REGINA, Dec. 21, 2017 /CNW/ - AGT Food and Ingredients Inc. (TSX:AGT) ("AGT" or the "Company") has announced that Alliance Pulse Processors Inc. ("APP"), a wholly-owned subsidiary of AGT, has extended the maturities of its facilities and amended certain portions of its credit agreement (the "Credit Agreement"). The maturities of the facilities under the Credit Agreement have been extended to January 24, 2020 from January 24, 2019. Other amendments to the Credit Agreement include cancelling the non-revolving facility and reducing the aggregate committed facility amount to CDN $400,000,000 from CDN $437,500,000. Facility amounts have been reallocated under the revolving and operating facilities, and the uncommitted accordion will be increased from CDN $50,000,000 to CDN $75,000,000. Furthermore, the Credit Agreement was amended to reflect changes in, and the evolution of, AGT's and APP's businesses by removing the covenants which measured the fixed charge coverage ratios and replacing them with minimum Adjusted EBITDA* to Interest Expense ratios, for both AGT, on a consolidated basis, and APP.
"The extension and amendment of our credit facilities provides AGT with continued access to the credit required for our current business, as well as for working capital needed for our liquidity and growth over a longer period of time. A reduction in our available credit facilities reflects the reduced borrowing requirements we have in our business after the issuance of the Preferred Securities to Fairfax in August of this year. We have built in an uncommitted accordion of $75,000,000 to ensure we have access to more funding if needs arise in the future. Other features of the amended credit facilities include the removal of the non-revolving facility and amendments to our covenants to better reflect our business today. By eliminating principal repayments on debt, we have freed up cash flow. Our banking group is behind us and with liquidity bolstered by our recent transaction with Fairfax, we expect the syndicated credit facility will allow us to continue to grow AGT and our business overall," said Mr. Murad Al-Katib, President and CEO of AGT.
"Access to capital is a strategic advantage for AGT in a highly competitive global commodity trading environment. We have a clearly defined risk management program on our sales to minimize our credit risk, and this is viewed positively by our banking partners. This is reflected by the commitment and ongoing support of our banking partners. Our Canadian banking partners are an important part of our growth strategy and this facility assists us in the ability to monetize opportunities in our business into sustainable, diversified earnings," said Mr. Huseyin Arslan, Executive Chairman of AGT.
AGT Food and Ingredients Inc. Profile
AGT 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. In particular, this press release contains forward looking statements with respect to, among other things, consumer markets, export markets, volumes and margins, deliveries, prospects, opportunities, demand fundamentals and the expected benefits of AGT's investment herein and its production facilities in response to the foregoing. 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 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). For a more comprehensive description of non-IFRS measures and a reconciliation of net earnings (loss) determined in accordance with IFRS to Adjusted EBITDA* and other non-IFRS measures, see the table in the most recently dated related 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]