Telstra 2012 Annual Report Download - page 155

Telstra Corporation Limited and controlled entities
125
Notes to the Financial Statements (continued)
d) Movements in net debt
The decrease in the carrying amount (including net cash
movements) of our net debt during the year of $318 million for the
Telstra Group (30 June 2011: decrease of $331 million) is
represented by the movements shown in Table E below:
(i) The net revaluation gain of $18 million includes:
• gain of $6 million (2011: loss of $156 million) affecting other
finance costs comprising a loss of $9 million (2011: $27 million)
from fair value hedges; a gain of $14 million (2011: loss of $125
million) from transactions either not designated or de-designated
from fair value hedge relationships; and a gain of $1 million
(2011: loss of $4 million) relating to other hedge accounting
adjustments; and
• gain of $12 million (2011: $3 million) affecting interest on
borrowings comprising a gain of $27 million (2011: $21 million)
relating to cross currency swap discounts on new borrowings
which will be amortised to interest in the income statement over
the life of the borrowing; and a loss of $15 million (2011: $18
million) comprising the amortisation of discounts.
We have issued the following long term debt during the year for
refinancing purposes:
• $1,002 million offshore Euro public bond in November 2011,
matures 16 May 2022;
• $98 million offshore Euro private placement bond in December
2011, matures 20 December 2023;
• $252 million offshore Swiss franc public bond in December 2011,
matures 14 December 2018;
• $50 million offshore Australian dollar private placement bond in
December 2011, matures 19 December 2023;
• $9 million domestic private placement loan in December 11 and
February 12, matures 30 July 2018;
• $1,248 million offshore Euro public bond in March 2012, matures
21 September 2022;
• $2 million offshore Indian rupee bank loan in December 2011,
matures 22 December 2016; and
• $140 million offshore Australian dollar private placement bond in
May 2012; matures 25 May 2022.
Our unsecured promissory notes are used principally to support
working capital and short term liquidity, as well as hedging certain
offshore investments. Our short term unsecured promissory notes
will continue to be supported by liquid financial assets and ongoing
credit standby lines.
The following long term debt was repaid during the year:
• $5 million Telstra bonds, matured 15 July 2011;
• $435 million domestic syndicated bank loan, matured 22
September 2011;
• $90 million offshore New Zealand dollar public bond, matured 24
November 2011;
• $27 million offshore United States dollar private placement bond,
matured 16 December 2011;
• $106 million offshore United States dollar public bond, matured
30 January 2012;
• $250 million offshore Australian dollar syndicated bank loan,
matured 1 February 2012;
• $947 million offshore United States dollar public bond, matured
1 April 2012; and
• $176 million offshore United States dollar syndicated bank loan,
matured 18 May 2012.
Long term debt of $2,970 million will mature during fiscal 2013. This
represents the contractual face value amount after hedging.
Included in this amount are offshore borrowings which were
swapped into Australian dollars at inception of the borrowing
through to maturity using cross currency and interest rate swaps,
creating synthetic Australian dollar obligations. These post hedge
obligations are reflected in our total contractual Australian dollar
liability at maturity of $2,970 million.
17. Capital management and financial instruments (continued)
Table E Telstra Group
Year ended
30 June
2012 2011
$m $m
Debt issuance - offshore and domestic loans 2,801 2,086
Net short term borrowings and bank deposits
greater than 90 days . . . . . . . . . . . . . 60 254
Repayment of offshore and domestic loans . (2,036) (2,536)
Finance lease repayments . . . . . . . . . . (52) (61)
Net cash inflow/(outflow) 773 (257)
Non-cash movements in gross debt before
tax
Revaluation losses affecting cash flow hedging
reserve . . . . . . . . . . . . . . . . . . . . 103 244
Revaluation losses/(gains) affecting foreign
currency translation reserve . . . . . . . . . 89 (32)
Revaluation (gains)/losses affecting other
expenses in the income statement . . . . . . (9) 21
Revaluation (gains)/losses affecting finance
costs in the income statement (i) . . . . . . . (18) 153
Finance lease additions . . . . . . . . . . . 52 72
217 458
Total increase in gross debt . . . . . . . . 990 201
Net increase in cash and cash equivalents
(including foreign currency exchange
differences) . . . . . . . . . . . . . . . . . . (1,308) (532)
Total decrease in net debt . . . . . . . . . (318) (331)