Tesco 2009 Annual Report Download - page 125

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123
FINANCIAL STATEMENTS
Tesco PLC Annual Report and Financial Statements 2009
To find out more go to
www.tesco.com/annualreport09
Note 37 Leasing commitments continued
Operating lease commitments – Group as lessee
Future minimum rentals payable under non-cancellable operating leases are as follows:
2009 2008
£m £m
Within one year 754 551
Greater than one year but less than five years 3,069 2,190
After five years 9,170 7,127
Total minimum lease payments 12,993 9,868
Operating lease payments represent rentals payable by the Group for certain of its retail, distribution and office properties and other assets such as
motor vehicles. The leases have varying terms, purchase options, escalation clauses and renewal rights.
Operating lease commitments with joint ventures
Since 1988, the Group has entered into several joint ventures and sold and leased back properties to and from these joint ventures. The terms of these
sale and leasebacks vary, however, common factors include: the sale of the properties to the joint venture at market value, options at the end of the
lease for the Group to repurchase the properties at market value, market rent reviews and 20-25 year lease terms. The Group reviews the substance
as well as the form of the arrangements when making the judgement as to whether these leases are operating or finance leases; all of the leases under
these arrangements are operating leases.
Operating lease receivables – Group as lessor
The Group both rents out its investment properties and also sublets various leased buildings under operating leases. At the Balance Sheet date, the
following future minimum lease payments are contractually receivable from tenants:
2009 2008
£m £m
Within one year 201 141
Greater than one year but less than five years 445 341
After five years 335 313
Total minimum lease payments 981 795