Having refinanced the Group's debt, Hyve has new debt facilities totalling £135m
New £135m debt facilities
Hyve Group plc, the next-generation global events business, today announces the refinancing of the Group's debt. New debt facilities totalling £135m have been signed, comprising a £115m term loan and a £20m super senior revolving credit facility ('SSRCF').
The new debt facilities will replace the Group's previous debt facilities, with the £101m currently drawn to be repaid in full on 20 October 2022 when the new funds are to be drawn.
The £115m term loan is provided by certain funds and/or accounts of HPS Investment Partners, LLC or subsidiaries or affiliates thereof and is repayable over the next four years. Interest is initially payable at a rate of 7.75% over SONIA1. A minimum liquidity covenant of £21m is in place up to and including August 2023. Thereafter a net debt to adjusted EBITDA ratio applies, flatlining at 3x.
The £20m SSRCF is provided by HSBC UK Bank PLC and is available over the next three years and nine months. Interest is initially payable on drawn amounts at 3.5% over SONIA2 with a commitment fee of 35% (i.e. 1.225%) payable on undrawn amounts.
As announced in the Group's trading update on 27 June 2022, the pace of in-person event recovery in FY22 has exceeded anticipated levels. This trend has continued over the final three months of the financial year in all markets with the exception of China where restrictions continue to disrupt our event schedule and resulted in the cancellation of the August Chinese events.
In September two of the Group's largest events, Autumn Fair and Groceryshop, took place and both significantly outperformed their previous editions. Groceryshop in particular outperformed expectations, reporting revenues more than 40% higher than the largest pre-COVID edition of the event.
Positive trading momentum continues as we approach FY23, with forward bookings for the next financial year currently in excess of £65m. This gives confidence in the FY23 outlook such that that the incremental debt service cost attributable to the increased margin over SONIA is expected to be offset by improved trading performance.
As of 31 August 2022, the Group's cash position was £34.7m and adjusted net debt3 £66.4m, on track to be towards the lower end of the previously stated FY22 year end guidance of £70m-£90m.
Mark Shashoua, CEO of Hyve Group plc said:
I am pleased that we have secured new debt facilities with two partners that share our vision and are aligned with our ambitions. With the continued accelerated pace of recovery, we now have the long-term financial footing to further advance our organic growth and omnichannel strategy.
1 Subject to a margin ratchet, with a margin range of 7.5% to 8.0% over SONIA
2 Subject to a margin ratchet, with a margin range of 2.5% to 3.5% over SONIA
3 Adjusted net debt is defined as cash and cash equivalents after deducting bank loans. This is therefore prior to any lease liabilities recognised on the balance sheet and it is excluding cash presented as held for sale.