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Long-Term Debt:
12 Months Ended
Dec. 31, 2017
Long-term Debt, Unclassified [Abstract]  
Long-term Debt
LONG-TERM DEBT

Long-term debt outstanding was as follows (dollars in thousands):


Interest Rate at
Balance Outstanding
 
Due Date
December 31, 2017
December 31, 2017
December 31, 2016
Corporate
 
 
 
 
Senior unsecured notes due 2023
November 30, 2023
4.25%
$
525,000

$
525,000

Senior unsecured notes due 2020
July 15, 2020
5.88%
200,000

200,000

Remarketable junior subordinated notes (b)
November 1, 2028
3.50%
299,000

299,000

Senior unsecured notes due 2019
January 11, 2019
2.50%
250,000

250,000

Senior unsecured notes due 2026
January 15, 2026
3.95%
300,000

300,000

Senior unsecured notes due 2027
January 15, 2027
3.15%
400,000

400,000

Senior unsecured notes, due 2046
September 15, 2046
4.20%
300,000

300,000

Corporate term loan due 2019 (a)
August 9, 2019
2.55%
300,000

400,000

Corporate term loan due 2021
June 7, 2021
2.32%
18,664

24,406

Total Corporate debt
 
 
2,592,664

2,698,406

Less unamortized debt discount
 
 
(3,808
)
(4,413
)
Total Corporate debt, net
 
 
2,588,856

2,693,993

 
 
 
 
 
Electric Utilities
 
 
 
 
First Mortgage Bonds due 2044
October 20, 2044
4.43%
85,000

85,000

First Mortgage Bonds due 2044
October 20, 2044
4.53%
75,000

75,000

First Mortgage Bonds due 2032
August 15, 2032
7.23%
75,000

75,000

First Mortgage Bonds due 2039
November 1, 2039
6.13%
180,000

180,000

First Mortgage Bonds due 2037
November 20, 2037
6.67%
110,000

110,000

Industrial development revenue bonds due 2021 (c)
September 1, 2021
1.78%
7,000

7,000

Industrial development revenue bonds due 2027 (c)
March 1, 2027
1.78%
10,000

10,000

Series 94A Debt, variable rate (c)
June 1, 2024
1.83%
2,855

2,855

Total Electric Utilities debt
 
 
544,855

544,855

Less unamortized debt discount
 
 
(90
)
(94
)
Total Electric Utilities debt, net
 
 
544,765

544,761

 
 
 
 
 
Total long-term debt
 
 
3,133,621

3,238,754

Less current maturities
 
 
5,743

5,743

Less deferred financing costs (d)
 
 
18,478

21,822

Long-term debt, net of current maturities and deferred financing costs
 
 
$
3,109,400

$
3,211,189

_______________
(a)
Variable interest rate, based on LIBOR plus a spread.
(b)
See Note 12 for RSN details.
(c)
Variable interest rate.
(d)
Includes deferred financing costs associated with our Revolving Credit Facility of $1.7 million and $2.3 million as of December 31, 2017 and December 31, 2016, respectively.
Scheduled maturities of long-term debt, excluding amortization of premiums or discounts, for future years are (in thousands):
2018
$
5,743

2019
$
555,742

2020
$
205,743

2021
$
8,436

2022
$

Thereafter
$
2,361,855



Our debt securities contain certain restrictive financial covenants, all of which the Company and its subsidiaries were in compliance with at December 31, 2017.

Substantially all of the tangible utility property of South Dakota Electric and Wyoming Electric is subject to the lien of indentures securing their first mortgage bonds. First mortgage bonds of South Dakota Electric and Wyoming Electric may be issued in amounts limited by property, earnings and other provisions of the mortgage indentures. The first mortgage bonds issued by South Dakota Electric and Wyoming Electric are callable, but are subject to make-whole provisions which would eliminate any economic benefit for us to call the bonds.

Assumption of Long-Term Debt

At the closing of the SourceGas Acquisition on February 12, 2016, we assumed $760 million in long-term debt, consisting of the following:

$325 million, 5.9% senior unsecured notes with an original issue date of April 16, 2007, due April 1, 2017.

$95 million, 3.98% senior secured notes with an original issue date of September 29, 2014, due September 29, 2019.

$340 million unsecured corporate term loan due June 30, 2017. Interest under this term loan was LIBOR plus a margin of 0.875%.

The $760 million in long-term debt assumed in the SourceGas Acquisition was repaid in August 2016.

