E-Z-GO 2008 Annual Report Download - page 43

Download and view the complete annual report

Please find page 43 of the 2008 E-Z-GO 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 114

  • 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

30
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Payments/Receipts Due by Period
Less than More than
(In millions) 1 year 1-2 Years 2-3 Years 3-4 Years 4-5 Years 5 years Total
Payments due: (1)
Multi-year credit facilities, loan from
Textron and commercial paper (2) $ — $ — $ — $ 876 $ — $ — $ 876
Other short-term debt 25 — — — — — 25
Term debt 1,534 2,315 727 52 578 152 5,358
Securitized on-balance sheet debt (3) 169 205 134 89 66 190 853
Subordinated debt — — — — — 300 300
Securitized off-balance sheet debt (3) 2,031 5 — — — 31 2,067
Loan commitments 13 12 3 — 1 66 95
Operating lease rental payments 5 4 4 1 1 1 16
Total payments due 3,777 2,541 868 1,018 646 740 9,590
Cash and contractual receipts: (1) (4)
Finance receivable held for investment 1,474 970 1,193 855 584 1,839 6,915
Finance receivable held for sale 793 435 256 293 125 94 1,996
Securitized off-balance sheet finance
receivables (3) 2,212 5 — — — 31 2,248
Operating lease rental receipts 31 26 22 17 10 24 130
Total contractual receipts 4,510 1,436 1,471 1,165 719 1,988 11,289
Cash 16 — — — — — 16
Total cash and contractual receipts 4,526 1,436 1,471 1,165 719 1,988 11,305
Net cash and contractual receipts
(payments) $ 749 $ (1,105) $ 603 $ 147 $ 73 $ 1,248 $ 1,715
Cumulative net cash and contractual
receipts (payments) $ 749 $ (356) $ 247 $ 394 $ 467 $ 1,715
(1) Contractual receipts and payments exclude finance charges from receivables, debt interest payments and other items.
(2) Commercial paper outstanding and the Textron intercompany loan are reflected as being repaid in connection with the maturity of the Finance group’s
$1.75 billion committed multi-year credit facility in 2012. Actual commercial paper issuances generally are outstanding for less than 90 days; however, these
issuances were replaced by a full drawdown on the multi-year credit facility in February 2009.
(3) Securitized on-balance sheet and securitized off-balance sheet debt payments are based on the contractual receipts of the underlying receivables, which
are remitted into the securitization structure when and as they are received. These payments do not represent contractual obligations of the Finance group,
and we do not provide legal recourse to investors that purchase interests in the securitizations beyond the credit enhancement inherent in the retained
subordinate interests.
(4) Finance receivable receipts are based on contractual cash flows only and do not reflect any reserves for uncollectible amounts. These receipts could differ
due to prepayments, charge-offs and other factors, including the inability of borrowers to repay the balance of the loan at the contractual maturity date.
Finance receivable receipts on the held for sale portfolio exclude the potential negative impact from selling the portfolio at the estimated fair value, which
reflects a $293 million mark-to-market adjustment, net of the existing allowance for loan losses of $44 million, as discussed in Note 5 to the Consolidated
Financial Statements.
This liquidity profile, combined with the excess cash generated by the drawdown of our credit facilities, is an indicator of the Finance group’s
ability to repay outstanding funding obligations, assuming contractual collection of all finance receivables, absent access to new sources of
liquidity or origination of additional finance receivables. In addition, at January 3, 2009, our Finance group had $338 million in other liabilities,
primarily including accounts payable and accrued expenses, that are payable within the next 12 months.