Philips 2005 Annual Report Download - page 207

Philips Annual Report 2005 207
The following amounts of long-term debt as of December 31, 2005 are
dueinthenextveyears:
2006 578
2007 130
2008 1,768
2009 69
2010 158
2,703
Corresponding amount of previous year 2,996
The following table provides additional details regarding the
outstanding bonds.
December 31,
Effective
Rate 2004 2005
Unsecured Eurobonds
Due 2/09/05; 8¼%¼% 8.458% 128 −
Due 4/20/05; 7¾%¾% 7.839% 123 −
Due2/06/08;7⅛%⅛% 7.302% 130 130
Due 5/14/08; 7% 7.094% 61 61
Due 5/16/08; 5¾%¾% 5.817% 1,500 1,500
Due5/16/11;6⅛%⅛% 6.212% 750 750
Adjustments1) 9 6
2,701 2,447
Unsecured USD Bonds
Due 5/15/25; 7¾%¾% 8.010% 73 84
Due 8/15/13; 7¼%¼% 7.554% 105 121
Due9/15/06;8⅜%⅜% 8.739% 197 226
Adjustments1) (1) (2)
374 429
Unsecured USD Bonds subject to put
Due5/15/25,putdate5/15/07;7⅛%⅛% 7.361% 75 87
Due 6/01/26, put date 6/01/06; 71/5% 7.426% 122 140
Adjustments1) (2) (3)
195 224
1) Ad�ustments relate to issued bond discount, transaction costs and fair value
ad�ustments for interest rate derivatives.
As of December 31, 2005, Philips had outstanding public bonds of
EUR 3,100 million previously issued mostly in USD or EUR. Two of
the USD bonds are ‘putable’ bonds. A USD 175 million bond issued
(USD 103 million outstanding as of year-end 2005) at 7.125%, due 2025,
carries an option of each holder on May 15, 2007 to put the bond to
the Company upon notice given to Philips between March 15 and April
15, 2007, and a USD 300 million bond issued (USD 166 million
outstanding as of year-end 2005) at 7.20%, due 2026, carries an option
of each holder on June 1, 2006 to put the bond to the Company upon
notice given to Philips between April 1 and May 1, 2006.
In the case of put exercise by investors, the redemption price would be
equal to the principal amount, plus accrued interest until the date of
redemption. Assuming that investors repay at the relevant put dates, the
average remaining tenor of the total outstanding long-term debt at the
end of 2005 was 3.8 years, compared to 4.4 years in 2004. However,
assuming that the ‘putable’ bonds will be repaid at maturity, the average
remaining tenor at the end of 2005 was 5.0 years, compared to 5.4 years
at the end of 2004.
Secured liabilities
Certain portions of long-term and short-term debt have been secured
by collateral as follows:
amount of
the debt collateral
property,
plant and
equipment
other
assets
Institutionalnancing 152 425 190
Other debts 3 3 −
155 428 190
Previous year 242 518 93
Philips currently has a USD 400 million syndicated credit facility in Singapore,
comprising a USD 200 million term loan, of which USD 170 million
(EUR 143 million) was outstanding as at 31 December 2005, and a USD
200 million revolving credit facility which was undrawn as at 31 December
2005. For this facility, EUR 425 million of property, plant and equipment
and EUR 154 million of other assets have been provided as security.
58
Other non-current liabilities
Other non-current liabilities are summarized as follows:
2004 2005
Accrued pension costs 573 689
Income tax payable 74 59
Asset retirement obligations 28 22
Liabilities arising from guarantees 4 47
Liabilities for restructuring costs −16
Liabilities for employee stock-options of subsidiaries −87
Other liabilities 100 148
779 1,068
59
Leases
Capital Leases
Property, plant and equipment includes EUR 122 million (2004: EUR 114
million)forcapitalleasesandotherbenecialrightsofuse,suchas
buildingrightsandhirepurchaseagreements.Thenancialobligations
arisingfromthesecontractualagreementsarereectedinlong-termdebt.
Operating leases
Long-term operating lease commitments totaled EUR 937 million in
2005 (2004: EUR 723 million). These leases expire at various dates
during the next 20 years. The future payments that fall due in
connection with these obligations are as follows:
2006 163
2007 140
2008 124
2009 106
2010 89
Later 315
5858
5959
benetobligationsasofDecember31wereasfollows:
−
− −
− −
−
−
−
nancing,thetotaloutstandingamountsareclassiedascurrentportion
5656
57