Kroger 2007 Annual Report Download - page 48

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DEBT OBLIGATIONS
DEBT RATING
Kroger’s debt rating remains important to us as we execute our Customer
1st strategy. Management believes maintaining a solid investment grade
rating provides the best cost of capital and the flexibility to execute our
growth strategy in a competitive and consolidating industry.
Our current debt ratings are as follows:
Fitch Moody’s S&P
BBB
(stable outlook)
Baa2
(stable outlook) BBB -
(positive outlook)
FINANCIAL GOALS & STRATEGY
1. Increase shareholder value.
2. Earn a return on assets that exceeds our cost of capital.
3. Maintain a strong capital program.
4. Smooth debt maturities.
5. Use free cash flow to repurchase stock and pay a cash dividend while
maintaining a solid investment grade rating.
DEBT ISSUES
At year-end 2007, Kroger had one credit facility:
$2.5 Billion Five-Year Credit Agreement maturing in 2011, unless earlier
terminated by Kroger.
The Kroger Co. Page 48
As of February 2, 2008, the Company had $570 million outstanding under
the credit agreement including borrowings totaling $345 million under its
P2/F2/A3 rated commercial paper program. Any borrowings under this
program are backed by the Company’s credit facility and reduce the
amount available under the credit facility.