2017E — Page 148

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

27

OPERATING LEASE COMMITMENTS

At 31 December 2017, the total future minimum lease payments under non-cancellable operating leases are payable as follows:

Within 1 year

After 1 year but within 5 years

2017 HK$'000

2016

HK$'000

2,141

1,564

1,399

1,830

3,540

3,394

The Group leases a number of retail outlets and offices under operating leases. The leases typically run for an initial period of one to three years. Lease payments are usually fixed during the period of the leases. None of the leases includes contingent rentals.

28 CAPITAL COMMITMENTS

Capital commitments outstanding at 31 December 2017 not provided for in the financial statements were as follows:

29

Contracted for

Authorised but not contracted for

CONTINGENT LIABILITIES

Financial guarantees issued

At 31 December 2017, the Company has issued the following guarantees:

2017

HK$'000

2016 HK$'000

18,267

891

131,693

891

19,158

132,584

(a)

guarantees to certain suppliers in respect of granting or giving credit facilities to its wholly-owned subsidiaries; and

(b)

guarantees to banks in respect of banking facilities granted to its wholly-owned subsidiaries and a joint venture.

Under the guarantees, the Company is liable to the amount due from the subsidiaries and the joint venture to these respective parties in the event of any default and its liability shall at no time exceed the sum stated on the letters of guarantee.

At the end of the reporting period, the directors do not consider it probable that a claim will be made against the Company under any of the guarantees. The maximum liability of the Company at the end of the reporting period under the guarantees issued above is the outstanding amount due to the relevant parties by its wholly-owned subsidiaries and the joint venture, being HK$90,000 (2016: HK$110,000).

The Company has not recognised any deferred income in respect of the guarantees issued as its fair value cannot be reliably measured using observable market data and its transaction price was HK$Nil.

146

Hong Kong Ferry (Holdings) Company Limited

Annual Report 2017