INEOS Group Holdings PLC ("the Group") confirms that its request for an extension to certain covenant waivers, to allow sufficient time for the Sounding Group and its advisors to consider the company’s proposals, has been agreed
On 06 May 2009 INEOS announced that it was requesting an extension to the waiver of the requirements to test certain financial covenants and provide certain compliance certificates in respect of the testing period ended on 31 March 2009 to 17 July 2009.
INEOS can now confirm that this request has been approved by the requisite majority of its lenders and therefore the extension to the covenant waivers has been granted.
The extension was sought to:
- allow sufficient time for the Group’s business to be reviewed by the accounting and financial advisors appointed to act on behalf of the Sounding Group; and
- prepare any further consent requests to be presented to Lenders in June 2009.
Lazard & Co., Limited is acting as financial advisor to INEOS.
Richard Longden +44 (0) 2380 287037
Edward Bridges +44 (0) 207 831 3113
Michael Grayer +44 (0) 20 7187 2000.
Note to editors:
INEOS (www.ineos.com) is the world's third largest chemicals company; a leading manufacturer of petrochemicals, specialty chemicals and oil products. Comprising 17 businesses, with a production network spanning 64 manufacturing facilities in 14 countries, the company produces more than 57 million tonnes of petrochemicals, 20 million tons per annum of crude oil refined products (fuels). INEOS employs 15,500 people and has sales of around $47bn.
Q1 2009 summary
- Based on management information INEOS expects that Replacement Cost EBITDA for the first quarter was in the region of €170 million.
- The Group confirms an improving trend in its trading performance in the first quarter of 2009. Market conditions have shown some signs of slow but steady improvement during the quarter reflected in RC EBITDA for March in the region of €73 million.
- Fixed costs in the Group are line with budget to achieve the planned fixed cost savings of €200 million in 2009. The relevant actions have also taken place to reduce capital expenditure levels to the target of €250 million in 2009.
- INEOS experienced further operating cash inflows in the quarter as the Group has continued to focus on cash management and liquidity. The Group implemented its working capital improvement programme, which has successfully reduced physical inventory levels by 20%. Net debt was approximately €7.5 billion at the end of March 2009.
- Cash balances at the end of the quarter were €560 million. Repayments under the securitisation facility amounted to approximately €210 million in the quarter, and senior bank interest of €210 million was paid in March.
Lazard & Co., Limited
Lazard & Co., Limited is acting for INEOS Group Holdings Plc, INEOS Holdings Limited and INEOS US Intermediate Finance LLC and no one else in connection with the matters referred to in this announcement and will not be responsible to any person other than INEOS Group Holdings Plc, INEOS Holdings Limited and INEOS US.
Forward looking statements
This announcement includes “forward-looking statements”, within the meaning of the U.S. securities laws, based on INEOS Group Holdings plc’s (“IGH”) current expectations and projections about future events. All statements other than reported financial results and statements of historical facts included in this announcement may be deemed to be forward-looking statements, including, but not limited to, estimates of IGH’s EBITDA for 2009 and expected future cost savings. Words such as “believe”, “expect”, “anticipate”, “may”, “intend”, “will”, “should”, “estimate” and similar expressions or the negatives of these expressions are intended to identify forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties, including: IGH’s high degree of leverage and significant debt service obligations, as well as future cash flow, profitability and liquidity; a continuation of, or further negative developments in, adverse financial market conditions that may affect IGH’s ability to incur or refinance indebtedness and the terms of its existing and future indebtedness; changes in raw material costs and supply arrangements, including rapid fluctuations in the costs of feedstocks; the cyclical and highly competitive nature of IGH’s businesses; adverse developments in global economic conditions; currency fluctuations; disruptions in production at IGH’s facilities, including due to plant and equipment failures, labor stoppages and adverse weather conditions and natural disasters; IGH’s ability to realize synergies and cost savings; and, current or future environmental requirements and the related costs of maintaining compliance and/or addressing liabilities. Reference should be made to IGH’s 2007 annual report, including the section therein titled “Risk Factors”, for a description of certain of these risks and uncertainties. In addition, from time to time IGH or IGH’s representatives, acting in respect of information provided by IGH, have made or may make forward-looking statements orally or in writing and these forward-looking statements may be included in but are not limited to press releases, filings with the regulatory authorities, reports to IGH’s security holders and other communications. Although IGH believes that the expectations reflected in such forward-looking statements are reasonable, IGH can give no assurance that such expectations will prove to be correct. IGH does not undertake any obligations to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.