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79Marks and Spencer Group plc
21 BORROWINGS AND OTHER FINANCIAL LIABILITIES continued
Borrowing facilities
At 1 April 2006, the Group had a five-year committed syndicated bank facility of £1.2bn set to mature on 27 March 2011, which
contains only one financial covenant being earnings before interest, tax, depreciation, amortisation and rents payable to fixed charge
cover. The Group also has a number of undrawn uncommitted facilities available to it. At 1 April 2006, these amounted to £175m
(last year £190m), all of which are due to be reviewed within a year. All committed and uncommitted bank facilities were undrawn as
at the balance sheet date.
Financial liabilities
After taking into account the various interest rate swaps entered into by the Group, the currency and interest rate exposure of the
Groups’ financial liabilities is as set out below. There are no financial liabilities other than short term payables excluded from this
analysis:
2006
Fixed Floating
rate rate Total
Currency £m £m £m
Sterling 1,137.7 1,045.5 2,183.2
Euro 3.2 0.2 3.4
1,140.9 1,045.7 2,186.6
Included within floating rate liabilities is £54.7m of unredeemed B shares.
The floating rate sterling and euro borrowings are linked to interest rates related to LIBOR. These rates are for periods ranging from
one month to six months. Excluding finance leases, the fixed rate Sterling borrowings are at an average rate of 6.1% and the
weighted average time for which the rate is fixed is 10.4 years.
Interest rate analysis
The effective interest rates at the balance sheet date were as follows:
2006
%
Medium term notes 5.7
Securitised loan notes 6.3
Non-equity B shares 3.5
Finance leases 4.4
Finance leases
The minimum lease payments under finance leases fall due as follows:
2006 2005
£m £m
Not later than one year 4.8 5.5
Later than one year but not more than five 9.8 13.6
More than five years 197.7 201.2
212.3 220.3
Future finance charges on finance leases (162.1) (166.4)
Present value of lease obligations 50.2 53.9
It is the Group’s policy to lease certain of its properties and equipment under finance leases. The average lease term for equipment
is four years and 125 years for property. Interest rates are fixed at the contract rate. All leases are on a fixed repayment basis and no
arrangements have been entered into for contingent payments. The Group’s obligations under finance leases are secured by the
lessors’ charges over the leased assets.