Boeing 2015 Annual Report Download - page 56

Download and view the complete annual report

Please find page 56 of the 2015 Boeing 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.

Page out of 152

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152

40
During 2015, we issued $1.7 billion and repaid $0.9 billion of debt. At December 31, 2015 and 2014 the
recorded balance of debt was $10.0 billion and $9.1 billion of which $1.2 billion and $0.9 billion was
classified as short-term. At December 31, 2015 and 2014 this includes $2.4 billion of debt attributable to
BCC, of which $0.5 billion and $0.1 billion was classified as short-term.
During 2015 and 2014 we repurchased 46.7 million and 46.6 million shares totaling $6.8 billion and $6.0
billion through our open market share repurchase program. In 2015 and 2014, we had 0.7 million shares
transferred to us from employees for tax withholdings. At December 31, 2015, the amount available under
the share repurchase plan, announced on December 14, 2015, totaled $14 billion.
Capital Resources We have substantial borrowing capacity. Any future borrowings may affect our credit
ratings and are subject to various debt covenants as described below. We have a commercial paper
program that continues to serve as a significant potential source of short-term liquidity. Throughout 2015
and at December 31, 2015, we had no commercial paper borrowings outstanding. Currently, we have $5.0
billion of unused borrowing capacity on revolving credit line agreements. We anticipate that these credit
lines will primarily serve as backup liquidity to support our general corporate borrowing needs.
Financing commitments totaled $16.3 billion and $16.7 billion at December 31, 2015 and 2014. We
anticipate that we will not be required to fund a significant portion of our financing commitments as we
continue to work with third party financiers to provide alternative financing to customers. Historically, we
have not been required to fund significant amounts of outstanding commitments. However, there can be
no assurances that we will not be required to fund greater amounts than historically required. In addition,
many of our non-U.S. customers finance aircraft purchases through the Export-Import Bank of the United
States. Following the expiration of the bank’s charter on June 30, 2015, the bank’s charter was reauthorized
in December 2015. The bank is now authorized through September 30, 2019. However, until the U.S.
Senate confirms members sufficient to reconstitute a quorum of the bank’s board of directors, the bank
will not be able to approve any transaction totaling more than $10 million. As a result, we may fund additional
commitments and/or enter into new financing arrangements with customers.
In the event we require additional funding to support strategic business opportunities, our commercial
aircraft financing commitments, unfavorable resolution of litigation or other loss contingencies, or other
business requirements, we expect to meet increased funding requirements by issuing commercial paper
or term debt. We believe our ability to access external capital resources should be sufficient to satisfy
existing short-term and long-term commitments and plans, and also to provide adequate financial flexibility
to take advantage of potential strategic business opportunities should they arise within the next year.
However, there can be no assurance of the cost or availability of future borrowings, if any, under our
commercial paper program, in the debt markets or our credit facilities.
At December 31, 2015 and 2014, our pension plans were $17.9 billion and $17.3 billion underfunded as
measured under GAAP. On an Employee Retirement Income Security Act (ERISA) basis our plans are
more than 100% funded at December 31, 2015 with minimal required contributions in 2016. We expect to
make contributions to our plans of approximately $0.1 billion in 2016. We may be required to make higher
contributions to our pension plans in future years.
At December 31, 2015, we were in compliance with the covenants for our debt and credit facilities. The
most restrictive covenants include a limitation on mortgage debt and sale and leaseback transactions as
a percentage of consolidated net tangible assets (as defined in the credit agreements), and a limitation
on consolidated debt as a percentage of total capital (as defined). When considering debt covenants, we
continue to have substantial borrowing capacity.