GOL Refinances R$1.2 Billion of Short-Term Debt, Concluding Liability Management Program

Rhea-AI Summary

On September 17, 2021, GOL Linhas Aéreas Inteligentes S.A. announced the refinancing of R$1.2 billion in short-term debt, set to mature in 2024. This move marks the conclusion of its liability management program, reducing short-term debt to approximately R$0.5 billion, the lowest since 2014. The refinancing will extend the average debt tenor to 3.3 years and improve GOL's credit metrics. The use of proceeds will include debt repayments and working capital. GOL's disciplined financial management has strengthened its balance sheet despite the pandemic, allowing for a focus on sustainable growth.

Positive

• Reduced short-term debt to R$0.5 billion, lowest level since 2014.
• Extended average debt maturity from short-term to 3.3 years.
• Improved credit metrics and cost of debt reduction.
• Successful capital increases and debt amortization initiatives.

Negative

• None.

SÃO PAULO, Sept. 17, 2021 /PRNewswire/ -- GOL Linhas Aéreas Inteligentes S.A. (NYSE: GOL and B3: GOLL4), ("GOL" or "Company"), Brazil's largest airline, announces that it has finalized the terms and conditions for the refinancing by GLA Linhas Aéreas S.A., an operating unit of the Company, of R$1.2 billion, with a final maturity in 2024. The participating syndicate is comprised of local banks in Brazil, and the transaction is subject to final approvals and execution of the relevant documents.

The refinancing will conclude GOL's liability management program and return the Company to its lowest level of short-term debt since 2014 (approximately R$0.5 billion at the end of 3Q21). Through its liability management program, GOL utilized assets on its balance sheet to reduce short-term debt by R$2.1 billion over the 12-month period ended in June 2021. In partnership with its aircraft lease providers, the Company has maintained its aircraft lease liability at approximately 45% of total indebtedness during the same period, with a stable IFRS16 discount rate.

The refinancing of GOL's short-term debt will extend the average tenor of its liabilities to 3.3 years – an increase of more than two years. The use of proceeds of the refinancing includes: R$592 million applied to the remaining balance of the 7^th issue of debentures, R$528 million of export financing lines (Finimps), and R$165 million of working capital credit lines.

"With this transaction, the Company has concluded the largest balance sheet deleveraging among its peers, making it the airline with the lowest liabilities. We can now focus the vast majority of our operating cash flow on sustainable operational growth," said Richard Lark, CFO.

The transaction will also improve GOL's credit metrics by better matching future assets and liabilities and reducing the Company's average cost of debt. Richard Lark added: "We are optimistic that this will be a critical catalyst to restoring GOL's credit rating to its pre-pandemic level of B/B+ by the three major corporate credit ratings agencies."

The Company's disciplined financial management throughout the pandemic strengthened its balance sheet and reduced short-term indebtedness, preserving liquidity to maintain operations. GOL also concluded several other important initiatives to rebalance its capital structure, such as the amortization of its US$300 million Term Loan B, the issuance of US$500 million of Senior Secured Notes due 2026, a R$423 million equity capital increase led by its controlling shareholder, and the acquisition of the minority interest in its Smiles loyalty program.

The table below shows the main sources and uses in GOL's liability management since January 2020.

Sources of Funds	R$bn	Uses of Funds	R$bn
Senior Secured Notes due 2026	2.4	Term Loan B	1.6
Guaranteed Financing	1.3	Guaranteed Financing	1.3
Restricted Cash	0.6	Capex Financing	0.7
Aircraft Sales	0.5	Working Capital Financing	0.7
Capital Increase	0.5	Import Financing	0.6
Deposits	0.3	Senior Notes due 2022	0.4
Other Sources	0.2	Cash	0.5
TOTAL	5.8	TOTAL	5.8

Investor Relations
ri@voegol.com.br
www.voegol.com.br/ir
+55(11) 2128-4700

Media Relations
Becky Nye, Montieth & Company
bnye@montiethco.com

About GOL Linhas Aéreas Inteligentes S.A.

GOL is Brazil's largest airline, leader in the corporate and leisure segments. Since its founding in 2001, it has been the airline with the lowest unit cost in Latin America, which has enabled the democratization of air transportation. The Company has a strategic alliance with American Airlines and Air France-KLM, in addition to making available to Customers many codeshare and interline agreements, bringing more convenience and ease of connections to any place served by these partnerships. With the purpose of "Being First for Everyone", GOL offers the best travel experience to its passengers, including: the largest inventory of seats and the most legroom; the most complete platform with internet, movies and live TV; and the best loyalty program, SMILES. In cargo transportation, GOLLOG delivers parcels to various regions in Brazil and abroad. The Company has a team of 15,000 highly qualified airline professionals focused on Safety, GOL's number one value, and operates a standardized fleet of 127 Boeing 737 aircraft. GOL's shares are traded on the NYSE (GOL) and the B3 (GOLL4). For further information, visit www.voegol.com.br/ir.

Disclaimer

The information contained in this press release has not been subject to any independent audit or review and contains "forward-looking" statements, estimates and projections that relate to future events, which are, by their nature, subject to significant risks and uncertainties. All statements other than statements of historical fact contained in this press release including, without limitation, those regarding GOL's future financial position and results of operations, strategy, plans, objectives, goals and targets, future developments in the markets in which GOL operates or is seeking to operate, and any statements preceded by, followed by or that include the words "believe", "expect", "aim", "intend", "will", "may", "project", "estimate", "anticipate", "predict", "seek", "should" or similar words or expressions, are forward-looking statements. The future events referred to in these forward-looking statements involve known and unknown risks, uncertainties, contingencies and other factors, many of which are beyond GOL's control, that may cause actual results, performance or events to differ materially from those expressed or implied in these statements. These forward-looking statements are based on numerous assumptions regarding GOL's present and future business strategies and the environment in which GOL will operate in the future and are not a guarantee of future performance. Such forward-looking statements speak only as at the date on which they are made. None of GOL or any of its affiliates, officers, directors, employees and agents undertakes any duty or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law. None of GOL or any of its affiliates, officers, directors, employees, professional advisors and agents make any representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved, and such forward-looking statements represent, in each case, only one of many possible scenarios and should not be viewed as the most likely or standard scenario. Although GOL believes that the estimates and projections in these forward-looking statements are reasonable, they may prove materially incorrect and actual results may materially differ. As a result, you should not rely on these forward-looking statements.

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SOURCE GOL Linhas Aéreas Inteligentes S.A.

FAQ

What debt has GOL refinanced in 2021?

GOL refinanced R$1.2 billion of short-term debt, maturing in 2024.

How has GOL's liability management program affected its debt?

The program reduced GOL's short-term debt to approximately R$0.5 billion, the lowest level since 2014.

What is the new average debt maturity for GOL after refinancing?

The average debt maturity has been extended to 3.3 years.

How has GOL's debt refinancing impacted its credit metrics?

The refinancing is expected to improve GOL's credit metrics and reduce its average cost of debt.

What are the uses of proceeds from GOL's refinancing?

Proceeds will be applied to debt repayments, export financing lines, and working capital credit lines.