Tech Data 2014 Annual Report Download - page 56

Table of Contents
available to be borrowed up to the maximum. This program was renewed in October 2012 for a period of two years and interest is to be paid on
advances under the Receivables Securitization Program at the applicable commercial paper or LIBOR rate plus an agreed-upon margin. There
were no amounts outstanding under the Receivables Securitization Program at January 31, 2014. There was $83.5 million outstanding under the
Receivables Securitization Program at January 31, 2013, at an interest rate of 1.02% .
In addition to the facilities described above, the Company has various other committed and uncommitted lines of credit and overdraft facilities
totaling approximately $429.6 million at January 31, 2014 to support its operations. Most of these facilities are provided on an unsecured, short-
term basis and are reviewed periodically for renewal. There was $42.9 million outstanding on these facilities at January 31, 2014, at a weighted
average interest rate of 6.15% , and there was $40.6 million outstanding at January 31, 2013, at a weighted average interest rate of 4.76% .
In consideration of the financial covenants discussed below, the Company’s maximum borrowing availability on the credit facilities is
approximately $891.0 million , of which $42.9 million was outstanding at January 31, 2014. Certain of the Company’s credit facilities contain
limitations on the amounts of annual dividends and repurchases of common stock and require compliance with other obligations, warranties and
covenants. The financial ratio covenants contained within these credit facilities include a debt to capitalization ratio and a minimum interest
coverage ratio. At January 31, 2014, the Company was in compliance with all such financial covenants. The ability to draw funds under certain
credit facilities is dependent upon maintaining sufficient collateral (in the case of the Receivables Securitization Program) and meeting the
aforementioned financial covenants, which may limit the Company’s ability to draw the full amount of these facilities.
At January 31, 2014, the Company had also issued standby letters of credit of $83.0 million . These letters of credit typically act as a guarantee
of payment to certain third parties in accordance with specified terms and conditions. The issuance of these letters of credit reduces the
Company’s borrowing availability under certain of the above-mentioned facilities.
Future payments of debt and capital leases at January 31, 2014 and for succeeding fiscal years are as follows (in thousands):
NOTE 8 — INCOME TAXES
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities
for the expected future tax consequences of events that have been included in the financial statements. The Company performs an evaluation of
the realizability of the Company’s deferred tax assets on a quarterly basis. The Company considers all positive and negative evidence available
in determining the potential of realizing deferred tax assets, including the scheduled reversal of temporary differences, recent cumulative losses,
recent and projected future taxable income, and prudent and feasible tax planning strategies. In making this determination, the Company places
greater emphasis on recent cumulative losses and recent taxable income due to the inherent lack of subjectivity associated with these factors. The
estimates and assumptions used by the Company in computing the income taxes reflected in the Company’s consolidated financial statements
could differ from the actual results reflected in the income tax returns filed during the subsequent year. Adjustments are recorded based on filed
returns when such returns are finalized or the related adjustments are identified.
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Fiscal year:
2015
$
43,633
2016
700
2017
664
2018
350,664
2019
664
Thereafter
3,773
Total payments
400,098
Less - amounts representing interest on capital leases
(1,522
)
Total principal payments
$
398,576