Notes to the Accounts

17. Borrowings

Note: In the absence of enforceable contracts from the relevant lenders to refinance current advances as they fall due, at 31 December 1997 £140.8m (1996: £84.3m) of debt currently classified from two to five years would be repayable within one year.

	1997		1996
All figures in £ millions	Group	Company	Group	Company
Borrowing summary (by instrument)
Secured
Bank loans and overdrafts	0.3	-	0.1	-
Unsecured
10.5% Euro-sterling Bond 2008	100.0	100.0	100.0	100.0
9.5% Euro-sterling Bonds 2004	117.3	-	113.2	-
10.75% Eoru-sterling Bonds 2002	100.0	-	100.0	-
Other unsecured borrowings	7.9	0.1	8.5	3.0
Unsecured bank loans and overdrafts, commercial paer and medium term notes	596.4	436.0	407.6	256.4
Total borrowings	921.9	536.1	729.4	359.4

Forward foreign exchange contracts
Foreign currency transactional cash flows are hedged using forward foreign exchange contracts. At 31 December 1997, the UK Group had contracted to exchange the equivalent of £66m and the estimated mark-to-market gain on these contracts at 31 December 1997 was £0.7m.

Interest rate hedging transactions	Notional principal £m	Weighted avereage rate %	Mark-to -market Value £m
Swaps in force at 31 December 1997
US dollar: converting fixed debt to floating	152	7.23	11
US dollar: converting floating debt to fixed	152	5.99	-
Sterling: conerting fixed debt to floating	120	6.74	5
Sterling: converting floating debt to fixed	40	7.16	-
Convertong fixed sterling debt to floating US dollar	117	10.41	19
			35

Note: All of the total mark-to-market gain on the above transactions of £35m arises from transactions that hedge debt issues for their entire lives. There is a mark-to-market loss on those issues of £55m included in the footnote below.

The following shows the amount of these contracts which are in force at the end of each year.

	1997	1998	1999	2000
All figures in £ million
US dollar: converting fixed debt to floating	152	152	152	152
US dollar: converting floating debt to fixed	152	152	167	130
Sterling: conerting fixed debt to floating	120	120	120	120
Sterling: converting floating debt to fixed	40	40	40	-
Convertong fixed sterling debt to floating US dollar	117	117	117	117

As a result of the above transactions, the interest rate exposure of the borrowings of the Group at 31 December 1997 was as follow:

All figures in £ millions	Total Gross borrowing	Fixed rate	Floating rate
Sterling	317	120	197
US dollar	519	160	359
Other currencies	86	-	86
	922	280	642

Note: Of this total, £466m relates to long-term borrowings with a maturity of over four years. The current value of this debt at 31 December 1997, considering only the movements in risk-free interest rates, is £521m. The difference between the current and book values of these borrowings is partially offset by the mark-to-market gain on the related swaps detailed see above.