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76 THE EST{E LAUDER COMPANIES INC.
In June 2015, we issued the 2045 Senior Notes in a public
offering, priced at 97.999% with a yield of 4.497%. Inter-
est payments are required to be made semi-annually on
June 15th and December 15th. For further information,
see “Note 10—Debt” of Notes to Consolidated Financial
Statements.
We have a $1.0 billion commercial paper program
under which we may issue commercial paper in the
United States. As of June 30, 2015, we had no commercial
paper outstanding. At August 14, 2015, we had $220.0
million of commercial paper outstanding, which we may
refinance on a periodic basis as it matures at then-prevail-
ing market interest rates.
We have a $1.0 billion senior unsecured revolving
credit facility (the “Facility”) that we extended by one year
and is currently set to expire on July 15, 2020. We have a
remaining option to extend the Facility one more year. At
June 30, 2015, no borrowings were outstanding under the
Facility. The Facility may be used for general corporate
purposes. Up to the equivalent of $350 million of the
Facility is available for multi-currency loans. The interest
rate on borrowings under the Facility is based on LIBOR
or on the higher of prime, which is the rate of interest
publicly announced by the administrative agent, or ½%
plus the Federal funds rate. We incurred costs of approxi-
mately $1.0 million to establish the Facility, which costs
are being amortized over the term of the Facility. The
Facility has an annual fee of $0.6 million, payable
quarterly, based on our current credit ratings. The Facility
also contains a cross-default provision whereby a failure
to pay other material financial obligations in excess of
$150.0 million (after grace periods and absent a waiver
from the lenders) would result in an event of default and
the acceleration of the maturity of any outstanding debt
under the Facility.
Total debt as a percent of total capitalization (exclud-
ing noncontrolling interests) increased to 31% at June 30,
2015 from 26% at June 30, 2014, primarily due to the issu-
ance of the 2045 Senior Notes.
Cash Flows
Net cash provided by operating activities was $1,943.3
million, $1,535.2 million and $1,226.3 million in fiscal
2015, 2014 and 2013, respectively. The fiscal 2015
increase in cash flows provided by operating activities as
compared with fiscal 2014 primarily reflected a favorable
change in accounts receivable, reflecting the timing of
shipments and improved collections, a favorable change
in inventory, reflecting our initiative to better align supply
levels with forecasted demand and other supply chain
improvements, and a favorable change in accounts pay-
able, primarily due to the timing of payments. The accel-
erated orders in connection with our July 2014 SMI
implementation also contributed to the favorable changes
in these working capital components and the decrease in
net earnings as compared to fiscal 2014. The increase
in cash flows provided by operating activities during fiscal
2014 as compared with fiscal 2013 was primarily driven
by an increase in net earnings, an increase in accrued
income taxes as a result of the level and timing of tax
Debt
At June 30, 2015, our outstanding borrowings were as follows:
Long-term Debt Current Debt Total Debt
($ in millions)
4.375% Senior Notes, due June 15, 2045 (“2045 Senior Notes”)(1), (7) $ 294.0 $ — $ 294.0
3.70% Senior Notes, due August 15, 2042 (“2042 Senior Notes”)(2), (7) 249.0 — 249.0
6.00% Senior Notes, due May 15, 2037 (“2037 Senior Notes”)(3), (7) 296.6 — 296.6
5.75% Senior Notes, due October 15, 2033 (“2033 Senior Notes”)(4) 197.9 — 197.9
2.35% Senior Notes, due August 15, 2022 (“2022 Senior Notes”)(5), (7) 249.6 — 249.6
5.55% Senior Notes, due May 15, 2017 (“2017 Senior Notes”)(6), (7) 313.9 — 313.9
Other borrowings 6.5 29.8 36.3
$1,607.5 $29.8 $1,637.3
(1) Consists of $300.0 million principal and unamortized debt discount of $6.0 million
(2) Consists of $250.0 million principal and unamortized debt discount of $1.0 million.
(3) Consists of $300.0 million principal and unamortized debt discount of $3.4 million.
(4) Consists of $200.0 million principal and unamortized debt discount of $2.1 million.
(5) Consists of $250.0 million principal, unamortized debt discount of $0.2 million and a $(0.2) million adjustment to reflect the fair value of interest
rate swaps.
(6) Consists of $300.0 million principal, unamortized debt discount of $0.1 million and a $14.0 million adjustment to reflect the termination value of
interest rate swaps.
(7) The Senior Notes contain certain customary incurrence-based covenants, including limitations on indebtedness secured by liens.