Telenor asa and each subsidiary shall have sufficient

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Unformatted text preview: uybacks carried out from July to November 2011 (3% of registered shares). The Board of Telenor ASA has proposed to pay a dividend of NOK 5.00 per share for the fiscal year 2011, payable in 2012. The objective is to distribute 50-80% of normalised net income and aim for a nominal increase in the dividend per share. Telenor ASA has an agreement with the Kingdom of Norway through the Ministry of Trade and Industry to carry through share buy backs with the purpose to cancel these shares through write-down of the share capital to maintain its ownership interest. See notes 25, 34 and 37 for further description. The subsidiaries aim to have a capital structure reflecting the cost of capital, market conditions, legal and tax regulations and other relevant parameters in each individual case. The Group is pursuing disciplined and selective approach to M&A transactions. Financial risk factors Telenor ASA’s treasury function is responsible for funding, foreign exchange risk, interest rate risk, credit risk and liquidity management for the parent company and for companies owned more than 90% directly or indirectly by Telenor ASA. Subsidiaries owned less than 90% normally have stand-alone financing. See note 32 regarding uninor. The Group has limited activities related to interest rate and currency trading (other than hedging activities). As of 31 December 2011 and 2010, the Group did not have any outstanding open trading positions. Liquidity risk The Group emphasises financial flexibility. An important part of this emphasis is to minimise liquidity risk through ensuring access to a diversified set of funding sources. Telenor ASA issues debt in the domestic and international capital markets mainly in the form of Commercial Paper and bonds. The Group uses Euro Commercial Paper, u.S. Commercial Paper, Euro Medium Term Note (EMTN) and the Norwegian domestic capital market to secure satisfactory financial flexibility. Telenor ASA has established committed syndicated revolving credit facilities of EuR 1.0 billion with maturity in 2013 and EuR 2.0 billion with maturity in 2016. As of 31 December 2011, uninor had current interest-bearing borrowings of INR 72.1 billion (NOK 8.1 billion), all with financial guarantees from Telenor ASA. uninor’s loan agreements contain typical bank loan provisions including material adverse affect clauses. uninor has a poor liquidity situation and is dependent on additional funding until a decision is made regarding Telenor’s operations in India. Additional funding will be disbursed in portions to meet minimum funding requirements only. When permissible by local rules and regulations, subsidiaries owned 90 percent or more are parts of Telenor ASA’s cash management framework agreement. They participate in Telenor ASA’s cash pool systems and place their excess liquidity with the internal bank in Group Treasury. Subsidiaries owned less than 90 percent have established their own cash management framework agreements for banking services, their own cash pool systems and place their excess liquidity externally. Telenor ASA and each Subsidiary shall have sufficient sources of liquidity to cover expected needs for liquidity during the next 12 months. Liquidity to fund significant acquisitions and investments are considered separately. The debt portfolio of Telenor ASA and each subsidiary with external debt shall have a balanced maturity profile. The Group’s debt maturities shall be spread relative evenly over a time horizon of approximately 10 years by issuing bonds and commercial papers in order to reduce the Group’s liquidity risk. The debt maturity profile is presented below. For information about duration please refer to chapter “Interest rate risk”. /page 65/ telenor annual report 2011 notes to the financial statements / telenor group Maturity profile of the Group’s liabilities (in nominal values) Total as of <1 2 3 4 5 6 7 8 9 10 NOK in millions 31.12.11 year years years years years years years years years years Interest-bearing liabilities bank loans bonds and Commercial Paper Finance lease liabilities Other interest-bearing liabilities Sum of interest-bearing liabilities 9 904 8 731 457 477 20 083 1 556 703 3 877 854 15 13 32 1 875 377 667 185 32 716 10 678 1 840 4 571 128 378 30 186 722 111 - - 7 754 32 36 131 123 274 7 913 - - 47 109 156 - - - 5 816 128 46 10 10 138 5 871 - - 45 12 56 - - 431 66 496 Non-interest bearing liabilities Trade and other payables 30 708 30 708 - - Other current non-interest-bearing liabilities 2 237 2 237 - - derivatives financial instruments non-current liabilities 1 063 - 736 185 Other non-current non-interest-bearing liabilities 2 529 - - - Sum of non-interest-bearing liabilities 36 537 32 945 736 185 Total 69 253 43 623 2 576 4 756 - - 25 - 25 747 - - - - - 118 - - 118 274 8 030 - - - - 156 - - - - - - - - 138 5 871 - - - - 56 - - - - 2 529 - 2 529 496 2 529 Future interest payments Total including future interest payments 5 174 >10 Not years specified - 1 784 762 657 509 537 442 227 143 114 - - - 74 427...
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This document was uploaded on 03/21/2014.

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