|
Notes to Consolidated Financial Statements
Note 10 - Short-Term Borrowings and Long-Term Debt
|
|
1998
|
.
|
1997
| |
|
|
|
|
Short-Term Borrowings
|
.
|
|
|
Commercial paper (5.3%)
|
$
|
1,901
|
.
|
$
|
-
|
|
|
Current maturities of long-term debt
|
1,075
|
.
|
1,819
| |
|
Notes (5.2% and 5.7%)
|
2,076
|
.
|
80
| |
|
Other borrowings (7.4% and 7.4%)
|
519
|
.
|
222
| |
|
Amount reclassified to long-term debt
|
(1,650
|
)
|
(2,212
|
)
|
|
|
|
|
|
$
|
3,921
|
.
|
$
|
-
|
|
|
|
|
|
|
|
|
Long-Term Debt
|
.
|
|
|
Short-term borrowings, reclassified
|
$
|
1,650
|
.
|
$
|
2,121
|
|
|
Notes due 1999-2013 (5/8% and 6.4%)
|
1,693
|
.
|
3,063
| |
|
Notes (5.2% and 5.7%)
|
2,076
|
.
|
80
| |
|
Various foreign currency debt, due
|
.
|
|
|
1999-2001 (5.3% and 5.2%)
|
956
|
.
|
809
| |
|
Zero coupon notes, $1.0 billion due
|
.
|
|
|
1999-2012 (10.1% and 10.5%)
|
504
|
.
|
480
| |
|
Other, due 1999-2014 (6.8% and 7.2%)
|
300
|
.
|
292
| |
|
|
|
|
|
5,103
|
.
|
6,765
| |
|
Less current maturities of long-term debt
|
(1,075
|
)
|
(1,819
|
)
|
|
|
|
|
|
$
|
4,028
|
.
|
$
|
4,946
| |
|
|
|
The interest rates in the above table include the effects of associated interest rate and currency swaps at year-end 1998 and 1997. Also, see Note 11 for a discussion of our use of interest rate and currency swaps, our management of the inherent credit risk and fair value information related to debt and interest rate and currency swaps.
Interest Rate Swaps
The following table indicates the notional amount and weighted average interest rates, by category, of interest rate swaps outstanding at year-end 1998 and 1997. The weighted average variable interest rates that we pay, which are primarily linked to either commercial paper or LIBOR rates, are based on rates as of the respective balance sheet date and are subject to change. The terms of the interest rate swaps match the terms of the debt they modify. The swaps terminate at various dates through 2013.
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|
1998
|
.
|
1997
|
|
|
|
|
|
Receive fixed-pay variable
|
.
|
|
|
|
Notional amount
|
$
|
1,855
|
.
|
$
|
2,584
|
|
|
|
Weighted average receive rate
|
6.1
|
%
|
6.8
|
%
|
|
|
Weighted average pay rate
|
5.3
|
%
|
5.8
|
%
|
|
Receive variable-pay variable
|
.
|
|
|
|
Notional amount
|
$
|
-
|
.
|
$
|
250
|
|
|
|
Weighted average receive rate
|
-
|
.
|
5.7
|
%
|
|
|
Weighted average pay rate
|
-
|
.
|
5.8
|
%
|
|
Receive variable-pay fixed
|
.
|
|
|
|
Notional amount
|
$
|
-
|
.
|
$
|
215
|
|
|
|
Weighted average receive rate
|
-
|
.
|
5.9
|
%
|
|
|
Weighted average pay rate
|
-
|
.
|
8.2
|
%
|
|
At year-end 1998, approximately 83% of total debt was exposed to variable interest rates, compared to 77% in 1997. In addition to variable rate long-term debt, all debt with maturities of less than one year is categorized as variable for purposes of this measure.
Currency Swaps
We enter into currency swaps to hedge our currency exposure on certain non-U.S. dollar denominated debt. At year-end 1998, the aggregate carrying amount of the debt was $678 million and the net receivables and payables under related currency swaps were $1 million and $70 million, respectively, resulting in a net effective U.S. dollar liability of $747 million with a weighted average interest rate of 5.3%, including the effects of related interest rate swaps. At year-end 1997, the carrying amount of this debt aggregated $629 million and the net payables under related currency swaps aggregated $104 million, resulting in an effective U.S. dollar liability of $733 million with a weighted average interest rate of 5.8%, including the effects of related interest rate swaps.
Revolving Credit Facilities
We increased our 1998 unused revolving credit facility by $2.0 billion to $4.75 billion from $2.75 billion at year-end 1997. These unused credit facilities exist largely to support the issuances of short-term borrowings and are available for general corporate purposes. The 1998 facilities are composed of $3.1 billion expiring March 1999 and $1.65 billion expiring March 2003.
Short-term borrowings of $1.65 billion at year-end 1998 and $2.1 billion at year-end 1997 were reclassified as long-term debt. This reflects our intent and ability, through the existence of the unused credit facilities, to refinance these borrowings.
Long-term debt outstanding at December 26, 1998 matures as follows during the next five years:
|
1999
|
2000
|
2001
|
2002
|
2003
|
|
|
Maturities
|
$
|
1,075
|
$
|
716
|
$
|
323
|
$
|
36
|
$
|
284
|
|
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