Sasbadi Annual Report 2020

137 ANNUAL REPORT 2020 FINANCIAL STATEMENTS (continued) 27. Capital management The Group’s objectives when managing capital are to maintain a strong capital base and safeguard the Group’s ability to continue as going concern, so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Directors monitor and are determined to maintain an optimal debt-to- equity ratio that complies with debt covenants and regulatory requirements. The debt-to-equity ratios are as follows: Group Note 2020 2019 RM’000 RM’000 Total loans and borrowings 17 37,443 35,360 Less: Cash and cash equivalents 14 (6,230) (7,443) Net debt 31,213 27,917 Total equity 146,042 154,942 Net debt-to-equity ratio 0.21 0.18 There was no change in the Group’s approach to capital management during the financial year. 28. Contingencies The Directors are of the opinion that provisions are not required in respect of these matters, as it is not probable that future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement. Group Company Note 2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000 Bank guarantees obtained by the Group to the Ministry of Education 28.1 592 570 - - In respect of corporate guarantees issued for subsidiaries - - 37,263 35,022 28.1 As part of the agreements with the Ministry of Education, the Group has issued performance bond in the form of bank guarantees to the Ministry of Education for the supply of text books and applied learning products.