Telstra 2011 Annual Report Download - page 48

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Telstra Corporation Limited and controlled entities
Full year results and operations review - June 2011
value on a portion of our borrowings in fair value
hedges;
• other current liabilities increased due to higher trade
creditors and accruals mainly as a result of an
increase in expenditure as well as an increase in
derivative liabilities. This is partly offset by a
decrease in revenues received in advance primarily
related to Sensis print revenue; and
• other non current liabilities decreased due to lower
defined benefit pension and tax liabilities, partly
offset by an increase in derivative liabilities
predominantly from a strengthening of the Australian
dollar.
Our gross debt position at 30 June 2011 was $16,232
million, an increase of $201 million from 30 June 2010.
The increase is due to a net non-cash revaluation loss of
$386 million and $72 million of finance lease additions,
partly offset by net borrowing repayments of $257
million. These net borrowing repayments comprise
$156 million inflow relating to borrowings and $15
million inflow from non current bank deposits. This was
offset by $428 million outflow relating to the associated
derivative instruments.
The increase in cash and cash equivalents of $694
million includes a net loss of $72 million for the effect of
exchange rate movements and reflects a change in
policy settings which requires us to hold more liquidity
to prefund major payments. Also of note is $169 million
for the net cash portion of SouFun assets sold which was
included in current assets held for sale in June 2010,
partly offset by $7 million classified as held for sale
relating to Adstream at June 2011. Adjusting for this
the net increase in cash and cash equivalents is $532
million.
Net debt at 30 June 2011 was $13,595 million which
reflects a decrease of $331 million from 30 June 2010,
comprising the net increase in cash and cash
equivalents of $532 million, partly offset by higher gross
debt of $201 million. Our net debt gearing ratio (net
debt as a proportion of equity plus net debt) increased
from 51.7% as at 30 June 2010 to 52.5% as at 30 June
2011 which is largely due to a reduction in equity over
the period due to a movement in the foreign currency
translation reserve as a result of the strengthening of
the Australian dollar and the execution of our strategy
to invest in customer acquisition and simplify our
business.