KOHLS Corp
For the period ended Feb 3, 2024. Filed Mar 21, 2024.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 21, 2024
Contents
2. Debt
- Debt
Long-term debt, which excludes borrowings on the revolving credit facility, consists of the following unsecured debt:
| Outstanding | ||||
|---|---|---|---|---|
| Maturity (Dollars in Millions) | Effective Rate at Issuance | Coupon Rate | February 3, 2024 | January 28, 2023 |
| 2023 | 3.25% | 3.25% | $— | $164 |
| 2023 | 4.78% | 4.75% | — | 111 |
| 2025 | 9.50% | 10.75% | 113 | 113 |
| 2025 | 4.25% | 4.25% | 353 | 353 |
| 2029 | 7.36% | 7.25% | 42 | 42 |
| 2031 | 3.40% | 4.63% | 500 | 500 |
| 2033 | 6.05% | 6.00% | 112 | 112 |
| 2037 | 6.89% | 6.88% | 101 | 101 |
| 2045 | 5.57% | 5.55% | 427 | 427 |
| Outstanding unsecured senior debt | 1,648 | 1,923 | ||
| Unamortized debt discounts and deferred financing costs | (10) | (11) | ||
| Current portion of unsecured senior debt | — | (275) | ||
| Long-term unsecured senior debt | $1,638 | $1,637 | ||
| Effective interest rate at issuance | 5.06% | 4.89% | ||
Our estimated fair value of unsecured senior long-term debt is determined using Level 1 inputs, using financial instruments with unadjusted, quoted prices listed on active market exchanges. The estimated fair value of our unsecured senior debt was $1.3 billion at February 3, 2024 and $1.6 billion at January 28, 2023.
In 2023, $164 million in aggregate principal amount of our 3.25% notes and $111 million in aggregate principal amount of our 4.75% notes matured and were repaid.
During the first quarter of 2023, S&P downgraded our senior unsecured credit rating from BB+ to BB and Moody's downgraded our rating from Ba2 to Ba3. As a result of the downgrades, the interest rate on our 3.375% notes due May 2031 and 9.50% notes due May 2025 increased 50 basis points in May 2023 due to the coupon adjustment provisions within these notes. Our credit rating was also downgraded in 2022. This resulted in the interest rates increasing 75 basis points, with 25 basis points effective in 2022 and the remaining 50 basis points effective in May 2023. In total, the interest rate of both these notes have increased 125 basis points since their issuance.
Borrowings under the revolving credit facility, recorded as short-term debt, were $92 million as of February 3, 2024, and $85 million as of January 28, 2023. Outstanding borrowings under the credit facility bear interest at a variable rate based on SOFR plus the applicable margin. As of February 3, 2024, we had $26 million of standby and trade letters of credit outstanding under the credit facility, which reduces the available borrowing capacity.
Our various debt agreements contain covenants including limitations on additional indebtedness and certain financial tests. As of February 3, 2024, we were in compliance with all covenants of the various debt agreements.
We also had outstanding standby and trade letters of credit outside of the credit facility totaling approximately $12 million at February 3, 2024.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.