Report of the Directors
Business Review

Liquidity and Going Concern

The group’s policy on funding capacity is to ensure that we always have sufficient long term funding and committed bank facilities in place to meet foreseeable peak borrowing requirements. At 31st March 2012 the group had cash and deposits of £139.1 million and £312.1 million of undrawn committed bank facilities available to meet future funding requirements. The group also has a number of uncommitted facilities, including overdrafts and metal lease lines, at its disposal.

Gross borrowings (net of related swaps) of £593.3 million at 31st March 2012 included £539.1 million of debt arranged under long term bond issues and long term funding from the European Investment Bank (EIB). Of this, only £40.0 million falls due to be repaid in the 15 months to 30th June 2013 (the going concern period). The group’s committed bank facilities have a range of maturities with £191.3 million expiring after 30th June 2013. The maturity dates of the group’s debt and borrowing facilities are illustrated in the table in the Financial Review and the chart above. In the context of our policy on funding capacity, to take account of the proposed special dividend of approximately £212 million, we are in the process of arranging additional long term financing arrangements.

The directors have assessed the future funding requirements of the group and the company and compared it to the level of long term debt and committed bank facilities for the 15 months from the balance sheet date. The assessment included a sensitivity analysis on the key factors which could affect future cash flow and funding requirements. Having undertaken this work the directors are of the opinion that the group has adequate resources to fund its operations for the foreseeable future and so determine that it is appropriate to prepare the accounts on a going concern basis.

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