Bank Amendment & Extension
6 June 2022
IG Design Group plc
('Design Group' or the 'Company')
Bank Amendment & Extension
IG Design Group plc is pleased to announce that the Company has extended the term of its existing banking agreement to 31 March 2024. The agreement was signed after market close on 1 June 2022.
As part of this extension, covenants have been revised for the period to 31 March 2023 and the facility size has been amended as follows:
- RCF A has reduced from $95 million to $90 million
- RCF B has reduced from a maximum level of £130 million to a maximum of £92 million
The Directors believe these amendments continue to give the Group more than sufficient headroom to fund its seasonal working capital requirements over the remaining term of the banking agreement. There are no other changes to the banking facility limits.
The revised covenants, which operate for a maximum period to 31 March 2023 are as follows:
- Minimum EBITDA performance, measured quarterly at the end of June, September, December and March, which requires the Group to be within $10 million of its EBITDA budget at each quarter end, based on the last twelve-month EBITDA performance at each measurement point
- Minimum liquidity level, which requires the Group to maintain a minimum of $35 million of headroom to the maximum available facility on a monthly basis
From April 2023 the Group will revert to the previous covenants, as detailed in the Group's 2021 Annual Accounts, being EBITDA leverage and interest cover.
The amendment also stipulates that any dividends to be paid by the Group during the remaining term of the agreement will require majority lender approval. Furthermore, the bank lending margin has increased to 250 bps, rising to 300 bps from 1 June 2023. Banking and legal fees associated with the amendment and extension of the facility totalled c.$1 million.
Stewart Gilliland, Chair, commented:
"We are very pleased to have agreed this extension to our facilities and to have the ongoing support of our banking partners. Our seasonal orderbook remains strong and this revised facility provides us with sufficient funding for our working capital requirements."
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU No. 596/2014) which is part of UK law by virtue of the European Union (withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
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IG Design Group plc
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Tel: +44 (0)1525 887310 |
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Canaccord Genuity Limited (NOMAD and Broker)
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Tel: +44 (0)20 7523 8000 |
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Alma PR
Susie Hudson
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Tel: +44 (0)20 3405 0205 |
About IG Design Group plc
IG Design Group plc, the largest consumer gift packaging business in the world, is a designer, innovator and manufacturer of products that help people celebrate life's special occasions. Design Group works with more than 11,000 customers in over 80 countries throughout the UK, Europe, Australia and the USA.
Its products are found in over 210,000 retail outlets, including several of the world's biggest retailers, for example Walmart, Target, Amazon, Costco, Lidl and Aldi. Its brand, Tom Smith, also holds the Royal Warrant for the supply of Christmas crackers and Christmas wrapping paper to the Royal family. Design Group is a diverse business operating across multiple regions, categories, seasons and brands.
Its five major product categories are: Celebrations, Gifting, Craft & creative play, Stationery and 'Not-for-resale' consumables. It offers customers a full end-to-end service from design through to distribution, offering both branded and bespoke products from the value-focused through to the higher-margin ends of the market.
The Company was admitted to the Alternative Investment Market of the London Stock Exchange in 1995 under the name 'International Greetings plc' and rebranded to IG Design Group plc in 2016. For further information please visit www.thedesigngroup.com.
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