Petra Diamonds Ltd - New First Lien Banking Facility on more favourable terms
PR Newswire
London, February 2
| 02 February 2022 | LSE: PDL |
Petra Diamonds Limited
("Petra" or the "Company" or the "Group")
New First Lien Banking Facility on more favourable terms
Petra Diamonds is pleased to announce that it has concluded a binding, credit approved term sheet for the refinancing of its first lien debt facility with its South African Lender Group, providing for more favourable terms than the Group's current first lien facilities. The conclusion of the new facility is subject to completion of appropriate definitive agreements, expected to be finalised during Q3 FY 2022.
This refinancing reflects an improved Group balance sheet and financial profile, supported by a quicker than expected diamond price recovery and the continued recovery of exceptional diamonds.
Richard Duffy, Chief Executive of Petra, commented:
"The significant improvement in our facility reflects our stronger cashflow generation and improved balance sheet resulting from a robust diamond market and solid operational performance."
A new Revolving Credit Facility ("RCF") with Absa Bank Limited (acting through its corporate and investment banking divisions) ("Absa") will replace the existing RCF and term lending arrangements with the current South African lender syndicate comprising Absa, Nedbank, RMB and Ninety One. The new terms include, inter alia:
- Improved structure with a single ZAR1 billion RCF replacing the existing amortising term loan (ZAR856.1 million owed at 31 December 2021 net of unamortised transaction costs of ZAR20.2million) and the ZAR408.8 million RCF. During January 2022, Petra settled the ZAR402.2 million drawn under the existing RCF as at 31 December 2021 from available cash balances;
- More appropriate covenant package resulting in improved headroom and flexibility on the balance sheet;
- Extended tenure for the RCF with a maturity date of December 2025 and a more usual bullet payment at maturity; and
- Reduced financing costs with improved margin and commitment fees.
Details of the new terms compared with the previous terms:
| Previous terms | New terms | |
| Facility | R408.8 m amortising RCF and R876.3m gross term loan (as at 31 Dec 2021) | R1,000m RCF |
| Duration | 3 years (Mar-24) | 4 years (Dec-25), with a 60 day buffer between the redemption of the Notes and the maturity of the RCF |
| Lenders | Absa, Nedbank, RMB & Ninety One | Absa |
| Margin | JIBAR + 525 bps | JIBAR + 415 bps, with the margin to be reconsidered annually based on Petra's credit metrics with a view of further optimising the margin to be achieved |
| Commitment fee | 210 bps per annum | 125 bps per annum |
The new terms also provide improved flexibility on early Note redemption and coupon settlement.
Covenants
| FY22 H2 | FY23 H1 | FY23 H2 | FY24 H1 | FY24 H2 | FY25 H1 | FY25 H2 | FY26 H1 | |
| Net Debt: EBITDA Leverage ratio (maximum) | 4.00 | 4.00 | 3.50 | 3.50 | 3.25 | 3.25 | 3.00 | 3.00 |
Interest Cover Ratio (minimum) | 1.85 | 1.85 | 2.50 | 2.50 | 2.75 | 2.75 | 3.00 | 3.00 |
~ Ends ~
For further information, please contact:
Petra Diamonds, London Telephone: +44 20 7494 8203
Jill Sherratt investorrelations@petradiamonds.com
Julia Stone
About Petra
Petra Diamonds is a leading independent diamond mining group and a supplier of gem quality rough diamonds to the international market. The Company's portfolio incorporates interests in three underground producing mines in South Africa (Finsch, Cullinan and Koffiefontein) and one open pit mine in Tanzania (Williamson).
Petra's strategy is to focus on value rather than volume production by optimising recoveries from its high-quality asset base in order to maximise their efficiency and profitability. The Group has a significant resource base of ca. 230 million carats, which supports the potential for long-life operations.
Petra strives to conduct all operations according to the highest ethical standards and will only operate in countries which are members of the Kimberley Process. The Company aims to generate tangible value for each of its stakeholders, thereby contributing to the socio-economic development of its host countries and supporting long-term sustainable operations to the benefit of its employees, partners and communities.
Petra is quoted with a premium listing on the Main Market of the London Stock Exchange under the ticker 'PDL'. The Company's US$336.7 million notes due in 2026 are listed on the Irish Stock Exchange and admitted to trading on the Global Exchange Market. For more information, visit www.petradiamonds.com
