ANNUAL REPORT 2015 |
179
NOTES TO THE FINANCIAL STATEMENTS
30 June 2015 (cont’d)
36. FINANCIAL INSTRUMENTS
(a) Capital management
The primary objective of the capital management of the Group is to ensure that entities of the Group would be able
to continue as going concerns whilst maximising the return to shareholders through the optimisation of the debt and
equity balance. The overall strategy of the Group remains unchanged from that in the previous financial year.
The Group manages its capital structure and makes adjustments to it in response to changes in economic conditions.
In order to maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return
capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes during the
financial years ended 30 June 2015 and 30 June 2014.
The Group monitors capital using gearing ratios, i.e. gearing ratio and net gearing ratio. Gearing ratio represents
borrowing divided by total capital whereas net gearing ratio represents borrowings less cash and bank balances divided
by total capital. Capital represents equity attributable to the owners of the parent.
Group
Company
2015
2014
2015
2014
RM’000
RM’000
RM’000
RM’000
Borrowings
143,086
145,503
12,321
14,890
Less: Cash and bank balances
(78,775)
(69,624)
(1,110)
(11,772)
64,311
75,879
11,211
3,118
Total capital
387,516
346,486
210,728
207,974
Gearing ratio
(1)
37%
42%
6%
7%
Net gearing ratio
(2)
17%
22%
5%
1%
(1)
without taking cash and bank balances into consideration
(2)
taking cash and bank balances into consideration
The Group will continue to be guided by prudent financial policies of which gearing is an important aspect.
Pursuant to the requirements of Practice Note No. 17/2005 of the Bursa Malaysia Securities, the Group is required to
maintain a consolidated shareholders’ equity equal to or not less than the twenty-five percent (25%) of the issued and
paid-up capital (excluding treasury shares) and such shareholders’ equity is not less than RM40.0 million. The Company
has complied with this requirement for the financial year ended 30 June 2015.
The Group is not subject to any other externally imposed capital requirements.
(b) Financial instruments
Group
Loans and Available-
receivables
for-sale
Total
2015
RM’000
RM’000
RM’000
Financial assets
Other investments
-
1,137
1,137
Trade and other receivables, net of prepayments
117,282
-
117,282
Cash and bank balances
78,775
-
78,775
196,057
1,137 197,194
