Tesco plc Annual Report and Financial Statements 2008

Note 32 Leasing commitments continued
Operating lease commitments – Group as lessee
Future minimum rentals payable under non-cancellable operating leases are as follows:
2008 2007
£m £m
Within one year 551 379
Greater than one year but less than five years 2,190 1,444
After five years 7,127 4,838
Total minimum lease payments 9,868 6,661
Operating lease payments represent rentals payable by the Group for certain of its retail, distribution and office properties and other assets such as motor
vehicles. The leases have varying terms, purchase options, escalation clauses and renewal rights.
Operating lease commitments with joint ventures
Since 1988, the Group has entered into several joint ventures and sold and leased back properties to and from these joint ventures. The terms of these
sale and leasebacks vary, however, common factors include: the sale of the properties to the joint venture at market value, options at the end of the lease
for the Group to repurchase the properties at market value, market rent reviews and 20-25 year lease terms. The Group reviews the substance as well as
the form of the arrangements when making the judgement as to whether these leases are operating or finance leases; the majority of the leases under
these arrangements are operating leases.
Operating lease receivables – Group as lessor
The Group both rents out its investment properties and also sublets various leased buildings under operating leases. At the Balance Sheet date,
the following future minimum lease payments are contractually receivable from tenants:
2008 2007
£m £m
Within one year 141 123
Greater than one year but less than five years 341 260
After five years 313 268
Total minimum lease payments 795 651
Note 33 Events after the balance sheet date
On 9 April 2008, Dobbies Garden Centres PLC, a 65.5% owned subsidiary of the Group, announced plans to raise £150m through an open offer of
shares. Dobbies Garden Centres PLC will seek shareholder approval at an Annual General Meeting on 21 May 2008 to issue up to 12.45 million shares
on a six for five basis at 1,200p per share. Tesco PLC will underwrite the offer.
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Financial Statements 2008 95