Pyxus Strengthens Capital Structure with Repurchases and Retirement of Long-term Debt
- None.
- None.
— Expects to Reduce Long-term Debt by
— To Eliminate Associated Annual Interest Cost of
— Stronger Capital Structure Supports Opportunity to Lower Future Borrowing Rates and Drive Profitability —
"We are pleased our strategy has resulted in the growing strength of our operational and financial performance. Combined with our disciplined approach to working capital management, we have realized a significant opportunity to materially reduce our long-term debt," said President and CEO of Pyxus, Pieter Sikkel. "These retirements improve our overall capital structure, directly enable lower annual interest costs and reinforce our ability to pursue ongoing opportunities to lower our cost of borrowing and drive future profitability."
Pursuant to the repurchase agreement, as of March 29, 2024, the Company will have paid approximately
In addition to the
The following table summarizes these anticipated actions to reduce the Company's long-term debt:
December 31, | Anticipated | Discount to | Long-term Debt After | |
(in thousands and at par value) | 2023 | Debt Reduction | Par | Anticipated Debt Reduction |
Senior secured notes: | ||||
$ 20,391 | $ (20,391) | — | $ — | |
260,452 | (112,113) | 23 % | 148,339 | |
Senior secured term loans: | ||||
Intabex Term Loans | 189,033 | — | — | 189,033 |
Pyxus Term Loans | 130,550 | (10,345) | 12 % | 120,205 |
Other Debt: | ||||
Other long-term debt | 193 | — | — | 193 |
Total long-term debt | $ 600,619 | $ (142,849) | $ 457,770 | |
Long-term: | . | |||
Current portion of long-term debt | $ 20,473 | $ (20,391) | $ — | $ 82 |
Total long-term debt | 580,146 | (122,458) | — | 457,688 |
$ 600,619 | $ (142,849) | $ 457,770 |
About Pyxus International, Inc.
Pyxus International, Inc. is a global agricultural company with 150 years of experience delivering value-added products and services to businesses and customers. Driven by a united purpose—to transform people's lives, so that together we can grow a better world—Pyxus International, its subsidiaries and affiliates, are trusted providers of responsibly sourced, independently verified, sustainable and traceable products and ingredients. For more information, visit www.pyxus.com.
About Monarch Alternative Capital LP
Monarch Alternative Capital LP is a global investment firm founded in 2002 with approximately
Disinterested Director Approval
The repurchase agreement between the Company and the Holders, and the transactions contemplated thereby, were approved by a majority of the disinterested members of the Board of Directors of Pyxus International, Inc.
Cautionary Statement Regarding Forward-Looking Statements
Readers are cautioned that the statements contained in this report regarding expectations of our performance or other matters that may affect our business, results of operations, or financial condition are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995, as amended. These statements, which are based on current expectations of future events, may be identified by the use of words such as "expects," "plans," "anticipates," "believes," "will," "estimates," "intends" and other words of similar meaning. These statements also may be identified by the fact that they do not relate strictly to historical or current facts. If underlying assumptions prove inaccurate, or if known or unknown risks or uncertainties materialize, actual results could vary materially from those anticipated, estimated, or projected. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. These risks and uncertainties include those discussed in our Annual Report on Form 10-K for the year ended March 31, 2023, our most recent Quarterly Report on Form 10-Q, and in our other filings with the Securities and Exchange Commission. These risks and uncertainties include: the possibility that the Company's actual liquidity and cash needs differ from anticipated levels such that the Company determines not to exercise its right to repurchase the additional 2027 Notes and 2027 Loans from the Holders; the possibility of unexpected costs, liabilities or delays in effecting the anticipated debt reduction actions; the outcome of any legal proceedings that may arise with respect to the anticipated debt reduction actions; the occurrence of any event, change or other circumstances that could give rise to the termination of the repurchase agreements by the Holders; our reliance on a small number of significant customers; continued vertical integration by our customers; global shifts in sourcing customer requirements; shifts in the global supply and demand position for tobacco products; variation in our financial results due to growing conditions, customer indications and other factors; loss of confidence in us by our customers, farmers and other suppliers; migration of suppliers who have historically grown tobacco and from whom we have purchased tobacco toward growing other crops; risks related to our advancement of inputs to tobacco suppliers to be settled upon the suppliers delivering us unprocessed tobacco at the end of the growing season; risks that the tobacco we purchase directly from suppliers will not meet our customers' quality and quantity requirements; weather and other environmental conditions that can affect the marketability of our inventory; international business risks, including unsettled political conditions, uncertainty in the enforcement of legal obligations, including the collection of accounts receivable, fraud risks, expropriation, import and export restrictions, exchange controls, inflationary economies, currency risks and risks related to the restrictions on repatriation of earnings or proceeds from liquidated assets of foreign subsidiaries; many of our operations are located in jurisdictions that pose a high risk of potential violations of the Foreign Corrupt Practices Act; risks and uncertainties related to geopolitical conflicts, including the armed conflict between
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SOURCE Pyxus International, Inc.
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