Derivative financial instruments and hedge accounting (Tables)

12 Months Ended

Dec. 31, 2023

Statement [line items]

Summary of Outstanding Derivative Financial Instruments

The Group’s approach to the management of financial risks is set out in note 19. The Group’s outstanding derivative financial instruments are as follows:

					2023							2022
All figures in £ millions	Gross notional amounts		Assets		Liabilities			Gross notional amounts		Assets		Liabilities
Interest rate derivatives – in a fair value hedge relationship		174		–		(5	)		177		–		(11	)
Interest rate derivatives – not in a hedge relationship		356		14		(1	)		260		19		–
Cross-currency rate derivatives – in a hedge relationship		352		26		(31	)		83		34		(43	)
Cross-currency rate derivatives – not in a hedge relationship		87		–		(1	)		–		–		–
FX derivatives – in a hedge relationship		420		7		–			355		1		(9	)
FX derivatives – not in a hedge relationship		526		1		(5	)		573		5		(2	)
Total		1,915		48		(43	)		1,448		59		(65	)
Analysed as expiring:
In less than one year		1,047		16		(5	)		1,028		16		(11	)
Later than one year and not later than five years		868		32		(38	)		420		43		(54	)
Total		1,915		48		(43	)		1,448		59		(65	)

Summary of Interest Rate and Cross Currency Swaps

The Group uses a combination of interest rate and cross-currency swaps to convert its €300m debt.

Receive Notional	Receive coupon	FX rate	Notional	Pay coupon
€100m	1.375%	GBPEUR: 1.1295	£87m	3.51%
€181m	1.375%	GBPUSD: 1.206	£157m	3.402%
				USD Libor
€19m	1.375%	GBPUSD: 1.206	£16m	+1.36%

Summary of Instruments to Hedge Exposures to Changes in Interest Rates and Foreign Currency Risk Associated with Borrowings

The Group held the following instruments to hedge exposures to changes in interest rates and foreign currency risk associated with borrowings:

							2023
All figures in £ millions	Carrying amount of hedging  instruments			Change in fair value of hedging  instrument used to determine hedge ineffectiveness			Nominal  amounts  of hedging   instruments
Derivative financial instruments for interest rate risk		(6	)		5			174
Derivative financial instruments for currency risk		26			(7	)		174

							2022
All figures in £ millions	Carrying amount of hedging  instruments			Change in fair value of hedging  instrument used to determine hedge ineffectiveness			Nominal  amounts  of hedging   instruments
Derivative financial instruments for interest rate risk		(11	)		(16	)		177
Derivative financial instruments for currency risk		33			9			266

Summary of Amounts at the Reporting Rate Relating to Items Designated as Hedge Items

The amounts at the reporting date relating to items designated as hedge items were as follows:

										2023
All figures in £ millions	Carrying amount of hedged items			Accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount		Change in fair value of hedged item used to determine hedge ineffectiveness		Hedge ineffectiveness		Line item  in profit or  loss that  includes hedge  ineffectiveness
Interest rate risk
Financial liabilities – borrowings		(169	)		6		5		1		Finance  costs
Currency risk
Financial liabilities – borrowings		(169	)		n/a		5		–		n/a

												2022
All figures in £ millions	Carrying amount of hedged items			Accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount		Change in fair value of hedged item used to determine hedge ineffectiveness			Hedge ineffectiveness			Line item  in profit or  loss that  includes hedge  ineffectiveness
Interest rate risk
Financial liabilities – borrowings		(167	)		11		15			(1	)		Finance  costs
Currency risk
Financial liabilities – borrowings		(167	)		n/a		(14	)		–			n/a

Summary of Amounts Related to Items Designated as Hedging Instruments

The amounts related to items designated as hedging instruments were as follows:

										2023
All figures in £ millions	Carrying amount of hedging instruments			Change in value of hedging instrument used to determine hedge ineffectiveness		Nominal amounts of hedging instruments		Hedging gains/(losses) recognised in OCI		Hedge  ineffectiveness  recognised in  profit or loss
Derivative financial instruments		(24	)		26		599		26		–
Financial liabilities – borrowings		–			–		–		–		–

													2022
All figures in £ millions	Carrying amount of hedging instruments			Change in value of hedging instrument used to determine hedge ineffectiveness			Nominal amounts of hedging instruments			Hedging gains/(losses) recognised in OCI			Hedge  ineffectiveness  recognised in  profit or loss
Derivative financial instruments		(50	)		(31	)		172			(31	)		–
Financial liabilities – borrowings		(89	)		(5	)		(88	)		(5	)		–

Disclosure of Derivative Financial Assets and Liabilities Subject to Offsetting Arrangements

Derivative financial assets and liabilities subject to offsetting arrangements are as follows:

						2023									2022
All figures in £ millions	Gross derivative assets		Gross derivative liabilities			Net  derivative  assets/  liabilities				Gross derivative assets		Gross derivative liabilities			Net derivative assets/ liabilities
Counterparties in an asset position		26		(14	)		12				30		(17	)		13
Counterparties in a liability position		22		(29	)		(7	)			29		(48	)		(19	)
Total as presented in the balance sheet		48		(43	)		5				59		(65	)		(6	)