HSS successfully refinances, interest cost reduced

RNS Number : 8691R

HSS Hire Group PLC

10 November 2021

 

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement

10 November 2021

HSS Hire Group Plc

Successful refinancing with interest cost materially reduced

HSS Hire Group plc (the "Group") today announces that it has entered into a new term loan facility of £70m and a revolving credit facility of £25m to refinance its existing corporate debt.

In the year ended 26 December 2020 the Group's senior finance facility interest charge was £16.3m. Alongside the successful change in operating model and equity placing in late 2020, the refinancing will materially reduce the ongoing annual interest charge to approximately £3.0m, driving a significant increase in earnings per share.

The facilities will be provided by HSBC Bank plc and National Westminster Bank plc and will mature in November 2025 with the opportunity to extend by a further year. The facilities are at interest rates of between 275bps and 350bps above SONIA, dependent upon the net debt leverage ratio of the Group. The interest rate will be 300bps above SONIA at closing.

Closing of the new facilities is subject to customary conditions and is expected to take place by the end of November together with repayment of the Group's existing term loan facility. A repayment premium of circa £4.5m will be payable at this time to the provider of the Group's existing term loan facility.

Current Trading

Trading since the Group's H1 Results update, announced 30 September 2021, continues to be strong and management now expects full year EBITDA and EBITA, on a non-IFRS16 basis, to be slightly ahead of market expectations. 

Commenting on the news, Steve Ashmore, HSS Chief Executive Officer, said:

"This new refinancing package is another significant development for HSS, adding to the very positive strategic and operational progress that we have delivered over the last few years. It materially reduces our interest costs and improves both our EPS and free cash flow. With a much stronger financial platform and continued trading momentum across our business, HSS is now well positioned to deliver our next exciting phase of growth." 

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Disclaimer:

This announcement contains forward-looking statements relating to the business, financial performance and results of HSS Hire Group plc and the industry in which HSS Hire Group plc operates. These statements may be identified by words such as "expect", "believe", "estimate", "plan", "target", or "forecast" and similar expressions, or by their context. These statements are made on the basis of current knowledge and assumptions and involve risks and uncertainties. Various factors could cause actual future results, performance or events to differ materially from those described in these statements and neither HSS Hire Group plc nor any other person accepts any responsibility for the accuracy of the opinions expressed in this presentation or the underlying assumptions. No obligation is assumed to update any forward-looking statements.

Notes to editors

About HSS Hire

HSS Hire Group plc provides tool and equipment hire and related services in the UK and Ireland through a nationwide network and its OneCall rehire business. It offers a one-stop-shop for all equipment through a combination of its complementary rental and rehire business to a diverse, predominantly B2B customer base serving a range of end markets and activities. Over 90% of its revenues come from business customers. HSS is listed on the AIM Market of the London Stock Exchange. For more information please see www.hsshiregroup.com.

For further information, please contact:

HSS Hire Group plc	Tel: [phone] (on 10 November 2021)
Steve Ashmore, Chief Executive Officer	Thereafter, please email: [e-mail]
Paul Quested, Chief Financial Officer
Greig Thomas, Head of Group Finance

Teneo
Tom Davies Charles Armitstead	Tel: [phone] Tel: [phone]
Numis Securities (Nominated Adviser and Broker)	Tel: [phone]
Stuart Skinner George Price

 

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