Note 16: Commitments
Lease Commitments
HP leases certain real and personal property under non-cancelable operating leases. Certain leases require HP to pay property taxes, insurance and routine maintenance and include renewal options and escalation clauses. Rent expense was $1.0 billion in fiscal 2013, 2012 and 2011. Sublease rental income was $30 million in fiscal 2013, $37 million in fiscal 2012 and $38 million in fiscal 2011.
Property under capital lease comprised primarily of equipment and furniture, which was $437 million and $482 million as of October 31, 2013 and October 31, 2012, respectively, and was included in property, plant and equipment in the Consolidated Balance Sheets. Accumulated depreciation on the property under capital lease was $404 million and $418 million as of October 31, 2013 and October 31, 2012, respectively. The related depreciation is included in depreciation expense.
Future annual lease commitments and sublease rental income as of October 31, 2013 were as follows:
| |
2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| |
In millions |
|||||||||||||||||||||
|
Operating lease commitments |
$ | 763 | $ | 605 | $ | 435 | $ | 275 | $ | 180 | $ | 735 | $ | 2,993 | ||||||||
|
Less: Sublease rental income |
(35 | ) | (24 | ) | (12 | ) | (5 | ) | (5 | ) | (12 | ) | (93 | ) | ||||||||
|
|
$ | 728 | $ | 581 | $ | 423 | $ | 270 | $ | 175 | $ | 723 | $ | 2,900 | ||||||||
|
Capital lease commitments |
$ | 229 | $ | 20 | $ | 7 | $ | 4 | $ | 4 | $ | 25 | $ | 289 | ||||||||
|
Less: Interest payments |
(5 | ) | (3 | ) | (2 | ) | (2 | ) | (2 | ) | (6 | ) | (20 | ) | ||||||||
|
|
$ | 224 | $ | 17 | $ | 5 | $ | 2 | $ | 2 | $ | 19 | $ | 269 | ||||||||
Unconditional Purchase Obligations
At October 31, 2013, HP had unconditional purchase obligations of approximately $2.2 billion. These unconditional purchase obligations include agreements to purchase goods or services that are enforceable and legally binding on HP and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum or variable price provisions and the approximate timing of the transaction. Unconditional purchase obligations exclude agreements that are cancelable without penalty. These unconditional purchase obligations are related principally to inventory and other items. Future unconditional purchase obligations at October 31, 2013 were as follows:
| |
2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| |
In millions |
|
||||||||||||||||||||
|
Unconditional purchase obligations |
$ | 1,191 | $ | 510 | $ | 196 | $ | 141 | $ | 128 | $ | — | $ | 2,166 | ||||||||