Del Taco Restaurants, Inc. Announces Refinancing of Senior Credit Facility
05 August 2015 - 10:00PM
Business Wire
Estimated Interest Expense Savings to Exceed $5
Million Annually
Del Taco Restaurants, Inc. (“Del Taco” and the “Company”)
(NASDAQ: TACO, TACOW), the second largest Mexican-American QSR
chain by units in the United States, operating restaurants under
the name Del Taco, today announced the closing of a new five-year
$250 million senior credit facility. The new revolving credit
facility bears an initial interest rate of LIBOR plus 200 basis
points. The Company utilized $164 million of proceeds from the new
facility to refinance in whole its existing senior secured debt and
pay costs associated with the refinancing.
The refinancing represents a 305 basis point reduction in the
Company’s borrowing costs based on current market conditions, and
is expected to reduce annual interest expense by approximately $5.4
million per year.
Steven L. Brake, Chief Financial Officer of Del Taco, commented,
“Del Taco’s strong performance, including twelve consecutive
quarters of positive same store sales at company-owned restaurants
and growth in restaurant contribution margins, along with
significant debt reduction since the completion of our business
combination with Levy Acquisition Corp. has enabled us to refinance
our outstanding indebtedness at a substantially lower interest
rate. This refinancing materially reduces our annual interest
expense, enhancing our net income and free cash flow, and allowing
us even greater flexibility to execute our new store development
strategy.”
Paul Murphy, Chief Executive Officer of Del Taco, remarked, “We
are thrilled that our great performance and exciting brand
resonated so well with lenders and allowed us to quickly complete a
refinancing. We were confident that as a public company we could
improve our cost of borrowing, and the terms of today’s refinancing
measure up to our best case scenario. Our strong second quarter
results, including 7.0% revenue growth, 12.2% growth in adjusted
EBITDA, 30.2% growth in operating income, and improved restaurant
contribution certainly helped achieve this outcome.”
Bank of America Merrill Lynch and J.P. Morgan Securities LLC are
the joint lead arrangers of the new senior credit facility.
About Del Taco Restaurants, Inc.
At Del Taco (NASDAQ: TACO) all menu items taste better because
they are made to order with fresh ingredients including cheddar
cheese grated from 40-pound blocks, handmade pico de gallo salsa,
lard-free beans slow-cooked from scratch, fresh sliced avocado and
marinated chicken grilled in the restaurant. The menu, which
includes a full line of breakfast, includes classic Mexican dishes
such as tacos, burritos, quesadillas and nachos as well as American
favorites including hamburgers, crinkle-cut fries and shakes. Del
Taco’s UnFreshing Believable campaign communicates the lengths the
company goes to in order to deliver quality, made-to-order menu
items created with freshly-prepared ingredients at unbelievable
prices. With nearly 550 restaurants in 16 states, Del Taco serves
more than three million guests each week. In June 2015, Del Taco
changed its name to Del Taco Restaurants, Inc. following the
completion of its transition to a public company.
For more information, please visit www.deltaco.com.
Forward-Looking Statements
In addition to historical information, this release may contain
a number of “forward-looking statements” as defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include, without limitation, information concerning Del
Taco’s possible or assumed future results of operations, business
strategies, competitive position, industry environment, potential
growth opportunities and the effects of regulation. These
statements are based Del Taco’s management’s current expectations
and beliefs, as well as a number of assumptions concerning future
events. When used in this press release, the words “estimates,”
“projected,” “expects,” “anticipates,” “forecasts,” “plans,”
“intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,”
“propose” and variations of these words or similar expressions (or
the negative versions of such words or expressions) are intended to
identify forward-looking statements. Such forward-looking
statements are subject to known and unknown risks, uncertainties,
assumptions and other important factors, many of which are outside
Del Taco’s management’s control that could cause actual results to
differ materially from the results discussed in the forward-looking
statements. These risks included, without limitation, consumer
demand, our inability to successfully open company-operated or
franchised restaurants or establish new markets, competition in our
markets, our inability to grow and manage growth profitably,
adverse changes in food and supply costs, our inability to access
additional capital, changes in applicable laws or regulations, food
safety and foodborne illness concerns, our inability to manage
existing and to obtain additional franchisees, our inability to
attract and retain qualified personnel, our inability to profitably
expand into new markets, and the possibility that we may be
adversely affected by other economic, business, and/or competitive
factors. Additional risks and uncertainties are identified and
discussed in Del Taco’s reports filed with the SEC and available at
the SEC’s website at www.sec.gov and the Company’s website at
www.deltaco.com.
Forward-looking statements included in this release speak only
as of the date of this release. Del Taco undertakes no obligation
to update its forward-looking statements to reflect events or
circumstances after the date of this release or otherwise.
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version on businesswire.com: http://www.businesswire.com/news/home/20150805005146/en/
Media:Julia Young, 646-277-1280julia.young@icrinc.comInvestor
Relations:Raphael Gross, 203-682-8253investor@deltaco.com
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