F I N A N C I A L R E V I E W
|Cash Flows, Liquidity and
In 2000, cash from operations was $2.0 billion compared to $1.9 billion in 1999. The increase reflects higher income from continuing operations and decreased cash payouts in 2000 for merger-related expenses and customer claims.
Cash used in investing activities was $1.5 billion in 2000 compared to $1.6 billion in 1999. The decrease is due to reduced capital spending, the receipt of a cash dividend from an affiliate, an increase in sales of real estate and other assets in 2000 and higher investment activity in 1999.
Cash used in financing activities increased to $486 million from $256 million in 1999. This increase reflects higher debt repayments ($796 million in 2000 versus $692 million in 1999) and lower financings ($509 million in 2000 versus $637 million in 1999). Including the Convertible Preferred Securities (see note 7 to the consolidated financial statements) as an equity instrument, the ratio of debt to total capital employed was 45.1% at December 31, 2000 compared to 47.6% at December 31, 1999.
Credit Facilities On December 31, 2000, the Corporation had $2.0 billion in revolving credit facilities of which $1.0 billion expires in March 2001, with the remaining $1.0 billion expiring in March 2005. The facilities, which were entered into during March 2000, are designated for general corporate purposes and replaced a $2.8 billion facility which was due to expire in April 2001. None of the credit facilities were used as of December 31, 2000 or 1999. Commitment fees and interest rates payable under the facilities are similar to fees and rates available to comparably rated investment-grade corporate borrowers.
Shelf Registration Under the currently effective shelf registration statement, the Corporation may issue, from time to time, any combination of debt securities, preferred stock or warrants for debt securities or preferred stock in one or more offerings. At December 31, 2000, the Corporation had $600 million remaining for issuance under the shelf registration. At January 18, 2001, the Corporation had $200 million remaining for issuance under the shelf registration. The Corporation has no immediate plans to issue equity securities.
Significant New Borrowings During June 2000, the Corporation issued $250 million of floating-rate debt under its shelf registration statement with a maturity date of July 1, 2002. The proceeds from the issuance of this debt were used for repayment of debt and other general corporate purposes. During September and November 2000, UPRR entered into capital leases covering new locomotives. The related capital lease obligations totaled approximately $201 million and are included as debt in the consolidated statements of financial position. In January 2001, the Corporation issued $400 million of fixed-rate debt under its shelf registration statement with a maturity date of January 15, 2011. The proceeds from the issuance of this debt were used for repayment of debt and other general corporate purposes.
|1999 Compared to 1998 | Other Matters|