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FORT WORTH, Texas - AZZ Inc . (NYSE: NYSE:AZZ), a prominent provider of metal coating solutions in North America with a market capitalization of $2.87 billion, has successfully repriced its $400 million Senior Secured Revolving Line of Credit, the company announced today. According to InvestingPro data, the company maintains a strong financial health score of "GOOD," supported by solid liquidity metrics. The revised terms include a reduction in the interest rate margin, commitment fee, and Letter of Credit Fees, which are all subject to leverage ratio step-downs.
The interest rate margin on the Revolving Credit Loans has been decreased from a range of 275 basis points to 350 basis points to a new range of 175 basis points to 275 basis points. Additionally, the Commitment Fee has been reduced from a range of 25 basis points to 37.5 basis points to a new range of 20 basis points to 30 basis points. The Letter of Credit Fees have also been lowered from 425 basis points to a range of 175 basis points to 275 basis points. This refinancing comes at a time when the company maintains a healthy current ratio of 1.77, indicating strong ability to meet short-term obligations.
Jason Crawford, Chief Financial Officer of AZZ Inc., stated, "We are pleased to announce the successful completion of our revolver repricing. The repricing will result in significantly lower interest costs through the maturity of the facility and demonstrates our ongoing commitment to interest expense reduction."
AZZ Inc. serves a diverse set of end-markets by providing hot-dip galvanizing and coil coating solutions, which are aimed at enhancing the longevity and appearance of infrastructure and buildings essential to everyday life.
This announcement is based on a press release statement and should be evaluated considering potential risks and uncertainties. Forward-looking statements contained in the press release are subject to various factors that could cause actual results to differ materially, including market demand, labor costs, raw material availability, supply chain delays, and economic conditions. For deeper insights into AZZ’s financial outlook, InvestingPro subscribers can access comprehensive analysis, including detailed financial health metrics and expert projections. The platform offers exclusive access to over 1,400 Pro Research Reports, transforming complex Wall Street data into actionable intelligence. Investors are advised to consider these risks carefully.
The company has provided further information regarding these risks in its Annual Report on Form 10-K for the fiscal year ended February 29, 2024, and other filings with the SEC. AZZ Inc. has not undertaken any obligation to update any forward-looking statements as of the date of the press release.
In other recent news, AZZ Incorporated reported impressive financial results for its fiscal third quarter of 2024, surpassing earnings per share (EPS) expectations. The company posted an EPS of $1.39, exceeding the forecasted $1.25, and achieved a revenue increase of 5.8% year-over-year, totaling $404 million. This performance was driven by strong growth in the Metal Coatings and Precoat Metals segments. In addition, Roth/MKM analysts initiated coverage of AZZ with a Buy rating and set a price target of $108.00, citing expectations of steady organic growth and operational efficiencies. The analysts highlighted AZZ’s tolling model, which contributes to a stable margin profile, and forecast an annual organic growth rate of 4-5%. They also noted the company’s potential for accelerating free cash flow due to lower interest costs and reduced capital expenditures. AZZ’s recent exit from a growth investment cycle is seen as a strategic move to support deleveraging and provide flexibility for future acquisitions, dividend increases, and share buybacks.
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