A discussion and analysis of the group's performance during the year and the material factors underlying its results and financial position. It should emphasise trends and identify significant events or transactions during the year under review. As a minimum the directors of the listed issuer should comment on the following:—

(1) the group's liquidity and financial resources. This may include comments on the level of borrowings at the end of the period under review, the seasonality of borrowing requirements, and the maturity profile of borrowings and committed borrowing facilities. Reference may also be made to the funding requirements for capital expenditure commitments and authorisations;
(2) the capital structure of the group in terms of maturity profile of debt, type of capital instruments used, currency and interest rate structure. The discussion may cover funding and treasury policies and objectives in terms of the manner in which treasury activities are controlled; the currencies in which borrowings are made and in which cash and cash equivalents are held; the extent to which borrowings are at fixed interest rates; the use of financial instruments for hedging purposes; and the extent to which foreign currency net investments are hedged by currency borrowings and other hedging instruments;
(3) the state of the group's order book (where applicable) and prospects for new business including new products and services introduced or announced;
(4) significant investments held, their performance during the year and their future prospects;
(4A) a breakdown of its significant investments (including any investment in an investee company with a value of 5 per cent. or more of the issuer's total assets as at the year end date):
(a) details of each investment, including the name and principal businesses of the underlying company, the number and percentage of shares held and the investment costs;
(b) the fair value of each investment as at the year end date and its size relative to the issuer's total assets;
(c) the performance of each investment during the year, including any realised and unrealised gain or loss and any dividends received; and
(d) a discussion of the issuer's investment strategy for these significant investments;
(5) details of material acquisitions and disposals of subsidiaries, associates and joint ventures in the course of the year;
(6) comments on segmental information. This may cover changes in the industry segment, developments within the segment and their effect on the results of that segment. It may also include changes in the market conditions, new products and services introduced or announced and their impact on the group's performance and changes in revenue and margins;
(7) where applicable, details of the number and remuneration of employees, remuneration policies, bonus and share option schemes and training schemes;
(8) details of charges on group assets;
(9) details of future plans for material investments or capital assets and their expected sources of funding in the coming year;
(10) gearing ratio;
(11) exposure to fluctuations in exchange rates and any related hedges; and
(12) details of contingent liabilities, if any.

1 It is the responsibility of the directors of the listed issuer to determine what investment or capital asset is material in the context of the listed issuer's business, operations and financial performance. The materiality of investment or capital asset varies from one listed issuer to another according to its financial performance, assets and capitalisation, the nature of its operations and other factors. An event that is "material" in the context of a smaller listed issuer's business and affairs is often not material to a larger listed issuer. The directors of the listed issuer are in the best position to determine materiality. The Exchange recognises that decisions on disclosure require careful subjective judgements, and encourages listed issuers to consult the Exchange when in doubt as to whether disclosure should be made.
2 The basis on which the gearing ratio is computed should be disclosed.
3 If the above information required in this rule has been disclosed in a business review in the directors' report as set out in rule 18.07A, no additional disclosure is required.