hhgregg, Inc. Announces Amendment and Extension of Existing Credit Facility
June 28 2016 - 2:32PM
Business Wire
Early Renegotiation Will
Provide Access to Operating Capital Through 2021
hhgregg, Inc. ("hhgregg" or the "Company") (NYSE:HGG) today
announced that it has amended its existing revolving credit
facility, providing the Company with increased financial
flexibility. The key changes are:
- Extended the maturity date five years
from the date of closing to June 28, 2021.
- Increased the borrowing base
availability calculation, immediately increasing funds available to
the Company by approximately $20 million to $185 million.
- Decreased the maximum credit limit from
$400 million to $300 million, subject to borrowing base
availability, to better align with hhgregg’s expected inventory
levels.
- No change to our interest rates.
"We continue to strengthen our balance sheet and improve our
already strong liquidity position, of which the early amended
credit facility is an important part," said Robert Riesbeck, Chief
Financial Officer and Interim President and Chief Executive
Officer. "Our amended revolving credit facility, combined with our
return to positive adjusted EBITDA in fiscal 2016, provide us with
significant flexibility as we pursue our fiscal 2017 initiatives
and goals. We appreciate our bank group’s continued support for
hhgregg and our strategic plan."
“As we complete the first quarter of fiscal 2017, I am pleased
with our progress in driving sales and optimizing our supply chain
and delivery network. We are on-track to reset more than 100 stores
and add seven Fine Lines departments by this holiday season. We
also saw an acceleration in our ecommerce business during the
current quarter,” Riesbeck added.
Borrowings under the Amended and Restated Loan and Security
Agreement (the "Amended Facility") will continue to bear interest
based on the bank’s prime rate (3.50% as of June 28, 2016) or LIBOR
plus an applicable margin based on the average quarterly excess
availability. We reduced the size of our facility from a maximum
credit limit of $400 million to $300 million to reflect the
reduction in inventory levels and overall working capital needs
resulting from the improvements made in our supply chain and
merchandise planning and allocation functions. The Company’s
increase in borrowing base availability is not expected to result
in incremental interest expense. The Company intends to use funds
borrowed under the Amended Facility from time-to-time for general
corporate purposes, which may include working capital needs,
capital expenditures, and satisfaction of other obligations of the
Company, subject to certain limitations, as defined.
Additional details regarding the Amended Facility will be
available in hhgregg’s Current Report on Form 8-K to be filed
with the Securities and Exchange Commission on June
28, 2016.
About hhgregg
hhgregg is an appliance, electronics and furniture retailer that
is committed to providing customers with a truly differentiated
purchase experience through superior customer service,
knowledgeable sales associates and great product selections.
Founded in 1955, hhgregg is a multi-regional retailer currently
with 226 stores in 20 states that also offers market-leading global
and local brands at value prices nationwide
via hhgregg.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20160628006488/en/
hhgregg, Inc.Lance Peterson, 317-848-8710Director, Finance &
Investor Relationsinvestorrelations@hhgregg.com
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