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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
covenants related to interest coverage, funded debt to cash flow,
and limitations on subsidiary indebtedness. Our borrowings under
this facility, which have not been guaranteed by any of our sub-
sidiaries, are unsecured and will rank on parity in right of payment
with all of our other unsecured and unsubordinated indebtedness
from time to time outstanding. At December 31, 2002, $11.8 mil-
lion of the revolving credit facility’s outstanding balance was
denominated in a foreign currency. This foreign denominated
obligation is used to hedge the impact of foreign exchange rate
fluctuations related to inter-company advances with one of our
foreign subsidiaries.
Scheduled maturities of long-term debt during the five years
subsequent to December 31, 2002, are as follows:
(In millions) Amount
2003 $201.3
2004 23.8
2005 249.6
2006 –
2007 249.8
Our short-term borrowings at December 31, 2002 and 2001,
totaled $32.6 million and $58.1 million, respectively, and consisted
primarily of notes payable to banks. These notes had a weighted-
average interest rate of 3.24% at December 31, 2002 and 3.30%
at December 31, 2001. In October 2001, one of our Canadian sub-
sidiaries entered into a C$100.0 million loan, renewable annually,
with a bank. The loan agreement provides interest rate options
tied to Prime, Base Rate, LIBOR, and Canadian Banker’s Accept-
ances, and contains financial covenants related to interest cov-
erage, funded debt to cash flow, and limitations on subsidiary
indebtedness. Our subsidiary’s borrowings under this facility,
which we have guaranteed, are unsecured. Borrowings under this
loan (which are included in the short-term borrowings totals
above) at December 31, 2002 and 2001 were $29.3 million and
$47.7 million, respectively.
7.
INCOME TAXES
We record deferred income taxes using enacted tax laws and rates
for the years in which the taxes are expected to be paid. Deferred
income tax assets and liabilities are recorded based on the differ-
ences between the financial reporting and income tax bases of
assets and liabilities.
The provision for income taxes from continuing operations consists
of the following:
(In millions) 2002 2001 2000
Current:
Federal $71.9 $65.7 $ 60.6
State 10.0 8.4 2.9
Foreign 20.6 5.7 25.6
102.5 79.8 89.1
Deferred:
Federal 23.3 5.7 10.8
State (1.9) (2.5) 2.2
Foreign (0.3) 2.3 6.2
21.1 5.5 19.2
$123.6 $85.3 $108.3
Domestic and foreign income from continuing operations before
income taxes was as follows:
(In millions) 2002 2001 2000
United States $264.5 $197.6 $216.3
Foreign 50.4 5.0 33.1
$314.9 $202.6 $249.4
The provision for income taxes from continuing operations is rec-
onciled with the federal statutory rate, as follows:
(In millions) 2002 2001 2000
Federal statutory rate 35.0% 35.0% 35.0%
Provision computed at federal
statutory rate $110.2 $70.9 $ 87.3
State and local taxes, net of
federal tax benefit 5.0 3.8 3.3
Nondeductible goodwill (including
amounts related to divestitures) –6.7 8.8
Foreign (8.8) 1.3 4.0
Valuation allowance 21.1 ––
Other (3.9) 2.6 4.9
$123.6 $85.3 $108.3
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