SANTA ANA, Calif., July 18 12, 2022 (GLOBE NEWSWIRE) — Ducommun Incorporated (:DCO) (“Ducommun” or the “Company”) today announced that effective July 14, 2022, it has entered into a new credit facility consisting of a $250 million term and a $200 million revolving line of credit to replace its existing debt structure. As part of the transaction, the Company extinguished its existing $140 million term loan, its existing $100 million unused revolving line of credit and its other existing $240 million term loan, which would have arrived maturing in December 2024, December 2024 and November 2025, respectively. The new term loan and the new revolving line of credit will mature in July 2027.
The initial floating rate on the new term loan is the term SOFR plus 1.625%, subject to adjustments based on the Company’s leverage ratio. At the time of extinguishment, the floating rates for the loans being extinguished were LIBOR plus 1.75% on the $140 million term loan, with an outstanding balance of approximately $110 million, and the LIBOR plus 4.00% on the $240 million term loan, with an outstanding balance of approximately $145 million.
This new credit facility, combined with the forward interest rate swaps that the Company entered into in November 2021 for an aggregate notional amount of $150 million which will become effective on January 1, 2024 and expire on January 1, 2031, immobilizes key elements of the Company’s debt management strategy.
“We elected to execute an opportunistic refinancing of our existing medium-term credit facility, with the goal of securing a new five-year credit facility in a favorable term lending environment,” said Stephen G. Oswald. , Chairman of the Board, President and Chief Executive Officer. . “We are very pleased with the outcome of the financing of the new credit facility and, combined with our interest rate swaps, we believe we have an effective debt structure that the company can use to drive organic growth as well as continued investments in strategic acquisitions.”
Detailed information regarding the new credit facility is included in the company’s current report on Form 8-K filed with the Securities and Exchange Commission.
About Ducommun Incorporated
Ducommun Incorporated provides innovative, value-added manufacturing solutions to customers in the aerospace, defense and industrial markets. Founded in 1849, the company specializes in two main areas – electronic systems and structural solutions – to produce complex products and components for commercial aircraft platforms, critical military and space programs and sophisticated industrial applications. . For more information, visit Ducommun.com.
This press release contains “forward-looking statements” within the meaning of federal securities laws relating to Ducommun Incorporated, as set forth above, including statements relating to Ducommun’s expectations regarding the effectiveness of its debt structure and its prospects for future organic and inorganic growth, and similar expressions that relate to Ducommun’s intentions or beliefs regarding future events, expectations or results. Forward-looking statements are subject to risks, uncertainties and other factors that may change over time and may cause actual results to differ materially from those expected. It is very difficult to predict the effect of known factors, and Ducommun cannot anticipate all factors that could affect actual results that could be important to an investor. All forward-looking information should be evaluated in the context of such risks, uncertainties and other factors, including the factors disclosed under “Risk Factors” in Ducommun’s filings with the SEC, including the company’s quarterly reports on Form 10-Q, Annual Reports on Form 10-K, and Current Reports on Form 8-K. The forward-looking statements included in this press release speak only as of the date of this press release, and Ducommun assumes no obligation to (and expressly disclaims any obligation to) update the forward-looking statements to reflect events or subsequent circumstances.
Suman Mookerji, vice president, corporate development and investor relations, 657.335.3665