Group financing is centrally managed through Klöckner & Co SE. Centralized financing makes it easier to implement a uniform finance policy and limit financing risk and strengthens our negotiating position with banks and other lenders.
Our financial strategy is focused on the provision of a solid debt capacity and an optimized liquidity at favorable conditions. For the funding of our operational business we are using a mix of credit facilities covering the financial needs in our segments and relevant currencies.
Key Group Financing Aspects
Financing for the Group is provided on a very flexible and diversified basis using a portfolio of various funding instruments, including a convertible bond issue, a syndicated loan, an asset-based lending facility (USA), an ABS program (Europe) and bilateral loan agreements.
Klöckner & Co has access to facilities of around €1.6 billion in total (incl. leasing). Drawings amounted to approximately €1.0 billion as of September 30, 2023.
The Klöckner & Co senior unsecured bond issue with a principal amount of €147.8 million was launched on September 8, 2016. In July 2022, Klöckner & Co repurchased and subsequently retired a part of the convertible bond with a nominal volume of €7.1 million. Klöckner & Co fully repaid the convertible bond upon maturity on September 8, 2023.
The Syndicated Revolving Credit Facility is provided by a syndicate of 8 international banks. The facility is available in EUR and USD (up to 50%) and is based on balance sheet-oriented covenants.
The European ABS program is provided by four international banks. It was installed in 2005 and amended and extended from time to time. Any trade receivables sold in connection with this program are shown on our consolidated balance sheet under IFRS.
Our US facility is provided by a syndicate of North American banks. Any drawings under the facility are secured by the US borrowing base. The receivables and inventories pledged under the facility are recognized on our balance sheet under IFRS.
Our portfolio of funding instruments is enhanced by bilateral bank facilities. The major portion of our bilateral facilities is allocated in Switzerland and is used for general corporate purposes in local currency.
The Klöckner & Co Group is contractual party in lease agreements accounted in accordance with IFRS 16. The new standard provides a single lessee accounting model whereby leases are recognized in the lessee's balance sheet (right-of-use-asset and lease liability).