Air New Zealand 2010 Annual Report Download - page 49

26. RELATED PARTIES
Crown
The Crown, the major shareholder of the Company, owns 75 percent of the issued capital of the Company (30 June 2009: 75 percent). The balance is
owned by the public. Air New Zealand enters into numerous transactions with Government Departments, Crown Agencies and State Owned Enterprises
on an arm’s length basis. These are not considered to be related party transactions.
All members of the Group are considered to be related parties of the Company. This includes the subsidiaries and associates identified in Note 13.
Key management personnel
Compensation of key management personnel (including directors) was as follows:
GROUP
2010
$M
GROUP
2009
$M
COMPANY
2010
$M
COMPANY
2009
$M
Short-term employee costs 5 7 5 7
Directors' fees 1 1 1 1
Share-based payments 3 3 3 3
9 11 9 11
Certain key management personnel (including directors) have relevant interests in a number of companies (including non-executive directorships) to
which Air New Zealand provides aircraft related services in the normal course of business, on standard commercial terms.
A related party to Jane Freeman (Director), Chris Hunter (Husband), is CEO of Hawkins Construction Limited. During the year Air New Zealand paid
to Hawkins Construction Limited and Hawkins Interiors $2 million (30 June 2009: $9 million) for construction related services. At balance date there
were no amounts outstanding (30 June 2009: Nil). All transactions between Air New Zealand, Hawkins Construction Limited and Hawkins Interiors are
conducted on standard commercial terms.
Staff Share Purchase Schemes
The Air New Zealand A and B Staff Share Purchase Schemes were established by the Group in 1998. All full time and regular part-time employees
were invited to participate in the Schemes and purchase a maximum of 2,000 Ordinary Shares each. The price of the shares was $1.60, being the
lower of the offer price and a price 10 percent below the weighted average sale price for the shares at the date of allotment, being 12 August 1998.
Adjusted for a consolidation ratio (based on the share consolidation which occurred in August 2004), the price of the shares equates to $8.00. The
shares were held by the Trustees during a three year restrictive period, which expired in September 2001. Allocated shares carry normal Voting Rights
and participate in dividends. Voting Rights were exercised by the Trustees on behalf of the employees during the restrictive period, after which time
the rights were transferred to the employees. At 30 June 2010, Mr R France (Director), Mr J Blair (General Counsel and Company Secretary) and
Mr R McDonald (Chief Financial Officer) were the Trustees of the Schemes and were appointed by the Company’s Board of Directors.
As at 30 June 2010, the Scheme held 93 unallocated ordinary shares (30 June 2009: 93 shares).
Executive share option plans
Executive share option plans are detailed in Note 21.
Transactions between the Company and its subsidiary or associated companies
Subsidiaries
During the year there have been transactions between the Company and its subsidiaries as follows:
COMPANY
2010
$M
COMPANY
2009
$M
Operating revenue (excluding dividend revenue) 61 83
Dividend revenue 16 -
Finance costs* (12) (37)
Operating expenditure (306) (378)
Included within Operating expenditure ("Other expenses") are the following amounts:
Reversal of impairment of investment in subsidiaries 2 3
* Finance costs include finance income of $6 million (30 June 2009: $5 million) and finance costs of $18 million (30 June 2009: $42 million).
AIR NEW ZEALAND
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
AS AT 30 JUNE 2010
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