Originally Posted by
Snoopy
Ferg, the full text you refer to is from p26 of HYR2024 and is here:
"The syndicated facility agreement allows the Group, subject to certain conditions, to enter into additional facilities outside of the Company's syndicated facility. The additional facilities are guaranteed by the security trust. These facilities amounted to $6.77 million as at 31 December 2023.
– Overdraft facilities of $3.00 million. This facility was undrawn at 31 December 2023 (undrawn at 30 June 2023, undrawn at 31 December 2022).
– Guarantee, letters of credit and trade finance facilities of $3.77 million."
There is no mention of the "Guarantee, letters of credit and trade finance facilities." being drawn or undrawn. What is mentioned is that the overdraft on the line above is undrawn. My impression is that the "Guarantee, letters of credit and trade finance facilities.' is drawn, because if it wasn't, PGW would have told us, like they did with the overdraft facility on the line above.
I consider the "Guarantee, letters of credit and trade finance facilities" has been drawn, or should be thought of as such because such money can be called upon at any time, and there is nothing the banks can do or could have done about it. You say the letter of credit is a 'limit'. But that is your word. The word 'limit' is not mentioned in the quoted text. And if it were a limit, why pick such a strange number?: $3.77m? Why not just make the limit $4m? The mere fact the number is $3.77m is another hint to me that the $3.77m is already drawn. I could still be wrong about this. But you haven't convinced me that I am.