Reach4Entertainment Enterprises PLC Banking update (5519S)
22 December 2016 - 6:00PM
UK Regulatory
TIDMR4E
RNS Number : 5519S
Reach4Entertainment Enterprises PLC
22 December 2016
22 December 2016
reach4entertainment enterprises plc
('r4e', 'the Company' or 'the Group')
Banking update
r4e, the transatlantic media and entertainment company,
announced in its full year results on 25 May 2016 and in its half
yearly report on 12 September 2016 (the "Interim Results"), that
the Company was expecting a potential breach of one of the
covenants in its 3-year secured asset based debt facility (the
"Facility") with PNC Business Credit ("PNC") in the second half of
2016. The Company announces that it did breach the fixed charge
cover covenant for the months of August, September and October
2016. The reason for the breaches was because the fixed charge
covenant with PNC is determined on a 3-month rolling basis and is
therefore sensitive to seasonality fluctuations in EBITDA and, as
announced in the Interim Results, the Company's results have been
H1 weighted in 2016.
The Company has received a letter from PNC, in which PNC has
confirmed that the fixed charge covenant was breached in August,
September and October 2016, but that in November 2016 the covenant
was met and was expected to be met at the year end. PNC
acknowledged that the breach of covenant was due to seasonal
fluctuations in the Group's revenues and is considering restating
the covenant test period to a period that would not be sensitive to
the seasonality of the Group's business. PNC has informed the
Company that, whilst reserving its rights, it does not intend at
this time to exercise its rights in respect of the covenant
breaches.
David Stoller, Executive Chairman, commented: "We very much
appreciate the continuing support of PNC and their reasonable
commercial position regarding the banking covenants, a reflection
of the trading strength of r4e."
Enquiries:
reach4entertainment enterprises
plc
+44 (0) 20 7968
David Stoller, Executive Chairman 1655
Allenby Capital (Nominated Adviser +44 (0) 20 3328
and Broker) 5656
Jeremy Porter/James Reeve (Corporate
Finance)
Katrina Perez/Kelly Gardiner
Novella Communications (Financial +44 (0) 20 3151
PR) 7008
Tim Robertson
Toby Andrews
This information is provided by RNS
The company news service from the London Stock Exchange
END
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