29. FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS AND OTHER EXPLANATORY INFORMATION (CONTINUED) 29E. Liquidity risk – financial liabilities maturity analysis (Continued) Financial guarantee contracts – At the end of the reporting year, no claims on the financial guarantee are expected. All the corporate guarantees provided are disclosed in Note 30. The underlying bank facilities mature within 1 year (2024: 1 year). The Group and Company manage the liquidity risk by maintaining sufficient cash balances and the availability of funding through an adequate amount of committed credit facilities. 29F. Interest rate risk Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Fair value interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. As the Group has no significant interest-bearing assets, the Group’s income and operating cash flows are substantially independent of changes in market interest rates. The Group’s interest rate risk mainly arises from bills payable to banks and short term bank loans at floating interest rates. The Group manages its interest rate risk by keeping bills payable and short term bank loans to the minimum required to sustain the operations of the Group. The floating rate debt instruments are with interest rates that are re-set at regular intervals. The interest rates are disclosed in the respective notes. The following table demonstrates the sensitivity of the Group’s and Company’s net profit or loss after tax and equity to changes in interest rates movement (assuming all other variables are consistent): 2025 2024 Increase/(Decrease) Profit after tax Equity attributable to the equity holders of the company Profit after tax Equity attributable to the equity holders of the company $ $ $ $ Group Increased by 100 basis points (293,548) (287,797) (210,159) (207,267) Decreased by 100 basis points 293,548 287,797 210,159 207,267 Company Increased by 100 basis points (230,814) (230,814) (157,152) (157,152) Decreased by 100 basis points 230,814 230,814 157,152 157,152 MEGACHEM LIMITED ANNUAL REPORT 2025 166 NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2025
RkJQdWJsaXNoZXIy NTM2MDQ5