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26. Lease Commitments
Group as Lessee
The Group has operating lease agreements for land and buildings, used
primarily for the provision of warehousing facilities to customers and as
vehicle depot locations, and in respect of the Group’s transport vehicle
and trailer fleet. These leases typically have terms of renewal but do not
contain purchase options. Property leases typically include rent review
clauses which allow for upward revision to the rental charge on a periodic
basis, according to prevailing market conditions. Where escalation clauses
are present that stipulate specific increases to the rental amount the
operating lease expense is recorded on a straight-line basis. Similarly, lease
incentives are recorded on a straight-line basis.
At the statement of financial position date, the Group had outstanding
commitments for future minimum payments under non-cancellable operating
leases, which fall due as follows:
Property Vehicles Property Vehicles
plant and
plant and
equipment
equipment
2011
2011
2010
2010
£’000
£’000
£’000
£’000
Within one year
13,349
21,432 15,866 20,433
After one year but not
more than five years 47,782
34,982 55,460 12,329
More than five years 85,793
127 75,636
597
146,924
56,541 146,962 33,359
Group as Lessor
The Group has entered into commercial property leases on certain of its
properties. These non-cancellable leases have remaining terms of between
1 and 30 years. All leases include a clause to enable upward revision of
the rental charge on an annual basis according to prevailing market
conditions. Future minimum rentals receivable under non-cancellable
operating leases are as follows:
2011
2010
£’000
£’000
Within one year
374
2,709
After one year but not more than five years
5,923
4,522
More than five years
10,453
8,496
16,750
15,727
Finance Lease and Hire Purchase Commitments:
Future minimum lease payments under finance leases and hire purchase contracts together with the present value of the net minimum lease payments are as follows:
Min. lease
Interest
Principal
Min. lease
Interest
Principal
payments
payments
2011
2011
2011
2010
2010
2010
£’000
£’000
£’000
£’000
£’000
£’000
Within one year
23,853
(1,451)
22,402
20,818
(1,927)
18,891
After one year but not more than five years
23,248
(605)
22,643
32,307
(798)
31,509
47,101
(2,056)
45,045
53,125
(2,725)
50,400
Capital commitments:
At 28 February 2011, the Group had commitments of £18,001,000 (2010 - £23,956,000).
Notes to the Consolidated Financial Statements
For the year to 28 February 2011, continued
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Financial Statements