Fisher&Paykel Appliances Holdings Ltd said its banks are no longer requiring a budget performance test after it reduced debt levels.In May 2009, the company renegotiated long term debt facilities of about $575 million. The banking covenant regime requ
Fisher&Paykel Appliances Holdings Ltd said its banks are no longer requiring a budget performance test after it reduced debt levels.
In May 2009, the company renegotiated long term debt facilities of about $575 million. The banking covenant regime required the repayment of $235m by April 30 and included a budget performance test, which had earnings thresholds.
The company repaid the $235m six months early and its net debt is expected to be $200m by March 31 from a peak of $502m in May 2009.
The banks have now agreed that a total leverage ratio will supersede the budget performance test from March 1. The total leverage ratio must be less than three times and will be tested monthly. The test will change to quarterly if the ratio is below 2.5 times for three consecutive months.
"The directors are pleased with the progress that the company has made in reducing debt levels and see the earlier than planned restoration of the total leverage ratio as a pleasing step towards normal banking terms," the company said.
