Air New Zealand 2009 Annual Report Download - page 44

23. CAPITAL COMMITMENTS (CONTINUED)
On 25 February 2009, Air New Zealand entered into an agreement to purchase an additional Boeing 777-300ER aircraft, by converting an existing
purchase option into a firm order, bringing the total on order to five aircraft. The Group also agreed during the year to purchase two spare engines to
support the Boeing 777-300ER fleet. The five aircraft will be delivered between November 2010 to January 2012 and the spare engines in
November 2010 and November 2011.
On 22 September 2008, the Group entered into an agreement to purchase seven ATR 72-500 aircraft currently on operating lease to the Group. The
aircraft will be acquired between October 2009 and February 2010.
The Group has entered into firm commitments to purchase eight Boeing 787-9 (B787-9) aircraft and associated engines and spares. The B787-9
aircraft that are subject to firm commitments were originally scheduled for delivery between the period December 2010 to September 2013. On 25
February 2009, Air New Zealand agreed to revised terms and delivery dates of between February 2013 to September 2016. As at the date of signing
these financial statements the Group is expecting to be notified of further delays.
The Group also has the right (but no obligation) to purchase nine Q400 aircraft.
24. OPERATING LEASE COMMITMENTS
GROUP
2009
$M
GROUP
2008
$M
COMPANY
2009
$M
COMPANY
2008
$M
Aircraft leases payable
Not later than 1 year 234 227 126 129
Later than 1 year and not later than 5 years 275 349 295 274
Later than 5 years 5 14 173 213
514 590 594 616
Property leases payable
Not later than 1 year 39 26 35 23
Later than 1 year and not later than 5 years 110 75 102 69
Later than 5 years 88 94 85 92
237 195 222 184
The Company leases a number of aircraft from its wholly owned subsidiary, Air New Zealand Aircraft Holdings Limited.
New Zealand International Airlines Limited, a wholly owned subsidiary, has the option to purchase two Boeing 737-300 aircraft which are currently
under an operating lease arrangement. The options may be exercised at certain predetermined dates, lapsing in September 2011 and July 2012. The
directors expect that the options will not be exercised.
Subject to negotiation, certain aircraft operating leases give the Group the right to renew the lease.
25. CONTINGENT LIABILITIES
GROUP
2009
$M
GROUP
2008
$M
COMPANY
2009
$M
COMPANY
2008
$M
Uncalled capital of subsidiaries - - 2 2
Guarantee of subsidiary indebtedness - - 1,279 1,325
Letters of credit and performance bonds 37 21 29 14
37 21 1,310 1,341
All significant legal disputes involving probable loss that can be reliably estimated have been provided for in the financial statements. There are no
contingent liabilities for which it is practicable to estimate the financial effect.
Air New Zealand has been named in four class actions. One, in Australia, claims travel agents commission on fuel surcharges and two (one in Australia
and the other in the United States) make allegations against more than 30 airlines, of anti competitive conduct in relation to pricing in the air cargo
business. The fourth class action alleges (in the United States) that Air New Zealand together with 11 other airlines conspired in respect of fares and
surcharges on trans-Pacific routes. All class actions are being defended.
AIR NEW ZEALAND
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
AS AT 30 JUNE 2009
42