NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 December 2025 9 LOANS AND BORROWINGS (CONT’D) Interest coverage ratio sensitivity analysis (cont'd) A sensitivity analysis for the Group’s ICR is set out in the table below: 31 December 2025 Assuming 10% decrease in EBITDA Assuming 100 basis points increase in weighted average interest rate Interest coverage ratio (times) 1.7 1.5 1.4 Interest coverage ratio, excluding Sponsor-Lender exit premium (times) 1.9 1.7 1.6 Excluding the Sponsor-Lender exit premium, the Group’s ICR would have been 1.9 times. The Manager will continue to maintain prudent capital management and will seek to improve the Group’s ICR through various strategies, including: • Using divestment proceeds under the Growth and Value Up Plan to repay loans and acquire higher-yielding assets from the industrial, living and retail sectors; • Focusing on leasing and asset management strategies to improve EBITDA; • Exploring refinancing options for higher-interest debt; and • Managing interest rate risk in line with the Group’s hedging policy. 10 FINANCIAL DERIVATIVES Group and Trust 2025 2024 US$’000 US$’000 Current Derivative asset Interest rate swap used for hedging 3,091 2,706 Non-current Derivative assets Interest rate swaps used for hedging − 11,956 Derivative liability Interest rate swap used for hedging (95) − 2,996 14,662 Financial derivatives as a percentage of the Group’s net assets 0.9% 3.4% Financial derivatives as a percentage of the Trust’s net assets 0.9% 3.4% / 131 / MANULIFE US REIT
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