Safeway 2000 Annual Report Download - page 24

Safeway Inc. and Subsidiaries
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Total debt, including obligations under capital leases,
decreased to $6.50 billion at year-end 2000 from $6.96
billion at year-end 1999 primarily because the Company
paid down debt with cash flows from operations. Total debt
increased from $4.97 billion at year-end 1998 primarily due
to the Randall’s and Carrs Acquisitions and the Safeway
stock repurchase. Annual debt maturities over the next five
years are set forth in Note C of the Company’s 2000 consol-
idated financial statements.
In January 2001, Safeway issued $600 million of 7.25%
senior unsecured debentures due in 2031. Proceeds from this
issuance were used to repay commercial paper borrowings and
finance the Genuardi’s Acquisition. Also, in February 2001,
the Company filed a shelf registration with the Securities and
Exchange Commission to sell, periodically, up to $2 billion
in debt securities and common stock.
Based upon the current level of operations, Safeway
believes that operating cash flow and other sources of liquid-
ity, including borrowings under Safeway’s commercial paper
program and bank credit agreement, will be adequate to
meet anticipated requirements for working capital, capital
expenditures, interest payments and scheduled principal pay-
ments for the foreseeable future. There can be no assurance,
however, that the Company’s business will continue to gen-
erate cash flow at or above current levels. The bank credit
agreement is used primarily as a backup facility to the
commercial paper program.
FORWARD-LOOKING STATEMENTS
This Annual Report contains certain forward-looking
statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Such statements relate to, among
other things, capital expenditures, acquisitions, operating
improvements and cost reductions, and are indicated by
words or phrases such as “continuing,” “on-going,” “expects,”
and similar words or phrases. The following are among the
principal factors that could cause actual results to differ
materially from the forward-looking statements: general
business and economic conditions in our operating regions,
including the rate of inflation, population, employment and
job growth in our markets; pricing pressures and competitive
factors, which could include pricing strategies, store openings
and remodels; results of our programs to control or reduce
costs; results of our programs to increase sales; results of our
programs to improve capital management; the ability to
integrate any companies we acquire and achieve operating
improvements at those companies; increases in labor costs
and relations with union bargaining units representing our
employees or employees of the third-party operators of
our distribution centers; opportunities or acquisitions that
we pursue; and the availability and terms of financing.
Consequently, actual events and results may vary significantly
from those included in or contemplated or implied by
such statements.