Debt |
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| Debt | 6. Debt Short-term borrowings, including the current portion of long-term debt, consist of the following at December 31:
The company has $500.0 million in uncommitted lines of credit. There were no outstanding borrowings under the uncommitted lines of credit at December 31, 2025 and 2024. The maturity for borrowings is generally short term and is agreed upon with lenders at the time of each borrowing. The uncommitted lines of credit had a weighted-average effective interest rate of 4.37% and 5.18% at December 31, 2025 and 2024, respectively. The company has a commercial paper program and the maximum aggregate balance of commercial paper outstanding may not exceed the borrowing capacity of $1.2 billion. Amounts outstanding under the commercial paper program are backstopped by available commitments under the company’s revolving credit facility. The company had no outstanding borrowings under this program at December 31, 2025 and December 31, 2024. The commercial paper program had a weighted-average effective interest rate of 4.26% and 5.21% at December 31, 2025 and 2024, respectively. Long-term debt consists of the following at December 31:
The 7.50% senior debentures are not redeemable prior to their maturity. All other notes may be called at the option of the company subject to “make whole” clauses. The estimated fair market value of long-term debt at December 31, using quoted market prices, is as follows:
The carrying amount of the company’s other short-term borrowings, North American asset securitization program, commercial paper, and other obligations approximate their fair value. The company has a $2.0 billion revolving credit facility that may be used by the company for general corporate purposes including working capital in the ordinary course of business, letters of credit, repayment, prepayment or purchase of long-term indebtedness, acquisitions, and as support for the company’s commercial paper program, as applicable. In 2025, the company amended its revolving credit facility and, among other things, extended its term to mature in 2030. Interest on borrowings under the revolving credit facility is calculated using a base rate or SOFR, plus a spread (1.08% at December 31, 2025), which is based on the company’s credit ratings, for a weighted-average effective interest rate of 5.01% at December 31, 2025. The effective interest rate was 5.48% at December 31, 2024. The facility fee, which is based on the company’s credit ratings, was 0.175% of the total borrowing capacity at December 31, 2025. The company had no outstanding borrowings under the revolving credit facility at December 31, 2025 and $30.0 million in outstanding borrowings under the revolving credit facility at December 31, 2024. The company has a North American asset securitization program collateralized by accounts receivable of certain of its subsidiaries. The company may borrow up to $1.5 billion under the program which matures in September 2027. The program is conducted through AFC, a wholly-owned, bankruptcy remote subsidiary. The North American asset securitization program does not qualify for sale treatment. Accordingly, the accounts receivable and related debt obligation remain on the company’s consolidated balance sheets. Interest on borrowings is calculated using a base rate plus a spread (0.40% at December 31, 2025), and a credit spread adjustment of 0.10% for an effective interest rate of 4.19% at December 31, 2025. The effective interest rate was 4.83% at December 31, 2024. The facility fee is 0.40% of the total borrowing capacity. The company had $970.0 million and $633.0 million in outstanding borrowings under the North American asset securitization program at December 31, 2025 and 2024, respectively, which was included in “Long-term debt” in the company’s consolidated balance sheets. Total collateralized accounts receivable of approximately $3.0 billion were held by AFC and were included in “Accounts receivable, net” on the company’s consolidated balance sheets at December 31, 2025 and 2024, respectively. Any accounts receivable held by AFC would likely not be available to other creditors of the company in the event of bankruptcy or insolvency proceedings of the company before repayment of any outstanding borrowings under the North American asset securitization program. Both the revolving credit facility and North American asset securitization program include terms and conditions that limit the incurrence of additional borrowings and require that certain financial ratios be maintained at designated levels. As of December 31, 2025, the company was in compliance with all such financial covenants. In the second quarter of 2025, the company repaid in full the $350.0 million principal amount of its 4.00% notes due April 2025. In the third quarter of 2024, the company completed the sale of $500.0 million principal amount of 5.15% notes, due 2029. The net proceeds of the offering of $494.9 million were used for general corporate purposes and to repay the $500.0 million principal amount of its 3.25% notes, due September 2024, which were redeemed at maturity. In the second quarter of 2024, the company completed the sale of $500.0 million principal amount of 5.875% notes, due 2034. The net proceeds of the offering of $494.7 million were used for general corporate purposes and to repay the $500.0 million principal amount of its 6.125% notes, due 2026, which were redeemed in April 2024. Expected annual payments of borrowings at December 31 are as follows:
Interest and other financing expense, net, includes interest and dividend income of $46.8 million, $54.5 million, and $66.4 million in 2025, 2024, and 2023, respectively. Interest paid, net of interest and dividend income, amounted to $163.2 million, $199.0 million, and $274.1 million in 2025, 2024, and 2023, respectively. |
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