The Group’s Treasury function arranges financing by leveraging the Group’s balance sheet to optimise the availability of cash resources of the Group. The aggregate borrowings of the Group at 31 December 2017, which comprised secured borrowings and the liability component of convertible bonds, amounted to US$881.0 million (2016: US$839.2 million) and are mainly denominated in United States Dollars.
The increase in interest (after capitalisation) to US$29.1 million (2016: US$22.1 million) was mainly due to an increase in average secured borrowings to US$794.9 million (2016: US$564.2 million).
Certain secured borrowings are subject to floating interest rates but the Group manages these exposures by using interest rate swap contracts.
As at 31 December 2017 and 31 December 2016, there remained the 3.25% p.a. coupon July 2021 convertible bonds with an outstanding principal of US$125.0 million and the prevailing conversion price of HK$3.07.