Why the Perenti (ASX:PRN) share price is higher today

The Perenti Global Ltd (ASX: PRN) share price is up 1.94% today after the company announced it had successfully refinanced debt.

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The Perenti Global Ltd (ASX: PRN) share price was higher today, up 2.2% to $1.16 at the time of writing. This came after the mining services company updated the market on its successful debt refinancing.

What was in the update?

Perenti announced that it had successfully issued US$450 million of unsecured notes in the US bond market. The initial offer of US$350 million was oversubscribed and the issue upsized by US$100 million.

The notes issue has not affected Perenti’s debt levels as proceeds will be used to repay existing borrowings. The notes are unsecured and have an interest rate of 6.5%. The company’s existing notes are secured and have a higher interest rate at 6.625%. The repayment profile has also been lengthened with repayment due in October 2025.

According to Perenti, the notes issue further strengthens its strong liquidity position. The company expects to maintain leverage of 1.3x, positioning it for growth and helping it to deliver on its 2025 strategy.

US$350million will be used to redeem senior secured notes issued by Perenti subsidiary Barminco Finance. The additional US$100 million will pay down amounts drawn under the company’s revolving credit facility.

Perenti currently has a BB rating with a positive outlook from Fitch ratings. It is rated BB by Standard and Poor’s and Ba2 by Moody’s.

About the Perenti share price

The mining services company offers services for underground and surface mining in 13 countries. It has been listed on the ASX since 1994 and was previously known as Ausdrill.

In the 2020 financial year, Perenti had record revenue of $2.04 billion, up 3.8%. The company had record underlying earnings before interest, tax, depreciation and amortisation (EBITDA) in FY2020 of $443.8 million, up 6.8%. The company had work in hand of $5.4 billion at 30 June 2020. $1.7 billion of this was secured revenue for the 2021 financial year.

The Perenti share price is up 158% since its 52-week low of 45 cents. However, it has fallen 27.5% since the beginning of the year. The Perenti share price is down 46.79% since this time last year.

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