The Dalrymple Bay Infrastructure Ltd (ASX: DBI) share price is in focus today after the company secured $1.07 billion refinancing, delivering a lower average debt margin and aiming to save approximately $75 million in interest costs through to 2030.
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What did Dalrymple Bay Infrastructure report?
- Secured $1.07 billion of new loan facilities via subsidiary Dalrymple Bay Finance Pty Ltd
- A$820 million in revolving credit facilities over 3- and 5-year terms from a broader range of lenders
- A$250 million, 2-year term facility arranged with three key relationship banks
- Weighted average margin on new facilities is 1.56% (down from 3.26% previously)
- Approximately $75 million of projected interest cost savings through to 2030
- Maintained investment grade credit rating and compliance with debt covenants
What else do investors need to know?
The refinancing package allowed DBI to fully repay its 2020 USPP Note Series and existing revolving credit lines, reducing reliance on older, more expensive, and less flexible debt. The new facilities also offer enough headroom to support ongoing capital projects, such as DBI's NECAP expansion program.
By locking in lower margins across its drawn debt and expanding its lender group, DBI has improved its balance sheet flexibility and positioned itself to accommodate future funding needs at a lower cost.
What did Dalrymple Bay Infrastructure management say?
Michael Riches, CEO and Managing Director said:
This refinance is strongly cashflow accretive to DBI and reaching financial close on these new facilities was a key part of our capital allocation review process. DBI was able to take advantage of the highly competitive current pricing in the debt markets and its improved credit position to repay higher cost and less flexible debt.
DBI maintains substantial debt capacity to fund its committed NECAP projects, now at a significantly lower cost and this refinance creates greater flexibility and options as DBI considers further capital management opportunities. DBI will continue to proactively assess alternative financing options and markets to improve its balance sheet and enhance returns to shareholders.
What's next for Dalrymple Bay Infrastructure?
DBI says the average tenor of its drawn debt now sits at 6.32 years, only slightly lower than before, and expects to keep refinancing facilities over time as market conditions allow. The company remains fully hedged on foreign currency exposure and about 85% hedged on its drawn debt base rates.
With expanded lender relationships and lower interest expenses, DBI plans to keep investing in its Dalrymple Bay Terminal and supporting NECAP projects to deliver value to security holders through steady cash flows and future growth.
Dalrymple Bay Infrastructure share price snapshot
Over the past 12 months, Dalrymple Bay Infrastructure shares have risen 29%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen around 2% over the same period.
