Card Factory completes £225m refinancing
The news follows the retailer's recent trading update which saw its sales performance ‘exceed expectations’ after reopening following the first and second lockdowns
Card Factory has announced it has completed a £225m refinancing with its current banking syndicate.
The news follows the retailer’s recent trading update which saw its sales performance “exceed expectations” after reopening following the first and second lockdowns.
Sales from the online channels reportedly fell which was in line with the group’s expectations as customers have also been able to shop in stores, however online sales are still “exceeding” pre-pandemic levels.
In addition, the completed refinancing of £225m provides additional liquidity above the original £200m it replaces, and is for the same term through to 24 September 2023 (with provision for a potential extension).
As of 16 May 2021, it revealed net debt amounted to £110m (excluding deferrals of approximately £40m, substantially agreed with stakeholders) from £132.5m the previous year.
The new finances consist of a £100m revolving credit facility (RCF), a £75m term loan facility, and in aggregate a £50m Coronavirus Large Business Interruption Loan Scheme.
It added the secured finance provides the group with the necessary resources to focus on its future growth strategy. This includes strengthening its online customer proposition and the capability and capacity to fulfil sales demand.
The facilities are structured to “incentivise an early reduction of overall debt” with fees of up to £5m payable if pre-payments are not made in line with specified dates from 30 November 2021 through until 30 July 2022.
The company is also permitted, under the terms of the facilities, to prepay £70m using funding from other subordinated sources.
Darcy Willson-Rymer, chief executive, said: “I am pleased we have secured increased banking facilities, which afford the Group the headroom required to focus on realising the growth strategy.
“In particular, enhancing our card-led proposition through all sales channels and accelerating the increase in our capability and capacity to fulfil sales demand via our online channel, and so capitalise upon the move to online adoption by more customers over the last year.”
The company will release its preliminary results for the financial year ended 31 January 2021 on 8 June 2021.
