2011-2012 Annual Report - Full Version - PDF - Palmerston North ...

Note 26Capital commitments and operating leasesCapital CommitmentsCouncilGroupActual Actual Actual Actual2012 2011 2012 2011$000 $000 $000 $000Capital expenditure contracted for at balance datebut not yet incurred for property, plant and equipment 754 1,007 754 1,509◊◊PNCC currently has no construction contracts.PNCC currently has no non-current assets thatare held for sale.◊There are no capital commitments in relationto PNCC’s interest in Gordon Kear Forest jointventure and investment properties (note 18).Operating Leases as LesseePNCC leases property, plant and equipment in the normal course of its business. The majority of these leaseshave a non-cancellable term of 36 months. The future aggregate minimum lease payments to be paid under noncancellableoperating leases are as follows:CouncilGroupActual Actual Actual Actual2012 2011 2012 2011$000 $000 $000 $000Non-cancellable Operating Leases as LesseeNot later than one year 458 458 1,087 1,050Later than one year and not later than five years 1,382 1,550 2,641 3,238Later than five years - 291 - 291Total non-cancellable operating leases 1,840 2,299 3,728 4,579◊◊The total minimum future sublease paymentsexpected to be received under non-cancellablesubleases at balance date is $nil (2011 $nil).Lease amounts payable have been determinedon the basis of current annual rent payable andhave not been discounted or inflation adjusted.◊◊Leases can be renewed at PNCC’s option, withrents set by reference to current market ratesfor items of equivalent age and condition. PNCCdoes have the option to purchase some of theleased assets at the end of the lease term.There are no restrictions placed on PNCC by anyof the leasing arrangements.Financial Statements Note 26Operating Leases as LessorPNCC leases its investment property and some operational assets under operating leases. The majority of theseleases have a non-cancellable term of 24 or 36 months. For some leases the lessee has the right for furtherrenewal periods. The future aggregate lease payments to be collected under non-cancellable operating leasesare as follows:CouncilGroupActual Actual Actual Actual2012 2011 2012 2011$000 $000 $000 $000Non-cancellable Operating Leases as LessorNot later than one year 1,235 1,260 2,199 2,394Later than one year and not later than five years 3,629 4,091 5,385 6,589Later than five years 4,903 5,889 8,012 9,315Total non-cancellable operating leases 9,767 11,240 15,596 18,298◊No contingent rents have been recognised in thestatement of comprehensive income during theperiod.Non-cancellable Energy Contracts◊ PNCC has a contract with Mighty River PowerLtd to supply electricity to all its complexes withthe contract expiring on 30 November 2013.Electricity is charged on an actual usage basis.◊PNCC has a contract with Energy Direct NZ Ltd tosupply gas to all its complexes with the contractexpiring on 30 June 2013. Gas is charged on anactual usage basis.Other Non-cancellable Contracts◊ Arena Manawatu have a lease agreement withMarist Club (PN) in relation to the carpark infront of the Marist Clubrooms in Pascal Streetalongside Arena 2. This is for a term of 15 yearswhich expires on 11 June 2019 with a right ofrenewal for a further term of 15 years.Palmerston North City Council Annual Report 2011/12173