Delta Airlines 2003 Annual Report Download - page 104

Table of Contents
Note 7. Lease Obligations
We lease aircraft, airport terminal and maintenance facilities, ticket offices and other property and equipment from third parties. Rental expense for operating
leases, which is recorded on a straight-line basis over the life of the lease, totaled $1.3 billion for each year ended December 31, 2003, 2002 and 2001.
Amounts due under capital leases are recorded as liabilities on our Consolidated Balance Sheets. Our interest in assets acquired under capital leases is
recorded as property and equipment on our Consolidated Balance Sheets. Amortization of assets recorded under capital leases is included in depreciation and
amortization expense on our Consolidated Statements of Operations. Our leases do not include residual value guarantees.
The following table summarizes, as of December 31, 2003, our minimum rental commitments under capital leases and noncancelable operating leases with
initial or remaining terms in excess of one year:
Years Ending December 31, Capital Operating
(in millions) Leases Leases
2004 $ 29 $ 1,271
2005 22 1,237
2006 18 1,173
2007 15 1,112
2008 13 1,147
After 2008 32 5,914
Total minimum lease payments 129 $ 11,854
Less: lease payments that represent interest 32
Present value of future minimum capital lease payments 97
Less: current obligations under capital leases 19
Long-term capital lease obligations $ 78
We expect to receive approximately $130 million under noncancelable sublease agreements. This expected sublease income is not reflected as a reduction in
the total minimum rental commitments under operating leases in the table above.
At December 31, 2003, we operated 309 aircraft under operating leases and 39 aircraft under capital leases. These leases have remaining terms ranging from
three months to 14 years.
Certain municipalities have issued special facilities revenue bonds to build or improve airport and maintenance facilities leased to us. The facility lease
agreements require us to make rental payments sufficient to pay principal and interest on the bonds. The above table includes $1.7 billion of operating lease
rental commitments for such payments.
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