Financing Arrangements

6 Months Ended

Jun. 30, 2018

Short-term debt at June 30, 2018 and December 31, 2017 was as follows:



	June 30, 2018		December 31, 2017
Variable-rate Accounts Receivable Facility with an interest rate of 2.93% at June 30, 2018 and 2.15% at December 31, 2017	$	96.4	$	62.9
Borrowings under variable-rate lines of credit for certain of the Company’s foreign subsidiaries with various banks with interest rates ranging from 0.32% to 1.10% at June 30, 2018 and 0.32% to 2.22% at December 31, 2017	65.9		42.5
Short-term debt	$	162.3	$	105.4

The Company has a $100 million Amended and Restated Asset Securitization Agreement ("Accounts Receivable Facility") that matures on November 30, 2018. The Company is exploring opportunities to refinance the facility prior to its maturity. Under the terms of the Accounts Receivable Facility, the Company sells, on an ongoing basis, certain domestic trade receivables to Timken Receivables Corporation, a wholly owned consolidated subsidiary that, in turn, uses the trade receivables to secure borrowings that are funded through a vehicle that issues commercial paper in the short-term market. Borrowings under the Accounts Receivable Facility may be limited by certain borrowing base limitations; however, the Accounts Receivable Facility was not reduced by any such borrowing base limitations at June 30, 2018. As of June 30, 2018, there were outstanding borrowings of $96.4 million under the Accounts Receivable Facility, which reduced the availability under this facility to $3.6 million. The cost of this facility, which is the prevailing commercial paper rate plus facility fees, is considered a financing cost and is included in "Interest expense" in the Consolidated Statements of Income. The outstanding balance under the Accounts Receivable Facility was classified as short term because the agreement matures in less than one year.

The lines of credit for certain of the Company’s foreign subsidiaries provide for short-term borrowings up to $285.5 million in the aggregate. Most of these lines of credit are uncommitted. At June 30, 2018, the Company’s foreign subsidiaries had borrowings outstanding of $65.9 million and bank guarantees of $0.5 million, which reduced the aggregate availability under these facilities to $219.1 million.

Long-term debt at June 30, 2018 and December 31, 2017 was as follows:



	June 30, 2018		December 31, 2017
Fixed-rate Medium-Term Notes, Series A, maturing at various dates through May 2028, with interest rates ranging from 6.74% to 7.76%	$	154.6	$	154.5
Fixed-rate Senior Unsecured Notes, maturing on September 1, 2024, with an interest rate of 3.875%	347.3		346.9
Variable-rate Senior Credit Facility with a weighted-average interest rate of 2.26% at June 30, 2018 and 1.83% at December 31, 2017	94.6		52.0
Fixed-rate Euro Senior Unsecured Notes, maturing on September 7, 2027, with an interest rate of 2.02%	174.6		179.3
Variable-rate Euro Term Loan with an interest rate of 1.13% at June 30, 2018 and December 31, 2017	109.1		119.7
Other	3.9		4.5
	884.1		856.9
Less: Current maturities	2.7		2.7
Long-term debt	$	881.4	$	854.2

The Company has a $500 million Amended and Restated Credit Agreement ("Senior Credit Facility"), which matures on June 19, 2020. At June 30, 2018, the Company had $94.6 million of outstanding borrowings under the Senior Credit Facility, which reduced the availability under this facility to $405.4 million. The Senior Credit Facility has two financial covenants: a consolidated leverage ratio and a consolidated interest coverage ratio. At June 30, 2018, the Company was in full compliance with both of these covenants.

On September 7, 2017, the Company issued €150 million of fixed-rate 2.02% senior unsecured notes that mature on September 7, 2027 (the "2027 Notes"). On September 18, 2017, the Company entered into a €100 million variable-rate term loan that matures on September 18, 2020 ("2020 Term Loan"). On June 14, 2018, the Company repaid €6.5 million reducing the principal balance to €93.5 million as of June 30, 2018. Proceeds from the 2027 Notes and 2020 Term Loan were used to repay amounts drawn from the Senior Credit Facility to fund the acquisition of Groeneveld, which closed on July 3, 2017. These debt instruments have two financial covenants: a consolidated leverage ratio and a consolidated interest coverage ratio. These covenants are similar to those in the Senior Credit Facility. At June 30, 2018, the Company was in full compliance with both of these covenants.