REGINA, July 3, 2018 /CNW/ - AGT Food and Ingredients Inc. (TSX: AGT) ("AGT" or the "Company") announces the closing of the Third Amended and Restated Credit Agreement by AGT's wholly-owned operating subsidiary, Alliance Pulse Processors Inc. ("APP"), with respect to APP's syndicated credit facilities in the aggregate amount of C$400,000,000 (the "Credit Facilities"), led by The Bank of Nova Scotia, as agent, and other syndicate members, including Canadian Imperial Bank of Commerce, The Toronto-Dominion Bank, Royal Bank of Canada, ATB Financial, Bank of Montreal, National Bank of Canada, ICICI Bank Canada, Farm Credit Canada and Export Development Canada, which occurred on June 29, 2018. The Credit Facilities bring the Mobil Group of companies (the "Mobil Group"), which were acquired by APP in October 2015 and which includes the Mobil Group's railway and terminal assets, into the Credit Facilities as guarantors. Pursuant the Credit Facilities, the Mobil Group has granted guarantees and has pledged its assets as security in favour of the lenders on customary terms and conditions consistent with the other current secured guarantors under the Credit Facilities. In addition to other conforming amendments, at the AGT consolidated level, the minimum Adjusted EBITDA* to interest expense ratio has been amended to reflect that such ratio for AGT will not be less than 1.25:1.00 for the quarters ending June 30, 2018 and September 30, 2018; not less than 1.50:1.00 for the quarter ending December 31, 2018; not less than 1.75:1.00 for the quarters ending March 31, 2019 and June 30, 2019; not less than 2.00:1.00 for the quarters ending September 30, 2019 and December 31, 2019; and not less than 2.50:1.00 for the quarter ending March 31, 2020 and each quarter thereafter. The financial covenants in respect of APP remain unchanged.
"We are pleased with the completion of our amended credit facilities. The cost of our debt remains unchanged and the financial covenants have been updated to reflect the gradual normalization of earnings through 2018 and 2019. In the current global pulses and staple foods environment, the support and confidence shown by our lenders positively positions AGT to continue to realize the benefits of our diversification strategy," said Mr. Murad Al-Katib, President and CEO of AGT.
AGT Food and Ingredients Inc. Profile
AGT Food and Ingredients Inc. is a processor of value-added pulses, staple foods and ingredients for export and domestic markets as well as a supplier of retail packaged and canned foods to retail and food service sectors. Through its offices and processing facilities located in some of the best agricultural growing regions in Canada, the U.S., Turkey, China, Australia and South Africa, merchandising and sales offices in the U.K., the Netherlands, Spain, Switzerland and India and origination offices in Russia, AGT produces a full range of pulses and specialty crops including lentils, peas, chickpeas, beans and canary seed as well as food ingredients such as pulse flours, proteins, starches and fibres. Through its subsidiaries in Turkey, the Arbel Group, AGT also produces staple foods such as Arbella Pasta, rice, and milled wheat products, including bulgur and semolina.
Certain statements in this press release are forward-looking statements. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by AGT at the time of preparation, may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of AGT (including its operating subsidiaries) to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, the actual results of harvests, fluctuations in the price of lentils and other crops, failure of plant, equipment or processes to operate as anticipated, accidents or labour disputes, risks relating to the integration of acquisitions or to international operations, as well as those factors referred to in the section entitled "Risk Factors" in the Annual Information Form of AGT which is available on SEDAR at www.sedar.com, and which should be reviewed in conjunction with this document. Although AGT has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. AGT expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws.
Non-IFRS Financial Measures
*AGT provides some non-IFRS measures as supplementary information that management believes may be useful to investors to explain AGT's financial results. These non-IFRS measures include Adjusted Gross Profit* (gross profit plus depreciation in cost of sales), Adjusted EBITDA* (earnings before finance expense, income taxes, depreciation and amortization, restructuring costs and any effects of non-cash, non-recurring and other costs and foreign exchange adjustment), Adjusted Net Earnings*, Adjusted Basic Net Earnings* per share and Adjusted Diluted Net Earnings* per share (earnings before any effects of non-cash, non-recurring and other costs, restructuring costs and foreign exchange adjustments), Net Debt* (bank indebtedness, short term financing and long term debt less cash) and Net Working Capital* (current assets less current liabilities). Adjusted Net Earnings*, Adjusted Basic Net Earnings* per share and Adjusted Diluted Net Earnings* per share do not include the tax effect of non-cash, non-recurring and other costs and foreign exchange. Management believes that Adjusted EBITDA*, Adjusted Net Earnings*, Adjusted Basic Net Earnings* per share and Adjusted Diluted Earnings* per share, Net Debt* and Net Working Capital* are important indicators of AGT's ability to generate liquidity through operating cash flow to fund future working capital needs, service outstanding debt and fund future capital expenditures and uses the metric for this purpose. The exclusion of non-cash and foreign exchange adjustments eliminates the non-cash impact on Adjusted EBITDA*, Adjusted Net Earnings*, Adjusted Basic Net Earnings* per share and Adjusted Diluted Earnings* per share. Adjusted EBITDA* and Adjusted Net Earnings*, Adjusted Basic Net Earnings* per share, Adjusted Diluted Net Earnings* per share, Net Debt* and Net Working Capital* are also used by investors and analysts for the purpose of valuing AGT. The intent of these measures is to provide additional useful information to investors and analysts and the measure does not have any standardized meaning under IFRS. Adjusted Gross Profit*, Adjusted EBITDA* and Adjusted Net Earnings*, Adjusted Basic Net Earnings* per share, Adjusted Diluted Net Earnings* per share, Net Debt* and Net Working Capital* should therefore not be considered in isolation or used as a substitute for measures of performance prepared in accordance with IFRS. For a reconciliation of net earnings (loss) determined in accordance with IFRS to Adjusted EBITDA*, Adjusted Net Earnings* and Adjusted Basic Net Earnings* per share and Adjusted Diluted Earnings* per share, see the table in the most recently dated management's discussion and analysis for AGT located on the Company's website or under the AGT profile on SEDAR, www.sedar.com.
SOURCE AGT Food and Ingredients Inc.
For further information: Investor Relations: Omer Al-Katib, (306) 525-4490, [email protected]