Kroger 2008 Annual Report Download - page 47

Download and view the complete annual report

Please find page 47 of the 2008 Kroger 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 54

  • 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
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54

The Kroger Co. Page 46
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. Allocate cash flow to keep our store base current, reduce Kroger’s
leverage, and provide a solid return for shareholders.
DEBT ISSUES
At year-end 2008, Kroger had one credit facility:
$2.5 Billion Five-Year Credit Agreement maturing in 2011, unless earlier
terminated by Kroger.
As of January 31, 2009, the Company had no borrowings under its credit
agreement and borrowings totaling $90 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. In addition, the Company had borrowings under its
money market lines totaling $39 million.