Pizza Hut 2005 Annual Report Download - page 63
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Please find page 63 of the 2005 Pizza Hut 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.10.ACCOUNTSPAYABLE
ANDOTHERCURRENTLIABILITIES
2005 2004
Accountspayable $ 398 $ 414
Accruedcompensationandbenefits 274 263
Othercurrentliabilities 566 512
$1,238 $1,189
11.SHORT-TERM
BORROWINGSANDLONG-TERMDEBT
2005 2004
Short-termBorrowings
Currentmaturitiesoflong-termdebt $ 211 $ 11
Long-termDebt
UnsecuredInternationalRevolving
CreditFacility,expiresNovember2010 180 —
UnsecuredRevolvingCreditFacility,
expiresSeptember2009 — 19
Senior,UnsecuredNotes,dueApril2006 200 200
Senior,UnsecuredNotes,dueMay2008 251 251
Senior,UnsecuredNotes,dueApril2011 646 646
Senior,UnsecuredNotes,dueJuly2012 398 398
Capitalleaseobligations(SeeNote12) 114 128
Other,duethrough2019(6% –12%) 77 79
1,866 1,721
Lesscurrentmaturitiesoflong-termdebt (211) (11)
Long-termdebtexcluding
SFAS133adjustment 1,655 1,710
Derivativeinstrumentadjustmentunder
SFAS133(SeeNote13) (6) 21
Long-termdebtincluding
SFAS133adjustment $1,649 $1,731
Ourprimarybankcreditagreementcomprisesa$1.0billion
senior unsecured Revolving Credit Facility (the “Credit
Facility”), which matures in September 2009. TheCredit
Facility is unconditionally guaranteed by our principal
domestic subsidiaries and contains financial covenants
relating to maintenance of leverage and fixed charge
coverageratios.TheCreditFacilityalsocontainsaffirmative
andnegativecovenantsincluding,amongotherthings,limi-
tationsoncertainadditionalindebtedness,guaranteesof
indebtedness,levelofcashdividends,aggregatenon-U.S.
investmentandcertainothertransactionsasspecifiedinthe
agreement.Wewereincompliancewithalldebtcovenantsat
December31,2005.
Undertheterms of the Credit Facility,wemayborrow
uptothemaximumborrowinglimitlessoutstandingletters
ofcredit.AtDecember31,2005,ourunusedCreditFacility
totaled $809million, net of outstanding letters of credit
of$191million.TherewerenoborrowingsundertheCredit
Facilityattheendof2005whileoutstandingborrowingsat
December25,2004were$19million.Theinterestratefor
borrowingsundertheCreditFacility ranges from0.35%to
1.625%overtheLondonInterbankOfferedRate(“LIBOR”)or
0.00%to0.20%overanAlternateBaseRate,whichisthe
greaterofthePrimeRateortheFederalFundsEffectiveRate
plus0.50%.TheexactspreadoverLIBORortheAlternateBase
Rate,asapplicable,willdependuponourperformanceunder
specifiedfinancialcriteria.Interestonanyoutstandingborrow-
ingsundertheCreditFacilityispayableatleastquarterly.In
2005,2004and2003,weexpensedfacilityfeesofapproxi-
mately$2million,$4millionand$6million,respectively.
Additionally,onNovember8,2005,weexecutedafive-
yearrevolvingcreditfacility(the“InternationalCreditFacility”
or“ICF”)onbehalfofthreeofourwhollyownedinternational
subsidiaries.Thetotalfacilityamountis$350million,with
separatesublimitsforeachofthethreesubsidiaries.TheICF
isunconditionallyguaranteedbyYUMandbyYUM’sprincipal
domesticsubsidiariesandcontainscovenantssubstantially
identicaltothoseoftheCreditFacility.Wewereincompli-
ancewithalldebtcovenantsattheendof2005.
There were borrowingsof $180million and available
credit of $170million outstanding under the ICF at the
end of 2005. The interest rate for borrowings under the
CreditFacilityrangesfrom0.20%to1.20%overtheLIBOR
or0.00%to0.20%overaCanadianAlternateBaseRate,
whichisthegreateroftheCitibank,N.A.,CanadianBranch’s
publiclyannouncedreferencerateorthe“CanadianDollar
OfferedRate”plus0.50%.TheexactspreadoverLIBORor
theCanadianAlternateBaseRate,asapplicable,depends
uponYUM’sperformanceunderspecifiedfinancialcriteria.
Interest on any outstanding borrowings under the ICF is
payableatleastquarterly.
OnNovember15,2004,wevoluntarilyredeemedallof
our7.45%SeniorUnsecured NotesthatweredueinMay
2005(the“2005Notes”)inaccordancewiththeiroriginal
terms. The 2005 Notes, which had a total face value of
$350million,wereredeemedforapproximately$358million
usingprimarilycashonhandaswellassomeborrowings
underourCreditFacility.Theredemptionamountapproxi-
matedthe carrying valueofthe 2005 Notes,including a
derivativeinstrumentadjustmentunderSFAS133,resulting
innosignificantimpactonnetincomeuponredemption.
In1997,wefiledashelfregistrationstatementwiththe
SecuritiesandExchangeCommissionforofferingsofupto
$2billionofseniorunsecureddebt,ofwhich$150millionis
availableforissuanceatDecember31,2005.Thefollowing
table summarizes all Senior Unsecured Notes issued
under this shelf registration that remain outstanding at
December31,2005:
Principal InterestRate
IssuanceDate(a) MaturityDate Amount Stated Effective(b)
May1998 May2008 250 7.65% 7.81%
April2001 April2006 200 8.50% 9.04%
April2001 April2011 650 8.88% 9.20%
June2002 July2012 400 7.70% 8.04%
(a)Interestpaymentscommencedsixmonthsafterissuancedateandarepayable
semi-annuallythereafter.
(b)Includestheeffectsoftheamortizationofany(1)premiumordiscount;(2)debt
issuancecosts;and(3)gainorlossuponsettlementofrelatedtreasurylocks.
ExcludestheeffectofanyinterestrateswapsasdescribedinNote13.
Yum!Brands,Inc. | 67.