XML 30 R16.htm IDEA: XBRL DOCUMENT v3.19.2
DEBT
 12 Months Ended
May 26, 2019
DEBT [Abstract]  
DEBT

NOTE 8. DEBT

NOTES PAYABLE

The components of notes payable and their respective weighted-average interest rates at the end of the periods were as follows:

May 26, 2019May 27, 2018
In MillionsNotesPayableWeighted-AverageInterest RateNotesPayableWeighted-AverageInterest Rate
U.S. commercial paper$1,298.52.7%$1,213.52.2%
Financial institutions170.29.0336.36.2
Total$1,468.73.4%$1,549.83.1%

To ensure availability of funds, we maintain bank credit lines sufficient to cover our outstanding notes payable. Commercial paper is a continuing source of short-term financing. We have commercial paper programs available to us in the United States and Europe. We also have uncommitted and asset-backed credit lines that support our foreign operations.

The following table details the fee-paid committed and uncommitted credit lines we had available as of May 26, 2019:

In BillionsFacility AmountBorrowed Amount
Credit facility expiring:
May 2022$2.7$-
June 20190.2-
Total committed credit facilities2.9-
Uncommitted credit facilities0.70.2
Total committed and uncommitted credit facilities$3.6$0.2

The credit facilities contain covenants, including a requirement to maintain a fixed charge coverage ratio of at least 2.5 times. We were in compliance with all credit facility covenants as of May 26, 2019.

LONG-TERM DEBT

In March 2019, we issued €300.0 million principal amount of 0.0 percent fixed-rate notes due January 15, 2020. We may redeem the notes if certain tax laws change and we would be obligated to pay additional amounts on the notes. These notes are senior unsecured obligations that include a change of control repurchase provision. We used the net proceeds, together with cash on hand, to repay our €300.0 million floating rate notes.

In February 2019, we repaid $1,150.0million of 5.65 percent fixed-rate notes with proceeds from commercial paper.

In April 2018, we issued $4,800.0 million principal amount of fixed-rate notes. Interest on the notes is payable semi-annually in arrears. We may redeem the notes in whole, or in part, at any time at the applicable redemption price. The notes are senior unsecured obligations that include a change of control repurchase provision. The net proceeds were used to finance a portion of the Blue Buffalo acquisition. The principal amounts of these fixed-rate notes were as follows:

In MillionsPrincipal
4.2% notes due April 17, 2028$1,400.0
3.7% notes due October 17, 2023850.0
4.0% notes due April 17, 2025800.0
4.7% notes due April 17, 2048650.0
3.2% notes due April 16, 2021600.0
4.55% notes due April 17, 2038500.0
Total$4,800.0

In April 2018, we issued $1,250.0 million principal amount of floating-rate notes. Interest on the notes is payable quarterly in arrears. The notes are not generally redeemable prior to maturity. These notes are senior unsecured obligations that include a change of control repurchase provision. The net proceeds were used to finance a portion of the Blue Buffalo acquisition. The principal amounts of these floating-rate notes were as follows:

In MillionsPrincipal
Floating-rate notes due April 16, 2021$850.0
Floating-rate notes due October 17, 2023400.0
Total$1,250.0

In February 2018, we paid $113.8 million to repurchase $100.0 million of our previously issued 6.39 percent medium term notes due 2023. We recorded the $13.8 million premium paid in the repurchase as net interest expense.

In October 2017, we issued $500.0 million principal amount of 2.6 percent fixed-rate notes due October 12, 2022. Interest on the notes is payable semiannually in arrears. We may redeem the notes in whole, or in part, at any time at the applicable redemption price. The notes are senior unsecured obligations that include a change of control repurchase provision. The net proceeds, together with cash on hand, were used to repay $500.0 million of 1.4 percent fixed-rate notes.

A summary of our long-term debt is as follows:

In MillionsMay 26, 2019May 27, 2018
4.2% notes due April 17, 2028$1,400.0$1,400.0
5.65% notes due February 15, 2019-1,150.0
3.15% notes due December 15, 20211,000.01,000.0
3.7% notes due October 17, 2023850.0850.0
Floating-rate notes due April 16, 2021850.0850.0
4.0% notes due April 17, 2025800.0800.0
3.2% notes due February 10, 2027750.0750.0
4.7% notes due April 17, 2048650.0650.0
3.2% notes due April 16, 2021600.0600.0
Euro-denominated 2.1% notes due November 16, 2020560.1582.6
Euro-denominated 1.0% notes due April 27, 2023560.1582.6
Euro-denominated floating-rate notes due January 15, 2020560.1582.6
4.55% notes due April 17, 2038500.0500.0
2.6% notes due October 12, 2022500.0500.0
5.4% notes due June 15, 2040500.0500.0
4.15% notes due February 15, 2043500.0500.0
3.65% notes due February 15, 2024500.0500.0
2.2% notes due October 21, 2019500.0500.0
Euro-denominated 1.5% notes due April 27, 2027448.1466.1
Floating-rate notes due October 17, 2023400.0400.0
Euro-denominated 0.0% notes due January 15, 2020336.1-
Euro-denominated floating-rate notes due March 20, 2019-349.6
Euro-denominated 2.2% notes due June 24, 2021224.0232.8
Medium-term notes, 2.36% to 6.59%, due fiscal 2022 or later104.2104.2
Other, including debt issuance costs and capital leases(71.4)(81.7)
13,021.314,268.8
Less amount due within one year(1,396.5)(1,600.1)
Total long-term debt$11,624.8$12,668.7

Principal payments due on long-term debt and capital leases in the next five years based on stated contractual maturities, our intent to redeem, or put rights of certain note holders are as follows:

In Millions
2020$1,396.5
20212,114.4
20221,224.1
20231,060.2
20241,750.0

Certain of our long-term debt agreements contain restrictive covenants. As of May 26, 2019, we were in compliance with all of these covenants.

As of May 26, 2019, the $45.2 million pre-tax loss recorded in AOCI associated with our previously designated interest rate swaps will be reclassified to net interest over the remaining lives of the hedged transactions. The amount expected to be reclassified from AOCI to net interest in fiscal 2020 is a $9.4 million pre-tax loss.