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10. Leases
NU has entered into lease agreements, some of which are capital leases,
for the use of data processing and office equipment, vehicles, and office
space. The provisions of these lease agreements generally provide for
renewal options.
Capital lease rental payments charged to operating expense were $1.7
million in 2002, $13.1 million in 2001, and $50.1 million in 2000. Interest
included in capital lease rental payments was $0.6 million in 2002, $4.7
million in 2001, and $11.6 million in 2000. Operating lease rental payments
charged to expense were $7.8 million in 2002, $7 million in 2001, and
$10.1 million in 2000.
Future minimum rental payments excluding executory costs, such as
property taxes, state use taxes, insurance, and maintenance, under
long-term noncancelable leases, at December 31, 2002 are as follows:
(Millions of Dollars) Capital Operating
Year Leases Leases
2003 $ 3.1 $ 23.1
2004 3.0 20.6
2005 2.8 18.4
2006 2.7 16.2
2007 2.6 9.8
After 2007 22.4 26.9
Future minimum lease payments $36.6 $115.0
Less amount representing interest 19.8
Present value of future
minimum lease payments $16.8
11. Accumulated Other Comprehensive Income/(Loss)
The accumulated balance for each other comprehensive income/(loss)
item is as follows:
Current
December 31, Period December 31,
(Millions of Dollars) 2001 Change 2002
Qualified cash flow
hedging instruments $(36.9) $52.4 $15.5
Unrealized gains/(losses) on securities 5.0 (5.1) (0.1)
Minimum pension liability adjustments (0.6) 0.1 (0.5)
Accumulated other
comprehensive (loss)/income $(32.5) $47.4 $14.9
Current
December 31, Period December 31,
(Millions of Dollars) 2000 Change 2001
Qualified cash flow
hedging instruments $ — $(36.9) $(36.9)
Unrealized gains on securities 2.4 2.6 5.0
Minimum pension liability adjustments (0.6) — (0.6)
Accumulated other
comprehensive income/(loss) $1.8 $(34.3) $(32.5)
The changes in the components of other comprehensive income/(loss)
are reported net of the following income tax effects:
(Millions of Dollars) 2002 2001 2000
Qualified cash flow
hedging instruments $(33.1) $24.3 $ —
Unrealized gains/(losses) on securities 3.3 (1.9) (0.2)
Minimum pension liability adjustments ———
Accumulated other
comprehensive income/(loss) $(29.8) $22.4 $(0.2)
Accumulated other comprehensive income/(loss) fair value adjustments
of NU’s qualified cash flow hedging instruments are as follows:
At December 31,
(Millions of Dollars, Net of Tax) 2002 2001
Balance at beginning of year $(36.9) $ —
Cumulative effect of adopting SFAS No. 133 —12.3
Hedged transactions recognized into earnings 17.0 4.5
Change in fair value 29.2 (29.6)
Cash flow transactions entered into for the period 6.2 (24.1)
Net change associated with the current period
hedging transactions 52.4 (36.9)
Total fair value adjustments included in
accumulated other comprehensive income/(loss) $15.5 $(36.9)
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