Medtronic 2013 Annual Report Download - page 66

Download and view the complete annual report

Please find page 66 of the 2013 Medtronic annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 145

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145

75732me_10K.indd 51 6/25/13 6:39 PM
Table of Contents
Maturity by Fiscal Year
(in millions)
Contractual obligations related to
off-balance sheet arrangements:
Operating leases(1)
Inventory purchases(2)
Commitments to fund minority
investments/contingent acquisition
consideration(3)
$
Total
294
139
307
$
2014
104
97
16
$
2015
74
26
100
$
2016
48
10
13
$
2017
27
—
100
$
2018
14
—
—
Thereafter
$ 27
6
78
Interest payments(4)
Other(5)
4,189
144
367
80
342
37
290
5
277
2
263
1
2,650
19
Total $ 5,073 $ 664 $ 579 $ 366 $ 406 $ 278 $ 2,780
Contractual obligations reflected in
the balance sheet:
Long-term debt, including current
portion(6) $ 9,925 $ 550 $ 1,250 $ 1,100 $ — $ 1,000 $ 6,025
Capital leases 164 13 13 12 30 18 78
Total $ 10,089 $ 563 $ 1,263 $ 1,112 $ 30 $ 1,018 $ 6,103
(1) Certain leases require us to pay real estate taxes, insurance, maintenance, and other operating expenses associated with
the leased premises. These future costs are not included in the schedule above.
(2) We have included inventory purchase commitments which are legally binding and specify minimum purchase quantities.
These purchase commitments do not exceed our projected requirements and are in the normal course of business. These
commitments do not include open purchase orders.
(3) Certain commitments related to the funding of cost or equity method investments and/or previous acquisitions are
contingent upon the achievement of certain product-related milestones and various other favorable operational conditions.
While it is not certain if and/or when these payments will be made, the maturity dates included in this table reflect our
best estimates.
(4) Interest payments in the table above reflect the contractual interest payments on our outstanding debt, and exclude the
impact of the debt discount amortization and impact of interest rate swap agreements. See Note 8 to the consolidated
financial statements in “Item 8. Financial Statements and Supplementary Data” in this Annual Report on Form 10-K for
additional information regarding our debt agreements.
(5) These obligations include certain research and development arrangements.
(6) Long-term debt in the table above includes the $3.000 billion of 2013 Senior Notes, $1.075 billion of 2012 Senior Notes,
$1.000 billion of 2011 Senior Notes, $3.000 billion of 2010 Senior Notes, $1.250 billion of 2009 Senior Notes, $600
million of 2005 Senior Notes, and certain bank borrowings. The table above excludes the debt discount, the fair value
impact of outstanding interest rate swap agreements, and the unamortized gains from terminated interest rate swap
agreements. See Notes 8 and 9 to the consolidated financial statements in “Item 8. Financial Statements and Supplementary
Data” in this Annual Report on Form 10-K for additional information regarding the interest rate swap agreements.
Debt and Capital
Our capital structure consists of equity and interest-bearing debt. Interest-bearing debt as a percentage of total interest-bearing
debt and equity was 36 percent as of April 26, 2013 and 38 percent as of April 27, 2012.
As part of our focus on returning value to our shareholders, shares are repurchased from time to time. In June 2011, our Board of
Directors authorized the repurchase of 75 million shares of our common stock. During fiscal years 2013 and 2012, we repurchased
approximately 31.2 million and 37.3 million shares at an average price of $39.97 and $38.64, respectively. As of April 26, 2013,
we had approximately 27.2 million shares remaining under the June 2011 repurchase program. In June 2013, our Board of Directors
authorized the repurchase of an additional 80 million shares of our common stock.
We use a combination of bank borrowings and commercial paper issuances to fund our short-term financing needs. Short-term
debt, including the current portion of our long-term debt and capital lease obligations, as of April 26, 2013, was $910 million
compared to $3.274 billion as of April 27, 2012. We utilize a combination of Senior Convertible Notes and Senior Notes to meet
our long-term financing needs. Long-term debt as of April 26, 2013 was $9.741 billion compared to $7.359 billion as of April 27,
2012. In April 2013, we repaid the remaining Senior Convertible Notes.
48