Amendment to Bank Covenant Measurements

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

Existing bank debt facilities remain unchanged as outlined below:

Lender	Type	Size ZARM	Size US$M1	Interest Rate	Annual Commitment Fees on undrawn facilities	Repayment
ABSA & Nedbank	ZAR Revolving Credit Facility	1,000	69	1M JIBAR plus 5.0%2	1.35%2	October 2021
ABSA & RMB	ZAR Working Capital facility	500	35	SA prime lending rate minus 1%	0.85%	Subject to annual 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 Debt to Consolidated EBITDA	Additional interest rate ratchet	Additional commitment fee  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."

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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.

 

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