WINNIPEG, April 29, 2020 /CNW/ - Ag Growth International
Inc. ("AGI") (TSX: AFN) today welcomed Farm Credit Canada ("FCC")
to its Canadian lending syndicate and announced several amendments
to its credit facility.
AGI's credit facility has been expanded to include a
$50 million increase in its senior
revolving facility as well as the creation of a separate one-year
revolving facility of $50 million to
provide increased short-term flexibility during the Covid-19
crisis. AGI's senior credit facility now totals approximately
$575 million Canadian dollar
equivalent, excluding an undrawn accordion of $100 million. For reference, as at March 31, 2020 AGI had drawn $345 million under these facilities.
The amendments to the credit facility include a suspension of
all financial covenant requirements for the six-month period ending
October 31, 2020 as well as the
ability to normalize Q1 2020 and Q2 2020 financial results for
certain Covid-19 impacts when calculating trailing EBITDA in future
covenant calculations. Following October 31,
2020, AGI's minimum leverage ratio covenant will return to
3.75x up to and including the calculation as at March 31, 2021. The minimum leverage ratio
decreases to 3.50x for the quarter ended June 30, 2021 and returns to 3.25x thereafter.
During the financial covenant suspension period AGI is subject to a
minimum liquidity covenant. The maturity date of the facility
remains March 20, 2025. The
amendments announced today do not impact terms of AGI's Series B
and C secured notes that total $60
million.
"We would like to thank our banking partners for their
outstanding support during this crisis and we welcome FCC to our
lending syndicate," said Tim Close,
President and CEO of AGI. "AGI remains in compliance with all
financial covenants, all of our facilities are currently operating,
our backlogs remain solid and we continue to monitor sales intake
for areas of concern. In the early days of Covid-19 we moved
quickly to engage our banking partners to account for the expected
uncertainties created by the crisis. Given that the extent, depth
and trailing impacts remain unknown it was prudent to implement
measures to ensure AGI is well prepared. This amendment, in
combination with our recently announced dividend change, is part of
our Preparation with Progress initiative to prudently deal with the
crisis while also progressing on strategic initiatives."
AGI Company Profile
AGI is a leading provider of solutions for the global food
infrastructure, including seed, fertilizer, grain, feed, and food
processing systems. AGI has manufacturing facilities in
Canada, the United States, the United Kingdom, Brazil, India, France
and Italy and distributes its
product globally.
Further information can be found in the disclosure documents
filed by AGI with the securities regulatory authorities, available
at www.sedar.com and on AGI's website www.aggrowth.com.
CAUTIONARY STATEMENTS
Forward-Looking Information
This press release may contain forward-looking statements and
information [collectively, "forward-looking information"] within
the meaning of applicable securities laws that reflect our
expectations regarding the future growth, results of operations,
performance, business prospects, and opportunities of the Company.
All information and statements contained herein that are not
clearly historical in nature constitute forward-looking
information, and the words "anticipate", "believe", "continue",
"could", "expects", "intend", "plans", "postulates", "predict",
"will" or similar expressions suggesting future conditions or
events or the negative of these terms are generally intended to
identify forward-looking information. Forward-looking information
involves known or unknown risks, uncertainties and other factors
that may cause actual results or events to differ materially from
those anticipated in such forward-looking information. Undue
reliance should not be placed on forward-looking information, as
there can be no assurance that the plans, intentions or
expectations upon which it is based will occur. Such
forward-looking information reflects our current beliefs and is
based on information currently available to us, including certain
key expectations and assumptions including with respect to the
anticipated impacts of the coronavirus (COVID-19) outbreak on our
business, operations and financial results. Forward-looking
information involves significant risks and uncertainties. A number
of factors could cause actual results to differ materially from
results discussed in the forward-looking information, including the
effects of global outbreaks of pandemics or contagious diseases or
the fear of such outbreaks, such as the recent COVID-19 pandemic,
including the effects on the Company's operations, manufacturing
facilities, personnel, and supply chain, the demand for our
products and services, our ability to expand and produce in new
geographic markets or the timing of such expansion efforts, and on
overall economic conditions and customer confidence and spending
levels, changes in international, national and local macroeconomic
and business conditions, as well as sociopolitical conditions in
certain local or regional markets, weather patterns, crop planting,
crop yields, crop conditions, the timing of harvest and conditions
during harvest, the ability of management to execute the Company's
business plan, seasonality, industry cyclicality, volatility of
production costs, agricultural commodity prices, the cost and
availability of capital, currency exchange and interest rates, the
availability of credit for customers, competition, AGI's failure to
achieve the expected benefits of recent acquisitions including to
realize anticipated synergies and margin improvements; and changes
in trade relations between the countries in which the Company does
business including between Canada
and the United States. These risks
and uncertainties are described under "Risks and Uncertainties" in
our MD&A, our annual MD&A and in our most recently filed
Annual Information Form, all of which are available under the
Company's profile on SEDAR [www.sedar.com]. These factors should be
considered carefully, and readers should not place undue reliance
on the Company's forward-looking information. We cannot assure
readers that actual results will be consistent with this
forward-looking information. The forward-looking information
contained herein is expressly qualified in its entirety by this
cautionary statement. The forward-looking information included in
this press release is made as of the date of this press release and
AGI undertakes no obligation to publicly update such
forward-looking information to reflect new information, subsequent
events or otherwise unless so required by applicable securities
laws.
Non-IFRS Measures
This press release contains references to "EBITDA", a financial
measure that does not have a standardized meaning prescribed by
International Financial Reporting Standards and that may not be
comparable to similar measures presented by other companies or
entities. References to "EBITDA" in this press release are to
consolidated profit before income taxes, finance costs,
depreciation, amortization and share of associate's net loss, as
more particularly defined in AGI's credit facility. EBITDA is used
in the credit facility to, among other things, measure AGI's
compliance with certain financial covenants under the credit
facility.
SOURCE Ag Growth International Inc. (AGI)
