— Completes Planned Elimination of $142.9 Million of Long-Term Debt as Announced in March 2024 —
MORRISVILLE, N.C., Aug. 27, 2024 /PRNewswire/ -- Pyxus International, Inc. (OTC Pink: PYYX) ("Pyxus," the "Company," "we," or "our"), a global value-added agricultural company, today announced it has made a payment from cash on hand to retire the remaining $20.4 million aggregate principal amount of its 10.0% Senior Secured Notes due 2024 at maturity. This payment, along with the Company's recently completed discounted repurchases under a privately negotiated agreement with Monarch Alternative Capital LP of its 8.50% Senior Secured Notes and its Senior Secured Pyxus Term Loans both due in 2027, completes the planned elimination of $142.9 million of long-term debt from Pyxus' capital structure, as announced March 25, 2024.
Pyxus International, Inc. logo (PRNewsfoto/Pyxus International, Inc.)
"We are pleased our sustained, disciplined approach to working capital management has resulted in the completion of our planned elimination of approximately a quarter of our long-term debt. These efforts have enabled us to steadily strengthen our business, improve our balance sheet and reinforce our position in the global marketplace," said Pyxus President and CEO Pieter Sikkel. "We remain focused on reducing our borrowing costs and believe the ongoing improvement in our credit profile positions us to decrease financing costs through our global lending partners, as well as evaluate a range of opportunities to deliver a more cost-effective capital structure."
The retired notes are the remainder of an original $280.8 million principal amount of 10% Senior Secured Notes due 2024 that were issued in 2020. As part of the Company's debt exchange transactions completed in February 2023, it successfully exchanged 92.7% of the then-outstanding principal amount of those notes for its 8.50% Senior Secured Notes due December 31, 2027.
The following table summarizes the Company's recently completed long-term debt reductions:
(in thousands and at par value)
December 31, 2023
Debt Reduction
Discount to Par
Long-term Debt After Debt Reduction
Senior secured notes:
$ 20,391
$ (20,391)
-
$ -
10.0% Notes Due 2024
260,452
(112,113)
23 %
148,339
8.5% Notes Due 2027
Senior secured term loans:
Intabex term Loans
189,033
-
-
189,033
Pyxus Term Loans
130,550
(10,345)
12 %
120,205
Other Debt:
Other long-term debt
193
-
-
-
Total long-term debt
$ 600,619
$ (142,849)
$ 457,577
Long-term:
Current portion of long-term debt
$ 20,473
$ (20,391)
-
$ 82
Total long-term debt
580,146
(122,458)
-
457,688
$ 600,619
$ (142,849)
$ 457,770
About Pyxus International, Inc.
Pyxus International, Inc. is a global agricultural company with more than 150 years of experience delivering value-added products and services to businesses and customers. Driven by a united purpose—to transform people's lives, so that together we can grow a better world—Pyxus International, its subsidiaries and affiliates, are trusted providers of responsibly sourced, independently verified, sustainable and traceable products and ingredients. For more information, visit www.pyxus.com.
Readers are cautioned that the statements contained in this report regarding expectations of our performance or other matters that may affect our business, results of operations, or financial condition, including with respect to future financing costs and capital structure, are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements, which are based on current expectations of future events, may be identified by the use of words such as "guidance", "strategy," "expects," "continues," "plans," "anticipates," "believes," "will," "estimates," "intends," "projects," "goals," "targets," and other words of similar meaning. These statements also may be identified by the fact that they do not relate strictly to historical or current facts. If underlying assumptions prove inaccurate, or if known or unknown risks or uncertainties materialize, actual results could vary materially from those anticipated, estimated, or projected. These risks and uncertainties include those discussed in our Annual Report on Form 10-K for the year ended March 31, 2024, our most recent Quarterly Report on Form 10-Q, and in our other filings with the Securities and Exchange Commission. These risks and uncertainties include: our reliance on a small number of significant customers; continued vertical integration by our customers; global shifts in sourcing customer requirements; shifts in the global supply and demand position for tobacco products; variation in our financial results due to growing conditions, customer indications and other factors; loss of confidence in us by our customers, farmers and other suppliers; migration of suppliers who have historically grown tobacco and from whom we have purchased tobacco toward growing other crops; risks related to our advancement of inputs to tobacco suppliers to be settled upon the suppliers delivering us unprocessed tobacco at the end of the growing season; risks that the tobacco we purchase directly from suppliers will not meet our customers' quality and quantity requirements; weather and other environmental conditions that can affect the marketability of our inventory; international business risks, including unsettled political conditions, uncertainty in the enforcement of legal obligations, including the collection of accounts receivable, fraud risks, expropriation, import and export restrictions, exchange controls, inflationary economies, currency risks and risks related to the restrictions on repatriation of earnings or proceeds from liquidated assets of foreign subsidiaries; many of our operations are located in jurisdictions that pose a high risk of potential violations of the Foreign Corrupt Practices Act; risks and uncertainties related to geopolitical conflicts, including the armed conflict between Israel and Hamas and disruptions affecting Red Sea shipping; impacts of international sanctions on our ability to sell or source tobacco in certain regions; exposure to foreign tax regimes in which the rules are not clear, are not consistently applied and are subject to sudden change; fluctuations in foreign currency exchange and interest rates; competition with the other primary global independent leaf tobacco merchant and independent leaf merchants; disruption, failure or security breaches of our information technology systems and other cybersecurity risks; continued high inflation; regulations regarding environmental matters; risks related to our capital structure, including risks related to our significant debt and our ability to continue to finance our non-U.S. local operations with uncommitted short-term operating credit lines at the local level; our ability to continue to access capital markets to obtain long-term and short-term financing; potential failure of foreign banks in which our subsidiaries maintain deposits or the failure by such banks to transfer funds or honor withdrawals; the risk that, because our ability to generate cash depends on many factors beyond our control, we may be unable to generate the significant amount of cash required to service our indebtedness; our ability to refinance our current credit facilities at the same availability or at similar or reduced interest rates; failure to achieve our stated goals, which may adversely affect our liquidity; developments with respect to our liquidity needs and sources of liquidity; the volatility and disruption of global credit markets; failure by counterparties to derivative transactions to perform their obligations; increasing scrutiny and changing expectations from governments, as well as other stakeholders such as investors and customers, with respect to our environmental, social and governance policies, including sustainability policies; inherent risk of exposure to product liability claims, regulatory action and litigation facing our e-liquids business if its products are alleged to have caused significant loss, injury, or death; certain shareholders have the ability to exercise controlling influence on various corporate matters; reductions in demand for consumer tobacco products; risks and uncertainties related to pandemics or other widespread health crises and any related shipping constraints, labor shortages and supply-chain impacts; legislative and regulatory initiatives that may reduce consumption of consumer tobacco products and demand for our services and increase regulatory burdens on us or our customers; government actions that significantly affect the sourcing of tobacco, including governmental actions to identify and assess crop diversification initiatives and alternatives to leaf tobacco growing in countries whose economies depend upon tobacco production; governmental investigations into the Company's business activities, including but not limited to, leaf tobacco industry buying and other payment practices; and impact of potential regulations to prohibit the sale of cigarettes in the United States other than low-nicotine cigarettes. The Company does not undertake to update any forward-looking statements that we may make from time to time except to the extent required by law.
