GCC Successfully Refinances Its Bank Debt

New unsecured credit agreement replaces all existing bank debt

Around US$ 10 million estimated annualized interest expense savings

CHIHUAHUA, Mexico, June 15, 2018 (GLOBE NEWSWIRE) -- Grupo Cementos de Chihuahua, S.A.B. de C.V., or GCC, (BMV:GCC*) announces the completion of a comprehensive new term loan agreement with its banks. The new agreement replaces all GCC’s existing bank debt, reduces interest expense, and improves terms and conditions. 

The new US$ $400 million loan has a term of 5 years, with a variable interest rate spread of 1.25% to 2.0% over Libor, based on GCC’s debt/EBITDA ratio. The initial margin will be 1.75%. In addition, the agreement includes an unsecured US$ 50 million revolving line of credit.

BBVA Bancomer S.A., Banco Nacional de México, S.A., JPMorgan Chase Bank, N.A., and The Bank of Nova Scotia are leading the financing.

The refinancing will result in an annualized reduction of interest expense of approximately US$ 10 million.

The revolving line of credit will be available to meet working capital requirements and for general corporate purposes, increasing GCC’s financial flexibility. 

Luis Carlos Arias, GCC’s Chief Financial Officer, said, “The new bank agreement is another ratification of the decisive steps GCC is taking to grow our business in the U.S. and Mexico and expand margins.  The bank refinancing and back-up revolving credit further strengthen GCC’s financial position and improve our financial flexibility.”

The bank refinancing follows the May 2018 upgrade by S&P of GCC’s debt rating to BB+ with a stable outlook and takes place less than one year after GCC refinanced its US$ 260 million senior notes, reducing the interest coupon by 287.5 basis points.

About GCC

GCC is a leading supplier of cement, concrete, aggregates, and construction‐related services in the United States and Mexico, with an annual cement production capacity of 5.1 million metric tons. Founded in 1941, the Company’s shares are listed on the Mexican Stock Exchange under the ticker symbol GCC.

Forward Looking Statements

This press release may contain forward-looking statements. All statements that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “expect,” “estimate,” “intend,” “project” and similar expressions are generally intended to identify forward-looking statements. These statements are subject to risks and uncertainties including, among others, changes in macroeconomic, political, governmental or business conditions in the markets where GCC operates; changes in interest rates, inflation rates and currency exchange rates; performance of the construction industry; pricing, business strategy, and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may differ materially from the beliefs, projections, and estimates described herein. GCC assumes no obligation to update the information contained in this press release.

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