ESR Group Limited Annual Report 2023 31 STRATEGIC REPORTS CORPORATE GOVERNANCE FINANCIAL STATEMENTS Investment in joint ventures and associates increased 14.4% to US$3.4 billion as at 31 December 2023 (31 December 2022: US$3.0 billion). The increase was mainly contributed by the Group’s acquisition of 15.57% interest in BW for US$331.3 million during the year. Financial assets at fair value through other comprehensive income (“FVOCI”) increased by 7.6% or US$74.0 million to US$1.1 billion as at 31 December 2023 contributed mainly by the Group’s additional investment in ESR-LOGOS REIT. Trade receivables increased 50.7% to US$532.9 million as at 31 December 2023 (31 December 2022: US$353.5 million), mainly arising from higher Fee Income. The trade receivables balance includes promote fee receivables, of which over 50% has been collected subsequent to yearend. LIABILITIES Total bank and other borrowing as at 31 December 2023 were US$6.0 billion as compared to US$5.5 billion as at 31 December 2022. Net debt was US$5.0 billion compared to US$3.7 billion as at 31 December 2022 mainly due to lower cash balance arising from the Group’s ongoing fundings to its investments. The Group continues to stay focused on its capital recycling strategy with proactive and disciplined capital management. It regularly reviews its debt maturity profiles and refinancing ahead of maturity ensuring a wellcapitalised balance sheet is maintained. ESR Group has ample liquidity with US$2.5 billion of cash and loan drawdown capacity. The Group continues to expand its funding sources through a combination of facilities with both local and international banks, and capital market issuances in diversifying and reducing its cost of debt. TOTAL EQUITY Total equity remained strong at US$8.7 billion as at 31 December 2023 (US$9.1 billion as at 31 December 2022), backed by profit for the year of US$268.1 million, offset by dividend distribution to shareholders of US$139.6 million and shares repurchased of US$217.8 million. In addition, an unrealised loss of US$86.3 million was recognised on the Group’s FVOCI, mainly due to mark-to-market losses adjusted based on quoted market prices. The Group manages and minimises its foreign currency exposures through asset and liability matching of various currencies at project and corporate level; and continues to assess the use of financial derivatives where appropriate to manage its foreign currency exposures. For FY2023, the Group recorded unrealised currency translation losses of US$58.5 million arising from its foreign operations due to the strengthening of the U.S. dollar against the respective local currencies.
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