Analysis of Debt
Total Debt (Carrying Amount)
Emerson Electric Co., balance sheet: debt
US$ in millions
Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30).
The overall trajectory of total debt exhibited significant volatility between 2014 and 2019, characterized by an initial increase, a substantial contraction, and a subsequent recovery toward the end of the period.
- Total Debt Trends
- Total debt rose from US$ 6,024 million in 2014 to a peak of US$ 6,842 million in 2015. A marked reduction occurred by 2017, when the balance fell to US$ 4,656 million, representing the lowest point in the analyzed period. Following this low, a recovery trend emerged, with total debt increasing to US$ 5,721 million by September 30, 2019.
- Short-term Borrowings and Current Maturities
- Short-term obligations remained relatively stable between 2014 and 2016, fluctuating slightly around the US$ 2.5 billion mark. A sharp decrease was recorded in 2017, with borrowings dropping to US$ 862 million. This was followed by a partial recovery to US$ 1,623 million in 2018 and a slight adjustment to US$ 1,444 million in 2019.
- Long-term Debt Obligations
- Long-term debt, excluding current maturities, experienced a general declining trend from 2015, falling from US$ 4,289 million to a period low of US$ 3,137 million in 2018. This trend shifted abruptly in 2019, as long-term debt increased significantly to US$ 4,277 million, serving as the primary driver for the increase in total carrying amount for that fiscal year.
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Total Debt (Fair Value)
| Sep 30, 2019 | |
|---|---|
| Selected Financial Data (US$ in millions) | |
| Commercial paper | 929) |
| Payable to banks | —) |
| Total short-term borrowings (fair value) | 929) |
| Long-term debt, including current maturities | 5,261) |
| Total debt (fair value) | 6,190) |
| Financial Ratio | |
| Debt, fair value to carrying amount ratio | 1.08 |
Based on: 10-K (reporting date: 2019-09-30).
Weighted-average Interest Rate on Debt
Interest rate for weighted-average debt: 3.06%
| Interest rate | Debt amount1 | Interest rate × Debt amount | Weighted-average interest rate2 |
|---|---|---|---|
| 4.88% | 500) | 24) | |
| 4.25% | 300) | 13) | |
| 2.63% | 500) | 13) | |
| 2.63% | 500) | 13) | |
| 0.38% | 545) | 2) | |
| 3.15% | 500) | 16) | |
| 1.25% | 545) | 7) | |
| 2.00% | 545) | 11) | |
| 6.00% | 250) | 15) | |
| 6.13% | 250) | 15) | |
| 5.25% | 300) | 16) | |
| Total | 4,735) | 145) | |
| 3.06% | |||
Based on: 10-K (reporting date: 2019-09-30).
1 US$ in millions
2 Weighted-average interest rate = 100 × 145 ÷ 4,735 = 3.06%