Annual Report 1999 in PDF - Aer Lingus

AER LINGUS GROUP PLCNotes to the Consolidated Accounts (continued)22. Guarantees and Other Financial Commitments (continued)(b) Lease commitmentsAt 31 December, 1999 the Group had annual commitments under operating leases as set out below:Plant andProperty Aircraft Machinerye000 e000 e000Operating leases which expire:Within one year 2,710 21,500 132Between two and five years 759 46,700 42After five years 2,462 45,811 -5,931 114,011 174(c)Contingent liabilities(i)(ii)The Company has irrevocably guaranteed the liabilities as defined in Section 5(c) of the Companies(Amendment) Act, 1986 of the following subsidiary undertakings incorporated in Ireland: Aer Lingus Limited,Aer Lingus Shannon Limited, Aer Lingus Commuter Limited, Aer Lingus Investments Limited, Aer LingusFinancial Services Limited, Aberport Limited, Aviation Services (Ireland) Limited, Dirnan Ireland Limited, ShinaghLimited and SRS Aviation (Ireland) Limited.There are certain legal and other claims, which arise from the Group’s activities which the Directors consider willnot materially affect the financial position of the Group.(d)Treasury contractsDue to the scale of its international operations and the nature of its business, the Group is exposed to the effects offluctuations in exchange rates and interest rates. These exposures arise principally in relation to foreign currencydebt, anticipated revenues and expenditure commitments. In order to hedge against these exposures, the Grouphas entered into various treasury arrangements to change the currency exposure of certain debt and to fix interestrates and exchange rates. The principal commitments outstanding under treasury arrangements at 31 December,1999 are forward purchases of US Dollars 88 million (1998: US Dollars 162m) and forward sales ofSterling £107 million (1998: Sterling £93m).23. Related Party Transactions(a)(b)(c)Ownership of the Company95.24% of the issued share capital of the Company was held by the Minister for Finance on behalf of the IrishGovernment at the balance sheet date.Purchase of services from entities owned by the Irish GovernmentIn the ordinary course of its business the Group purchases services from entities controlled by the Irish Government(including Aer Rianta, Irish Aviation Authority and ESB). Purchases of services from these entities during the yearwere less than 5% of group operating costs.Deposits with the National Treasury Management Agency of Ireland and with financial institutionsowned by the Irish GovernmentIn the ordinary course of its business the Group deposits funds with the National Treasury Management Agency ofIreland and financial institutions owned by the Irish Government (ACC Bank and ICC Bank). At 31 December, 1999deposits with these entities amounted to e48 million.44