The renewals include improvements to certain key terms and conditions, which have a positive impact on the Company’s liquidity position.
MONTREAL, December 29, 2021 / CNW Telbec / – Birks Group Inc. (the âCompanyâ or the âBirks Groupâ) (NYSE American: BGI) today announced that it has entered into an amended and restated senior secured revolving credit facility (â Modified Credit Facility “) with Wells Fargo Capital Finance Corporation Canada (” Wells Fargo “) and a Senior Secured Term Loan (” Modified Term Loan “) with Crystal Financial LLC (dba SLR Credit Solutions) (” SLR ” ). The Amended Credit Facility and Amended Term Loan extend the maturity date of the Company’s existing loans by October 2022 until December 2026.
Mr. Jean-Christophe BÃ©dos, President and CEO of Birks Group, said: âI am pleased to announce the successful renewal of our senior secured credit facilities with Wells Fargo and SLR. The renewals include certain improved terms, which we are favorable to the Company’s liquidity position and will support the continued execution of the Company’s strategic plan. By building on our recent positive results and current banking market conditions and renewing our senior secured credit facilities on favorable terms through December 2026, we effectively guarantee an important source of liquidity and financial flexibility for the next 5 years. “
Mr. BÃ©dos added, âWe appreciate the relationships we have established with Wells Fargo and SLR over the past few years, and thank them for their continued support and commitment to the Birks Group. We look forward to continuing to work with them as we move forward on executing our long-term growth strategies.
The amended credit facility maintains a $ 85 million commitment subject to the availability of the borrowing base on the basis of the specified advance rates, eligibility criteria and usual reserves. The amended credit facility also includes a committed accordion of $ 5 million. The amended credit facility provides for a number of modifications, including favorable reductions in seasonal blocks of excess availability in effect from December 20 to January 31st of each year, as well as a LIBOR transition.
The modified term loan of $ 12.5 million is subordinated to the amended credit facility and now bears interest at the annual CDOR rate plus 7.75%, a reduction of 50 basis points. The modified term loan also allows periodic revisions of the annual interest rate to 7.00% or 6.75% depending on the Company’s compliance with certain financial covenants. In addition, the modified term loan includes an increase in advance rates on qualifying inventory of 100 basis points from december 2021 at December 2022, 75 basis points January 2023 at March 2023, 50 basis points of April 2023 at June 2023, and 25 basis points of July 2023 at September 2023, as well as favorable reductions in seasonal blocks of excess availability in effect from December 20 to January 31st of each year.
All figures presented here are in Canadian dollars.
About Groupe Birks inc.
The Birks Group is a leading designer of jewelry, watches and gifts and operator of luxury jewelry stores in Canada. The Company operates 25 stores under the Maison Birks brand in most of the major metropolitan markets of Canada, a point of sale at Calgary under the Brinkhaus brand, a point of sale in Vancouver operated under the Graff brand and a location in Vancouver under the Patek Philippe brand. Birks Bijoux fine jewelry collections are also available at select SAKS Fifth Avenue stores in Canada and in the United States, select the Mappin & Webb and Goldsmiths locations in the UK, in Mayors stores in United States as well as several jewelry retailers across North America. Birks was founded in 1879 and has become from Canada leading retailer and designer of jewelry, watches and gifts. Additional information is available on the Birks website, www.birks.com.
This press release contains forward-looking statements which can be identified by the use of words such as “plans”, “expects”, “believes”, “will”, “anticipates”, “intends to” , “Projects”, “estimates”, “could”, “would”, “could”, “planned”, “objective” and other words with similar meaning. All statements that deal with any expectations, possibilities or projections regarding the future, including, without limitation, statements about our growth strategies, expansion plans, liquidity and sources or adequacy of capital, expenses and financial results are forward-looking statements.
Since these statements include various risks and uncertainties, actual results may differ materially from those projected in forward-looking statements and no assurance can be given that the Company will achieve the results projected in forward-looking statements. These risks and uncertainties include, but are not limited to: (i) the extent and duration of economic disruptions resulting from the global COVID-19 epidemic, including its impact on macroeconomic conditions, in general, as well as its impact on the Company’s operating results and financial condition and share price; (ii) economic, political and market conditions, including the economies of Canada, and the United States, which could adversely affect our business, results of operations or financial condition, including our revenues and profitability, through the impact of changes in real estate markets, changes in property markets, actions and declines in consumer confidence and related changes in consumer spending habits, the impact on store traffic, tourism and sales; (iii) the impact of fluctuations in exchange rates, increases in commodity prices and borrowing costs and their related impact on the costs and expenses of the Company; (iv) variations in interest rates; (v) the Company’s ability to maintain and obtain sufficient sources of liquidity to finance its operations, achieve expected sales, gross margin and net profit, keep costs low, execute its business strategy, maintain relationships with its major suppliers, mitigate fluctuations in the availability and prices of the Company’s merchandise, compete with other jewelers, succeed in marketing initiatives and have an effective customer service program; (vi) the ability of the Company to continue to borrow under the Amended Credit Facility and the Amended Term Loan, (vii) the ability of the Company to maintain profitable operations, as well as to maintain levels of excess availability specified under the amended Credit Facility, to make scheduled payments of principal and interest, and to finance capital expenditures; (viii) the Company’s ability to execute its strategic vision; and (ix) the Company’s ability to continue operating.
Information regarding factors that could cause actual results to differ materially is presented under the headings âRisk Factorsâ and âOperational and Financial Review and Outlookâ and elsewhere in the Company’s annual report on Form 20-F filed with the Securities and Exchange Commission on June 17, 2021 and subsequent filings with the Securities and Exchange Commission. The Company assumes no obligation to update or publish revisions of these forward-looking statements to reflect events or circumstances after the date of this statement or to reflect the occurrence of unforeseen events, except as required by law. .
SOURCE Birks Group inc.
For further information: Company contacts: Katia Fontana, Vice-President and Chief Financial Officer, (514) 397-2592; For all press and media inquiries, please contact: OverCat Communications, Audrey Hyams Romoff, [emailÂ protected], (647) 223-9970; Gillian DiCesare, [emailÂ protected], (647) 223-5590; Chelsea Brooks, [emailÂ protected], (289) 221-6006