Target 2015 Annual Report Download - page 56

Download and view the complete annual report

Please find page 56 of the 2015 Target 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 84

  • 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

Required€Principal€Payments
(millions) 2016 2017 2018 2019 2020
Total required principal payments $751 $2,251 $201 $1,001 $1,094
In June 2014, we issued $1 billion of unsecured fixed rate debt at 2.3 percent that matures in June 2019 and $1 billion
of unsecured fixed rate debt at 3.5 percent that matures in July 2024. We used proceeds from these issuances to
repurchase $725 million of debt before its maturity at a market value of $1 billion, and for general corporate purposes
including the payment of $1 billion of debt maturities. We recognized a loss of $285 million on the early retirement,
which was recorded in net interest expense in our Consolidated Statements of Operations.
We periodically obtain short-term financing under our commercial paper program, a form of notes payable.
Commercial Paper
(dollars in millions) 2015 2014 2013
Maximum€daily€amount€outstanding€during€the€year $—$590 $1,465
Average amount outstanding during the year — 129 408
Amount outstanding at year-end — — 80
Weighted average interest rate —%0.11%0.13%
No balances were outstanding at any time during 2015 or 2014 under our $2.25 billion revolving credit facility that
expires in October 2018.
Substantially all of our outstanding borrowings are senior, unsecured obligations. Most of our long-term debt obligations
contain covenants related to secured debt levels. In addition to a secured debt level covenant, our credit facility also
contains a debt leverage covenant. We are, and expect to remain, in compliance with these covenants, which have
no practical effect on our ability to pay dividends.
21. Derivative Financial Instruments
Our derivative instruments primarily consist of interest rate swaps, which are used to mitigate interest rate risk. As a
result of our use of derivative instruments, we have counterparty credit exposure to large global financial institutions.
We monitor this concentration of counterparty credit risk on an ongoing basis. See Note€10 for a description of the fair
value measurement of our derivative instruments and their classification on the Consolidated Statements of Financial
Position.
As of January 30, 2016 and January 31, 2015, three interest rate swaps with notional amounts totaling $1,250 million
were designated as fair value hedges. No ineffectiveness was recognized in 2015 or 2014.
Outstanding€Interest€Rate€Swap€Summary January 30, 2016
Designated De-Designated
(dollars in millions) Pay Floating Pay Floating Pay Fixed
Weighted average rate:
Pay (a) 1-month LIBOR 3.8%
Receive 1.7%5.7%1-month LIBOR
Weighted average maturity 3.1 years 0.5 years 0.5 years
Notional $1,250 $500 $500
(a) There are three designated swaps at January 30, 2016. Two swaps have floating pay rates equal to 3-month LIBOR and one swap
has a floating pay rate equal to 1-month LIBOR.
51