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21 Financial liabilities - Borrowings

The Group's current and non-current borrowings are as follows:

All figures in £ millions	2005	2004	2003
Non-current
Bank borrowings	-	62	85
7.375% US Dollar notes 2006 (nominal amount $250m)	-	130	139
6.125% Euro Bonds 2007 (nominal amount €591m)	436	390	343
10.5% Sterling Bonds 2008 (nominal amount £100m)	107	100	100
4.7% US Dollar Bonds 2009 (nominal amount $350m)	203	181	-
7% Global Dollar Bonds 2011 (nominal amount $500m)	307	260	278
7% Sterling Bonds 2014 (nominal amount £250m)	250	226	235
5.7% US Dollar Bonds 2014 (nominal amount $400m)	238	207	-
4.625% US Dollar notes 2018 (nominal amount $300m)	161	156	167
Finance lease liabilities	1	2	2
Total	1,703	1,714	1,349
Included in the above is £35m of accrued interest in 2005.
Current
Due within one year or on demand:
Bank loans and overdrafts	102	107	119
7.375% US Dollar notes 2006	152	-	-
9.5% Sterling Bonds 2004	-	-	108
4.625% Euro Bonds 2004	-	-	348
Finance lease liabilities	2	2	3
Total	256	109	578
Total borrowings	1,959	1,823	1,927
Included in the above is £3m of accrued interest in 2005.

The Group has elected to apply the provisions of IAS 32 and IAS 39 with effect from 1 January 2005. The comparative financial information is prepared in accordance with UK GAAP. The nature of the main adjustments that would make the information comply with IAS 32 and IAS 39 are set out in note 34.

The 2004 and 2003 figures for the 2007 Euro Bonds and 2014 Sterling Bonds (together with the 2004 Sterling and Euro Bonds which have now been redeemed) include the effect of accounting for the foreign exchange element of the related derivatives.

All of the Group's borrowings are unsecured. In respect of finance lease obligations (£3m in 2005; £4m in 2004 and £5m in 2003) the rights to the leased asset revert to the lessor in the event of default.

The maturity of the Group's non-current borrowing is as follows:

All figures in £ millions	2005	2004	2003
Between one and two years	437	131	86
Between two and five years	310	734	583
Over five years	956	849	680
Total	1,703	1,714	1,349

As at 31 December 2005 the exposure of the borrowings of the Group to interest changes when the borrowings re-price is as follows:

All figures in £ millions	Total	One year	One to five years	More than five years
Carrying value of borrowings	1,959	256	747	956
Effect of interest rate swaps	-	1,161	(473)	(688)
	1,959	1,417	274	268

The carrying amounts and fair values of non-current borrowings are as follows:

All figures in £ millions	Effective interest rate	Carrying amount 2005	Fair value 2005	Carrying amount 2004	Fair value 2004	Carrying amount 2003	Fair value 2003
Bank borrowings	n/a	-	-	62	62	85	85
7.375% US Dollar notes 2006	7.75%	-	-	130	138	139	157
6.125% Euro Bonds 2007	6.18%	436	419	390	409	343	448
10.5% Sterling Bonds 2008	10.53%	107	113	100	116	100	120
4.7% US Dollar Bonds 2009	4.86%	203	200	181	185	-	-
7% Global Dollar Bonds 2011	7.16%	307	310	260	293	278	317
7% Sterling Bonds 2014	7.20%	250	282	226	255	235	275
5.7% US Dollar Bonds 2014	5.88%	238	234	207	217	-	-
4.625% US Dollar notes 2018	4.69%	161	155	156	142	167	151
Finance lease liabilities	n/a	1	1	2	2	2	2
Total		1,703	1,714	1,714	1,819	1,349	1,555

The fair values are based on clean market prices at the year end or, where these are not available, on the quoted market prices of comparable debt issued by other companies. The effective interest rates above relate to the underlying debt instruments. The carrying amounts of current borrowings approximate their fair value.

The carrying amounts of the Group's borrowings are denominated in the following currencies:

All figures in £ millions	2005	2004	2003
US dollar	1,165	1,335	1,432
Sterling	357	202	201
Euro	437	284	292
Other currencies	-	2	2
Total	1,959	1,823	1,927

The maturity of the Group's finance lease obligations is as follows:

All figures in £ millions	2005	2004	2003
Finance lease liabilities - minimum lease payments
Not later than one year	2	2	3
Later than one year and not later than five years	1	2	3
Later than five years	-	-	-
Future finance charges on finance leases	-	-	(1)
Present value of finance lease liabilities	3	4	5

The present value of finance lease liabilities is as follows:

All figures in £ millions	2005	2004	2003
Not later than one year	2	2	3
Later than one year and not later than five years	1	2	2
Later than five years	-	-	-
Total	3	4	5

The carrying amount of the Group's lease obligations approximates their fair value.

The Group has the following undrawn committed borrowing facilities as at 31 December:

All figures in £ millions	2005	2004	2003
Floating rate
- expiring within one year	-	-	-
- expiring beyond one year	786	641	950
Total	786	641	950

In addition to the above facilities, there are a number of short-term facilities that are utilised in the normal course of business.

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