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Debt
 12 Months Ended
Aug. 31, 2024
Debt Disclosure [Abstract]  
Debt Debt
Debt carrying values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated debt is translated to the U.S. dollar using the spot rates as of the balance sheet date. Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted):
 August 31, 2024August 31, 2023
Short-term debt  
Credit facilities 1
November 2021 DDTL due November 2024$290 $— 
$850 million note issuance 1
0.9500% unsecured notes due 2023
— 850
$8 billion note issuance 1
3.800% unsecured notes due 2024
1,157 — 
Other 2
58 68 
Total short-term debt$1,505 $917 
Long-term debt  
Credit facilities 1
November 2021 DDTL due November 2024
$— $289 
December 2022 DDTL due January 20261,000 999 
August 2023 DDTL due November 20261,000 — 
$1.5 billion note issuance 1
3.200% unsecured notes due 2030
498 498 
4.100% unsecured notes due 2050
635 793 
$6 billion note issuance 1
3.450% unsecured notes due 2026
1,445 1,444 
4.650% unsecured notes due 2046
295 318 
$8 billion note issuance 1
3.800% unsecured notes due 2024
— 1,156 
4.500% unsecured notes due 2034
301 301 
4.800% unsecured notes due 2044
657 869 
£700 million note issuance 1
3.600% unsecured Pound Sterling notes due 2025
391 381 
€750 million note issuance 1
2.125% unsecured Euro notes due 2026
833 814 
$4 billion note issuance 3
4.400% unsecured notes due 2042
236 263 
$750 million note issuance 1
8.125% unsecured notes due 2029
740 — 
Other 2
13 20 
Total long-term debt, less current portion$8,044 $8,145 
1.Notes, borrowings under credit facilities and commercial paper are unsecured debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding.
2.Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies.
3.Notes are senior debt obligations of Walgreen Co.
At August 31, 2024, the future maturities of short-term and long-term debt, excluding debt discounts, issuance costs and finance lease obligations (See Note 4. Leases, for further information on the future lease payments), consisted of the following (in millions):
Amount
2025$1,505 
20262,838 
20271,835 
20281 
2029751 
Later2,651 
Total estimated future maturities$9,581 

$750 million Note Issuance
On August 12, 2024, the Company issued, in an underwritten public offering, $750 million of 8.125% notes due 2029. The notes contain a call option which allows for the notes to be repaid, in full or in part, at 104%, 102% and 100% of the principal amount of the notes to be redeemed, in each case plus accrued and unpaid interest at August 15, 2026, August 15, 2027 and August 15, 2028 respectively.

$850 million Note Issuance
On November 17, 2021, the Company issued, in an underwritten public offering, $850 million of 0.95% notes due 2023. The notes contained a call option that allowed for the notes to be repaid, in full or in part, at 100% of the principal amount of the notes to be redeemed, in each case plus accrued and unpaid interest. On November 17, 2023, the Company repaid the note in full.

Credit facilities

August 2023 Revolving Credit Agreement
On August 9, 2023, the Company entered into a $2.25 billion unsecured three-year revolving credit facility (the “August 2023 Revolving Credit Agreement” or “August 2023 RCF”). Interest on borrowings under the revolving credit facility accrues at applicable margins based on the Company’s Index Debt Rating by Moody’s or Standard and Poor (“S&P”) and ranges from 75 basis points to 150 basis points over specified benchmark rates for Secured Overnight Financing Rate (“SOFR”) loans, as applicable. Additionally, the Company pays commitment fees to maintain the availability under the August 2023 Revolving Credit Agreement at applicable fee rates based upon certain criteria at an annual rate on the unutilized portion of the total credit commitment. The August 2023 Revolving Credit Agreement’s termination date is August 9, 2026, or earlier, subject to the Company’s discretion to terminate the agreement. As of August 31, 2024, there were no borrowings outstanding under the August 2023 Revolving Credit Agreement.

August 2023 Delayed Draw Term Loan
On August 9, 2023, the Company entered into a $1 billion senior unsecured delayed draw term loan credit agreement (the “August 2023 DDTL”). Interest on borrowings under the August 2023 DDTL accrues at applicable margins based on the Company’s Index Debt Rating by Moody’s or S&P and ranges from 75 basis points to 150 basis points over specified benchmark rates for SOFR loans, as applicable. The August 2023 DDTL was drawn for general corporate purposes. The August 2023 DDTL matures on November 17, 2026. As of August 31, 2024, there was $1 billion in borrowings outstanding under the August 2023 DDTL. Amounts borrowed under the August 2023 DDTL that are repaid or prepaid may not be reborrowed.

