Equifax 2004 Annual Report Download - page 35

M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
O F F I N A N C I A L C O N D I T I O N A N D R E S U L T S O F O P E R A T I O N S
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In 2003, net payments for short-term debt were $16.0 mil-
lion. Additions to our long-term debt were $113.4 million,
and payments on our long-term debt were $202.6 mil-
lion during 2003. We increased the amount outstanding
under our credit facility in 2003 for purposes of retiring the
$200.0 million aggregate principal amount of our outstand-
ing 6.5% senior notes that matured in June 2003. In addi-
tion, we used $94.9 million during 2003 for the purchase of
4,174,800 shares of our common stock at an average price
of $22.74. Our dividend policy remained consistent; we
paid cash dividends of $11.3 million in 2003. We received
cash of $19.5 million during 2003 for the exercise of stock
options. At December 31, 2003, our remaining authorized
share repurchase was approximately $127.3 million.
In 2002, we received $249.5 million in proceeds from the
sale of $250.0 million aggregate principal amount of our
4.95% senior unsecured notes, which mature November 1,
2007. During 2002, we invested $79.8 million to repurchase
2,939,300 shares of our common stock and received $34.2
million in proceeds from the exercise of stock options. At
December 31, 2001, our remaining authorization for
share repurchases was approximately $45.0 million, and in
February 2002, our Board of Directors approved an addi-
tional $250.0 million for share repurchases. We also paid
dividends of $11.4 million in 2002.
CASH฀AND฀CASH฀EQUIVALENTS
Our cash and cash equivalents balance was $52.1 million and
$38.1 million at December 31, 2004 and 2003, respectively.
REVOLVING฀CREDIT฀FACILITIES
In August 2004, we entered into a new fi ve-year, $500.0 mil-
lion senior unsecured revolving credit agreement. The new
facility provides for a variable interest rate tied to a Base
Rate, the London InterBank Offered Rate (“LIBOR”)
plus a specifi ed margin or competitive bid options similar
to those contained in the previous facility. The new facility
replaces a $465.0 million revolving credit facility. Under
our senior credit agreement, we must comply with various
fi nancial and non-fi nancial covenants. The fi nancial cov-
enants require us to maintain a leverage ratio of not more
than 3.0 to 1.0 (raised to 3.25 to 1.0 for four fi scal quarters
in the event the CSC Put option described below under
“Contractual Obligations and Commercial Commitments”
is exercised) and a minimum interest coverage ratio of not
less than 4.0 to 1.0. Compliance with these fi nancial cov-
enants is tested quarterly on a rolling four quarter basis.
The non-fi nancial covenants include limitations on liens,
subsidiary debt, mergers, liquidations, asset dispositions and
acquisitions. Our borrowings under this facility, which have
not been guaranteed by any of our subsidiaries, are unse-
cured and will rank on parity in right of payment with all
of our other unsecured and unsubordinated indebtedness
from time to time outstanding. As of December 31, 2004,
$500.0 million was available and there were no borrowings,
outstanding under this facility. As of December 31, 2004,
we were in compliance with our covenants under this senior
revolving credit agreement.
In September 2004, we entered into a new trade receiv-
ables-backed revolving credit facility. Under the terms of
the transaction, a wholly-owned subsidiary of Equifax may
borrow up to $125.0 million, subject to borrowing base
availability and other terms and conditions. Equifax will use
the net proceeds received from the sale of its trade receiv-
ables to the subsidiary for general corporate purposes. The
credit facility has an expiration date of September 6, 2005,
but may be extended for an additional period of up to three
years if specifi ed conditions are satisfi ed. Loans will bear
interest based on commercial paper rates, LIBOR or Base
Rate plus a specifi ed margin. Outstanding debt under the
facility will be consolidated on our balance sheet for fi nan-
cial reporting purposes. As of December 31, 2004, $84.0 mil-
lion was available and no amounts were outstanding under
this facility.
One of our Canadian subsidiaries had an unsecured, 364-
day C$100.0 million revolving credit facility that expired
on September 30, 2004. The agreement provided for
borrowings tied to the Prime Rate, Base Rate, LIBOR or
Canadian Banker’s Acceptances and contains fi nancial cov-
enants related to interest coverage, funded debt to cash fl ow
and limitations on subsidiary indebtedness. We guaranteed
the indebtedness of our Canadian subsidiary under this
credit facility. The bank agreed to carry the amounts out-
standing under the facility on a demand basis following the
expiration of the revolver on September 30, 2004, and the
remaining balance was paid in October 2004. Borrowings
under this loan (which are included in 2003 short-term
borrowings on the Consolidated Financial Statements) at
December 31, 2003 were $15.4 million.
In November 2004, we entered into a C$25.0 million revolv-
ing credit facility that replaced the C$100.0 million facility
that expired in September 2004. The C$25.0 million facility
expires in September 2005. There were no borrowings out-
standing under this facility at December 31, 2004.