27. CAPITAL AND FINANCIAL RISK MANAGEMENT (a) Capital management The Group’s objectives when managing capital are to maintain a strong capital base and safeguard the Group’s ability to continue as a going concern, so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Directors monitor and are determined to maintain an optimal debtto-equity ratio that complies with debt covenants and regulatory requirements. The debt-to-equity ratios are as follows: Group 2025 2024 RM’000 RM’000 Total loans and borrowings 18,065 7,437 Less: Cash and cash equivalents (27,672) (10,980) Net cash (9,607) (3,543) Total capital, equity attributable to the owners of the Company 158,350 152,346 Net debt-to-equity ratio N/A N/A The net debt-to-equity ratio for the Group is not applicable as the Group is in net cash position. There was no change in the Group’s approach to capital management during the financial year. (b) Financial risk management The Group has exposures to the following risks from its use of financial instruments: i) Credit risk ii) Liquidity risk iii) Interest rate risk i) Credit risk Credit risk is the risk of a financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group’s and the Company’s exposure to credit risk arises principally from its outstanding balances from customers and loans and advances to its subsidiaries. There are no significant changes as compared to prior periods. Receivables Risk management objectives, policies and processes for managing the risk Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on customers requiring credit over a certain amount. Exposure to credit risk, credit quality and collateral As at the end of the reporting period, the maximum exposure to credit risk arising from receivables is represented by the carrying amounts in the statements of financial position. Information regarding credit risk concentration for trade and other receivables is disclosed in Note 15(f) to the financial statements. SASBADI HOLDINGS BERHAD Financial Statements (conঞ nued) 144
RkJQdWJsaXNoZXIy NDgzMzc=