Eurofins completes its hybrid capital refinancing exercise finalising its new mid-term financing structure
17 Octobre 2019 - 8:35PM
Business Wire
Regulatory News:
Following its successful tender offer, Eurofins (Paris:ERF)
repaid this week the remaining EUR 58.4m outstanding notes for the
hybrid capital instrument that had a first call date in January
2020, at face value together with accrued interest.
With this repayment, Eurofins has concluded the refinancing
exercise of its EUR 300m 7%-coupon hybrid capital instrument,
thanks to the successful issuance of a new EUR 300m 2.875%-coupon
hybrid capital instrument as announced on 4th September 2019. As a
result, the blended average coupon on its three hybrid instruments
will fall below 3.7% in 2020 whereas the average interest rate on
Eurofins’ senior debt already fell below 2% in 2019. This is a
significant reduction compared to what Eurofins was paying in 2018
and 2019 and should correspond to less than EUR 65m in interest and
EUR 36.25m hybrid dividend in 2020 associated with an objective of
EUR 1bn for pro-forma adjusted EBITDA in 2020 based on the M&A
(EUR 200m revenues per annum consolidated at mid-year) and organic
growth (5%) hypotheses already published for 2019 and 2020.
After finalising this refinancing exercise, Eurofins has neither
a bond maturity due nor a hybrid capital call date (only Eurofins
can call its perpetual hybrid capital) prior to January 2022:
Type
Amount (EURm)
Coupon (%)
Maturity/ First Call Date**
Eurobond
500
2.250
27/01/2022
Eurobond
500
3.375
30/01/2023
Eurobond
650
2.125
25/07/2024
Schuldschein
550
1.38*
2022 / 2025
Hybrid capital
300
2.875
11/08/2022
Hybrid capital
300
4.875
29/04/2023
Hybrid capital
400
3.250
13/11/2025
*Calculated on the fixed tranches **Hybrid
capital issued by Eurofins contains no equity rights or
warrants
Over the last two years Eurofins has also significantly improved
its financing strategy. As opposed to carrying a lot of cash
received from bonds on its balance sheet like the Group did until
2017, Eurofins is now using medium-term (typically five year term)
committed bank lines of credit to fund part of its needs. This is a
much more cost effective approach, especially considering European
banks now charge interest to hold large Euro balances for their
clients. As of 30th June 2019, on top of the amount of credit lines
used to back up the outstanding commercial paper (EUR 320.5m) and
the amount used via short-term drawings on its bank credit lines
(EUR 410m), Eurofins had access to more than EUR 500m of undrawn
and available bank credit lines, with an average remaining life
greater than three years. The latter remains the case today.
While those commercial paper instruments and drawings under
credit lines are short-term by nature (between one and six months),
they are backed by committed medium-term bank facilities. Eurofins
is consequently not facing any issue should the commercial paper
market close down for an unexpected reason. As a reminder, no
financial covenants are included in any of Eurofins’ bilateral
revolving credit facilities, and those facilities are regularly
renewed for three to five year terms by their lenders.
Eurofins has also been made aware on Wednesday 16th October of a
publication (which was written by a party who claims it stands to
gain if Eurofins’ share price falls) that, we believe, could have
the effect of misleading investors. As for previous communications
by other parties which contained misleading information and some
damaging errors, this publication was issued without the author
confirming with Eurofins the correctness or relevance of all their
assumptions, hypotheses and inferences, which would have enabled
the avoidance of spreading inaccurate, irrelevant or misleading
information and the twisting or spinning of facts to disparage a
company and its management. Eurofins of course stands by the
reliability in all material aspects of its Group consolidated
accounts. As and when appropriate, Eurofins will address specific
inaccurate, incomplete, irrelevant or misleading statements in the
aforementioned publication.
Eurofins has alerted stock market regulatory authorities of this
publication that could constitute part of an attempt to manipulate
Eurofins’ share price. Eurofins has also shared this publication
with its past (PricewaterhouseCoopers) as well as with its current
lead auditors (Deloitte Audit), as some statements or insinuations
in this publication may unjustly cast doubts on their work.
Eurofins invites parties who consider they may have been harmed by
this misleading publication of 16th October and other associated
activities to get in touch with its Investor Relations department.
Eurofins and its advisors will evaluate how to support them and the
competent authorities in actions they may want to undertake to
obtain redress.
Eurofins will be publishing its trading update for Q3 2019 on
Monday 28th October and will hold a conference call thereafter.
For more information, please visit www.eurofins.com
Notes for the editor:
Eurofins – a global leader in bio-analysis
Eurofins Scientific through its subsidiaries (hereinafter
sometimes “Eurofins” or “the Group”) believes it is a scientific
leader in food, environment, pharmaceutical and cosmetics products
testing and in agroscience CRO services. It is also one of the
global independent market leaders in certain testing and laboratory
services for genomics, discovery pharmacology, forensics, CDMO,
advanced material sciences and for supporting clinical studies. In
addition, Eurofins is one of the leading global emerging players in
specialty clinical diagnostic testing. With about 45,000 staff in
more than 800 laboratories across 47 countries, Eurofins offers a
portfolio of over 200,000 analytical methods for evaluating the
safety, identity, composition, authenticity, origin and purity of
biological substances and products, as well as for innovative
clinical diagnostic. The Group objective is to provide its
customers with high-quality services, accurate results on time and
expert advice by its highly qualified staff.
Eurofins is committed to pursuing its dynamic growth strategy by
expanding both its technology portfolio and its geographic reach.
Through R&D and acquisitions, the Group draws on the latest
developments in the field of biotechnology and analytical chemistry
to offer its clients unique analytical solutions and the most
comprehensive range of testing methods.
As one of the most innovative and quality oriented international
players in its industry, Eurofins is ideally positioned to support
its clients’ increasingly stringent quality and safety standards
and the expanding demands of regulatory authorities around the
world.
The shares of Eurofins Scientific are listed on the Euronext
Paris Stock Exchange (ISIN FR0000038259, Reuters EUFI.PA, Bloomberg
ERF FP).
Important disclaimer:
This press release contains forward-looking statements and
estimates that involve risks and uncertainties. The forward-looking
statements and estimates contained herein represent the judgment of
Eurofins Scientific’s management as of the date of this release.
These forward-looking statements are not guarantees for future
performance, and the forward-looking events discussed in this
release may not occur. Eurofins Scientific disclaims any intent or
obligation to update any of these forward-looking statements and
estimates. All statements and estimates are made based on the
information available to the Company’s management as of the date of
publication, but no guarantee can be made as to their validity.
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Investor Relations Eurofins Scientific Phone: +32 2 766 1620
E-mail: ir@eurofins.com
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