Obligations under finance leases and hire purchase contracts
The Group uses finance leases and hire purchase contracts to acquire plant and machinery. These leases have terms of renewal and purchase options but no escalation clauses. Renewals are at the option of the lessee.
The value of future minimum lease payments and their present value, which are the same, is analysed as follows:
| |
2006
£m |
2005
£m |
| Not later than 1 year |
0.2 |
0.2 |
| Later than 1 year but not later than 5 years |
0.3 |
– |
| |
0.5 |
0.2 |
Operating lease agreements where the Group is lessee
The Group has entered into commercial leases on certain properties, motor vehicles and items of plant and machinery. These leases have an average duration of between 3 and 10 years.
Future minimum rentals payable under non-cancellable operating leases are as follows:
| |
2006
£m |
2005
£m |
| Not later than 1 year |
53.7 |
50.5 |
| Later than 1 year but not later than 5 years |
113.3 |
120.3 |
| Later than 5 years |
57.7 |
68.3 |
| |
224.7 |
239.1 |
Operating lease agreements where the Group is lessor
The Group has determined that certain executory contracts contain embedded leases as defined by IFRIC 4 'Determining whether an Arrangement contains a Lease'. Accordingly, these are accounted for as leases in accordance with IAS 17 'Leases'.
Future minimum rentals receivable under these embedded operating leases are as follows:
| |
2006
£m |
2005
£m |
| Not later than 1 year |
18.1 |
18.1 |
| Later than 1 year but not later than 5 years |
1.5 |
19.6 |
| |
19.6 |
37.7 |