Join our daily newsletter At The Bell to receive exclusive market insights
- Yancoal Australia (YAL) announces its intention to prepay its US$1 billion (A$1.55 billion) debt
- The company will use available cash to repay the debt which consists of payment toward its syndicated facility and its unsecured related-party loans
- The prepayments deliver an approximate US$207 million reduction in total finance costs over the loan periods
- Yancoal says the debt maturity profile is substantially improved after the prepayment, with the debt expiry date now more evenly distributed in the next five years
- Yancoal Australia is up 4.94 per cent to end the day trading at $5.95
Yancoal Australia (YAL) has announced it intends to prepay its US$1 billion (A$1.55 billion) debt.
The company will use available cash to repay the debt which consists of payment toward its syndicated facility and its unsecured related-party loans.
The prepayments deliver an approximate US$207 million reduction in total finance cost over the loan periods.
“Combined with debt prepayments in October 2021 and July 2022, the planned US$1 billion debt prepayment results in Yancoal prepaying over US$2.3 billion of debt in the last 12 months,” CEO David Moult explained.
Once the prepayment is complete, Yancoal will have US$792 million of total debt – the majority of which is made up of US$301 million, due in the second half of 2024, and US$307 million due in the second half of 2026, respectively.
The company said the debt maturity profile is substantially improved after the prepayment, with the debt expiry date now more evenly distributed in the next five years.
“Yancoal continues accumulating cash and has maintained a strong net cash position since July 2022. It will report its cash balance for the end of September 2022 in the 3Q production report,” Mr Moult said.
“Yancoal’s decision to undertake another debt prepayment was made possible by the robust coal prices and the company’s focus on optimising its capital structure to deliver sustainable future value to shareholders.”
YAL said as the price of coal strengthens, it will continue to evaluate how to balance the allocation of its financial resources.
Yancoal Australia was up 4.94 per cent to end the day trading at $5.95.
