Vector Annual Report 2018

NOTES TO THE FINANCIAL STATEMENTS continued

22. Equity:// CONTINUED

22.3 Financial ratios

2018 $M 12 MONTHS

2017 $M 12 MONTHS

Earnings per share

Net profit attributable to owners of the parent

148.2

65.8

Weighted average ordinary shares outstanding during the period (number of shares)

998,370,185

995,651,036

Total earnings per share

14.8 cents

16.7 cents

2018 $M

2017 $M

Net tangible assets per share

Net assets attributable to owners of the parent

2,440.4 (1,398.2) 1,042.2

2,430.6 (1,399.6) 1,031.0

Less total intangible assets Total net tangible assets

Ordinary shares outstanding (number of shares)

999,913,852 104.2 cents

995,645,987 103.5 cents

Economic net debt to economic net debt plus adjusted equity ratio (“gearing ratio”)

2018 $M

2017 $M

Face value of borrowings

2,405.7

2,235.0

Less cash and cash equivalents

(27.9)

(14.9)

Economic net debt

2,377.8 2,457.9

2,220.1 2,448.3

Total equity

Adjusted for hedge reserves

40.1

49.0

Adjusted equity

2,498.0 4,875.8

2,497.3 4,717.4

Economic net debt plus adjusted equity

48.8%

47.1%

22.4 Reserves

Hedge reserves

Hedge reserves comprise the cash flow hedge reserve and cost of hedging. The cash flow hedge reserve records the effective portion of changes in the fair value of derivatives that are designated as cash flow hedges. The gain or loss relating to the ineffective portion is recorded in profit or loss within interest costs (net). During the year, $44.4 million (2017: $59.5 million) was transferred from the cash flow hedge reserve to interest expense. Cost of hedging records the change in the fair value of the cost to convert foreign currency into New Zealand dollars as required under NZ IFRS 9. Other reserves comprise: —— A share-based payment reserve relating to the employee share purchase scheme. When shares are vested to the employee, the reserve is offset with a reduction in treasury shares. —— A foreign currency translation reserve to record exchange differences arising from the translation of the group’s foreign operations. —— A reserve recording the group’s share of its associates other comprehensive income. —— A reserve to record the fair value movements in the group’s investments in financial assets.

Other reserves

105

Vector://AR 18

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