Archer Daniels Midland 2010 Annual Report Download - page 36

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32
Item 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Contractual Obligations and Off-Balance Sheet Arrangements
In the normal course of business, the Company enters into contracts and commitments which obligate the Company
to make payments in the future. The following table sets forth the Company‘s significant future obligations by time
period. Purchases include commodity-based contracts entered into in the normal course of business, which are
further described in Item 7A, ―Quantitative and Qualitative Disclosures About Market Risk,‖ energy-related
purchase contracts entered into in the normal course of business, and other purchase obligations related to the
Company‘s normal business activities. The following table does not include unrecognized income tax benefits of
$84 million as at June 30, 2010, due to uncertainty of the timing of deductibility. Where applicable, information
included in the Company‘s consolidated financial statements and notes is cross-referenced in this table.
Payments Due by Period
Contractual
Item 8
Note
Less
than
1 - 3
3 – 5
More
than
Obligations
Reference
Total
1 Year
Years
Years
5 Years
(In millions)
Purchases
Inventories
$ 9,949
$ 9,508
$ 417
$ 6
$ 18
Energy
498
284
137
31
46
Other
409
143
208
56
2
Total purchases
10,856
9,935
762
93
66
Short-term debt
374
374
–
–
–
Long-term debt
Note 8
7,174
344
428
1,076
5,326
Estimated interest payments
7,928
381
700
636
6,211
Operating leases
Note 13
1,381
235
371
333
442
Estimated pension and other
postretirement plan
contributions (1)
Note 14
150
45
17
21
67
Total
$27,863
$11,314
$2,278
$2,159
$12,112
(1) The Company is unable to estimate the amount of pension contributions beyond fiscal year 2011. For more information concerning the
Company‘s pension and other postretirement plans, see Note 14 in Item 8.
At June 30, 2010, the Company estimates it will spend approximately $1.5 billion through calendar year 2013 to
complete currently approved capital projects which are not included in the table above. The Company also has
outstanding letters of credit and surety bonds of $459 million at June 30, 2010.
In addition, the Company has entered into agreements, primarily debt guarantee agreements related to equity-
method investees, which could obligate the Company to make future payments. The Company‘s liability under
these agreements arises only if the primary entity fails to perform its contractual obligation. The Company has
collateral for a portion of these contingent obligations. At June 30, 2010, these contingent obligations totaled
approximately $131 million. Amounts outstanding for the primary entity under these contingent obligations were
$74 million at June 30, 2010.