Estee Lauder 2010 Annual Report Download - page 130

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THE EST{E LAUDER COMPANIES INC. 129
of the issuance of the 5.75% Senior Notes, the Company
entered into a series of treasury lock agreements on a
notional amount totaling $195.0 million at a weighted
average all-in rate of 4.53%. The treasury lock agreements
were settled upon the issuance of the new debt and the
Company received a payment of $15.0 million that will be
amortized against interest expense over the life of the
2033 Senior Notes. As a result of the treasury lock agree-
ments, the debt discount and debt issuance costs, the
effective interest rate on the 2033 Senior Notes will be
5.395% over the life of the debt.
As of June 30, 2010, the Company had outstanding
$338.3 million of 2017 Senior Notes consisting of $300.0
million principal, an unamortized debt discount of $0.4
million, and a $38.7 million adjustment to reflect the fair
value of outstanding interest rate swaps. The 2017 Senior
Notes, when issued in May 2007, were priced at 99.845%
with a yield of 5.570%. Interest payments are required
to be made semi-annually on May 15 and November 15.
In April 2007, the Company entered into interest rate
swap agreements with a notional amount totaling $250.0
million to effectively convert the fixed rate interest on its
outstanding 2017 Senior Notes to variable interest rates
based on six-month LIBOR.
As of June 30, 2010, the Company had outstanding
$230.0 million of 2013 Senior Notes consisting of $230.1
As of June 30, 2010, the Company had outstanding
$296.3 million of 2037 Senior Notes consisting of $300.0
million principal and unamortized debt discount of $3.7
million. The 2037 Senior Notes, when issued in May 2007,
were priced at 98.722% with a yield of 6.093%. Interest
payments are required to be made semi-annually on
May 15 and November 15. In April 2007, in anticipation of
the issuance of the 2037 Senior Notes, the Company
entered into a series of forward-starting interest rate swap
agreements on a notional amount totaling $210.0 million
at a weighted average all-in rate of 5.45%. The forward-
starting interest rate swap agreements were settled upon
the issuance of the new debt and the Company recog-
nized a loss in other comprehensive income of $0.9
million that will be amortized to interest expense over the
life of the 2037 Senior Notes. As a result of the forward-
starting interest rate swap agreements, the debt discount
and debt issuance costs, the effective in
terest rate on the
2037 Senior Notes will be 6.181% over the life of the debt.
As of June 30, 2010, the Company had outstanding
$197.6 million of 2033 Senior Notes consisting of $200.0
million principal and unamortized debt discount of $2.4
million. The 2033 Senior Notes, when issued in September
2003, were priced at 98.645% with a yield of 5.846%.
Interest payments are required to be made semi-annually
on April 15 and October 15. In May 2003, in anticipation
NOTE 10
—
DEBT
The Company’s short-term and long-term debt and available financing consist of the following:
Available financing
Debt at June 30 at June 30, 2010
2010 2009 Committed Uncommitted
($ in millions)
6.00% Senior Notes, due May 15, 2037 (“2037 Senior Notes”)
$ 296.3 $ 296.3 $— $—
5.75% Senior Notes, due October 15, 2033 (“2033 Senior Notes”)
197.6 197.5 — —
5.55% Senior Notes, due May 15, 2017 (“2017 Senior Notes”)
338.3 324.1 — —
7.75% Senior Notes, due November 1, 2013 (“2013 Senior Notes”)
230.0 299.8 — —
6.00% Senior Notes, due January 15, 2012 (“2012 Senior Notes”)
118.3 244.2 — —
$13.5 million promissory note due August 31, 2012 7.3 15.2 — —
$7.0 million promissory note due July 31, 2009 — 7.7 — —
Commercial paper — — — 750.0
Turkish lira overdraft borrowing facility 4.6 12.5 — 20.7
Loan participation notes — — — 150.0
March 2011 Japanese yen revolving credit facility — — 16.9 —
March 2012 Japanese yen revolving credit facility — — 16.9 —
Other long-term borrowings 17.2 10.5 — —
Other short-term borrowings 18.8 13.6 — 158.5
Revolving credit facility — — 750.0 —
1,228.4 1,421.4 $783.8 $1,079.2
Less short-term debt including current maturities (23.4) (33.8)
$1,205.0 $1,387.6
2010
$ 296.3
197.6
338.3
230.0
118.3
7.3
—
—
4.6
—
—
—
17.2
18.8
—
1,228.4
(23.4)
$1,205.0