Simmons Delays Earnings Announcement For Lender Talks

November 12, 2008  by in UnCategorized   

By Home Furnishings Business in Bedding on November 2008 Simmons Bedding announced Wednesday that it will not be reporting third-quarter earnings today, as scheduled, because it is in discussions with its senior lenders. The announcement stated it is “seeking a forbearance agreement related to a senior credit facility in order to have more time to negotiate an amendment” that will provide revised financial covenants into 2010.

On Oct. 21, Simmons Co., the holding company for Simmons Bedding, released an announcement stating that it was seeking the consent of its senior lenders to amend its senior credit facility after falling out of compliance with a “maximum leverage ratio covenant.” The senior credit facility provides for a $75 million revolving loan facility and a $465 million tranche D term loan facility.

In the Oct. 11 announcement, Simmons Bedding officials also said the company expected that its net sales for the third quarter would be down 10 percent to 13 percent from the same period in 2007. It reported that cash on hand on Sept. 27 was $62 million to $64 million and the company’s $75 million revolving credit facility was fully drawn. Finally, the announcement stated that the company’s total debt was approximately $984 million (approximately $745 million at the Simmons Bedding level).