Cathay Pacific 1998 Annual Report Download - page 47

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45
CATHAY PACIFIC AIRWAYS LIMITED ANNUAL REPORT 1998
Notes to the Accounts – Balance Sheets
10. Fixed assets
(continued)
(a) Certain support equipment is subject to pooling agreements with other airlines.
(b) Security, including charges over the assets concerned and relevant insurance policies, is provided to the
leasing companies or other parties that provide the underlying finance.
(c) Properties held at 31st December 1998 comprised land held under medium-term lease in Hong Kong with a net
book value of HK$1,061 million (1997: nil) and freehold land held outside Hong Kong with a net book value of
HK$19 million (1997: HK$20 million).
(d) Advance payments are made to manufacturers for aircraft and related equipment to be delivered in future
years. Advance payments included in owned aircraft and related equipment amount to HK$1,194 million (1997:
HK$3,292 million) for the Group and HK$60 million (1997: HK$131 million) for the Company. No depreciation is
provided on these advance payments.
(e) During 1998, it was decided to phase out the B747-200 and B747-300 aircraft. As a result, the net recoverable
amount of these aircraft was re-assessed and an exceptional loss of HK$607 million has been incorporated.
(f) Properties under construction comprise:
Group
1998 1997
HK$M HK$M
Headquarters and hotel 905 2,257
Training facilities 562 296
Stores building 205 77
Catering facilities –1,233
Total 1,672 3,863
Included in the cost of the properties under construction is land held under medium-term lease in Hong Kong
with a net book value of HK$708 million (1997: HK$1,761 million).
(g) Capitalised value of operating leased aircraft
At 31st December 1998, the estimated capitalised value of the rental obligations for the two B747-400s held
under operating leases was HK$723 million. The estimated capitalised value represents the present value of the
aggregate future payments for operating lease commitments.