of the contract.
Notional Principal Note 2005 2006-2011
$’000 $’000
Interest rate swaps (i) 229,000 229,000
Cross currency swaps (ii) 229,000 229,000
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