REG - Smiths News PLC - Refinancing Agreement

Smiths NewsAnnouncement

02/05/2024 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240502:nRSB8783Ma&default-theme=true

RNS Number : 8783M  Smiths News PLC  02 May 2024

2 May 2024

 

This announcement contains inside information

 

 

Smiths News plc

("Smiths News" or the "Group" or the "Company")

 

Refinancing Agreement

 

Smiths News (LSE: SNWS), the leading distributor of newspapers, magazines and
ancillary services to retailers across the UK, is pleased to announce it has
signed a refinancing agreement to replace its current senior finance
agreement, which was due to mature on 31 August 2025.

 

The new refinancing agreement with two of the Company's existing lending
syndicate, Santander and HSBC (the "Agreement"), comprises a £40 million
revolving credit facility ("RCF"), with an additional £10 million uncommitted
accordion facility (together the "Facilities").

 

The Facilities are available initially on a three-year term at an improved
competitive margin of 2.45% per annum over SONIA, which is a 155bps
improvement from the previous agreement. The Company has the option at each of
the first and second anniversaries to extend maturity on the same financial
terms, with lender consent, upon new three-year maturity periods.

 

The Agreement removes the existing cap on dividends and distributions, which
was previously capped at £10 million per financial year. The removal of this
restriction will enable the Company to implement its revised capital
allocation policy that comprises:

 

·      Maintaining a strong balance sheet, with a Bank Net Debt:
adjusted EBITDA ratio of less than 1.0x

·      Continued investment in both core business and organic growth

·      Payment of sustainable ordinary dividend, maintaining 2x dividend
cover

·      Disciplined approach to inorganic growth, focused on bolt-on
acquisitions with clear accretive returns to enhance shareholder value

·      Further returns to shareholders when appropriate.

 

Further detail on the successful refinancing is provided in the Group's
interim results announcement and accompanying presentation, published today.

 

Jonathan Bunting, Chief Executive Officer of Smiths News, commented:

 

"We are extremely pleased to announce today's refinancing news, reflecting the
clear progress we have made in strengthening the Company's underlying finances
and reducing the net debt of the business. The removal of the distribution cap
also enables us to implement a revised capital allocation policy that will
support our goals of investing in business capabilities, exploring inorganic
adjacent market opportunities and delivering value to investors."

 

 

For further information, please contact:

 

 Smiths News plc                                                        via Vigo Consulting

 Jonathan Bunting, Chief Executive Officer

 Paul Baker, Chief Financial Officer

 www.smithsnews.co.uk (http://www.smithsnews.co.uk)

 Vigo Consulting                                                        Tel: +44 (0) 20 7390 0230

 Jeremy Garcia / Fiona Hetherington / Verity Snow

 smithsnews@vigoconsulting.com (mailto:smithsnews@vigoconsulting.com)

 

 

About Smiths News

 

For over 200 years, Smiths News has been delivering newspapers to retailers
across the UK. It distributes newspapers and magazines on behalf of the major
national and regional publishers, delivering to approximately 23,000 customers
across England and Wales on a daily basis. The speed of turnaround and the
density of Smiths News' coverage is critical to one of the world's fastest
physical supply chains.

 

For more information, please visit: www.smithsnews.co.uk
(http://www.smithsnews.co.uk)

 

 

Person responsible for arranging release of this announcement:

Stuart Marriner, General Counsel and Company Secretary

Smiths News plc, Rowan House, Cherry Orchard North, Kembrey Park, Swindon SN2
8UH

Email: cosec@smithsnews.co.uk (mailto:cosec@smithsnews.co.uk)

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  STRBSGDUXDGDGSB