The Company's financial instruments comprise bank and other loans, senior loan notes, derivatives, trade payables, deferred consideration and deferred contingent consideration. Other than derivatives, the main purpose of these financial instruments is to raise finance for the Company's operations. The Company also has various financial assets such as trade receivables and cash and cash equivalents, which arise directly from its operations.

Derivative financial instruments We are exposed to market risk during the normal course of business from changes in currency exchange rates, interest rates and commodity prices such as aluminum prices. We manage exposures through a combination of normal operating and financing activities and through the use of derivative financial instruments such as foreign currency forward purchase contracts and aluminum forward purchase contracts. We do not use market risk-sensitive instruments for trading or speculative purposes. In 2020, the Company had $0.2 million (2019: $0.3 million) derivative financial instruments recorded within accounts and other receivables. The value of derivative financial instruments recorded in liabilities in 2020 was $0.4 million and in 2019 was less than $0.1 million.

At December 31, 2020, the fair value of forward foreign currency exchange contracts deferred in equity was nil (2019: nil and 2018: liability of $0.4 million). During 2020, nil (2019: gain of $0.1 million and 2018: loss of $0.1 million) has been transferred to the consolidated income statement in respect of contracts that have matured in the year.

Aluminum is traded on the London Metal Exchange ("LME") and therefore the Group is able to use LME derivative contracts to hedge a portion of its price exposure. In 2020 the Group purchased approximately 7,000 (2019: 8,000) metric tons of primary aluminum for use in continuing operations. The processed waste can be sold as scrap aluminum at prices linked to the LME price. Based on the 2020 level of aluminum purchases for continuing operations, a $100 increase in the LME price of aluminum would increase our Gas Cylinders segment's costs by approximately $0.7 million.

The Company incurs currency transaction risk whenever one of the Company's operating subsidiaries enters into either a purchase or sales transaction in a currency other than its functional currency. Currency transaction risk is reduced by matching sales and expenses in the same currency. The Company's U.S. operations have little currency exposure as most purchases, costs and sales are conducted in U.S. dollars. The Company's U.K. operations are exposed to exchange transaction risks, mainly because these operations sell goods priced in euros and U.S. dollars, and purchase raw materials priced in U.S. dollars. The Company also incurs currency transaction risk if it lends currency other than its functional currency to one of its joint venture partners.

At December 31, 2020 and 2019, the Company held various forward foreign currency exchange contracts designated as hedges in respect of forward sales for U.S. dollars, euros, Canadian dollars and Japanese yen for the receipt of GBP sterling or euros. The Company also held forward foreign currency exchange contracts designated as hedges in respect of forward purchases for U.S. dollars, euros, Canadian dollars, Australian dollars and Chinese Yuan by the sale of GBP sterling. The contract totals in GBP sterling and euros, range of maturity dates and range of exchange rates are disclosed below, with the value denominated in GBP sterling given that is the currency the majority of the contracts are held in.

December 31, 2020

Sales hedges

U.S. dollars

Euros

Japanese Yen

Canadian dollars

Contract totals/£m

3.0

11.1

0.1

Maturity dates

01/21 to 03/21

01/21 to 04/21

01/21

Exchange rates

$1.3045 to $1.3667

€1.0917 to €1.1181

JPY136.89

$1.7409

Purchase hedges

U.S. dollars

Euros

Canadian dollars

Australian dollars

Chinese yuan

Contract totals/£m

4.8

1.7

9.4

0.9

Maturity dates

01/21 to 04/21

01/21 to 02/21

01/21

03/21

Exchange rates

$1.3046 to $1.3667

€1.1065 to €1.0944

$1.7409 to $1.7201

$1.7729

¥8.9184

December 31, 2019

Sales hedges

U.S. dollars

Euros

Japanese Yen

Contract totals/£m

0.1

7.6

0.1

Maturity dates

01/20

01/20 to 03/20

01/20

Exchange rates

$1.2914

€1.1551 to €1.1750

JPY142.86

Purchase hedges

U.S. dollars

Euros

Canadian dollars

Contract totals/£m

1.3

0.8

7.0

Maturity dates

03/20

01/20

Exchange rates

$1.3228

€1.1663

$1.7137 to $1.7664

The above contracts are held in GBP sterling, therefore the analysis in the table has been given in GBP sterling to avoid any movements as a result of translation.

The carrying value approximates the fair value as a result of the short-term maturity of the instruments. Cash at bank and in hand are subject to a right to offset in the U.S.

At December 31, 2020, bank and other loans of $54.1 million (2019: $92.5 million) were outstanding. At December 31, 2020, bank and other loans are shown net of issue costs of $0.7 million (2019: $1.1 million), and these issue costs are to be amortized to the expected maturity of the facilities. This carrying value is equal to its fair value. At December 31, 2020, $4.1 million (2019: $17.5 million) of the total $54.1 million (2019: $92.5 million) bank and other loans was variable interest rate debt and subject to floating interest rate risk, with the remainder being fixed rate debt.

The fair value of these contracts was calculated by determining what the Company would be expected to receive or pay on termination of each individual contract by comparison to present market prices.


In millions	Total		Level 1		Level 2		Level 3
Derivative financial assets:
Foreign currency contract assets	$	0.2	$	—	$	0.2	$	—
Derivative financial liabilities:
Foreign currency contract liabilities	0.4		—		0.4		—
Interest bearing loans and borrowings:

Loan Notes due 2023	25.0		—		25.0		—
Loan Notes due 2026	25.0		—		25.0		—
Revolving credit facility	4.1		—		4.1		—


In millions	2020
Balance at January 1	$	0.5
Payments made during year	(0.4)

Remeasurement of deferred consideration (recognized in acquisition-related costs)	(0.1)
Balance at December 31	$	—
Total gains for the period included in profit and loss	0.1

The deferred contingent consideration above related to estimates of amounts payable in the future regarding acquisitions made in prior years. This deferred contingent consideration was based upon an estimate of the future profitability of the businesses versus targets agreed upon as part of the acquisitions.