|12 Months Ended|
Sep. 30, 2012
|LONG-TERM DEBT [Abstract]|
Long-term debt at September 30, 2012 and 2011 consisted of the following:
The Company has a domestic Revolving Credit Facility with a syndicate of financial institutions. In March 2012, the maximum amount of borrowings available under the facility was increased from $300,000 to $400,000 and the facility's maturity was extended to March 2017. Borrowings under the amended facility bear interest at LIBOR plus a factor ranging from 1.00% to 1.50% based on the Company's leverage ratio. The leverage ratio is defined as net indebtedness divided by EBITDA (earnings before interest, taxes, depreciation and amortization). The Company is required to pay an annual commitment fee ranging from .20% to .30% (based on the Company's leverage ratio) of the unused portion of the facility.
The Revolving Credit Facility requires the Company to maintain certain leverage and interest coverage ratios. A portion of the facility (not to exceed $25,000) is available for the issuance of commercial and standby letters of credit. Outstanding borrowings on the Revolving Credit Facility at September 30, 2012 and 2011 were $281,323 and $250,000, respectively. The weighted-average interest rate on outstanding borrowings at September 30, 2012 and 2011 was 2.83% and 2.59%, respectively.
The Company has entered into the following interest rate swaps:
The Company enters into interest rate swaps in order to achieve a mix of fixed and variable rate debt that it deems appropriate. The interest rate swaps have been designated as cash flow hedges of the future variable interest payments under the Revolving Credit Facility which are considered probable of occurring. Based on the Company's assessment, all of the critical terms of each of the hedges matched the underlying terms of the hedged debt and related forecasted interest payments, and as such, these hedges were considered highly effective.
The fair value of the interest rate swaps reflected an unrealized loss of $9,133 ($5,571 after tax) and $7,161 ($4,368 after tax) at September 30, 2012 and 2011, respectively, that is included in shareholders' equity as part of accumulated other comprehensive loss ("AOCL"). Assuming market rates remain constant with the rates at September 30, 2012, approximately $1,739 of the $5,571 loss included in AOCL is expected to be recognized in earnings as an adjustment to interest expense over the next twelve months.
At September 30, 2012 and 2011, the interest rate swap contracts were reflected as a liability on the balance sheets. The following derivatives are designated as hedging instruments:
The loss recognized on derivatives was as follows:
The Company recognized the following losses in accumulated other comprehensive loss ("AOCL"):
The Company, through certain of its German subsidiaries, had a credit facility with a European bank that expired in September 2012. The maximum amount of borrowings available under this facility was 25.0 million Euros. Outstanding borrowings under the credit facility totaled 23.6 million Euros ($31,593) at September 30, 2011. The weighted-average interest rate on outstanding borrowings under the facility at September 30, 2011 was 2.38%.
The Company, through its German subsidiary, Saueressig GmbH & Co. KG ("Saueressig"), has several loans with various European banks. Outstanding borrowings on these loans totaled 8.2 million Euros ($10,514) and 8.3 million Euros ($11,159) at September 30, 2012 and 2011, respectively. The weighted-average interest rate on outstanding borrowings of Saueressig at September 30, 2012 and 2011 was 6.10% and 6.05%, respectively.
The Company, through its wholly-owned subsidiary, Matthews International S.p.A., has several loans with various Italian banks. Outstanding borrowings on these loans totaled 6.3 million Euros ($8,080) and 8.7 million Euros ($11,611) at September 30, 2012 and 2011, respectively. Matthews International S.p.A. also has three lines of credit totaling 11.4 million Euros ($14,621) with the same Italian banks. Outstanding borrowings on these lines were 3.4 million Euros ($4,322) and 493,000 Euros ($661) at September 30, 2012 and 2011, respectively. The weighted-average interest rate on outstanding Matthews International S.p.A. borrowings at September 30, 2012 and 2011 was 3.08% and 3.11%, respectively.
As of September 30, 2012 and 2011, the fair value of the Company's long-term debt, including current maturities, which is classified as Level 2 in the fair value hierarchy, approximated the carrying value included in the Consolidated Balance Sheets.
Aggregate maturities of long-term debt, including short-term borrowings and capital leases, follows:
The entire disclosure for short-term and long-term debt arrangements, and disclosure of the entity's derivative instruments and hedging activities.
No definition available.