Amgen 2001 Annual Report Download - page 33

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AMGEN 2001 ANNUAL REPORT
Interest Rate Sensitivity
Principal Amount by Expected Maturity as of December 31, 2001
Dollars in millions Fair Value
Average Interest Rate 2002 2003 2004 2005 2006 Thereafter Total 12/31/01
Available-for-sale debt
securities $1,466.9 $362.9 $390.6 $163.9 $115.0 — $2,499.3 $2,568.0
Interest rate 4.4% 6.6% 5.8% 7.0% 5.1% —
Commercial paper obligations $ 100.0 —————$ 100.0 $ 100.0
Interest rate 1.9% —————
Long-term debt — $ 23.0 ———$200.0 $ 223.0 $ 244.9
Interest rate —6.2% ———7.3%
Interest rate swaps related to
available-for-sale debt
securities:
Pay fixed/receive variable — $153.7 $144.2 $120.0 $ 40.0 — $ 457.9 $ 1.4
Average pay rate —2.9% 3.8% 4.2% 4.5% —
Average receive rate —2.0% 2.0% 2.0% 2.0% —
Principal Amount by Expected Maturity as of December 31, 2000
Dollars in millions Fair Value
Average Interest Rate 2001 2002 2003 2004 2005 Thereafter Total 12/31/00
Available-for-sale debt
securities $ 780.4 $740.6 $232.3 $118.5 $ 60.0 — $1,931.8 $1,950.2
Interest rate 6.6% 6.7% 7.0% 6.5% 7.0% —
Commercial paper obligations $ 100.0 —————$ 100.0 $ 100.0
Interest rate 6.7% —————
Long-term debt ——$ 23.0 ——$200.0 $ 223.0 $ 222.0
Interest rate ——6.2% ——7.3%
The Company is exposed to equity price risks on the marketable portion of equity securities included in its
portfolio of investments entered into for the promotion of business and strategic objectives. These investments are
generally in small capitalization stocks in the biotechnology industry sector. In 2001, the Company entered into equity
forward contracts to hedge against changes in the fair market value of a portion of its equity investment portfolio. At
December 31, 2001 and 2000, the fair value of the unhedged portion of its equity securities was $133.4 million and
$223.0 million, respectively. For the years ended December 31, 2001 and 2000, an adverse change in equity prices of
45% and 80%, respectively, would result in a decrease of approximately $60.0 million and $178.4 million, respec-
tively, in the fair value of the unhedged portion of the Company’s equity securities. Price volatility for equity invest-
ments is based on the volatility of a relevant market index for small capitalization stocks in the biotechnology sector.
The Company did not have material exposures to changes in foreign currency exchange rates related to its foreign
currency forward contracts outstanding as of December 31, 2001 and 2000.
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