Debt Transactions

On May 16, 2017, we paid down $50 million on our Corporate term loan due August 9, 2019. On July 17, 2017, we paid down an additional $50 million on the same term loan. Short-term borrowings from our CP program were used to fund the payments on the Corporate term loan.

On August 19, 2016, we completed a public debt offering of $700 million principal amount of senior unsecured notes. The debt offering consisted of $400 million of 3.15% 10-year senior notes due January 15, 2027 and $300 million of 4.20% 30-year senior notes due September 15, 2046 (together the “Notes”). The proceeds of the Notes were used for the following:

Repay the $325 million 5.9% senior unsecured notes assumed in the SourceGas Acquisition;

Repay the $95 million, 3.98% senior secured notes assumed in the SourceGas Acquisition;

Repay $100 million on the $340 million unsecured term loan assumed in the SourceGas Acquisition;

Pay down $100 million of the $500 million three-year unsecured term loan discussed below;

Payment of $29 million for the settlement of $400 million notional interest rate swap; and

Remainder was used for general corporate purposes.

On August 9, 2016, we entered into a $500 million, three-year, unsecured term loan expiring on August 9, 2019. The proceeds of this term loan were used to pay down $240 million of the $340 million unsecured term loan assumed in the SourceGas Acquisition and the $260 million term loan expiring on April 12, 2017. This new term loan has substantially similar terms and covenants as the amended and restated Revolving Credit Facility.

In accordance with regulatory orders related to the early termination and settlement of the gas supply contract described in Note 1, on June 7, 2016, we entered into a 2.32%, $29 million term loan, due June 7, 2021. Proceeds from this term loan were used to finance the early termination of the gas supply contract, resulting in a regulatory asset. Principal and interest are payable quarterly at approximately $1.6 million.

On January 13, 2016, we completed a public debt offering of $550 million principal amount of senior unsecured notes. The debt offering consisted of $300 million of 3.95%, ten-year senior notes due 2026, and $250 million of 2.50%, three-year senior notes due 2019. After discounts and underwriter fees, net proceeds from the offering totaled $546 million and were used as funding for the SourceGas Acquisition. The discounts are amortized over the life of each respective note.

Amortization Expense

Our deferred financing costs and associated amortization expense included in Interest expense on the accompanying Consolidated Statements of Income (Loss) were as follows (in thousands):
 
Deferred Financing Costs Remaining at
Amortization Expense for the years ended December 31,
 
December 31, 2017
2017
2016
2015
Revolving Credit Facility
$
1,703

 
$
638

$
537

$
504

Senior unsecured notes due 2023
2,427

 
494

494

494

Senior unsecured notes due 2019
59

 
704

643


Senior unsecured notes due 2020
425

 
167

167

167

Senior unsecured notes due 2026
2,031

 
287

262


Senior unsecured notes due 2027
2,918

 
363

121


Senior unsecured notes due 2046
3,082

 
111

37


Corporate term loan due 2019
86

 
201

144


Bridge Term Loan

 

843

4,213

RSNs due 2028
1,326

 
122

122

10

First mortgage bonds due 2044 (South Dakota Electric)
639

 
24

24

24

First mortgage bonds due 2044 (Wyoming Electric)
591

 
22

23

22

First mortgage bonds due 2032
485

 
33

33

33

First mortgage bonds due 2039
1,657

 
76

76

76

First mortgage bonds due 2037
613

 
31

31

31

Other
436

 
76

304

43

Total
$
18,478

 
$
3,349

$
3,861

$
5,617



Dividend Restrictions

Our credit facility and other debt obligations contain restrictions on the payment of cash dividends when a default or event of default occurs. In addition, the agreements governing our equity units contain restrictions on the payment of cash dividends upon any time we have exercised our right to defer payment of contract adjustment payments under the purchase contracts or interest payments under the RSNs included in such equity units. As of December 31, 2017, we were in compliance with these covenants.

Due to our holding company structure, substantially all of our operating cash flows are provided by dividends paid or distributions made by our subsidiaries. The cash to pay dividends to our shareholders is derived from these cash flows. As a result, certain statutory limitations or regulatory or financing agreements could affect the levels of distributions allowed to be made by our subsidiaries. The following restrictions on distributions from our subsidiaries existed at December 31, 2017:

Our utilities are generally limited to the amount of dividends allowed to be paid to our utility holding company under the Federal Power Act and settlement agreements with state regulatory jurisdictions. As of December 31, 2017, the restricted net assets at our Electric and Gas Utilities were approximately $257 million.