Page 128 - HRC_AR2020

126 I 2020 ANNUAL REPORT I financial reports

NOTES TO THE FINANCIAL STATEMENTS

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2020 (CONTINuED)

26 BorroWinGs (continued)
Detailed below are changes in liabilities arising from financing activities:
2020 2019
rM’000 rM’000
At 1 January 1,381,913 1,150,632
Proceeds from borrowings 980,606 4,518,922
Repayment of borrowings (includes interest paid) (1,588,009) (4,320,682)
Non-cash changes:
• Interest accrued 28,464 47,700
• Amortisation of term loan commitment fees 177 166
• Effect of exchange rate changes (3,344) (14,825)

At 31 December 799,807 1,381,913

As at 31 December 2020 and 31 December 2019, the Company does not have any unsecured borrowings.

Details of the facilities are set out below:
• The term loan principal is repayable every 6 to 12 months until final maturity date in January 2023.
• The revolving credits are short term and will mature within one year from the reporting date.
• Both the term loans and revolving credits are subject to interest at LIBOR + 1.60% per annum.
• The borrowings are secured:

– by way of a first fixed charge, the refinery plant owned by the Company and the Company’s interest in the refinery plant.
The refinery plant means assets, fixtures and equipment described further in the valuation report issued by Appraisal &
Valuation Consultants Ltd dated 16 May 2017 and excludes stock in trade, such as feedstock, intermediate and finished
products, and land;
– by way of a first floating charge, the Company’s undertaking and all assets, both present and future in the refinery
plant as stated above if and insofar as the charges therein contained shall for any reason be ineffective as fixed charges;
– a charge over lands belonging to the Company; and
– by way of a first fixed charge and assignment and agrees to assign absolutely to the Chargee, free from all liens, charges
and other encumbrances, each designated bank account (including the debt service reserve account, disbursement
account, income accounts and settlement accounts, which are further defined in the relevant security document),
all the Company’s present and future rights, title and interest in and to such designated accounts and all amounts
(including interest) standing to the credit of the designated bank accounts.
The effective interest rates of the Company’s borrowings at the end of the reporting period ranged between 1.74% to 3.52%
(2019: 3.50% to 4.34%) per annum.
The fair value of borrowings outstanding as at 31 December 2020 and 31 December 2019 approximated its carrying amount.