Analysis of Debt
Total Debt (Carrying Amount)
Raytheon Co., balance sheet: debt
US$ in millions
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
The total carrying amount of commercial paper and long-term debt exhibits a general downward trajectory between 2015 and 2019. After remaining relatively stable during the 2015-2016 period, the aggregate debt obligation decreased from US$ 5,335 million in 2016 to US$ 4,760 million by the end of 2019, representing a total reduction of approximately 10.7% from its peak.
- Long-Term Debt Trends
- A significant contraction in long-term debt, excluding the current portion, is observed over the analyzed period. The balance declined from US$ 5,330 million in 2015 to US$ 3,261 million in 2019. The most pronounced decrease occurred between 2018 and 2019, where the balance fell by approximately US$ 1,494 million.
- Short-Term Debt and Current Obligations
- Commercial paper and the current portion of long-term debt were not present in the 2015 and 2016 records. These obligations appeared at a constant level of US$ 300 million in 2017 and 2018, followed by a sharp increase to US$ 1,499 million in 2019. This surge indicates a substantial shift in the maturity profile of the company's debt, with a larger volume of obligations becoming due within the short term.
- Debt Structure Shift
- The data reveals a strategic transition in the composition of total liabilities. While the overall debt burden decreased, the proportion of short-term versus long-term debt shifted dramatically by 2019. The reduction in total debt was driven primarily by the decrease in long-term obligations, which offset the significant rise in current debt portions and commercial paper.
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Total Debt (Fair Value)
| Dec 31, 2019 | |
|---|---|
| Selected Financial Data (US$ in millions) | |
| Commercial paper | —) |
| Long-term debt | 5,337) |
| Total commercial paper and long-term debt (fair value) | 5,337) |
| Financial Ratio | |
| Debt, fair value to carrying amount ratio | 1.12 |
Based on: 10-K (reporting date: 2019-12-31).
Weighted-average Interest Rate on Debt
Weighted-average interest rate on debt: 4.01%
| Interest rate | Debt amount1 | Interest rate × Debt amount | Weighted-average interest rate2 |
|---|---|---|---|
| 4.40% | 500) | 22) | |
| 3.13% | 999) | 31) | |
| 2.50% | 1,097) | 27) | |
| 3.15% | 298) | 9) | |
| 7.20% | 374) | 27) | |
| 7.00% | 185) | 13) | |
| 4.88% | 592) | 29) | |
| 4.70% | 420) | 20) | |
| 4.20% | 295) | 12) | |
| Total | 4,760) | 191) | |
| 4.01% | |||
Based on: 10-K (reporting date: 2019-12-31).
1 US$ in millions
2 Weighted-average interest rate = 100 × 191 ÷ 4,760 = 4.01%