Alcoa 1997 Annual Report Download - page 45

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G. Lon g-Te r m De b t
Decem b er 31 19 9 7 19 9 6
U. S.
5.75% Note s p ayable, du e 2001 $ 248 .8 $ 248.4
Com m ercia l pape r, var iable rat e,
(5.4% average rat e) — 173.6
Ba n k loa n s, 7.5 b illion yen , d ue 1999,
(4.4% fixed rate) 78.0 78.0
Ta x-exem p t reven ue b on d s r an gin g fr om
3.5% t o 6.6%, d u e 20 0 0 –2 012 130.5 131.1
Alcoa Fujiku ra Ltd .—va r iable-rat e te r m
loa n , du e 1998 –2002 (6.1% ave ra ge r ate) 25 0.0 262.5
Alcoa Alu m in io
7.5% Fixe d-r at e n ot e, du e 2008 3 95 .2 400 .0
Va r iable -rat e n ot e s, du e 1998 –2001
(6.9% a n d 7.3% a ve r a ge r a t e s) 97.3 208.2
Alcoa of Au st ralia
Eu r o-com m e rcia l p ap e r, va r iable rat e,
(5.7% an d 5.5% aver age r ates) 225.3 131.0
Ot h er su b sid ia r ie s 1 79 .3 235.5
1,604.4 1,868.3
Les s: am ou n t du e w ith in on e ye ar 14 7.2 178.5
$1,457.2 $1,689.8
Th e a m ou n t of lon g-t er m debt m at u r in g in each of t h e n ext five
years is $147.2in 1998,$133.8in 1999,$82.5in 2000,$347.5in 2001
a n d $347.4 in 2002.
In 1997, Alco a Fu jik u r a is su e d a $250 t e r m lo a n a n d e n t e re d
in to a five -yea r, $250 revolvin g-cr ed it agre em e nt . Th e p roce ed s of
t h e t er m loa n w er e u s ed t o r ep ay ex ist in g de bt . T he se a gr eem e nt s
r equ ire Alco a Fujiku ra t o m a in t a in ce r t a in fi na n c ia l r at ios.
In 1996, Alcoa Alu m in io is su e d $400 of exp or t n ot es. T h e a gree-
m e nt requ ire s Alu m in io to m a in ta in cer ta in fin an cia l rat ios.
Un de r Alcoa’s $1.3 b illion r evolv in g-c re d it facilit y, wh ich e xp ir es
in Ju ly 2001, cer t ain levels of con solidated net wor th m u st be
m a in t ain e d wh ile com m e rcia l p ap e r ba la nce s a re ou t st an d in g.
Th e com m ercial p ap er issu ed by Alcoa a n d th e Eu ro-com m ercial
p ap er issu ed by Alcoa of Au st ra lia ar e cla ssified a s lon g-t er m debt
sin ce t h ey a re backe d by t h e r evolvin g-cr ed it facilit y n o t e d a b ove .
H. Min o r it y In t e re s t s
Th e follow in g t able su m m a r ize s t h e m in or it y sh a reh old er s’ in te rest s
in t he equ it y of con solidated subs idiar ies.
Decem b er 31 19 9 7 19 9 6
Alcoa of Au st ralia $ 39 0.7 $ 572.7
Alcoa Alu m in io 3 87 .7 362.5
Alcoa Alu m in a an d Ch em ica ls 320.9 376.7
Alcoa Fujiku ra 182.7 128.6
Ot h er m a jor it y-ow n e d com p a n ie s 15 7.7 17 0.0
$1,439.7 $1,610.5
I. Acq u is it ion s
Alco a m a d e va r iou s a cqu is it ion s du r ing 1996 tot alin g $302. They
in clu de t h e pu rch a se of Alu m ix , It aly ’s st at e-ow n e d in tegrat ed
a lu m in u m p rodu ce r, a n d Alca n’s e xt r u s ion op erat ion s in Bra zil .
In 1995, acqu is it ion s tot aled $426, wh ich resu lte d in goodw ill of
ap p r ox im a tely $250.
All of t h e a cqu isit ion s we re accou n ted for by t he pu rch a se
m et h od . Accord in gly, t h e pu rch a se p r ice s we re a llocat ed t o a ss et s
acqu ired an d liabilit ies a ssu m ed b as ed on t heir est im ated fa ir
va lu e s. Op e rat in g r esu lt s h ave be en in clu de d in t h e St at em e nt of
Con s olidat ed In com e s in ce t h e dat es of t h e acqu isit ion s. If t h e
acqu isit ion s had been m a de a t t h e b e gin n in g of t h e ye a r, n e t in com e
for t h e year wou ld n ot h ave been m ate r ia lly differen t .
J. Ca s h Flo w In for m a t io n
Ca sh p ay m e nt s for in te re st a n d in com e t a xe s follow.
19 9 7 19 9 6 19 9 5
In t e re st $145.9 $136.4 $123.4
In com e t a xe s 34 2.5 265.8 508.3
Th e det ails of ca sh p aym e nt s related to acqu isit ion s follow.
19 9 7 19 9 6 19 9 5
Fa ir va lue of a s set s — $365.2 $509.5
Liab ilit ies — 62.4 79.8
Ca sh p a id — 302.8 429.7
Les s: cash acqu ired — .5 3.6
Net ca sh pa id for acqu isit ion s — $302.3 $426.1
K. Ea rn in gs Pe r Sh a re
Basic ea r n ings per com m on sh are
(EPS) a m o u n t s a r e com p u t ed b y
d iv idin g e ar n in gs a ft er t h e de du ct ion of p refe r r ed st ock d ivide n d s
by t h e avera ge n u m b e r of com m on sh a r es ou t st a n d in g. Dilu te d
EPS
a m ou n t s a s su m e t h e is su a n ce of co m m on st o ck fo r a ll p ot e nt ia lly
dilu t ive e qu ivale nt s ou t sta nd in g. Se e Note O for add it iona lin for m at ion .
Th e d et a ils of ba sic a n d d ilu te d ea r n in gs p er com m on sh a r e
follow.
19 9 7 19 9 6 19 9 5
Ne t in com e $805 .1 $514.9 $790.5
Le ss: p refe r re d st ock d ivid en d s 2 .1 2.1 2.1
In com e ava ila ble t o com m on
stockholders $80 3.0 $512.8 $788.4
Weigh te d aver age sh ar es ou t st an d in g 17 2,2 25 ,7 96 174,333,524 178,018,083
Ba s ic
EPS $ 4.66 $ 2.94 $ 4.43
Effect of d ilut ive s ecu r it ies:
Sh a res is su able up on exercise
of d ilu t ive ou t st an d in g
st ock op t ion s 1,63 3,92 5 1,846,215 1,642,922
Fu lly d ilu te d sh a re s ou tst a nd in g 1 73 ,8 59 ,7 21 176,179,739 179,661,005
Dilute d
EPS $ 4.62 $ 2.91 $ 4.39
L. Lea s e Ex p e n s e
Ce r t a in e qu ip m en t , w ar eh ou s in g a n d office sp ace a n d o ce an goin g
ve s sels ar e u n de r op e rat in g lea s e ag re em e n t s. Tot a l e xp e n se fo r
a ll lea s e s w a s $110.9 in 1997, $95.4 in 1996 a n d $71 .9 in 1995. Un d e r
lon g-te r m op erat in g lea ses, m in im u m an n u al r en t als ar e $62.1
in 1998, $46.1 in 1999, $31.4 in 2000, $21.0 in 2001, $10.1 in 2002 a n d
a tot al of $27.2 for 2003 an d th er eaft er.