£150m refinancing deal agreed for Card Factory

Card Factory, says it has agreed terms of a refinancing with its current banking syndicate after making good progress in using its positive cash flows to reduce overall debt.

The Wakefield-headquartered greeting cards and gifts retailer has signed off on revised terms on reduced facilities of £150m (previously £225m).

As of 31 March 2022, the Group’s net debt (excluding lease liabilities) was £79m.

The best efforts commitment given by Card Factory to its banks, to raise net equity proceeds of £70m by 30 July 2022 has been removed from the revised facilities. The Board says it has no current intention of completing an equity raise.

Darcy Willson-Rymer, chief executive, said: “This is an important milestone for our business, ensuring we have the financial foundations in place to capitalise on the opportunities ahead.

“We are now well positioned to continue our strategic transition from a store-led card retailer to a market leading omnichannel retailer of cards and gifts.”

The revised facilities comprise:

·      a £100m revolving credit facility (RCF), substantially on the same terms as the previous RCF, subject to revised financial covenants, available until September 2025;

·      a £11.25m term loan facility, to be repaid between 31 January 2023 and 31 January 2024;

·      a £18.75m term loan facility, to be repaid in six quarterly instalments of £1.75m from April 2024 and a final bullet repayment of the balance in September 2025; and

·      in aggregate, a balance of £20m Coronavirus Large Business Interruption Loan Scheme (CLBILS) facilities, repayable by September 2023. Therefore, the Group will reduce its Government-backed CLBILS element from the original £50m to £20m.