NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 19 SHARE CAPITAL (CONT’D) Preference share capital (cont’d) As at 31 December 2022, a maximum number of 44,998,898 (2021: 44,998,898) ordinary shares are issuable upon full conversion at the sole option of the Company of all the Preference Shares. Holders of Preference Shares have no voting rights, except under certain circumstances provided for in the Singapore Companies Act and as set out in the Company’s Constitution. The Preference Shares rank: (i) pari passu without any preference or priority among themselves; and (ii) in priority over the ordinary shares (a) in respect of payment of the preference dividend (when, as and if declared) and the Additional Preference Dividend; and (b) in the event of a winding-up of or return of capital by the Company, payment of any preference dividend that has accrued to holders of Preference Shares and is unpaid, the Additional Preference Dividend (whether or not then due) as well as the amount paid up on the Preference Shares (including the premium paid thereon). Capital management policy The Group’s primary objective in capital management is to maintain a strong capital base so as to maintain investor, creditor and market confidence, and to continue to maintain the future development and growth of the business. The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. For this purpose, the Group defines “capital” as including all components of equity, including non-controlling interests. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders or issue new shares or other financial instruments. The Group monitors capital using a net debt equity ratio, which is defined as net borrowings divided by total capital employed. Note 2022 2021 $’000 $’000 Restated* Gross borrowings 10,381,801 11,422,435 Cash and bank balances (including restricted cash and cash and cash equivalents included in assets held for sale) 18 (2,369,691) (2,190,961) Net debt 8,012,110 9,231,474 Total capital employed 9,564,822 9,319,272 Net debt equity ratio 0.84 0.99 * Refer to Note 47 No changes were made to the above objectives, policies and processes during the years ended 31 December 2022 and 2021. The Group derives income from its investments in the PRC. The conversion of the Chinese Renminbi is subject to the rules and regulations of foreign exchange control promulgated by the PRC government. 18 CASH AND CASH EQUIVALENTS (CONT’D) Group Note 2022 2021 $’000 $’000 Restricted cash: – Current 115,050 157,198 – Non-current 12 6,494 89,630 121,544 246,828 As at 31 December 2022, restricted cash comprise mainly deposits pledged to financial institutions as collateral for credit facilities granted (see note 23). As at 31 December 2021, restricted cash comprise mainly deposits pledged to financial institutions as collateral for credit facilities granted (see note 23) and restricted deposit received from the buyer for the sale of a hotel property. 19 SHARE CAPITAL Company 2022 2021 Number of shares $’000 Number of shares $’000 Issued and fully paid ordinary share capital with no par value: At 1 January and 31 December 906,901,330 1,661,179 906,901,330 1,661,179 Issued and fully paid non-redeemable convertible non-cumulative preference share capital with no par value: At 1 January and 31 December 330,874,257 330,218 330,874,257 330,218 1,991,397 1,991,397 At the reporting date, the Company held 2,400,000 (2021: 2,400,000) ordinary shares as treasury shares. Ordinary share capital The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per ordinary share at General Meetings of the Company. All ordinary shares rank equally with regard to the Company’s residual assets. Preference share capital The Company has in issue 330,874,257 (2021: 330,874,257) non-redeemable convertible non-cumulative preference shares (Preference Shares), listed on the Official List of Singapore Exchange Securities Trading Limited. The Preference Shares are convertible only at the option of the Company, into fully-paid ordinary shares of the Company at the conversion ratio of 0.136 ordinary share for each Preference Share. In the event the Company exercises its right of conversion, the Company shall pay to preference shareholders a one-off preference cash dividend at the fixed rate of 64% (net) of the issue price for each Preference Share (Additional Preference Dividend) and any preference dividend accrued but unpaid. CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2022 FINANCIALS 180 181
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