Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily the result of fluctuations in interest rates. We continually monitor this risk and may develop strategies to manage it. We do not hold or issue financial instruments for trading purposes.
Interest rate risk
We are exposed to interest rate risks primarily through borrowings under our credit facility. Interest on our borrowings is based upon variable rates. We had $199.7 million and $195.4 million outstanding on the credit facility as of November 2, 2024 and October 28, 2023, respectively. We did not have any outstanding borrowings on the credit facility as of February 3, 2024.
A hypothetical 1% increase in interest rates on variable rate debt would not have a material impact on our operating income for the 39 weeks ended November 2, 2024.
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