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NOTE 30: SEGMENT INFORMATION (cont.)
(a) Business Segments (cont.)
The economic entity has the following three business segments:
Building products division manufactures vitrified clay, concrete and timber products used in the building industry. Major product
lines include bricks, blocks, pavers, roof tiles, floor tiles, and timber products used in the building industry.
Property division considers further opportunities to better utilise land owned by the Brickworks Group.
Investment division holds investments in the Australian share market, both for dividend income and capital growth, and includes
the Group’s investment in Washington H Soul Pattinson and Co. Ltd & Brickworks Investment Company Ltd.
(b) Geographical Segments
The Group’s business segments are located in Australia, with some product manufactured by the clay products division exported
to countries within South-East Asia. Total revenue from sales outside of Australia in the 12 months ended 31 July 2008 was
$17.1 million (2007 $18.6 million).
NOTE 31: FINANCIAL INSTRUMENTS
(a) Capital Management
The Brickworks Group manages its capital to ensure that all entities in the Group can continue as going concerns, while striving
to maximise returns to shareholders through an appropriate balance of net debt and total equity. The balance of capital can be
influenced by the level of dividends paid, the issuance of new shares, returns of capital to shareholders, or adjustments in the
level of borrowings through the acquisition or sale of assets.
Brickworks capital structure is regularly measured using the gearing ratio, calculated as net debt divided by (net debt plus total
equity). Net debt is calculated as total borrowings (note 20) less cash and cash equivalents (note 8), and total equity of the parent
entity includes issued capital (note 24), reserves (note 25) and retained earnings (note 26).
CONSOLIDATED
31 JULY 08 31 JULY 07
$000 $000
Gearing ratio calculation
Net debt 525,057 505,843
Total equity 1,113,469 1,072,715
Gearing ratio 32.0% 32.0%
The group is not subject to any externally imposed capital requirements.
(b) Financial Risk Management
The Group’s activities expose it to a variety of financial risks, primarily to the risk of changes in interest rates, but also, to a lesser
extent, credit risk of third parties with which the group trades and fluctuations in foreign currency exchange rates. The Group’s
overall risk management program seeks to minimise any significant potential adverse effects on the financial performance of the
Group. Where approved by the Board, certain derivative financial instruments such as interest rate swaps or foreign exchange
contracts may be used to hedge certain risk exposures. The Brickworks Group derivative policy prohibits the use of derivative
financial instruments for speculative purposes.
(c) Terms, conditions and accounting policies
Details of the accounting policies adopted in relation to financial instruments are included in the summary of significant accounting
policies to the accounts. Information regarding the significant terms and conditions of each significant category of financial
instruments are included within the relevant note for that category.

 

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