Cathay Pacific 2002 Annual Report Download - page 60

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Cathay Pacific Airways Limited Annual Report 2002 57
27. RELATED PARTY TRANSACTIONS
(a) Material transactions between the Group and associated companies and other related parties which were
carried out in the normal course of business on commercial terms are summarised below:
2002 2001
Other Other
Associated related Associated related
companies parties companies parties
HK$M HK$M HK$M HK$M
Turnover 85
-
80
-
Aircraft maintenance costs 839 1,191 775 1,845
Route operating costs 194 657 189 607
Dividends received (133) (87) (77) (28)
Fixed assets purchase 56 42 10 12
(b) Other transactions with related parties
(i) Under an agreement between the two parties, the Company pays fees and reimburses costs to the John
Swire & Sons Limited group in exchange for services provided. Service fees calculated at 2.5% of the
Group’s profit before tax, results of associated companies, minority interests, and any profits and losses
on disposal of fixed assets will be paid annually. Service fees paid for the year ended 31st December 2002
were HK$102 million (2001: HK$21 million) and expenses of HK$156 million (2001: HK$165 million) were
reimbursed at cost.
(ii) The Company received agency commission and service fees from Dragonair. Service fees were received
in respect of computer support, engineering, station and ground services provided to Dragonair. All these
transactions were conducted in the ordinary course of business and on normal commercial terms. A total
of HK$201 million was received from Dragonair for these transactions in 2002 (2001: HK$193 million).
Dragonair is also a partner of the Asia Miles frequent-flyer programme.
(c) Amounts due to and due from associated companies and other related companies at 31st December 2002
are disclosed in notes 18 and 20 to the accounts. These balances arising in the normal course of business are
non-interest bearing and have no fixed repayment terms.
(d) At 31st December 2002, the Company has given guarantees relating to long-term loan facilities of
HK$18 million (2001: HK$16 million) held by an associated company.
(e) There were no material transactions with Directors except for those relating to remuneration (note 25 to the
accounts) and shareholdings (Directors’ Report).
Notes to the Accounts
-
Related Party
Transactions