Entergy 2007 Annual Report Download - page 37

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Entergy Corporation and Subsidiaries 2007
Long-term debt, including the currently maturing portion, makes
up substantially all of Entergy’s total debt outstanding. Following are
Entergy’s long-term debt principal maturities and estimated interest
payments as of December 31, 2007. To estimate future interest
payments for variable rate debt, Entergy used the rate as of December
31, 2007. e gures below include payments on the Entergy Louisiana
and System Energy sale-leaseback transactions, which are included in
long-term debt on the balance sheet (in millions):
Long-term Debt Maturities 2011- After
and Estimated Interest Payments 2008 2009 2010 2012 2012
Utility $1,214 $ 610 $1,026 $1,236 $7,189
Non-Utility Nuclear 36 36 36 68 161
Parent Company & Other
Business Segments 452 474 456 3,052 –
Total $1,702 $1,120 $1,518 $4,356 $7,350
Note 5 to the nancial statements provides more detail concerning
long-term debt.
In August 2007, Entergy Corporation entered into a $3.5 billion,
ve-year credit facility, and terminated the two previously existing
facilities, a $2 billion ve-year revolving credit facility that was due to
expire in May 2010 and a $1.5 billion three-year revolving credit facility
that was due to expire in December 2008. Entergy Corporation has
the ability to issue letters of credit against the total borrowing capacity
of the facility. e weighted average interest rate as of December 31,
2007 was 5.524% on the drawn portion of the facility. e facility fee
is currently 0.09% of the commitment amount. e facility fee and
interest rate can uctuate depending on the senior unsecured debt
ratings of Entergy Corporation.
As of December 31, 2007, amounts outstanding under the $3.5
billion credit facility are (in millions):
Capacity Borrowings Letters of Credit Capacity Available
$3,500 $2,251 $69 $1,180
Entergy Corporation’s credit facility requires it to maintain a
consolidated debt ratio of 65% or less of its total capitalization. If
Entergy fails to meet this ratio, or if Entergy or one of the Registrant
Subsidiaries (except Entergy New Orleans) defaults on other
indebtedness or is in bankruptcy or insolvency proceedings, an
acceleration of the facility maturity date may occur.
Capital lease obligations, including nuclear fuel leases, are a minimal
part of Entergy’s overall capital structure, and are discussed further in
Note 10 to the nancial statements. Following are Entergy’s payment
obligations under those leases (in millions):
2011- After
2008 2009 2010 2012 2012
Capital lease payments, including
nuclear fuel leases $153 $213 $2 $3 $2
Notes payable includes borrowings outstanding on credit facilities
with original maturities of less than one year. Entergy Arkansas,
Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi,
and Entergy Texas each had credit facilities available as of December 31,
2007 as follows (with the exception of the Entergy Texas facility, which
is expected to become available in March 2008 aer the fulllment of
certain closing conditions) (amounts in millions):
Expiration Amount of Interest Amount Drawn as
Company Date Facility Rate(a) of Dec. 31, 2007
Entergy Arkansas April 2008 $100(b) 6.75% –
Entergy Gulf States
Louisiana August 2012 $100(c) 5.025% –
Entergy Louisiana August 2012 $200(d) 4.96% –
Entergy Mississippi May 2008 $ 30(e) 5.85% –
Entergy Mississippi May 2008 $ 20(e) 5.85% –
Entergy Texas August 2012 $100(f) 5.025% –
(a) The interest rate is the weighted average interest rate as of December
31, 2007 that would be applied to the outstanding borrowings under
the facility.
(b) The credit facility requires Entergy Arkansas to maintain a total
shareholders’ equity of at least 25% of its total assets.
(c) The credit facility allows Entergy Gulf States Louisiana to issue letters
of credit against the borrowing capacity of the facility. As of December
31, 2007, no letters of credit were outstanding. The credit facility re-
quires Entergy Gulf States Louisiana to maintain a consolidated debt
ratio of 65% or less of its total capitalization. Pursuant to the terms of
the credit agreement, the amount of debt assumed by Entergy Texas is
excluded from debt and capitalization in calculating the debt ratio.
(d) The credit facility allows Entergy Louisiana to issue letters of credit
against the borrowing capacity of the facility. As of December 31,
2007, no letters of credit were outstanding. The credit agreement
requires Entergy Louisiana to maintain a consolidated debt ratio of
65% or less of its total capitalization.
(e) Borrowings under the Entergy Mississippi credit facilities may be
secured by a security interest in its accounts receivable.
(f) The credit facility allows Entergy Texas to issue letters of credit
against the borrowing capacity of the facility. As of December 31,
2007, no letters of credit were outstanding. The credit facility requires
Entergy Texas to maintain a consolidated debt ratio of 65% or less of
its total capitalization. Pursuant to the terms of the credit agreement,
the transition bonds issued by Entergy Gulf States Reconstruction
Funding I, LLC are excluded from debt and capitalization in
calculating the debt ratio.
In August 2007, Entergy Gulf States, Inc. entered into a $200
million, 5-year bank credit facility, with the ability to issue letters of
credit against the facility. As of December 31, 2007, the Entergy Gulf
States, Inc. credit facility split into the two separate credit facilities
shown above, a $100 million credit facility available to Entergy Gulf
States Louisiana and a $100 million credit facility for Entergy Texas.
Management’s Financial Discussion and Analysis conti nued