Cathay Pacific 1999 Annual Report Download - page 41

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Notes to the Accounts – Balance Sheets
45CATHAY PACIFIC AIRWAYS LIMITED ANNUAL REPORT 1999
12. Fixed assets
(continued)
(a) Finance leased aircraft
Certain aircraft are subject to leases with purchase options to be exercised by the Group at the end of the
respective leases. The remaining lease terms range from 2 to 16 years. Some of the rent payments are on a
floating bases which are generally linked to market rates of interest. All leases permit subleasing rights,
subject to appropriate consent from lessors. Early repayment penalties would be payable on some of the
leases should they be terminated prior to their specified expiry dates.
(b) Leased out aircraft
As at the year ended 31st December 1999, six B747-200s (1998: three), five B747-300s (1998: nil) and
related equipment were leased to third-party lessees on operating leases of varying terms of between two and
five years. These have been included under aircraft and related equipment as follows:
1999 1998
HK$M HK$M
Cost 4,948 1,288
Accumulated depreciation
Balance at 1st January 3,598 841
Charge for the year 268 118
Balance at 31st December 3,866 959
Net book value 1,082 329
The future minimum lease payments receivable under these operating leases for each of the following periods
are as follows:
1999 1998
HK$M HK$M
Within one year 298 103
After one year but within five years 293 309
591 412
(c) Operating leased aircraft
At 31st December 1999, the two B747-400s (1998: two) with purchase options, and three A340-300s
(1998: nil) without purchase options, held under operating leases were not capitalised. The estimated
capitalised value of these leases being the present value of the aggregate future lease payments is
HK$925 million.
The future minimum lease payments payable under these operating leases for each of the following periods
are as follows:
1999 1998
HK$M HK$M
Within one year 424 200
After one year but within five years 577 590
1,001 790
The lease rentals are fixed. Subleasing is not allowed under the lease arrangements.