StoneMor Partners L.P. Successfully Completes Amendment to Credit Facility
June 18 2018 - 4:05PM
StoneMor Partners L.P. (NYSE:STON)
(“StoneMor” or the “Partnership”), a leading owner
and operator of cemeteries and funeral homes, today announced that
it has secured an amendment to its credit agreement that extends
the deadline for delivering the Partnership’s audited financial
statements for the year ended December 31, 2017 to June 30, 2018,
with the Partnership being required to deliver the unaudited
financial statements for the quarter ended March 31, 2018 no later
than 60 days after the date on which the Partnership delivers the
audited 2017 financial statements, and for the quarter ending June
30, 2018 no later than 105 days after the Partnership delivers the
audited 2017 financial statements.
Leo Pound, Interim Chief Executive Officer of StoneMor
commented, “Our amended credit agreement is the result of
significant collaboration with our lenders to meet their desire to
utilize more GAAP-based metrics, and we are pleased with the
result. StoneMor has previously stated its commitment to
operating within the four corners of its balance sheet and to
deemphasize the use of non-GAAP financial measures.
Historically, the Consolidated Leverage Ratios we reported have
included non-GAAP financial measures and unsecured debt unrelated
to the credit facility. Working with our lenders, our new
Consolidated Secured Net Leverage Ratio is calculated primarily
using GAAP financial measures, including specific GAAP-based cash
flow adjustments, and uses primarily our senior bank facility. The
Partnership and its lenders mutually agreed on the new covenant
metrics to more clearly reflect the cash flows and relevant debt
used to measure its leverage ratio. We believe this creates a
cleaner, more transparent view of our leverage covenant. We
appreciate our lenders continued support.”
Under the terms of the amended credit agreement, effective June
12, 2018, the credit facility:
- Increases the Partnership’s maximum leverage ratio, which is
now a Consolidated Secured Net Leverage Ratio, from 4.25:1.00 to
5.75:1.00 through September 30, 2018, after which it reduces to
5.50:1.00 through December 31, 2018, to 5.00:1.00 for periods
ending in the year ending December 31, 2019 and to 4.50:1.00 for
periods ending in the year ending December 31, 2020;
- Decreases the revolving credit commitment from $200 million to
$175 million while increasing the interest rate by 0.50%;
- Reduces the fixed charge coverage ratio from 1.2x to 1.0x in
2018 and 1.1x in 2019 and eliminates the consolidated debt service
coverage ratio;
- Establishes limitations on incurring additional unsecured
indebtedness and using subordinated debt to fund certain
acquisitions; and
- The Partnership will continue to restrict distributions to
partners until the Consolidated Leverage Ratio (which includes the
effect of unsecured indebtedness, of which there was approximately
$173.5 million outstanding at March 31, 2018) is not greater than
7.50:1.00 and there is at least $25.0 million of availability under
the revolving credit agreement.
The increase in the maximum CSNLR from 4.25 to 5.75 is primarily
due to the change in the way the ratio is calculated, relying
mostly on GAAP financial measures, as mentioned above. The
revised consolidated secured net leverage and fixed charge coverage
ratios provide StoneMor with financial flexibility while the lower
total commitment will reduce fees on capacity the Partnership did
not intend to use. It is anticipated that any future
growth acquisitions will either be funded through equity issuances
by the Partnership or completed by the general partner.
The Partnership will be filing a report on Form 8-K with the
United States Securities and Exchange Commission (“SEC”) that will
include as an exhibit the full text of the amendment as well as a
more detailed analysis of the changes implemented thereby.
About StoneMor Partners L.P.
StoneMor Partners L.P., headquartered in Trevose, Pennsylvania,
is an owner and operator of cemeteries and funeral homes in the
United States, with 316 cemeteries and 93 funeral homes in 27
states and Puerto Rico.
StoneMor is the only publicly traded death care company
structured as a partnership. StoneMor’s cemetery products and
services, which are sold on both a pre-need (before death) and
at-need (at death) basis, include: burial lots, lawn and mausoleum
crypts, burial vaults, caskets, memorials, and all services which
provide for the installation of this merchandise. For additional
information about StoneMor Partners L.P., please visit StoneMor’s
website, and the investors section, at http://www.stonemor.com.
