REG - SIG PLC - Full Year Results <Origin Href="QuoteRef">SHI.L</Origin> - Part 3

SIGAnnouncement

12/03/2015 07:01

- Part 3: For the preceding part double click  ID:nRSL2230Hb 

commitment throughout the organisation                                                                                                                                                                                           
 DebtGroup net debt at 31 December 2014 amounted to £126.9m. The Group has to manage the following risks relating to its net debt:·      future availability of funding;·      interest rate risk;·      foreign currency risk;·      compliance with debt covenants; and·      counterparty credit risk.                                                                                                                           ·     Comprehensive Treasury Policy·     Regular monitoring, including sensitivity analysis, to understand the impact of interest rate and exchange rate movements·     Active hedging programme in place·     Monitor performance against covenants on the     
                                                                                                                                                                                                                                                                                                                                                                                                                                    Group's Revolving Credit Facility and private placement notes                                                                                                                                                                                                   
 Working capital and credit managementFailure to manage working capital effectively may lead to a significant increase in the Group's net debt, thereby reducing the Group's funding headroom and liquidity.                                                                                                                                                                                                                        ·     Post-tax Return on Capital Employed is a Key Performance Indicator of the Group·     Cash flow targets are agreed with each business unit as part of the annual budget process and reviewed on a monthly basis·     Stringent authorisation procedures to 
                                                                                                                                                                                                                                                                                                                                                                                                                                    control capital expenditure·     Proactive credit management systems                                                                                                                                                                                            
 
 
13.    Principal risks and uncertainties (continued) 
 
 Risk                                                                                                                                                                                                                                                                                                                                                                                                                Key Mitigation Activities Include:                                                                                                                                                                                                                              
 IT infrastructure and cyber securitySIG uses a range of computer systems across the Group. Outages and interruptions could affect the ability to conduct day-to-day operations which could result in loss of sales and delays to cash flow.Key systems are breached causing financial loss, data loss, disruption or damage.A new ERP system is currently being implemented within the UK distribution businesses.  ·     Continual review of IT strategies to ensure they remain appropriate·     Business continuity framework (robust and effective)·     Dedicated internal IT support team together with external support providers·     Regular updates to technology,        
                                                                                                                                                                                                                                                                                                                                                                                                                     infrastructure, communications and application systems·     The Group has advanced hardware and software security in place to ensure protection of commercial and sensitive data·     For new IT projects, external consultants are utilised in conjunction with 
                                                                                                                                                                                                                                                                                                                                                                                                                     internal project management teams·     Collaborative cross functional risk group in place                                                                                                                                                                       
 Availability and quality of key resourcesUnavailability of key resources (e.g. assets such as property, stock and personnel) will impact on the ability of SIG to operate effectively and efficiently.Failure to attract and retain key individuals, strong management and technical staff in the future could have an adverse effect upon the Group's business.                                                    ·     Strategic and budget reviews ensure all key resource requirements are identified and managed·     Senior management succession planning·     Continue to evolve a defined people strategy based on culture and engagement, talent management, training and 
                                                                                                                                                                                                                                                                                                                                                                                                                     reward recognition·     Provision of channels for employees to raise concerns to promote an environment of honesty and trust                                                                                                                                    
 
 
This information is provided by RNS
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