LensCrafters 2012 Annual Report Download - page 253
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| 167 >CONSOLIDATED FINANCIAL STATEMENTS - NOTES
RENTALS, LEASING AND LICENSES
The Group leases through its worldwide subsidiaries various retail stores, plants, warehouses
and office facilities as well as certain of its data processing and automotive equipment
under operating lease arrangements. These agreements expire between 2013 and 2026
and provide for renewal options under various conditions. The lease arrangements for the
Group’s U.S. retail locations often include escalation clauses and provisions requiring the
payment of incremental rentals, in addition to any established minimums contingent upon
the achievement of specified levels of sales volume. The Group also operates departments
in various host stores, paying occupancy costs solely as a percentage of sales. Certain
agreements which provide for operations of departments in a major retail chain in the
United States contain short-term cancellation clauses.
Total rental expense for each year ended December 31 is as follows:
(thousands of Euro) 2012 2011
Minimum lease payments 442,932 328,261
Additional lease payments 99,377 90,876
Sublease payments (25,754) (23,005)
Total 516,555 396,132
Future rental commitments, including contracted rent payments and contingent minimums,
are as follows:
Years ending December 31 (thousands of Euro)
2013 296,411
2014 248,805
2015 197,620
2016 152,929
2017 108,925
Subsequent years 186,951
Total 1,191,460
OTHER COMMITMENTS
The Group is committed to pay amounts in future periods for endorsement contracts,
supplier purchase and other long-term commitments. Endorsement contracts are entered
into with selected athletes and others who endorse Oakley products. Oakley is often
required to pay specified minimal annual commitments and, in certain cases, additional
amounts based on performance goals. Certain contracts provide additional incentives
based on the achievement of specified goals. Supplier commitments have been entered
into with various suppliers in the normal course of business. Other commitments mainly
include auto, machinery and equipment lease commitments.