27. Loans and Borrowings
Loans and borrowings contains the following:
Unamortised debt issuance cost has changed as follows:
|
in EUR thousand |
2008/2009 |
2007/2008 |
|
Balance at 1 October |
–1,339 |
–1,826 |
|
Additions |
– |
– |
|
Amortisation |
487 |
487 |
|
Other changes |
– |
– |
|
Exchange differences |
– |
– |
|
Balance at 30 September |
–851 |
–1,339 |
The carrying amounts of loans and borrowings correspond to their fair values.
The composition of obligations under finance leases is shown in Note 16 "Property, Plant and Equipment".
Information on the Group’s interest and exchange rate risks is provided in Note 33 "Additional Disclosures on Financial Instruments".
Revolving Credit Facility
On 16 June 2006, the Group took out a revolving credit facility in the amount of EUR 325,000,000 for which major Group companies are jointly and severally liable to the lenders. The facility expires on 27 June 2011 and includes a EUR 105,000,000 ancillary facility for cash drawings and bank guarantees. Drawings on the facility at 30 September 2009 totalled EUR 105,000,000 (30 September 2008: EUR 105,000,000). This amount is due on 30 December 2009 and is subject to 1.09 percent interest (0.74 percent EURIBOR plus a 0.35 percentage point margin). Loan agreements specify certain financial covenants including a minimum interest cover requirement (ratio of adjusted earnings before interest, tax, depreciation and amortisation [operating EBITDA] to consolidated net interest payable) and a maximum gearing requirement (net debt to operating EBITDA). If the financial covenants are not met and the non-compliance is not remedied or the lenders do not waive the covenants, there may be grounds for termination. Among other things, the lenders would then be entitled to call due all amounts owed with immediate effect. There are also certain other contractually agreed circumstances whose occurrence can lead to termination with all outstanding amounts becoming due for repayment with immediate effect. A further right of termination exists in certain instances in the event of a change of control or third-party acquisition of a majority shareholding in Demag Cranes AG.
There are also covenants with regard to additional borrowing, purchases and disposals of assets, and the provision of collateral.
Drawings on the ancillary facility for guarantees totalled EUR 63,625,000 at 30 September 2009 (2008: EUR 67,905,000).
