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PARTII
ITEM8Financial Statements and Supplementary Data
In June 2015, Sysco repaid 0.55% senior notes totaling $300.0 million at maturity utilizing a combination of cash ow from operations and cash on hand.
In October 2014, Sysco issued senior notes and terminated a previously outstanding unsecured bridge facility that was established in December 2013 as a
potential nancing mechanism for funding the proposed US Foods merger until longer-term funding could be obtained. The senior notes, issued under the
company’s previous February 2012 registration statement, were unsecured, were not subject to any sinking fund requirement and included a redemption
provision that allowed Sysco to retire the notes at any time prior to maturity at the greater of par plus accrued interest or an amount designed to ensure
that the note holders are not penalized by early redemption. These senior notes contained mandatory redemption features providing that, on the earlier of
the merger agreement termination date or October 8, 2015, Sysco was required to redeem all of the senior notes at a redemption price equal to 101% of
the principal of the senior notes plus accrued interest. In June 2015, we terminated the merger agreement, and we redeemed the senior notes in July2015
using cash on hand and the proceeds from borrowings under our commercial paper program. The senior notes were classi ed as current maturities of
long-term debt as of June 27, 2015. Details of the senior notes are below:
Maturity Date
Par Value
(in millions) Coupon Rate
Pricing
(percentage of par)
October 2, 2017 $ 500 1.45% 99.962%
October 2, 2019 750 2.35 99.864
October 2, 2021 750 3.00 99.781
October 2, 2024 1,250 3.50 99.616
October 2, 2034 750 4.35 99.841
October 2, 2044 1,000 4.50 98.992
Total Debt
Total debt as of June 27, 2015 was $7.3 billion, of which approximately 74% was at xed rates with a weighted average of 4.3% and an average life of
4.37 years, and the remainder was at oating rates with a weighted average of 2.9% and an average life of 0.84 years. Certain loan agreements contain
typical debt covenants to protect note holders, including provisions to maintain the company’s long-term debt to total capital ratio below a speci ed level.
Sysco is currently in compliance with all debt covenants.
Other
As of June 27, 2015 and June 28, 2014, letters of credit outstanding were $101.0 million and $45.7 million, respectively.
NOTE12 Leases
Sysco has obligations under capital and operating leases for certain distribution facilities, vehicles and computers. Total rental expense under operating
leases was $104.3 million, $92.3 million, and $84.4 million in scal 2015, 2014 and 2013, respectively. Contingent rentals, subleases and assets and
obligations under capital leases are not signi cant.
Aggregate minimum lease payments by scal year under existing long-term operating leases are as follows:
(Inthousands)
Amount
2016 $ 47,559
2017 38,183
2018 27,831
2019 20,320
2020 16,661
Thereafter 45,670
NOTE13 Other Long-Term Liabilities
The following table presents details of the company’s other long-term liabilities:
(Inthousands)
June 27, 2015 June 28, 2014
Retirement Plan $ 227,352 $ 270,189
Supplemental executive retirement plan 420,704 438,288
Other 286,666 319,401
TOTAL $ 934,722 $ 1,027,878