Air New Zealand 2011 Annual Report Download - page 48

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23. CAPITAL COMMITMENTS
GROUP
2011
$M
GROUP
2010
$M
COMPANY
2011
$M
COMPANY
2010
$M
Aircraft and engines 2,022 3,062 2,018 3,056
Other property, plant and equipment 6 9 4 8
Intangible assets - 1 - 1
2,028 3,072 2,022 3,065
Commitments shown are for those asset purchases committed and contracted for and converted at the year end exchange rate.
On 2 November 2009, Air New Zealand announced the acquisition of fourteen Airbus A320 aircraft and associated engines.
Air New Zealand subsequently assigned the rights to four of these aircraft to an operating lessor. The remaining ten aircraft will be
delivered between June 2013 and September 2016. Under the agreement the Group secured the right to purchase up to an additional
eleven aircraft.
The Group has firm commitments to purchase two Boeing 777-300ER aircraft and one spare engine. The aircraft will be delivered
between November 2011 to January 2012 and the spare engine in November 2011.
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 delivery dates. The Group received notification from Boeing
on 4 March 2011 that these aircraft will be further delayed with deliveries likely to commence in late 2013. The capital commitments in
the above table reflect the revised delivery schedule.
24. OPERATING LEASE COMMITMENTS
GROUP
2011
$M
GROUP
2010
$M
COMPANY
2011
$M
COMPANY
2010
$M
Aircraft leases payable
Not later than 1 year 152 219 73 120
Later than 1 year and not later than 5 years 476 681 149 216
Later than 5 years 253 525 91 140
881 1,425 313 476
Property leases payable
Not later than 1 year 43 46 38 42
Later than 1 year and not later than 5 years 101 110 93 101
Later than 5 years 103 81 98 76
247 237 229 219
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.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
AS AT 30 JUNE 2011
AIR NEW ZEALAND ANNUAL FINANCIAL RESULTS 2011