Nordstrom 1999 Annual Report Download - page 44

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NORDSTROM, INC. AND SUBSIDIARIES
42
(Note 7 continued)
payment of interest on the Class A and Class B certifi-
cates, absorption of credit losses, and payment of servicing
fees to the Company, which services the receivables for
the trust. Excess cash flows revert to the Company. The
Company’s investment in the Class B certificate and the
Seller’s Interest totals $42,754 and $8,208 at January 31,
2000 and 1999, and is included in customer accounts
receivable.
Pursuant to the terms of operative documents of the
trust, in certain events the Company may be required to
fund certain amounts pursuant to a recourse obligation
for credit losses. Based on current cash flow projections,
the Company does not believe any additional funding
will be required.
Note 8: Land, Buildings and Equipment
Land, buildings and equipment consist of the following
(at cost):
January 31, 2000 1999
Land and land improvements $ 59,237 $ 57,337
Buildings 650,414 500,831
Leasehold improvements 870,821 957,877
Capitalized software 20,150 7,603
Store fixtures and equipment 1,037,936 944,202
2,638,558 2,467,850
Less accumulated depreciation
and amortization (1,370,726) (1,235,410)
1,267,832 1,232,440
Construction in progress 161,660 145,566
Land, buildings and
equipment, net $1,429,492 $1,378,006
At January 31, 2000, the net book value of property
located in California is approximately $335,000. The
Company does not carry earthquake insurance in
California because of its high cost.
At January 31, 2000, the Company has contractual com-
mitments of approximately $80 million for the construc-
tion of new stores or remodel of existing stores.
Note 9: Notes Payable
A summary of notes payable is as follows:
Year ended January 31 , 2000 1999 1998
Average daily short-
term borrowings $ 45,030 $195,596 $193,811
Maximum amount
outstanding 178,533 385,734 278,471
Weighted average
interest rate:
During the year 5.8% 5.5% 5.6%
At year-end 6.0% 5.2% 5.5%
At January 31, 2000, the Company has an unsecured
line of credit with a group of commercial banks totaling
$500,000 which is available as liquidity support for the
Company’s commercial paper program, and expires in
July 2002.The line of credit agreement contains restric-
tive covenants which, among other things, require the
Company to maintain a certain minimum level of net
worth and a coverage ratio (as defined) of no less than 2
to 1.The Company pays a commitment fee for the line
based on the Company’s debt rating.
Note 10: Long-Term Debt
A summary of long-term debt is as follows:
January 31, 2000 1999
Senior debentures, 6.95%,
due 2028 $ 300,000 $ 300,000
Senior notes, 5.625%, due 2009 250,000 250,000
Medium-term notes, payable by
Nordstrom Credit, Inc.,
7.0%-8.67%, due 2000-2002 145,350 203,350
Notes payable, of
Nordstrom Credit, Inc.,
6.7%, due 2005 100,000 100,000
Other 9,632 14,884
Total long-term debt 804,982 868,234
Less current portion (58,191) (63,341)
Total due beyond one year $746,791 $804 ,893
Aggregate principal payments on long-term debt are as
follows: 2000-$58,191; 2001-$11,454; 2002-$77,247;
2003-$319; 2004-$350; and thereafter-$657,421.