FirstGroup plc has announced that it has signed a new £300m sustainability-linked Revolving Credit Facility (RCF) with a group of its relationship banks. The RCF has an initial maturity of four years, with the option to extend by a further year subject to bank consent.
The initial interest rate will be linked to its performance against two sustainability KPIs (Key Performance Indicators), including emissions per £1m of revenue from its bus and rail operations, and the relative growth of its zero-emission bus fleet in the UK.
The new RCF replaces all the Group’s former committed syndicated and bilateral banking facilities, which have recently been repaid and cancelled. The Group has recently also repaid the UK Government’s Covid Corporate Financing Facility as well as all of its Private Placement debt, and said it will shortly give notice to the holders of its £325m 5.25% bonds due in November 2022 that it will exercise its right to repay those early.
Following the disposal of its First Student and First Transit businesses, the Group expects to have pro forma adjusted pre IFRS16 net debt of around £100m.
Ryan Mangold, FirstGroup CFO, said: “The new sustainability-linked RCF and repayment of our CCFF commercial paper, 2022 bonds, and private placement notes completes the reorganisation of our debt arrangements following the recent sale of our North American contract businesses. This has been an important step that complements the rationalisation of the Group and ensures that our debt arrangements are fit for purpose for our future development. We are pleased with the support shown by our relationship banks for our new facility, which has a clear link to our decarbonisation plans, including our commitment to operating a zero emission First Bus fleet by 2035.”