Page 211 - Sigmaroc Annual-Report 2023

The gearing ratio at 31 December 2023 is as follows:
211
2023 Contractual cash flows
1-12 months £’000
30,709
1-2 years £’000
31,663
2-5 years £’000
More than 5 years £’000
148,414
158,199
2,525
1,060
188,908
34,188
149,474
11,712
1,843
9,807
19,621
200,620
43,995
169,095
-
-
2,713
538
-
4,556
538
-
Consolidated
31 December 2023 £’000
31 December 2022 £’000
Non-derivative financial liabilities
Loans -
Total borrowings (Note 24)
Less: Cash and cash equivalents (Note 22)
Net debt Total equity Total capital Gearing ratio
262,476 (68,623)
193,853 469,850 663,703 0.29
238,296
(55,872)
Trade payables
Future forecast finance charges
Derivative financial liabilities
4,623
4,623
-
4,623
182,424
514,884
697,308
0.26
4. CRITICAL ACCOUNTING ESTIMATES
Forward
exchange - contracts used
for hedging
Electricity
hedges -
-
The outflows disclosed in the above tables represent the contractual undiscounted cash flows relating to derivative financial liabilities held for risk management purposed and which are not usually closed out before contractual maturity.
The interest payments on the variable interest rate loans in the table above reflect market forward interest rates at the reporting date and these amounts may change in line with changes in market interest rates. The future cash flows from derivative instruments may differ from the amount in the above table as interest rates and exchange rates change. With the exception of these financial liabilities, it is not expected that the cash flows included in the maturity analysis could occur significantly earlier or at significantly different amounts.
3.2. Capital Risk Management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern, in order to enable the Group to continue its construction material investment activities, and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the issue of shares or sell assets to reduce debts.
The Group defines capital based on the total equity of the Company. The Group monitors its level of cash resources available against future planned operational activities and the Company may issue new shares in order to raise further funds from time to time.
The preparation of the Financial Statements, in conformity with UK IASs, requires management to make estimates, assumptions and judgements that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amount of expenses during the year. Actual results may vary from the estimates used to produce these Financial Statements.
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Significant items subject to such estimates, assumptions and judgements include, but are not limited to:
a) Land and Mineral Reserves
The determination of fair values of land and mineral reserves are carried out by appropriately qualified persons in accordance with the Appraisal and Valuation standards published by the Royal Institution of Chartered Surveyors. To determine the reserves, management will engage an independent volume and tonnage assessment, which involves a topographic survey of the quarry working, conducted in 3 dimensions for the date of the assessment using a computer aided design (CAD) system and a series of theoretical computer-generated models, taking into account geotechnical and hydrogeological factors, as well as ensuring that there is a practical extraction plan so that all the rock can be recovered. This produces a removal of overburden model and removal of mineral model.
Following this, the volume of reserves is calculated and converted to tonnes by multiplying the volume by the density of the mineral. This process is based upon factors such as estimates of commodity prices and geological assumptions and judgements. Additional estimates include future capital requirements and production costs.
The volume of material is converted to tonnes by multiplying the volume by the density of the mineral. The final tonnage will be adjusted to exclude material that is not suitable mineral for processing, such as overburden, tips and weathered rock, to derive at the estimated volume of mineral reserves remaining at the date of assessment. This process is based upon factors such as estimates of commodity prices and geological assumptions and judgements. Additional estimates include future capital requirements and production costs.