First Quantum amends financial covenants under $2.7 billion facility

By Rebecca Melvin

New York, April 22 – First Quantum Minerals Ltd. has amended the financial covenants under its senior $2.7 billion term loan and revolving credit facility as a measure aimed at proactively dealing with current economic uncertainty, the company said in a release.

The net debt to EBITDA ratio has been increased:

• To 5x for the third and fourth quarters of 2020;

• To 4.75x for the first and second quarters of 2021; and

• To 4.5x for the third and fourth quarters of 2021.

The debt service cover ratio has been decreased:

• To 1x for the second, third and fourth quarters of 2020; and

• To 1.1x for all quarters of 2021.

The EBITDA and cash available for debt service definitions have been amended to exclude the EBITDA and net cash flows from Ravensthorpe up to and including the second quarter of 2020, while the company brings this operation out of care and maintenance and into commercial levels of production.

The financial covenants will revert to the original ratios from 2022.

“We appreciate the flexibility and support from our lenders and their continued commitment to work with us as we navigate this current uncertainty,” First Quantum’s chairman and chief executive officer Philip Pascall said in the release. “The amendment of the financial covenants continues management's long held practice of proactively addressing debt compliance and managing risk in periods of uncertainty.”

First Quantum obtained the $1.5 billion term loan and a $1.2 billion revolving credit facility with three banks in February 2019.

The copper producer is based in Vancouver, B.C.

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