Baby products retailer Mothercare in refinancing talks with lender
Reuters
Published May 04, 2023 08:01
(Reuters) - Mothercare said on Thursday it had begun discussions with its lender to change, renegotiate, or refinance its debt facility due to higher interest rates, and warned that it may need waivers to future covenant tests.
The baby products retailer said it is also considering various financing alternatives, including equity and equity-linked structures, to gain additional flexibility and reduced cash financing costs.
Mothercare said higher interest rates on its loan, coupled with a delay in return to pre-COVID-19 sales levels particularly in Middle Eastern markets, means the group may need waivers to future periods' covenant tests.
The London-listed group also said that at the end of its financial year to March 25, it had total cash of 7.2 million pounds, down from 9.2 million pounds a year ago, reflecting ongoing tight control of cash.
It expects to report full-year core profit before adjusted items in the range of 6.5 million pounds to 7 million pounds.
($1 = 0.7948 pounds)
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Written By: Reuters
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