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Keepmoat Annual Report 2020

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Keepmoat has released its Group financial results for the year ending 31 October 2020.

NOTES TO THE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 16 – Loans and borrowings Year ended 31 October 2020 Year ended 31 October 2019 Year ended 31 October 2020 Year ended 31 October 2019 EIR 1 % EIR 1 % £’000 £’000 Current Bank overdraft 4.0% 4.0% 254 6,311 Bank loans 4.0% 4.0% - 7,500 Other loans 6.8% 6.8% 9,836 12,805 Shareholder loan 2.5% 2.5% 1,809 1,809 11,899 28,425 Non-current Term loan 7.5% 157,500 150,000 Unamortised issue costs on term loan 7.5% (4,226) (7,636) 153,274 142,364 Total loans and borrowings 165,173 170,789 Maturity of financial liabilities Less than one year 11,899 28,425 Between two and five years 153,274 - After more than five years - 142,364 165,173 170,789 1 Effective interest rate % Analysis of movement in net debt is as follows: 31 October 2019 On adoption of IFRS 16 (note 26) 1 November 2019 Cash movements Non-cash movements 31 October 2020 £’000 £’000 £’000 £’000 £’000 Cash & cash equivalents (note 13) 35,173 21,613 - 56,786 Long-term borrowings (142,364) (7,500) (3,410) (153,274) Short-term borrowings (22,114) 10,469 - (11,645) Lease liability adopted on 1 November 2019 (note 26 and 14) - (8,598) (3,453) 4,117 (7,934) Net debt (129,305) (8,598) 21,129 707 (116,067) The senior secured notes were redeemed at par on 11 December 2018, incurring no early repayment charges. On the same day the Group issued a £150,000,000 term loan facility attracting interest of 6.5% plus Libor due for repayment on 11 December 2024. On 11 December 2018, the Group repaid in full its £37,500,000 revolving credit facility. On the same day, the Group opened a new debt facility in the form of a £27,500,000 revolving credit facility, of which £7,500,00 has been utilised at 31 October 2019. The new facility is a super senior revolving credit facility with a limit of £27,500,000 due for renewal in June 2025 attracting interest at a rate of 3.0% plus LIBOR. On the same day the Group repaid its overdraft and opened a new overdraft facility as part of the super senior revolving credit facility giving a combined limit of £55,000,000. The new facility is secured via a floating charge over the assets of the Group Companies. In the period ended 31 October 2019 the Group incurred and capitalised total issue costs of £8,300,000 as a result of issuing the two new debt facilities. 96 KEEPMOAT.COM

FINANCIAL REVIEW 16 – Loans and borrowings (continued) On 18 March 2020, the Group increased its super senior revolving credit facility by £5,000,000, bringing the total limit to £60,000,000. The terms of the additional limit are in line with the existing facility. On the 12 June 2020, the Group signed agreements to increase its super senior revolving credit facility by a further £15,000,000, bringing the total limit to £75,000,000. This £15,000,000 increased facility matures on 12 December 2021. On the same day the Group entered into an agreement to increase its existing term loan facility by £7,500,000 on the same terms as the existing facility. This brings the total term loan facility to £157,500,000. On the 3 July 2020, the Group drew down on the £7,500,000 term loan and the £15,000,000 of super senior revolving credit facility became available to the Group. In the period ended 31 October 2020 the Group incurred and capitalised total issue costs of £1,250,000 as a result of increasing the two existing debt facilities. On 15 June 2020, the Group also received £7,500,000 of additional funding from its shareholders in the form the purchase of shares in Keystone JVCo Limited, the company’s ultimate parent undertaking. The purchase was split in proportion to the existing ownership of the Group’s shareholders. On 1 December 2017 the Group received a loan from its shareholders with principal amount of £10,000,000. The loan bore interest at 2.5% payable quarterly in arrears and £8,191,000 was repaid in the year ended 31 October 2019. The loan was split in proportion of the ownership of the Group’s shareholders. The shareholder loans attract interest at 2.5%. Other loans comprise Builders Finance Fund (“BFF”) loans from the Homes and Communities Agency (HCA) and loans from the Greater Manchester Combined Authority (GMCA). Interest is charged at European Central Bank base rate plus a margin which varies 4.5% to 6.5% between sites and amounts are repayable on completion of each site for which the loan relates. The interest rate risk profile of the Group’s financial liabilities at 31 October 2020 is below, which includes all drawn down borrowings. This includes interest payable in each year until maturity as well as principal repayments. It is assumed that the London inter-banking lending rate (LIBOR) remains constant at the year-end position. Within 1 year 1-2 years 2-3 years 3-4 years 4-5 years More than 5 years Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 20,796 13,871 13,962 13,486 160,056 - 222,171 Profile as at 31 October 2019 is shown below: Within 1 year 1-2 years 2-3 years 3-4 years 4-5 years More than 5 years Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 18,895 11,537 13,853 16,123 13,011 151,325 224,744 ANNUAL REPORT & FINANCIAL STATEMENTS 2020 97