134
CDL
HOSPITALITY TRUSTS
11 UNITS/STAPLED SECURITIES IN ISSUE (CONT’D)
Capital management
The Board of the H-REIT Manager and HBT Trustee-Manager has a policy to maintain a strong capital base so as
to maintain investor, creditor and market confidence and to sustain future development of the business. Capital
consists of Unitholders’ funds. The Board monitors the yield, which is defined as net property income from the
property divided by the latest valuation for the property, on the properties acquired. The Board also monitors the
level of distributions made to holders of Stapled Securities.
The Board seeks to maintain a balance between the higher returns that might be possible with higher levels of
borrowings and the advantages and security afforded by a sound capital position.
H-REIT is subject to the aggregate leverage limit as defined in the Property Fund Appendix of the Code on Collective
Investment Scheme ("CIS Code") issued by the Monetary Authority of Singapore. The CIS Code stipulates that
the total borrowings and deferred payments (together the “Aggregate Leverage”) of a property fund should not
exceed 35.0% of its Deposited Property except that the Aggregate Leverage of a property fund may exceed 35.0%
of its Deposited Property (up to a maximum of 60.0%) if a credit rating of the property fund from Fitch Inc., Moody’s
or Standard and Poor’s is obtained and disclosed to the public. The property fund should continue to maintain and
disclose a credit rating so long as its Aggregate Leverage exceeds 35.0% of its Deposited Property.
For this financial year, H-REIT has a credit rating of BBB- from Fitch Inc. The Aggregate Leverage of H-REIT as at
31 December 2014 was 31.7% (2013: 29.7%) of H-REIT’s Deposited Property. This complied with the aggregate
leverage limit as described above.
HBT Group, H-REIT Group and the Stapled Group are in compliance with the borrowing limit requirements imposed
by the relevant Trust Deeds and all externally imposed capital requirements for the financial year 2014 and 2013.
There were no substantial changes in the HBT Group’s, H-REIT Group’s and the Stapled Group’s approach to
capital management during the year.
12 LOANS AND BORROWINGS
HBT Group
H-REIT Group
Stapled Group
Note 2014
2013
2014
2013
2014
2013
$’000
$’000
$’000
$’000
$’000
$’000
At amortised cost:
Non-current liabilities
Unsecured bank loans
(i)
–
–
254,159
338,972
254,159 338,972
Unsecured medium
term notes
(ii)
–
–
203,444
203,273
203,444 203,273
–
–
457,603
542,245
457,603 542,245
Current liabilities
Unsecured bank loans
(iii)
–
–
317,329
76,092
317,329
76,092
Unsecured medium
term notes
(ii)
–
–
–
69,891
–
69,891
–
–
317,329
145,983
317,329 145,983
–
–
774,932
688,228
774,932 688,228
NOTES TO THE FINANCIAL STATEMENTS