December 2022 Delayed Draw Term Loan
On December 19, 2022, the Company entered into a $1.0 billion senior unsecured delayed draw term loan credit agreement (the “December 2022 DDTL”). Interest on borrowings under the December 2022 DDTL accrues at applicable margins based on the Company’s Index Debt Rating by Moody’s or S&P and ranges from 87.5 basis points to 150 basis points over specified benchmark rates for SOFR loans, as applicable. The December 2022 DDTL was drawn for the purpose of funding the consideration due for the purchase of Summit and paying fees and expenses related to it. The December 2022 DDTL matures on January 3, 2026. As of August 31, 2024, there was $1.0 billion in borrowings outstanding under the December 2022 DDTL. Amounts borrowed under the December 2022 DDTL that are repaid or prepaid may not be reborrowed.
June 2022 Revolving Credit Agreements
On June 17, 2022, the Company entered into a $3.5 billion unsecured five-year revolving credit facility and a $1.5 billion unsecured 18-month revolving credit facility, with designated borrowers from time to time party thereto and lenders from time to time party thereto (the “2022 Revolving Credit Agreements”). Interest on borrowings under the revolving credit facilities accrues at applicable margins based on the Company’s Index Debt Rating by Moody’s or S&P and ranges from 80 basis points to 150 basis points over specified benchmark rates for eurocurrency rate and SOFR loans, as applicable. Additionally, the Company pays commitment fees to maintain the availability under the revolving credit facility at applicable fee rates based upon certain criteria at an annual rate on the unutilized portion of the total credit commitment. The five-year facility’s termination date is June 17, 2027, or earlier, subject to the Company’s discretion to terminate the agreement. The 18-month facility’s termination date was December 15, 2023, or earlier, subject to the Company’s discretion to terminate the agreement. On August 9, 2023 the Company terminated the 18-month facility under the 2022 Revolving Credit Agreements. All outstanding obligations under the 18-month revolving credit facility have been paid and satisfied in full. As of August 31, 2024, there were no borrowings outstanding under the five-year revolving credit facility.

November 2021 Delayed Draw Term Loan
On November 15, 2021, the Company entered into a $5.0 billion senior unsecured multi-tranche delayed draw term loan credit facility, (the “November 2021 DDTL”) consisting of (i) a 364-day senior unsecured delayed draw term loan facility in an aggregate principal amount of $2.0 billion (the “364-day loan”), (ii) a two-year senior unsecured delayed draw term loan facility in an aggregate principal amount of $2.0 billion (the “two-year loan”) and (iii) a three-year senior unsecured delayed draw term loan facility in an aggregate principal amount of $1.0 billion (the “three-year loan”). Borrowings under the November 2021 DDTL bear interest at a fluctuating rate per annum equal to SOFR, plus an applicable margin. The applicable margins for the 364-day and two-year loans were 0.75% and 0.88%, respectively. The applicable margin for the three-year loan is 1.05%. An aggregate amount of $3.0 billion or more of the November 2021 DDTL was drawn for the purpose of funding the purchase of the increased equity interest in VillageMD, and paying fees and expenses related to the foregoing, with the remainder used for general corporate purposes. In fiscal 2023, the Company repaid the 364-day loan and the two-year loan in full. The maturity date on the three-year loan is November 24, 2024. As of August 31, 2024, there was $290 million in borrowings outstanding under the November 2021 DDTL. Amounts borrowed under the November 2021 DDTL and repaid or prepaid may not be reborrowed.

Debt covenants
Each of the Company’s credit facilities described above contain a covenant to maintain, as of the last day of each fiscal quarter, a ratio of consolidated debt to total capitalization not to exceed 0.60:1.00, subject to increase in certain circumstances set forth in the applicable credit agreement. The credit facilities contain various other customary financial covenants. As of August 31, 2024, the Company was in compliance with all such applicable financial covenants.

Commercial paper
The Company periodically borrows under its commercial paper program and may borrow under it in future periods. As of August 31, 2024 and 2023, the Company had no borrowings outstanding under the commercial paper program.
 
Interest
Interest paid by the Company was $578 million, $606 million and $420 million in fiscal 2024, 2023 and 2022, respectively.

In fiscal 2024, the Company recognized a gain of $102 million related to the early extinguishment of debt within Interest expense, net in the Consolidated Statements of Earnings. The cash payments related to the early extinguishment of debt are classified as cash outflows from financing activities in the Consolidated Statements of Cash Flows.

Credit ratings
In fiscal 2024, the Company’s long-term ratings were downgraded below investment grade to BB with a negative outlook by Standard and Poor’s and Ba3 with a stable outlook by Moody’s (with respect to the Company’s Corporate Family Rating). The reduction in the Company’s credit ratings has limited impact to the cost of interest on existing debt, but has minimally increased borrowing margins under certain credit facilities that are tied to ratings grids or similar terms. The Company’s current credit ratings significantly reduce the Company’s ability to issue commercial paper, has and may continue to increase the cost of new financing for the Company, and may decrease access to credit and debt capital markets. As of August 31, 2024, the Company had an aggregate borrowing capacity under committed revolving credit facilities of $5.8 billion, with no funds drawn under these facilities.