Supercuts 2008 Annual Report Download - page 65

Tabular Presentation:
The following table presents information about the Company's debt obligations and derivative financial instruments that are sensitive to
changes in interest rates. For fixed rate debt obligations, the table presents principal amounts and related weighted-
average interest rates by fiscal
year of maturity. For variable rate obligations, the table presents principal amounts and the weighted
-average forward LIBOR interest rates as of
June 30, 2008 through June 30, 2013. For the Company's derivative financial instruments, the table presents notional amounts and weighted-
average interest rates by expected (contractual) maturity dates. Notional amounts are used to calculate the contractual payments to be exchanged
under the contract.
**
Expected maturity date as of June 30,
June 30, 2008
June 30,
2007
2009 2010 2011 2012 2013
Thereafter
Total
Fair Value
Fair Value
Liabilities
(U.S.$ equivalent in thousands)
Long
-
term debt:
Fixed rate (U.S.$)
$
91,124
$
53,521
$
91,790
$
93,885
$
53,898
$
141,429
$
525,647
$
531,924
$
460,557
Average interest rate
7.1
%
6.0
%
6.0
%
7.0
%
5.4
%
5.6
%
6.2
%
Variable rate (U.S.$)
139,100
—
—
—
70,000
30,000
239,100
239,100
247,800
Average interest rate
3.0
%
3.3
%
3.4
%
3.2
%
Total liabilities
$
230,224
$
53,521
$
91,790
$
93,885
$
123,898
$
171,429
$
764,747
$
771,024
$
708,357
Interest rate derivatives
(U.S.$ equivalent in thousands)
Pay variable/receive fixed (U.S.$)
$
5,000
—
—
—
—
—
$
5,000
$
—
$
—
Average pay rate**
4.6
%
4.6
%
Average receive rate**
7.1
%
7.1
%
Pay fixed/receive variable (U.S.$)
—
—
—
—
35,000
$
15,000
$
50,000
$
1,366
$
(1,728
)
Average pay rate**
2.8
%
2.8
%
Average receive rate**
4.8
%
4.9
%
Represents the average expected cost of borrowing for outstanding derivative balances as of June 30, 2008.
Foreign Currency Exchange Risk:
The majority of the Company's revenue, expense and capital purchasing activities are transacted in United States dollars. However, because
a portion of the Company's operations consists of activities outside of the United States, the Company has transactions in other currencies,
primarily the Canadian dollar, British pound and Euro. In preparing the Consolidated Financial Statements, the Company is required to translate
the financial statements of its foreign subsidiaries from the currency in which they keep their accounting records, generally the local currency,
into United States dollars. Different exchange rates from period to period impact the amounts of reported income and the amount of foreign
currency translation recorded in accumulated other comprehensive income. As part of its risk management strategy, the Company frequently
evaluates its foreign currency exchange risk by monitoring market data and external factors that may influence exchange rate fluctuations. As a
result, the Company may engage in transactions involving various derivative instruments to hedge assets,
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