Huawei 2007 Annual Report Download - page 42

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FINANCIAL REPORT
Operating Leases
Leases as lessee
Non-cancellable operating lease rentals are payable as follows:
2007 2006
USD’000 USD’000
Less than one year 33,434 43,710
Between one and two years 20,281 27,643
Between two and ve years 11,007 4,483
Total 64,722 75,836
The Group leases a number of warehouses, factory
facilities, ofce premises and staff apartments under
operating leases. The leases typically run for an initial
period of between one and ve years. None of the leases
includes contingent rentals.
During the year ended 31 December 2007, $144,142
thousand was recognized as an expense in the consolidated
income statement in respect of operating leases (2006:
$117,365 thousand).
Leases as lessor
The Group leases out certain of its properties under
operating leases. Non-cancellable operating lease rentals
are receivable as follows:
2007 2006
USD’000 USD’000
Less than one year 6,752 3,994
Between one and ve years 5,097 11,982
Total 11,849 15,976
During the year ended 31 December 2007, $8,505 thousand
was recognized as rental income in the consolidated
income statement (2006: $6,155 thousand).
Investment properties
The Group is engaged in the manufacturing, sales and
marketing of telecommunications equipment and the
provision of related services. Beginning from 1 January
2004, it leased certain buildings to an ex-subsidiary and
a former related company. Such buildings are classied as
investment properties.
The carrying value of investment properties as of 31 December
2007 is $39,105 thousand (2006: $39,218 thousand). The
fair value of investment properties as of 31 December 2007
is estimated by the directors to be $62,594 thousand (2006:
$43,583 thousand). The investment properties have not
been valued by an external independent valuer.
The fair value of investment property is determined by the
Group internally by reference to market conditions and
discounted cash ow forecasts. The Group’s current lease
agreements, which were entered into on an arm’s-length
basis, were taken into account.
lnventories
2007 2006
USD’000 USD’000
Raw materials 284,161 314,255
Work in progress 144,454 184,636
Finished goods 721,665 459,576
Goods delivered but not 679,578 461,988
completely installed
Total 1,829,857 1,420,455
Trade and Other Receivables
2007 2006
USD’000 USD’000
Trade receivables 5,303,412 3,432,795
Other receivables 410,538 217,291
Pledged deposit 18 -
Total 5,713,968 3,650,086
Cash and Cash Equivalents
2007 2006
USD’000 USD’000
Cash and bank balances 1,686,153 1,056,042
Trade and Other Payables
2007 2006
USD’000 USD’000
Trade payables 4,588,717 2,746,124
Dividends payables 5 49
Other payables 1,643,735 1,436,873
Total 6,232,457 4,183,046
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