Singapore Airlines 2003 Annual Report Download - page 105

Download and view the complete annual report

Please find page 105 of the 2003 Singapore Airlines annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 128

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128

103
SIA Annual Report 02/03
Notes to the Financial Statements
31 March 2003
30 Capital and Other Commitments (in $ million) (continued)
Operating lease commitments
The Company has 16 B747-400s, 1 B777-200 and 3 CFM-56 engines under operating leases with fixed rental rates.
The lease terms range from 4 to 10 years for the B747-400 and B777-200 aircraft, and 3 to 3.5 years for the CFM-
56 engines. In 11 of the aircraft lease agreements, the Company holds options to extend the leases for a further
maximum period of 2 years. None of the operating agreements confer on the Company an option to purchase the
related aircraft or engines. Sub-leasing is allowed under all the lease arrangements.
SilkAir (Singapore) Private Limited ("SilkAir") has 1 A320-232 aircraft under operating lease with fixed rental rates.
The lease term is two years. It holds the option to extend the lease for a further maximum period of 2 years, which
is not likely to be exercised. There is no option to purchase the aircraft.
Future lease payments under non-cancellable operating leases are as follows:
Aircraft
The Group The Company
31 March 31 March
2003 2002 2003 2002
Within one year 429.4 445.4 424.0 445.4
After one year but not more than five years 1,060.7 1,315.6 1,059.8 1,315.6
More than five years 202.1 325.9 202.1 325.9
1,692.2 2,086.9 1,685.9 2,086.9
Property and equipment
The Group The Company
31 March 31 March
2003 2002 2003 2002
Within one year 11.3 10.0 7.1 7.2
After one year but not more than five years 17.3 21.3 5.8 10.5
More than five years 38.6 41.6 – –
67.2 72.9 12.9 17.7
31 Contingent Liabilities (in $ million)
Flight SQ006
On 31 October 2000, Flight SQ006 crashed on the runway at the Chiang Kai-Shek International Airport, Taipei en
route to Los Angeles. There were 83 fatalities among the 179 passengers and crew members aboard the Boeing
747 aircraft. On 26 April 2002, the Taiwan Aviation Safety Council released its final investigation report on the
accident. Whilst the full implications of these conclusions and recommendations are still being deliberated, the
Company is currently a defendant in a number of lawsuits relating to the crash. It maintains substantial insurance
coverage which is sufficient to cover the claims arising from the crash. Accordingly, it believes that the resolution of
these claims will have no material impact on its financial position. There has been no change to this position since
the last financial year.
Flight MI 185
The 6 remaining claims resulting from SilkAir MI 185 crash on 19 December 1997 were settled during the financial
year, without any financial impact on the Company. It was fully covered by insurance.
There are contingent liabilities in respect of guarantees given by the Group and the Company at 31 March 2003
amounting to $72.9 million (2002: $125.2 million) and $33.6 million (2002: $52.8 million) respectively.