ACCOUNTABILITY 268 YINSON HOLDINGS BERHAD 44. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED) (c) Liquidity risk Liquidity risk is the risk that the Group and the Company will encounter difficulty in meeting financial obligations due to shortage of funds. The Group’s and the Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Group’s and the Company’s objectives are to maintain a balance between continuity of funding and flexibility through the use of bank loans and perpetual securities. The Group mitigates its liquidity risk by maintaining ample cash reserves and ensuring access to sufficient banking facilities to support its operations and investment activities. Operating in an environment that necessitates substantial cash outflows during the initial stages of an FPSO project, the Group finances the construction of the FPSO through short to medium term loans. Once the project achieves first oil and the charter begins, the loan transitions to a non-recourse status for the Group. At this stage, the Group refinances the loan into a long-term facility, aligning the repayment schedule to approximate lease term of the charter. This strategy allows the Group to adequately recoup its capital investment and repay loan instalments using the charter fees received during the lease period. In ensuring that the Group manages its overall liquidity risk, it has undertaken the following during the financial year: - The Group entered into various financing agreements during the year in which the Group has drawn down RM9,243 million (2025: RM11,624 million) in borrowings; - The drawdown of the borrowings was used to mainly finance EPCIC construction cost of RM887 million (2025: RM3,797 million) for the construction of the Agogo FPSO which achieved first oil and re-financing into project bonds and other long-term facilities during the current financial year. The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities based on contractual undiscounted repayment obligations: Group On demand or within one year RM million Two to five years RM million Over five years RM million Total RM million 31 January 2026 Trade and other payables 641 27 - 668 Loans and borrowings 3,918 11,513 12,103 27,534 Lease liabilities 20 59 8 87 Gross settled interest rate swaps - Receipts (212) (386) (25) (623) - Payments 170 259 25 454 Total undiscounted financial liabilities 4,537 11,472 12,111 28,120 31 January 2025 Trade and other payables 1,221 1 - 1,222 Loans and borrowings 2,995 14,820 5,561 23,376 Lease liabilities 30 47 29 106 Gross settled interest rate swaps - Receipts (428) (792) (46) (1,266) - Payments 282 601 36 919 Net settled foreign exchange forward contracts 1 - - 1 Total undiscounted financial liabilities 4,101 14,677 5,580 24,358
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