Virgin Media 2009 Annual Report Download - page 87

Contractual Obligations and Commercial Commitments
The following table includes aggregate information about our contractual obligations as of
December 31, 2009, and the periods in which payments are due (in millions):
Payments Due by Period
Less than 1–3 3–5 More than
Contractual Obligations Total 1 year years years 5 years
Long term debt obligations ................ £5,964.5 £ 0.5 £2,813.4 £ 476.1 £2,674.5
Capital lease obligations ................... 249.5 51.2 101.8 16.4 80.1
Operating lease obligations ................ 324.3 60.1 113.0 70.2 81.0
Purchase obligations ..................... 816.6 505.2 194.1 55.6 61.7
Interest obligations ...................... 2,198.5 413.0 721.3 485.8 578.4
Total ................................. £9,553.4 £1,030.0 £3,943.6 £1,104.1 £3,475.7
Early termination charges .................. £ 21.4 £ 7.7 £ 0.1 £ —
Early termination charges are amounts that would be payable in the above periods in the event of
early termination during that period of certain of the contracts underlying the purchase obligations
listed above.
The following table includes information about our commercial commitments as of December 31,
2009. Commercial commitments are items that we could be obligated to pay in the future. They are not
required to be included in the consolidated balance sheet (in millions):
Amount of Commitment Expiration
per Period
Less than 1–3 3–5 More than
Other Commercial Commitments Total 1 year years years 5 years
Guarantees .................................... £16.2 £ 7.0 £0.9 £— £8.3
Lines of credit ................................. — — — — —
Standby letters of credit ........................... 5.8 5.1 — — 0.7
Standby repurchase obligations ...................... — — — — —
Other commercial commitments ..................... — — — — —
Total commercial commitments ..................... £22.0 £12.1 £0.9 £— £9.0
Guarantees relate to performance bonds provided by banks on our behalf as part of our
contractual obligations. The fair value of the guarantees has been calculated by reference to the
monetary value of each bond.
Derivative Instruments and Hedging Activities
We have a number of derivative instruments with a number of counterparties to manage our
exposures to changes in interest rates and foreign currency exchange rates. We account for certain of
these instruments as accounting hedges, in accordance with the Derivatives and Hedging Topic of the
FASB ASC, when the appropriate eligibility criteria has been satisfied, and to the extent that they are
effective. Ineffectiveness in our accounting hedges, and instruments that we have not elected for hedge
accounting, are recognized through the consolidated statement of operations immediately. Effective
cash flow accounting hedges are recognized as either assets or liabilities and measured at fair value
with changes in the fair value recorded within other comprehensive income (loss). The derivative
instruments consist of interest rate swaps, cross-currency interest rate swaps and foreign currency
forward contracts.
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