Note 3 - Debt and Revolving Credit Facility

3 Months Ended

Aug. 27, 2023

Notes to Financial Statements

Long-Term Debt [Text Block]

3. DEBT AND REVOLVING CREDIT FACILITY

Senior Notes

During the first quarter of fiscal 2024, we repaid the entire outstanding $500.0 million aggregate principal amount of our 0.50% senior notes on their maturity date of August 11, 2023. The repayment was primarily funded using the net proceeds from the issuance of $500.0 million aggregate principal amount of 5.30% senior notes due October 1, 2026.

During the third quarter of fiscal 2023, we repaid the remaining outstanding $437.0 million aggregate principal amount of our 3.20% senior notes on their maturity date of January 25, 2023.

During the second quarter of fiscal 2023, we repaid the entire outstanding $250.0 million aggregate principal amount of our 3.25% senior notes on their maturity date of September 15, 2022.

Term Loan

During the second quarter of fiscal 2023, we borrowed the full $500.0 million aggregate principal amount available under our unsecured term loan (the "Term Loan") from a syndicate of financial institutions. The Term Loan matures on August 26, 2025.

Revolving Credit Facility

At  August 27, 2023, we had a revolving credit facility (the "Revolving Credit Facility") with a syndicate of financial institutions providing for a maximum aggregate principal amount outstanding at any one time of $2.0 billion (subject to increase to a maximum aggregate principal amount of $2.5 billion with consent of the lenders). The Revolving Credit Facility matures on August 26, 2027 and is unsecured. The Company may request the term of the Revolving Credit Facility be extended for additional one-year or two-year periods from the then-applicable maturity date on an annual basis. As of August 27, 2023, there were no outstanding borrowings under the Revolving Credit Facility.

Debt Covenants

The Revolving Credit Facility generally requires our ratio of earnings before interest, taxes, depreciation and amortization ("EBITDA") to interest expense to be not less than 3.0 to 1.0 and our ratio of funded net debt to EBITDA not to exceed 4.5 to 1.0, with each ratio to be calculated on a rolling four-quarter basis. As of August 27, 2023, we were in compliance with all financial covenants under the Revolving Credit Facility.

Commercial Paper

As of  August 27, 2023 and May 28, 2023, we had $458.7 million and $576.0 million, respectively, outstanding under our commercial paper program.

Interest Expense

Net interest expense consists of:

	Thirteen Weeks Ended
	August 27, 2023			August 28, 2022
Long-term debt	$	102.5		$	97.7
Short-term debt		7.4			1.9
Interest income		(1.1	)		(0.9	)
Interest capitalized		(2.8	)		(1.6	)
	$	106.0		$	97.1