Treasury Overview
(updated as at 30 June 2008)
SEGRO operates a UK based centralised treasury function which is responsible for raising funding for the Group and implementing hedging strategies, in line with Board Policies, in order to manage interest rate and currency risk. Its objectives are to meet the financing requirements of the Group on a cost-effective basis, whilst maintaining a prudent and flexible financial position and to provide a firm cost base for budgeting and planning purposes.
Group Treasury operations are overseen by the Treasury Risk Committee (‘TRC’). The TRC is a Sub- Committee of the Group Board and it has delegated powers to monitor treasury positions and to give authority for Group Treasury to enter into transactions required to keep positions within Policy limits. The TRC is made up of the Group Chief Executive, the Group Finance Director, the Group Head of Tax, the Group Financial Controller and the Group Treasurer. It meets quarterly or as required.
Group Treasury is not a profit centre and speculative transactions are not permitted. Clear Board Policies are in place covering the parameters of the department’s operations including minimum permitted levels of liquidity, the interest rate mix of borrowings, currency translation exposure and the aggregate exposure limits to individual financial institutions.
Derivative instruments are used to hedge real underlying debt, cash flow or asset positions and to convert one currency to another. Regular reports are submitted to the TRC and the Group Board measuring the current actual positions against Policy limits.
The four main financial risks facing the Company are:
- liquidity risk
- interest rate risk
- currency exposure
- counter party credit risk
See our debt profile for an analysis of the Company’s debt.
If you have any questions related to this overview of the Group’s treasury positions, please feel free to contact our Group Treasurer Trevor.Mant@SEGRO.com.