Financial Statements
Strategic Report
Governance
Additional Information
25. Risk management/ Continued At the reporting date the gearing ratios were as follows:
2023 £000
2022 £000
224,467 792,556
Total borrowings
218,835 895,807
Gross assets
Gearing ratio (must not exceed 65%)
28.3%
24.4%
The Board of Directors monitors the return on capital as well as the level of dividends to ordinary shareholders. The Group has managed its capital risk by entering into long-term loan arrangements with different maturities, which will enable the Group to manage its borrowings in an orderly manner over the long-term. The Group also has a revolving credit facility
which provides greater flexibility in managing the level of borrowings. The Group’s net debt to equity ratio at the reporting date was as follows:
2023 £000
2022 £000
244,932 (20,050) 224,882 547,624
Total liabilities
238,677 (38,547) 200,130 657,130
Less: cash and cash equivalents
Net debt
Total equity
Net debt to equity ratio at end of year
0.41
0.30
Credit risk The following tables detail the balances held at the reporting date that may be affected by credit risk:
Financial assets and liabilities at amortised cost £000
Held at fair value through profit or loss £000
Total £000
31 March 2023
Notes
Financial assets Tenant debtors
– – –
2,855 2,855 20,050 20,050 22,905 22,905
15 16
Cash and cash equivalents
Financial assets and liabilities at amortised cost £000
Held at fair value through profit or loss £000
Total £000
31 March 2022
Notes
Financial assets Tenant debtors
15 16
– – –
4,618 4,618 38,547 38,547 43,165 43,165
Cash and cash equivalents
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group’s exposure to and credit ratings of, its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.
Picton Property Income Limited Annual Report 2023
151
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