Safeway 2013 Annual Report Download - page 66
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Table of Contents
Mortgage Notes Payable Mortgage notes payable at year-end 2013 have remaining terms ranging from less than two years to eight years,
had a weighted-average interest rate during 2013 of 5.57% and are secured by properties with a net book value of approximately $89.6
million.
Other Notes Payable Other notes payable at year-end 2013 have remaining terms ranging from one year to 22 years and had a weighted
average interest rate of 6.73% during 2013.
Annual Debt Maturities As of year-end 2013, annual debt maturities (principal payments only) were as follows (in millions). Many of the
notes payable include make-whole provisions:
2014 $252.9
2015 442.2
2016 402.0
2017 501.9
2018 3.4
Thereafter 2,165.8
$3,768.2
Letters of Credit The Company had letters of credit of $44.7 million outstanding at year-end 2013, of which $43.4 million were issued
under the credit agreement. The letters of credit are maintained primarily to support performance, payment, deposit or surety obligations of
the Company. The Company pays commissions ranging from 0.15% to 1.10% on the face amount of the letters of credit.
Fair Value At year-end 2013 and year-end 2012, the estimated fair value of debt, including current maturities, was $3,949.7 million and
$5,408.2 million, respectively.
Safeway manages interest rate risk through the strategic use of fixed- and variable-interest rate debt and, from time to time, interest rate
swaps. The Company does not utilize financial instruments for trading or other speculative purposes, nor does it utilize leveraged financial
instruments. At year-end 2013, the Company had no interest rate swaps outstanding.
The accounting guidance for fair value measurements prioritizes the inputs used in measuring fair value into the following hierarchy:
Level 1
Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2
Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable;
Level 3
Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions
about the assumptions that market participants would use in pricing.
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