Hedge of variable interest rate risk arising from bank loan liabilities Anchor Hanover Group keep its hedging strategy and portfolio under review, and entered into additional swaps with National Australia Bank and Mitsubishi UFJ Financial Group in October 2022 under the same ISDA Master Agreement as those already in place. The National Australia Bank swaps carry a link to the Group's Sustainability Financing Framework key performance indicators (KPI). The derivatives in place as at 31 March 2024 are accounted for as complex financial instruments and are in hedge relationships, in accordance with FRS 102. The value is carried as an asset when the fair value is positive and a liability when the fair value is negative. Movements in fair value for effective hedge relationships are presented in a separate cash flow hedge reserve. Where movements in fair value adjustments relate to the ineffective part of the swap or are not hedge accounted for, they are recognised in the statement of comprehensive income. Fair value is determined by reference to the mark-to-market position of the derivative instruments at each reporting date. The derivative financial instruments are analysed as follows: 2024 2023 Maturity date Notional value £’000 Fair value £’000 Notional value £’000 Fair value £’000
Instrument type Interest rates swaps Interest rates swaps Interest rates swaps Interest rates swaps
Counterparty
MUFG
08/02/2031
10,000 10,000 30,000 30,000
1,723 1,722
10,000 10,000 30,000 30,000 80,000
1,822 1,821
National Australia Bank 08/02/2031
MUFG
25/10/2024
(18) (19)
(316) (318)
National Australia Bank 25/10/2024
101,846 80,000
3,408
3,009
28. Notes to the consolidated cash flow statement 28.1 Reconciliation of operating surplus to net cash flow from operating activities
Restated 2023 £’000
2024 £’000 36,704 67,376 3,402 (1,245) –
Operating surplus for the year Depreciation of tangible fixed assets Carrying value of property disposals Movement in restricted reserves Movement in cash flow hedge reserve Amortisation of positive goodwill Impairment charge Decrease / (increase) in stock Decrease / (increase) in debtors
37,538 64,709 1,023
864
(2,405)
399
–
8,507
3,544
Difference between pension charge and cash contributions
114
735
23,263 1,674 22,983 163,177
(22,924) (12,492) 2,034 72,626
Increase in creditors
Net cash inflow from operating activities
The increase in creditors includes £12,742,000 (2023: £22,933,000) for the amortisation to income of deferred capital grants.
108 Anchor Hanover Group Annual Report & Financial Statements 2024
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