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81
Cathay Pacific Airways Limited Annual Report 2005
27. Financial risk management (continued)
(e) Fuel price risk
Exposure to fluctuations in the fuel price is managed by the use of fuel derivatives. The Group’s policy is to
reduce exposure by hedging a percentage of its anticipated fuel consumption. Around 26.3% of the anticipated
fuel consumption for 2006 and 1.8% for 2007 were hedged at the balance sheet date.
(f) Fair values
The fair values of the following financial instruments differ from their carrying amounts shown in the
balance sheet:
Carrying Fair Carrying Fair
amount value amount value
2005 2005 2004 2004
HK$M HK$M HK$M HK$M
Group
Bank loans 4,839 4,909 3,222 3,273
Other loans 1,424 1,434 772 783
Obligations under finance leases 26,331 27,463 30,800 32,863
Pledged security deposits (10,139) (10,992) (12,163) (13,485)
Carrying Fair Carrying Fair
amount value amount value
2005 2005 2004 2004
HK$M HK$M HK$M HK$M
Company
Bank loans 3,678 3,720 1,567 1,586
Other loans 1,358 1,369 425 436
Obligations under finance leases 25,274 28,730 30,375 35,216
Pledged security deposits (3,600) (4,119) (4,344) (5,038)
The carrying amounts of other financial assets and liabilities are considered to be reasonable approximations to
their fair values.
Notes to the Accounts Supplementary Information