Long-term and Short-term Debt

12 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Long-term and Short-term Debt

Long-term and Short-term Debt

Long-term debt consists of (in millions):

	September 30,
	2022		2021
0.35% notes, payable in August 2023	$	600.0	$	600.0
2.875% notes, payable in March 2025	311.0		315.6
6.70% debentures, payable in January 2028	250.0		250.0
3.50% notes, payable in March 2029	425.0		425.0
1.75% notes, payable in August 2031	450.0		450.0
6.25% debentures, payable in December 2037	250.0		250.0
4.20% notes, payable in March 2049	575.0		575.0
2.80% notes, payable in August 2061	450.0		450.0
5.20% debentures, payable in January 2098	200.0		200.0
Unamortized discount, capitalized lease obligations and other	(34.1)		(44.2)
Total debt	3,476.9		$	3,471.4
Less: Current portion	(609.1)		(6.8)
Long-term debt	$	2,867.8	$	3,464.6

Our Short-term debt as of September 30, 2022 and 2021, includes commercial paper borrowings of $317.0 million and $484.0 million, respectively, with weighted average interest rates of 3.03 percent and 0.18 percent, respectively, and weighted average maturity periods of 22 days and 90 days, respectively. Also included in Short-term debt as of September 30, 2022 and 2021, are $42.3 million and $23.5 million, respectively, of interest-bearing loans from SLB to Sensia, due in December 2022.

In August 2021, we issued $1.5 billion aggregate principal amount of long-term notes in a registered public offering. The offering consisted of $600.0 million of 0.35% notes due in August 2023, $450.0 million of 1.75% notes due in August 2031, and $450.0 million of 2.80% notes due in August 2061, all issued at a discount. Net proceeds to the Company from the debt offering were $1,485.6 million. We used these net proceeds primarily to fund the acquisition of Plex. Refer to Note 4 for additional information on this acquisition.

In March 2019, we issued $1.0 billion aggregate principal amount of long-term notes in a registered public offering. The offering consisted of $425.0 million of 3.50% notes due in March 2029 and $575.0 million of 4.20% notes due in March 2049, both issued at a discount. Net proceeds to the Company from the debt offering were $987.6 million. We used these net proceeds primarily to repay our outstanding commercial paper, with the remaining proceeds used for general corporate purposes.

We entered into treasury locks to manage the potential change in interest rates in anticipation of the issuance of the $1.5 billion aggregate notes in August 2021 and the $1.0 billion of fixed rate debt in March 2019. These treasury locks were designated as and accounted for as cash flow hedges. The effective differentials paid on these treasury locks was initially recorded in Accumulated other comprehensive loss, net of tax effect. As a result of the changes in the interest rates on the treasury locks between the time we entered into the treasury locks and the time we priced and issued the notes, the Company made a net payment of $28.0 million to the counterparties from the August 2021 issuance and $35.7 million to the counterparty from the March 2019 issuance. The $28.0 million and $35.7 million net losses on the settlement of the treasury locks were recorded in Accumulated other comprehensive loss, net of tax effect, and are being amortized over the term of the corresponding notes, and recognized as an adjustment to Interest expense in the Consolidated Statement of Operations.

On June 29, 2022, we replaced our former $1.25 billion unsecured revolving credit facility with a new five-year $1.5 billion unsecured revolving credit facility, expiring in June 2027. We can increase the aggregate amount of this credit facility by up to $750.0 million, subject to the consent of the banks in the credit facility. We did not borrow against this credit facility or the former credit facility during the periods ended September 30, 2022, or 2021. Borrowings under this credit facility bear interest based on short-term money market rates in effect during the period the borrowings are outstanding. The terms of this credit facility contain covenants under which we agree to maintain an EBITDA-to-interest ratio of at least 3.0 to 1.0. The EBITDA-to-interest ratio is defined in the credit facility as the ratio of consolidated EBITDA (as defined in the facility) for the preceding four quarters to consolidated interest expense for the same period.

Among other uses, we can draw on our credit facility as a standby liquidity facility to repay our outstanding commercial paper as it matures. Under our current policy, we expect to limit our other borrowings under our credit facility, if any, to amounts that would leave enough credit available under the facility so that we could borrow, if needed, to repay all of our then outstanding commercial paper as it matures.

Separate short-term unsecured credit facilities of approximately $214.1 million at September 30, 2022, were available to non-U.S. subsidiaries, of which approximately $30.0 million was committed under letters of credit. Borrowings under our non-U.S. credit facilities at September 30, 2022 and 2021, were not significant. We were in compliance with financial covenants under our credit facilities at September 30, 2022 and 2021. There are no significant commitment fees or compensating balance requirements under our credit facilities.

Interest payments were $120.4 million during 2022, $91.8 million during 2021, and $101.7 million during 2020.

The following table presents the carrying amounts and estimated fair values of Long-term debt in the Consolidated Balance Sheet (in millions):

	September 30, 2022				September 30, 2021
	Carrying Value		Fair Value		Carrying Value		Fair Value
Current portion of long-term debt	$	609.1	$	589.1	$	6.8	$	6.8
Long-term debt	2,867.8		2,485.4		3,464.6		3,874.8

We base the fair value of long-term debt upon quoted market prices for the same or similar issues and therefore consider this a Level 2 fair value measurement. The fair value of long-term debt considers the terms of the debt excluding the impact of derivative and hedging activity. Refer to Note 1 for further information regarding levels in the fair value hierarchy. The carrying value of our short-term debt approximates fair value.