Petra Diamonds Limited Amendment to Bank Covenant Measurements (2821X)

TIDMPDL

RNS Number : 2821X

Petra Diamonds Limited

26 April 2019

This announcement contains inside information

 
 26 April 2019   LSE: PDL 
 

Petra Diamonds Limited

("Petra", "the Company" or "the Group")

Amendment to Covenant Measurement for South African Banking Facilities

Petra Diamonds Limited announces that its lender group, including Absa Bank Limited (acting through its Corporate and Investment Banking division), FirstRand Bank Limited (acting through its Rand Merchant Bank division), Investec Asset Management Proprietary Limited and Nedbank Limited (acting through its Corporate and Investment Banking division) (together the "Lender Group"), has agreed to amend the EBITDA-related maintenance covenant levels for the respective measurement periods as follows:

 
                                   12 months    12 months    12 months    12 months    12 months 
                                    to 30 Jun    to 31 Dec    to 30 Jun    to 31 Dec    to 30 Jun 
                                      2019         2019         2020         2020         2021 
 
   Consolidated Net Debt to Consolidated EBITDA: 
                                    <= 4.5x      <= 4.25x     <= 3.5x      <= 3.25x     <= 3.0x 
   *    New covenant ratio: 
                                  -----------  -----------  -----------  -----------  ----------- 
                                    <= 2.5x      <= 2.5x      <= 2.5x      <= 2.5x      <= 2.5x 
   *    Previous covenant ratio: 
                                  -----------  -----------  -----------  -----------  ----------- 
 
   Consolidated EBITDA to Consolidated Net Finance Charges: 
                                    >= 2.5x      >= 2.5x      >= 2.75x     >= 3.0x      >= 3.25x 
   *    New covenant ratio: 
                                  -----------  -----------  -----------  -----------  ----------- 
                                     >=4.0x       >=4.0x       >=4.0x       >=4.0x       >=4.0x 
   *    Previous covenant ratio: 
                                  -----------  -----------  -----------  -----------  ----------- 
 

Existing bank debt facilities remain unchanged as outlined below:

 
     Lender              Type          Size ZARM   Size US$M(1)     Interest        Annual      Repayment 
                                                                       Rate        Commitment 
                                                                                    Fees on 
                                                                                    undrawn 
                                                                                   facilities 
                   ZAR Revolving                                  1M JIBAR                      October 
 ABSA & Nedbank     Credit Facility      1,000          69         plus 5.0%(2)    1.35%(2)      2021 
                  ------------------  ----------  -------------  --------------  ------------  ----------- 
                                                                  SA prime 
                   ZAR Working                                     lending                      Subject 
                    Capital                                        rate minus                    to annual 
 ABSA & RMB         facility              500           35         1%                0.85%       renewal 
                  ------------------  ----------  -------------  --------------  ------------  ----------- 
 
   Note 1:   Converted to US$ using an exchange rate of ZAR14.40/US$1 

Note 2: The ZAR Revolving Credit Facility will be subject to new margin and commitment fee ratchet mechanisms contingent on the Consolidated Net Debt: Consolidated EBITDA covenant levels at each measurement date.

The reworked ratchet mechanism is as follows:

 
 Consolidated Net           Additional    Additional commitment 
  Debt to Consolidated     interest rate           fee 
  EBITDA                      ratchet            ratchet 
 <= to 2.5:1                   0.0%               0.0% 
                         ---------------  --------------------- 
 > 2.5:1 but <= 
  3.0:1                       +1.0%               0.0% 
                         ---------------  --------------------- 
 > 3.0:1 but <= 
  3.5:1                       +2.0%              +0.225% 
                         ---------------  --------------------- 
 > 3.5:1 but <= 
  4.0:1                       +3.0%              +0.450% 
                         ---------------  --------------------- 
 > 4.0:1                      +4.0%              +0.675% 
                         ---------------  --------------------- 
 

The distribution covenants related to Petra's banking facilities are unchanged. The Company's maintenance and distribution covenants can be found at:

https://www.petradiamonds.com/investors/fixed-income-investors/banking-covenants/

Richard Duffy, Chief Executive Officer, commented:

"The agreement of our Lender group to amend the financial covenant levels relating to our banking facilities demonstrates their continued support of Petra's business and strategy, to deliver consistent production from our diversified portfolio of assets in order to drive free cash flow generation and reduce our net debt."

Ends

For further information, please contact:

   Petra Diamonds, London                                         Telephone: [phone] 

Marianna Bowes [e-mail]

Salisha Ilyas

Buchanan Telephone: [phone]

   (PR Adviser)                                                               [e-mail] 

Bobby Morse

Chris Judd

Ariadna Peretz

About Petra Diamonds Limited

Petra Diamonds is a leading independent diamond mining group and a consistent supplier of gem quality rough diamonds to the international market. The Company has a diversified portfolio incorporating interests in three underground producing mines in South Africa (Finsch, Cullinan and Koffiefontein) and one open pit producing mine in Tanzania (Williamson). Petra also conducts a limited exploration programme in Botswana and South Africa, which is currently under review.

Petra's strategy is to focus on value rather than volume production by optimising recoveries from its high-quality asset base in order to maximise their efficiency and profitability. The Group has a significant resource base of ca. 290 million carats, which supports the potential for long-life operations.

Petra conducts all operations according to the highest ethical standards and will only operate in countries which are members of the Kimberley Process. The Company aims to generate tangible value for each of its stakeholders, thereby contributing to the socio-economic development of its host countries and supporting long-term sustainable operations to the benefit of its employees, partners and communities. Petra is quoted with a premium listing on the Main Market of the London Stock Exchange under the ticker 'PDL' and is a constituent of the FTSE4Good Index. For more information, visit www.petradiamonds.com.

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 [e-mail] or visit www.rns.com.

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April 26, 2019 08:41 ET (12:41 GMT)