Alaska Airlines and Horizon Air 2013 Annual Report Download - page 156

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Fixed-rate debt that is not carried at fair value on
the consolidated balance sheet and the
estimated fair value of long-term fixed-rate debt
as of December 31 (in millions):
2013 2012
Carrying Amount ...................... $703 $844
Fair value ........................... 762 915
NOTE 6. LONG-TERM DEBT
Long-term debt obligations were as follows at
December 31 (in millions):
2013 2012
Fixed-rate notes payable due through
2024 ........................... $703 $ 844
Variable-rate notes payable due through
2023 ........................... 168 188
Long-term debt ..................... 871 1,032
Less current portion ................. 117 161
$754 $ 871
Weighted-average fixed-interest rate ..... 5.7% 5.8%
Weighted-average variable-interest rate . . . 1.7% 2.0%
All of the Company’s borrowings are secured by
aircraft.
During 2013, the Company made debt payments
of $161 million. As of December 31, 2013, none
of the Company's borrowings were restricted by
financial covenants.
At December 31, 2013, long-term debt principal
payments for the next five years and thereafter
are as follows (in millions):
Total
2014 .................................... $117
2015 .................................... 113
2016 .................................... 111
2017 .................................... 116
2018 .................................... 147
Thereafter ................................ 267
Total principal payments ..................... $871
Bank Line of Credit
The Company has two $100 million credit
facilities. Both facilities have variable interest
rates based on LIBOR plus a specified margin.
Borrowings on one of the $100 million facilities
are secured by aircraft. Borrowings on the other
$100 million facility are secured by certain
accounts receivable, spare engines, spare parts
and ground service equipment. The Company
modified the first facility in 2012 by extending
the term from March 2013 to August 2015 and
the second facility in 2013 by extending the term
from March 2016 to March 2017, and reduced
the commitment fee for both facilities. The
Company has no immediate plans to borrow
using either of these facilities. These facilities
have a requirement to maintain a minimum
unrestricted cash and marketable securities
balance of $500 million. The Company was in
compliance with this covenant at December 31,
2013.
NOTE 7. INCOME TAXES
Deferred Income Taxes
Deferred income taxes reflect the impact of
temporary differences between the carrying
amounts of assets and liabilities for financial
reporting purposes and such amounts for tax
purposes. Primarily due to differences in
depreciation rates for federal income tax
purposes and for financial reporting purposes,
the Company has generated a net deferred tax
liability.
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