Baby products retailer Mothercare in refinancing talks with lender (updated)

Mothercare

04/05/2023 07:55

(Adds details)
       May 4 (Reuters) - Mothercare  MTC.L  said on Thursday it
had begun discussions with its lender to change, renegotiate, or
refinance its debt facility due to higher interest rates, and
warned that it may need waivers to future covenant tests.
    The baby products retailer said it is also considering
various financing alternatives, including equity and
equity-linked structures, to gain additional flexibility and
reduced cash financing costs.
    Mothercare said higher interest rates on its loan, coupled
with a delay in return to pre-COVID-19 sales levels particularly
in Middle Eastern markets, means the group may need waivers to
future periods' covenant tests.
    The London-listed group also said that at the end of its
financial year to March 25, it had total cash of 7.2 million
pounds, down from 9.2 million pounds a year ago, reflecting
ongoing tight control of cash.
    It expects to report full-year core profit before adjusted
items in the range of 6.5 million pounds to 7 million pounds.
    
($1 = 0.7948 pounds)

 (Reporting by Muhammed Husain in Bengaluru; editing by Uttaresh
Venkateshwaran)
 ((Muhammed.Husain@thomsonreuters.com;))