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Tiger Brands Limited integrated annual report
2015 183
37 Financial instruments
continued
37.6 Capital management
The primary objective of the company and group’s capital management is to ensure that it maintains a strong credit
rating and healthy capital ratios in order to support its business and maximise shareholder value.
The company and group manage their capital structure, calculated as equity plus net debt, and make adjustments to it,
in light of changes in economic conditions. To maintain or adjust the capital structure, the company and group may
adjust the dividend payment to shareholders, return capital to shareholders, issue new shares or increase or decrease
levels of debt. No changes were made in the objectives, policies or processes during the years ended 30 September
2015 and 30 September 2014.
The company and group monitor capital using a gearing ratio, which is net debt divided by total equity. The company
and group target a long-term gearing ratio of 30% to 40%, except when major investments are made where this target
may be exceeded.
GROUP
(R’million)
2015
2014
Cash and cash equivalents
(1 051,6)
(1 160,3)
Long-term borrowings
1 215,8
627,4
Short-term borrowings
3 624,0
4 022,1
Net debt
3 788,2
3 489,2
Total equity
13 777,6
13 947,2
Total capital
17 565,8
17 436,4
Net debt to equity (%)
27,5
25,0
COMPANY
(R’million)
2015
2014
Cash and cash equivalents
(127,1)
(270,0)
Long-term borrowings
98,5
131,8
Short-term borrowings
194,9
37,5
Net (cash)/debt
166,3
(100,7)
Total equity
9 214,0
9 548,8
Total capital
9 380,3
9 448,1
Net debt/(cash) to equity (%)
1,8
(1,1)