Food Lion 2011 Annual Report Download - page 115

Download and view the complete annual report

Please find page 115 of the 2011 Food Lion 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 168

  • 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
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168

DELHAIZE GROUP FINANCIAL STATEMENTS ’11 // 113
The variable interest payments arising from financial liabilities with variable coupons were calculated using the last interest rates
fixed before year-end. In the event where a counterparty has a choice of when an amount is paid (e.g., on demand deposits),
the liability is allocated to the earliest period in which Delhaize Group can be required to pay. Delhaize Group is managing its
liquidity risk based on contractual maturities.
Fair Value of Long-term Debt
The fair value of the Group’s long-term debt (excluding finance leases, see Note 18.3) is based on the current market quotes for
publicly traded debt (multiplying the quoted price with the nominal amount). Fair values of non-public debt are estimated using
rates currently publicly available for debt of similar terms and remaining maturities offered to the Group and its subsidiaries.
(in millions of EUR)
December 31,
2011 2010 2009
Fair value of long-term debt 2 839 2 342 2 158
Carrying value of long-term debt:
Current 88 40 42
Non-current 2 325 1 966 1 904
Total 2 413 2 006 1 946
Collateralization
The portion of Delhaize Group’s long-term debt that was collateralized by mortgages and security charges granted or irrevocably
promised on Delhaize Group’s assets was EUR 37 million at December 31, 2011 and EUR 17 million at December 31, 2010 and
2009.
At December 31, 2011, 2010 and 2009, EUR 56 million, EUR 38 million and EUR 32 million, respectively, of assets were pledged
as collateral for mortgages.
Debt Covenants for Long-term Debt
Delhaize Group is subject to certain financial and non-financial covenants related to the long-term debt instruments indicated
above. While these long-term debt instruments contain certain accelerated repayment terms, as further described below, none
contain accelerated repayment clauses that are subject solely to changes in the Group’s credit rating (“rating event”). Further,
none of the debt covenants restrict the abilities of subsidiaries of Delhaize Group to transfer funds to the parent.
Indentures covering the notes due in 2014 (USD and EUR), 2017 (USD), 2027 (USD) and 2040 (USD), the debentures due in
2031 (USD) and the retail bond due in 2018 (EUR) contain customary provisions related to events of default as well as
restrictions in terms of negative pledge, liens, sale and leaseback, merger, transfer of assets and divestiture. The 2014 (USD
and EUR), 2017 (USD) and 2040 (USD) notes and the 2018 (EUR) bonds also contain a provision granting their holders the right
to early repayment for an amount not in excess of 101% of the outstanding principal amount thereof in the event of a change of
control in combination with a rating event.
The term loan maturing in 2012 contains customary provisions related to events of default as well as a minimum fixed charge
coverage ratio and a maximum leverage ratio, both based on non-GAAP measures.
The bonds due in 2013 contain customary defined non-GAAP measure based minimum fixed charge coverage and maximum
leverage ratios.
At December 31, 2011, 2010 and 2009, Delhaize Group was in compliance with all covenants for long-term debt.