Singapore Airlines 2008 Annual Report Download - page 137

Singapore Airlines Annual Report 2007-08
135
23 Associated Companies (in $ million) (continued)
The customer-related intangible assets arose from the acquisition of associated companies and the Group has engaged an
independent third party to perform a fair valuation of these separately identified intangible assets. The useful life of these
intangible assets was determined to be five years and the assets will be amortised on a straight-line basis over the useful
life. The amortisation is included in the line of “share of profits of associated companies” in the consolidated profit and loss
account.
During the financial year:
1. The Company’s associated company, RCMS Properties Private Limited, recorded a revaluation gain of $253.4 million
(2006-07: revaluation gain of $72.3 million) from its annual revaluation exercise of its land and building. The
Company’s share of the revaluation gain of $50.7 million at 31 March 2008 (2007: revaluation gain of $14.4 million)
is included under the Group’s share of post-acquisition capital reserve.
2. SIA Cargo injected an additional $7.4 million (2006-07: $23.6 million) in Great Wall Airlines Company Limited
(“GWAC”). There was no change in the Group’s 25% equity stake in GWAC.
3. SATS injected an additional $0.2 million in Evergreen Airline Services Corporation (“EGAS”). There was no change in
SATS Group’s 20% equity stake in EGAS.
Loans to associated companies are unsecured and have no foreseeable terms of repayments. Accordingly, the fair value
of the loan is not determinable as the timing of future cash flows arising from the loans cannot be estimated reliably.
The loans are non-interest bearing, except for $2.6 million (2007: $2.6 million) and $133.0 million (2007: $133.0
million), which bear interest at 3.0% and LIBOR plus 2.5% per annum (2006-07: 3.0% and LIBOR plus 2.5% per annum)
respectively.
The loan of $133.0 million represents cumulative redeemable preference shares issued by the Company’s associated
company,฀Virgin฀Atlantic฀Limited฀(“VAL”).฀The฀cumulative฀redeemable฀preference฀shares฀carry฀no฀entitlement฀to฀vote฀at฀
meetings.฀On฀a฀winding฀up฀of฀VAL,฀the฀preference฀shareholders฀have฀a฀right฀to฀receive,฀in฀preference฀to฀payments฀to฀
ordinary shareholders, the amount paid up on any share including any amount paid up by way of share premium plus any
arrears or accruals of dividend calculated down to the date of the return of capital irrespective of whether such dividends
have been earned or declared or not.
Amounts owing by associated companies are unsecured, trade-related, non-interest bearing and are repayable on demand.
The associated companies at 31 March are:
Country of Percentage of
incorporation equity held
and place Cost (in $ million) by the Group
Principal activities of business 2008 2007 2008 2007
Service Quality (SQ) Centre Pte Ltd@ Quality service training Singapore # # 50.0 50.0
Virgin฀Atlantic฀Limited*++ Air transportation United 1,549.02 1,549.02 49.0 49.0
Kingdom
Tiger Aviation Pte Ltd@ Investment holding Singapore 11.93 11.93 49.0 49.0
RCMS Properties Private Limited^^+ Hotel ownership and management Singapore 31.16 31.16 20.0 20.0
Aviserv Ltd Inflight catering services Pakistan 3.31 3.31 39.6 40.1
Taj SATS Air Catering Limited** Catering services India 24.65 24.65 39.6 40.1
Servair-SATS Holding Company Investment holding company Singapore 0.51 0.51 39.6 40.1
Pte Ltd+
PT Jasa Angkasa Semesta Tbk^^^+ Ground and cargo handling services Indonesia 105.53 105.53 40.2 40.8
Beijing Airport Inflight Kitchen Ltd+ Inflight catering services People’s 13.88 13.88 32.3 32.8
Republic
of China
NOTES TO THE FINANCIAL STATEMENTS
31 March 2008