19) Aircraft and reserve engines


 

in €m

Aircraft and reserve engines

Advance payments for aircraft and reserve engines

Total

*

Rounded below EUR 1m

Cost as of 1.1.2010

19,973

1,282

21,255

Accumulated depreciation

–10,811

–10,811

Carrying amount 1.1.2010

9,162

1,282

10,444

 

 

 

 

Currency translation differences

271

42

313

Additions due to changes in consolidation

0*

0*

Additions

1,434

561

1,995

Reclassifications

731

–726

5

Disposals due to changes in consolidation

Disposals

–53

–6

–59

Reclassifications to assets held for sale

–187

–187

Depreciation

–1,358

–1,358

Reversal of impairment losses

Carrying amount 31.12.2010

10,000

1,153

11,153

Cost as of 1.1.2011

21,699

1,153

22,852

Accumulated depreciation

–11,699

–11,699

Carrying amount 1.1.2011

10,000

1,153

11,153

 

 

 

 

Currency translation differences

62

16

78

Additions due to changes in consolidation

Additions

1,215

830

2,045

Reclassifications

652

–654

–2

Disposals due to changes in consolidation

Disposals

–42

–1

–43

Reclassifications to assets held for sale

–198

–198

Depreciation

–1,444

–1,444

Reversal of impairment losses

3

3

Carrying amount 31.12.2011

10,248

1,344

11,592

Cost as of 31.12.2011

22,486

1,344

23,830

Accumulated depreciation

–12,238

–12,238

The item aircraft includes 16 aircraft (13 Boeing MD-11Fs and 3 Boeing B747-400s) at a carrying amount of EUR 265m (previous year: EUR 336m), which are the subject of transactions aimed at realising present value benefits from cross-border leasing constructions. These transactions generally involve entering into a 40 to 50 year head lease agreement with a lessee in the Bermudas. The leasing instalments paid by the lessee are transferred to the lessor in a single amount. At the same time, the lessor concludes a sub-lease agreement with a shorter duration (14 –16 years) with the lessee and pays the leasing obligations on this agreement in a single amount to a bank for the benefit of the lessee.

Following the transaction, the risks and rewards associated with the aircraft and legal ownership of it remain with the Lufthansa Group, so under SIC 27 the aircraft are treated not as leased assets within the meaning of IAS 17, but in the same way as they would be without the transaction.

The transaction does entail some operating constraints, as the aircraft may not be primarily deployed in American airspace.

The present value benefit derived from the transaction is recognised through profit or loss pro rata temporis over the duration of the sub-lease agreement. In 2011, as in the previous year, EUR 7m was recognised in other operating income.

The item also includes 47 aircraft carried at EUR 1,308m (previous year: 56 aircraft carried at EUR 1,728m), which have been sold and leased back to Japanese and British leasing companies, to leasing companies in the Bermudas and to a Swedish bank with the aim of obtaining favourable financing terms. The duration of these leasing agreements is between 10 and 26 years. The Group is entitled to buy the aircraft back at a fixed price at a given point in time.

As the risks and rewards associated with these aircraft remain with the Lufthansa Group, they are also not treated as leased assets under SIC 27.

Operating constraints apply to two of these aircraft financed via leasing companies in the Bermudas. They may not be primarily deployed in American airspace.

Order commitments for aircraft and reserve engines amount to EUR 7.6bn (previous year: EUR 6.8bn).

Within this item aircraft held at EUR 2,807m (previous year: EUR 3,245m) serve as collateral for current financing arrangements and aircraft held at EUR 293m (previous year: EUR 342m) were also acquired under finance leases, see “Note 22”.