Sundial Announces $50 million Prepayment on Senior Secured Non-Revolving Term Credit Facility

Rhea-AI Summary

Sundial Growers has announced a $50 million prepayment on its senior secured non-revolving term credit facility, improving its balance sheet and reducing annual interest costs by $2.5 million. The company now holds $22 million in outstanding debt and approximately $39 million in unrestricted cash. CFO Jim Keough stated this repayment enhances financial flexibility and supports a path to positive cash flow from operations. Sundial maintains a significant presence in cannabis cultivation with a focus on quality and consumer experience.

Positive

• Prepayment of $50 million improves financial flexibility.
• Annual interest cost reduced by $2.5 million.
• Current unrestricted cash balance is approximately $39 million.

Negative

• None.

CALGARY, AB, Dec. 15, 2020 /PRNewswire/ - Sundial Growers Inc. (Nasdaq: SNDL) ("Sundial" or the "Company") today announced that the Company has prepaid $50 million of the outstanding principal under its senior secured non-revolving term credit facility (the "Facility") to further improve its balance sheet. All amounts are denominated in Canadian dollars unless otherwise noted.

The debt repayment will result in an annualized reduction in interest costs of $2.5 million. Sundial's remaining indebtedness consists of $22 million under the Facility and the Company's current unrestricted cash balance is approximately $39 million.

"The accelerated repayment of a significant portion of our indebtedness is a further step in advancing our financial flexibility and reducing our overall cost structure," said Sundial's Chief Financial Officer, Jim Keough. "It reflects a substantial turnaround from our financial position earlier this year. Our current cash position enables us to focus on a path to positive cash flow from operations, refining our capital structure and potential future strategic opportunities."

ABOUT SUNDIAL GROWERS INC.

Sundial is a public company with Common Shares traded on Nasdaq under the symbol "SNDL".

Sundial is a licensed producer that crafts cannabis using state-of-the-art indoor facilities. Our 'craft-at-scale' modular growing approach, award-winning genetics and experienced master growers set us apart.

Our Canadian operations cultivate small-batch cannabis using an individualized "room" approach, with 448,000 square feet of total space.

Sundial's brand portfolio includes Top Leaf, Sundial Cannabis, Palmetto and Grasslands. Our consumer-packaged goods experience enables us to not just grow quality cannabis, but also to create exceptional consumer and customer experiences.

We are proudly Albertan, headquartered in Calgary, AB, with operations in Olds, AB, and Rocky View County, AB.

Forward-Looking Information Cautionary Statement  

This news release includes statements containing certain "forward-looking information" within the meaning of applicable securities law ("forward-looking statements"), including, but not limited to, statements regarding the Company's debt position, cash balance and statements regarding the Company's future strategic initiatives. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "likely", "outlook", "forecast", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Please see the risk factors identified in the Company's filings with the U.S. Securities and Exchange Commission, including those identified in the Company's Annual Report on Form 20-F, for a discussion of the material risks that could cause actual results to differ materially from the forward-looking information. The Company is under no obligation, and 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 as expressly required by applicable law.  

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SOURCE Sundial Growers Inc.

FAQ

What does Sundial Growers' $50 million prepayment mean for SNDL investors?

The $50 million prepayment on debt enhances Sundial's financial flexibility and reduces interest costs, which could positively impact future cash flow.

What is Sundial Growers' current debt situation?

Sundial Growers currently has $22 million remaining under its senior secured facility following the $50 million prepayment.

How much cash does Sundial Growers have?

Sundial Growers reports an unrestricted cash balance of approximately $39 million.

What impact does the debt repayment have on Sundial Growers' financial health?

The debt repayment is a significant step towards improving Sundial's overall cost structure, aiming for a path to positive cash flow.