2022 Corporate Report

Corporate Report for the year ended 30 June 2022

Introduction and overview

Business performance

Governance and risk

Directors’ report

Remuneration report

Financial statements

Sustainability supplement

Security holder information

Section B: Notes to the Group financial statements for the year ended 30 June 2022

Section B: Notes to the Group financial statements for the year ended 30 June 2022

B15 Derivatives and financial risk management (continued) Market risk (continued) Foreign exchange risk (continued) Exposure to foreign currency risk at the reporting date, denominated in the currency in which the risk arises are as follows:

2022 Local

2021 Local

$M

$M

USD

EUR

CAD

CHF

NOK

USD

EUR

CAD

CHF

NOK

2 2

— — —

1

— — —

— — —

8 2

— — —

5

— — —

— — —

Cash and cash equivalents

Trade payables

2,073

567

Net investment in foreign operation

2,057

544

(4,210)

(3,300)

(650)

(765)

(750)

Borrowings

(4,373)

(3,300)

(650)

(765)

(750)

1

12 —

Foreign exchange forwards

10

20 —

3,710 1,578

3,300

765

750

Cross-currency interest rate swaps

3,710 1,414

3,300

765

750

(70)

Net exposure

(81)

Sensitivity to exchange rate movements based on the translation of financial instruments held at the end of the period is as follows:

2022

2021

$M

$M

Movement in post-tax profit

Increase/ (decrease) in equity

Movement in post-tax profit

Increase/ (decrease) in equity

AUD/USD + 10 cents – 10 cents AUD/EUR + 5 cents – 5 cents AUD/CAD + 10 cents¹ – 10 cents¹ AUD/CHF + 10 cents – 10 cents AUD/NOK + 50 cents – 50 cents

(219)

(1)

(226)

1

293

1

295

— —

(193)

— —

(43)

303

50

(7)

(1)

(7)

(1)

8

1

9

2

— —

(9)

— —

(7)

12

9

— —

— —

— —

(1)

1 1. Movement in post-tax profit relates to the ineffective portion of the net investment hedge in Canadian operations where the gain or loss is recognised in the profit and loss. The Group revalues its foreign currency denominated borrowings each period using market spot rates and, where these borrowings have been appropriately hedged, defers these movements in the cash flow hedge reserve in equity. The volatility in the cash flow hedge reserve is caused mainly by fair value movements of the cross-currency interest rate swaps, which are affected by changes in forward Australian dollar/foreign currency exchange rates.

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