NORTHLAKE, Texas, U.S. — Farmer Bros Co yesterday announced that it has drawn down $34.0 million on its $125.0 million revolving credit facility, bringing the total amount outstanding to $122.0 million of revolving loans and $2.3 million of outstanding letters of credit. This is a proactive measure to increase the Company’s cash position and preserve financial flexibility.
Deverl Maserang, President and Chief Executive Officer of Farmer Bros, said, “We remain focused on taking actions to support the long-term sustainability of our business as we continue to navigate the evolving COVID-19 situation.
In addition to the steps we have already taken to eliminate discretionary expenses and reduce capital expenditures, we are accessing additional funds through our credit facility as a precautionary measure to maintain our financial flexibility.
This will also allow us to accelerate the continued rebalancing of our manufacturing across our network and reduce costs long-term.
We are committed to serving our customers as we prioritize the health and safety of our employees, and we continue to believe that our turnaround strategy and five key initiatives provide a strong foundation for Farmer Brothers to overcome near-term challenges and emerge better and stronger.”
Subsequent to the borrowing, the Company had over $65.0 million of cash and cash equivalents. In accordance with the terms of the credit facility, the proceeds from the draw down may be used for general corporate purposes.
Borrowings under the credit facility mature in November of 2023, and the Company may prepay amounts borrowed any time without premium or penalty (subject to customary break funding expenses, if any).