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Notes to Consolidated Financial Statements

 

NOTE >6 > BORROWINGS

Short-term borrowings consist of:

At January 1, 2000, SRAC's credit facilities totaled $5.06 billion in syndicated credit agreements. Sears Canada had credit agreements totaling $553 million. These syndicated and other credit agreements provide for loans at prevailing interest rates and mature at various dates through April 2003. The Company pays commitment fees in connection with these credit agreements.

The Company had interest rate swap agreements that established fixed rates on $1.52 billion and $1.50 billion of short-term variable rate debt at January 1, 2000 and January 2, 1999, respectively, resulting in weighted average interest rates of 6.7% and 6.8%, respectively. The weighted average maturity of agreements in effect on January 1, 2000, was approximately 14 years.

Long-term debt is as follows:

On October 2, 1998, the Company prepaid its 6% debentures with a face value of $300 million, which were due in May 2000. The transaction generated an extraordinary loss of $37 million and a related income tax benefit of $13 million, resulting in an after-tax loss of $24 million. The loss resulted primarily from the write-off of the related unamortized discount. The debt was refinanced with the issuance of commercial paper.

As of January 1, 2000, long-term debt maturities for the next five years are as follows:

The Company paid interest of $1.2, $1.3 and $1.4 billion in 1999, 1998 and 1997, respectively. Interest capitalized was $5, $5 and $3 million in 1999, 1998 and 1997, respectively.


  Annual Report 1999 

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1999 Sears, Roebuck and Co. - www.sears.com