Annual Report 2016
In order to assess the long-term
viability and financial resilience of
the Group to possible changing
circumstances, sensitivity analysis
has been applied to these financial
forecasts to assess the impact on
profitability, cash flows, liquidity,
borrowing capacity and compliance
with borrowing covenants of severe
but plausible adverse changes
to important assumptions made
within these base projections,
including those that are outside
of the control of the Group. They
include an increase in the required
level of capital investment and
operating costs (including those
arising from principal risk events
occurring - see principal risks
above) and the level of inflation.
The Directors have selected these
assumptions as they believe it is
these that could most significantly
impact on the longer term viability
of the Group and that could most
materially deviate from the Group’s
base assumptions over the longerterm.
The period to 31 March 2019
covered by the assessment is
considered to be appropriate for a
Group of this size, complexity and
structure.
Based on the business plan,
the related long-term financial
projections and associated
sensitivity analysis detailed above
the Board of Directors has a
reasonable expectation that the
Group will be able to continue in
operation and meet its liabilities
as they fall due over the period
of assessment to 31 March 2019.
This expectation is based on
the assumption that the Group
continues to maintain its existing
access to capital markets to fund its
required investment programme
and provide sufficient liquidity and,
as such, have prepared the financial
statements on a going concern
basis.
The Strategic Report on pages 4
to 39 is approved on behalf of the
Board of Directors.
A Page
Group Chief Executive
22 August 2016
39