XML 32 R12.htm IDEA: XBRL DOCUMENT v3.21.2
Long-Term Obligations and Other Short-Term Borrowings
 12 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Long-Term Obligations and Other Short-Term Borrowings
6. Long-Term Obligations and Other Short-Term Borrowings
The following table summarizes long-term obligations and other short-term borrowings at June 30:
(in millions) (1)20212020
2.616% Notes due 2022$572 $834 
3.2% Notes due 2022— 236 
Floating Rate Notes due 2022281 321 
3.2% Notes due 2023564 576 
3.079% Notes due 2024794 809 
3.5% Notes due 2024410 413 
3.75% Notes due 2025524 529 
3.41% Notes due 20271,216 1,215 
4.6% Notes due 2043341 340 
4.5% Notes due 2044342 342 
4.9% Notes due 2045441 441 
4.368% Notes due 2047560 560 
7.0% Debentures due 2026124 124 
Other Obligations67 35 
Total6,236 6,775 
Less: current portion of long-term obligations and other short-term borrowings871 10 
   Long-term obligations, less current portion$5,365 $6,765 
(1) Maturities are presented on a calendar year basis.
Maturities of existing long-term obligations and other short-term borrowings for fiscal 2022 through 2026 and thereafter are as follows: $872 million, $584 million, $808 million, $418 million, $525 million and $3.0 billion.
Long-Term Debt
All the notes represent unsecured obligations of Cardinal Health, Inc. and rank equally in right of payment with all of our existing and future unsecured and unsubordinated indebtedness. The 7.0% Debentures represent unsecured obligations of Allegiance Corporation (a wholly-owned subsidiary), which Cardinal Health, Inc. has guaranteed. None of these obligations are subject to a sinking fund and the Allegiance obligations are not redeemable prior to maturity. Interest is paid pursuant to the terms of the obligations. These notes are effectively subordinated to the liabilities of our subsidiaries, including trade payables of $23.7 billion and $21.4 billion at June 30, 2021 and 2020, respectively.
In June 2021, we redeemed all outstanding 3.2% Notes due June 2022 for $238 million and $262 million aggregate principle amount of 2.616% Notes due June 2022 at a redemption price equal to 100% of the principal amount and accrued but unpaid interest, plus the make-whole premium applicable to the notes. In connection with these redemptions, we recorded a $13 million loss on early extinguishment of debt.
During fiscal 2021, we also early repurchased $40 million of the Floating Rate Notes due 2022 and $2 million of the 2.616% Notes due 2022 with available cash. In connection with the early debt repurchases, we recorded a $1 million loss on early extinguishment of debt.
During fiscal 2020, we redeemed $500 million aggregate principle amount of 4.625% Notes due December 2020 at a redemption price equal to 100% of the principal amount and accrued but unpaid interest, plus the make-whole premium applicable to the notes. In connection with the redemption, we recorded a $7 million loss on early extinguishment of debt. We also early repurchased $247 million of the 2.616% Notes due 2022, $11 million of the 3.2% Notes due 2022, $20 million of the Floating Rate Notes due 2022, $104 million of the 3.41% Notes due 2027, $6 million of the 4.6% Notes due 2043, $5 million of the 4.9% Notes due 2045, and $35 million of the 4.368% Notes due 2047. In connection with the early debt repurchases, we recognized a $9 million loss on early extinguishment of debt. We also repaid the full principal of the $450 million 2.4% Notes due 2019 as they became due.
During fiscal 2019, we repurchased $67 million of the 2.616% Notes due 2022, $1 million of the 3.2% Notes due 2022, 8 million of the Floating Rate Notes due 2022, and $24 million of the 3.41% Notes due 2027 for a total of $100 million. The loss on early extinguishment of debt in connection with these early repurchases was immaterial. We also repaid the full principal of the $1.0 billion 1.948% Notes due 2019 as they became due.
The redemptions and repurchases were paid for with available cash and other short-term borrowings.
On August 13, 2021, we announced our intention to early redeem all remaining outstanding 2.616% Notes due June 2022 on September 15, 2021 at an expected redemption price equal to 100% of the principal amount and accrued but unpaid interest, plus the make-whole premium applicable to the notes.
If we undergo a change of control, as defined in the notes, and if the notes receive specified ratings below investment grade by each of Standard & Poors Ratings Services, Moody’s Investors Services and Fitch Ratings, any holder of the notes, excluding the debentures, can require with respect to the notes owned by such holder, or we can offer, to repurchase the notes at 101% of the principal amount plus accrued and unpaid interest.
Other Financing Arrangements
In addition to cash and equivalents and operating cash flow, other sources of liquidity include a $2.0 billion commercial paper program backed by a $2.0 billion revolving credit facility. We also have a $1.0 billion committed receivables sales facility.
In September 2019, we renewed our committed receivables sales facility program through Cardinal Health Funding, LLC (“CHF”) through September 30, 2022. CHF was organized for the sole purpose of buying receivables and selling undivided interests in those receivables to third-party purchasers. Although consolidated with Cardinal Health, Inc. in accordance with GAAP, CHF is a separate legal entity from Cardinal Health, Inc. and from our subsidiary that sells receivables to CHF. CHF is designed to be a special purpose, bankruptcy-remote entity whose assets are available solely to satisfy the claims of its creditors.
Our revolving credit and committed receivables sales facilities require us to maintain a consolidated net leverage ratio of no more than 3.75-to-1. As of June 30, 2021, we were in compliance with this financial covenant.
At June 30, 2021 and 2020, we had no amounts outstanding under the revolving credit facility; however, availability was reduced by outstanding letters of credit of $1 million at both June 30, 2021 and 2020.
Under our committed receivables sales facility program, we had a maximum amount outstanding of $200 million and an immaterial daily amount outstanding during fiscal 2021. We had no amounts outstanding as of June 30, 2021 under the committed receivables sales facility program; however, availability was reduced by outstanding standby letters of credit of $31 million and $29 million at June 30, 2021 and 2020, respectively.
We had no amounts outstanding under the commercial paper program as of June 30, 2021 and 2020.
We also maintain other short-term credit facilities and an unsecured line of credit that allowed for borrowings up to $6 million at both June 30, 2021 and 2020. The $67 million and $35 million balance of other obligations at June 30, 2021 and 2020, respectively, consisted of finance leases and short-term borrowings.