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- 45. Capital management
- LOTOS Annual Report 2011 /
- Home /
- Financial data /
- Consolidated financial statements 2011 /
- Notes to the financial statements /
- 45. Capital management
45. Capital management
The objective of the LOTOS Group financial policy is to maintain long-term liquidity, while using an appropriate level of financial leverage to support the achievement of the principal goal of maximising the return on equity for shareholders.
This is achieved by striving to develop the desired capital structure at the Group level.
The LOTOS Group monitors its financing structure using a debt to equity ratio calculated as net debt by equity.
Net debt is the sum of interest-bearing borrowings and other debt instruments less cash and cash equivalents. Equity includes equity attributable to owners of the Parent increased by non-controlling interests.
| PLN '000 | Note |
Year ended Dec 31 2011 |
Year ended Dec 31 2010 (restated) |
| Non-current interest-bearing borrowings and other debt instruments | 34 | 4,983,889 | 4,403,453 |
| Current interest-bearing borrowings and other debt instruments | 34 | 2,407,740 | 1,923,341 |
| Cash and cash equivalents | 30 | (383,680) | (382,601) |
| Net debt | 7,007,949 | 5,944,193 | |
| Equity attributable to owners of the Parent | 7,781,436 | 7,498,819 | |
| Non-controlling interests | 33 | 947 | 14,658 |
| Total equity | 7,782,383 | 7,513,477 | |
| Net debt to equity | 0.90 | 0.79 |
The Group monitors its financing structure in order to achieve the goal set in Strategy for the LOTOS Group for the years 2011–2015, providing for a reduction of debt in order to achieve a debt to equity ratio of no more than 0.4 at the end of the Strategy term.
This is a translation of a document originally issued in Polish.