Costco 2002 Annual Report Download - page 34

Download and view the complete annual report

Please find page 34 of the 2002 Costco 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 47

  • 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

Note 2—Debt
Bank Lines of Credit and Commercial Paper Programs
The Company has in place a $500,000 commercial paper program supported by a $400,000 bank credit
facility with a group of 10 banks, of which $200,000 expires on November 11, 2003 and $200,000 expires on
November 15, 2005. At September 1, 2002, no amounts were outstanding under the commercial paper program
and no amounts were outstanding under the loan facility. Covenants related to the credit facility place limitations
on total company indebtedness. As of September 1, 2002, the Company was in compliance with all restrictive
covenants.
In addition, a wholly owned Canadian subsidiary has a $128,000 commercial paper program supported by a
$51,000 bank credit facility with three Canadian banks, which expires in March, 2003. At September 1, 2002, no
amounts were outstanding under the bank credit facility or the Canadian commercial paper program.
The Company has agreed to limit the combined amount outstanding under the U.S. and Canadian commer-
cial paper programs to the $451,000 combined amounts of the respective supporting bank credit facilities.
The Company’s wholly-owned Japanese subsidiary has a short-term ¥4 billion bank line of credit, equal to
approximately $33,600, of which ¥1 billion ($8,400) expires in April 2003 and ¥3 billion ($25,200) expires in
November 2003. At September 1, 2002, $18,480 was outstanding under the line of credit with an applicable
interest rate of 1.375%.
The Company’s 80%-owned UK subsidiary has a £60 million ($93,048) bank revolving credit facility and a
£20 million ($31,016) bank overdraft facility, both expiring in February 2007. At September 1, 2002, $85,294
was outstanding under the revolving credit facility with an applicable interest rate of 4.413% and no balance was
outstanding under the bank overdraft facility.
Letters of Credit
The Company has separate letter of credit facilities (for commercial and standby letters of credit), totaling
approximately $373,000. The outstanding commitments under these facilities at September 1, 2002 totaled ap-
proximately $142,000 including approximately $32,000 in standby letters of credit.
33