Annual Report 2025 183 Notes to the Financial Statements 31 December 2025 28. Financial Risk Management (continued) (b) Market risk (continued) (i) Currency risk (continued) The Trust’s currency exposure is as follows: SGD $’000 AUD $’000 GBP $’000 EUR $’000 USD $’000 HKD $’000 Net $’000 Trust 2024 Financial assets Cash and fixed deposits 24,465 2,662 4,622 473 2,260 - 34,482 Trade and other receivables1 60,233 - - - - - 60,233 Finance lease receivables 32,826 - - - - - 32,826 Loans to subsidiaries 495,236 - - 30,187 - 525,423 117,524 497,898 4,622 473 32,447 - 652,964 Financial liabilities Trade and other payables2 (236,277) - - - - - (236,277) Security deposits (206,546) - - - - - (206,546) Amount due to a subsidiary (non-current) (20,020) - - - - - (20,020) Lease liabilities (600,874) - - - - - (600,874) Loans and borrowings - Gross (1,294,966) (618,264) (474,261) (424,059) - (1,489,539) (4,301,089) (2,358,683) (618,264) (474,261) (424,059) - (1,489,539) (5,364,806) Net financial liabilities (2,241,159) (120,366) (469,639) (423,586) 32,447 (1,489,539) (4,711,842) Add: Net interest in subsidiaries - 123,028 474,261 424,059 (30,187) - 991,161 L ess: Net financial assets denominated in the respective entities’ functional currency 2,241,159 - - - - - 2,241,159 Less: Cross currency swap - - - - - 1,489,539 1,489,539 Currency exposure - 2,662 4,622 473 2,260 - 10,017 1 Excludes prepayments. 2 Excludes rental received in advance and GST / VAT payable. Sensitivity analysis The Group and the Trust are not subject to significant currency risk after entering into cross currency swap and forward exchange contracts for the financial assets or liabilities denominated in foreign currencies. (ii) Interest rate risk The Group’s exposure to changes in interest rates relates primarily to interest-earning financial assets and interest-bearing financial liabilities. Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Fair value interest rate risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market interest rates. The Group has no significant interest-bearing assets. The Group’s policy is to maintain a certain level of its borrowings in fixed-rate instruments. The Group’s and the Trust’s exposure to cash flow interest rate risks arise mainly from variable-rate borrowings. The Manager manages these cash flow interest rate risks using floating-to-fixed interest rate swaps. The Group’s and Trust’s borrowings at variable rates on which interest rate swaps have not been entered into, are denominated mainly in SGD, AUD and GBP (2024 : SGD, AUD and GBP). If the SGD, AUD or GBP interest rates had increased / decreased by 100 basis point (2024 : 100 basis point) with all other variables including tax rate being held constant, the total return would have been lower / higher by $18,227,000 and $18,227,000 respectively (2024 : $11,309,000 and $11,309,000 respectively) as a result of higher / lower interest expense on these borrowings.
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