Cautionary Note Regarding Forward-Looking
Statements
Certain statements contained in this press release are
forward-looking statements. Generally, the words “believe,” “may,”
“will,” “estimate,” “continue,” “anticipate,” “intend (including,
but not limited to StoneMor’s intent to maintain or increase its
distributions),” “project,” “expect,” “predict” and similar
expressions identify these forward-looking statements. These
statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on management’s
current expectations and estimates. These statements are neither
promises nor guarantees and are made subject to certain risks and
uncertainties that could cause actual results to differ materially
from the results stated or implied in this press release.
StoneMor’s major risks are related to uncertainties associated with
the cash flow from pre-need and at-need sales, trusts and
financings, which may impact StoneMor’s ability to meet its
financial projections, service its debt, pay distributions, and
increase its distributions, as well as with StoneMor’s ability to
maintain an effective system of internal control over financial
reporting and disclosure controls and procedures.
StoneMor’s additional risks and uncertainties include, but are
not limited to, risks and uncertainties related to the following:
the consequences of the Partnership’s delinquent filing of its
Annual Report on Form 10-K for the fiscal year ended December 31,
2017 and its Quarterly Report on Form 10-Q for the fiscal
quarter ended March 31, 2018 (the “Delinquent Reports”), including
that the U.S. Securities and Exchange Commission could institute an
administrative proceeding seeking the revocation of the
registration of the Partnership’s common units under the Exchange
Act, and that the Partnership remains delinquent in its required
filings with the New York Stock Exchange (“NYSE”) and could
ultimately face the possible delisting of its common units from the
NYSE; the potential for defaults under the Partnership’s amended
credit facility if the Delinquent Reports are not filed within
specified periods or the indenture governing its senior notes if
the Partnership fails to file them within 120 days after notice
from the trustee under the indenture; the Partnership’s ability to
obtain relief from its creditors if it cannot file the Delinquent
Reports within the periods prescribed by the Partnership’s amended
credit facility or the indenture governing its senior notes, the
terms on which such relief might be granted and any restrictions
that might be imposed in connection with any relief that might be
obtained; uncertainties associated with future revenue and revenue
growth; uncertainties associated with the integration or
anticipated benefits of recent acquisitions or any future
acquisitions; StoneMor’s ability to complete and fund additional
acquisitions; the effect of economic downturns; the impact of
StoneMor’s significant leverage on its operating plans; the decline
in the fair value of certain equity and debt securities held in
StoneMor’s trusts; StoneMor’s ability to attract, train and retain
an adequate number of sales people; uncertainties associated with
the volume and timing of pre-need sales of cemetery services and
products; increased use of cremation; changes in the death rate;
changes in the political or regulatory environments, including
potential changes in tax accounting and trusting policies;
StoneMor’s ability to successfully implement a strategic plan
relating to achieving operating improvements, including improving
sales productivity and reversing negative trends in costs of goods
sold, certain expenses, cemetery billings and investment income
from trusts, strong cash flows, further deleveraging and liquidity
enhancement; StoneMor’s ability to successfully compete in the
cemetery and funeral home industry; litigation or legal proceedings
that could expose StoneMor to significant liabilities and damage
StoneMor’s reputation, including but not limited to litigation and
governmental investigations or proceedings arising out of or
related to accounting and financial reporting matters; the effects
of cyber security attacks due to StoneMor’s significant reliance on
information technology; uncertainties relating to the financial
condition of third-party insurance companies that fund StoneMor’s
pre-need funeral contracts; and various other uncertainties
associated with the death care industry and StoneMor’s operations
in particular.
When considering forward-looking statements, you should keep in
mind the risk factors and other cautionary statements set forth in
StoneMor’s Annual Report on Form 10-K and the other reports that
StoneMor files with the Securities and Exchange Commission, from
time to time. Except as required under applicable law, StoneMor
assumes no obligation to update or revise any forward-looking
statements made herein or any other forward-looking statements made
by it, whether as a result of new information, future events or
otherwise.
|
|
|
CONTACT: |
|
John McNamara |
|
|
Director - Investor
Relations |
|
|
StoneMor Partners
L.P. |
|
|
(215) 826-2945 |
StoneMor (NYSE:STON)
Historical Stock Chart
From Mar 2024 to Apr 2024
StoneMor (NYSE:STON)
Historical Stock Chart
From Apr 2023 to Apr 2024