Alsea informed that it successfully negotiated with all its relationship banks an extension to the suspension granted for the calculation of certain covenants in its credit contracts, mainly in relation to gross leverage and interest coverage ratios. Now, such dispensation has been extended to June 30, 2022 (vs. June 30, 2021 previously). In addition, it also communicated that as a result of this agreement, the company undertook to: (1) keep a maximum debt in pesos of MXN 19.4 billion and €615 million or the equivalent of both in US dollars or Chilean pesos; (2) have a minimum cash of MXN 3 billion; (3) have a minimum consolidated shareholders equity of MXN 6.9 billion (vs. the previous requirement of MXN 8.5 billion and MXN 7.683 billion reported at the end of 2020); and (4) not to exceed MXN 800 million in capital expenditures per quarter. It is worth noting that compliance with these metrics will be reviewed monthly.
Positive implication: In our opinion, this agreement positions the company more favorably to overcome the challenges it still faces due to the COVID-19 sanitary crisis at a global level, remembering that despite advances in the vaccination processes, in different regions we are observing contagion resurgences, and in some cases, the reimposition of stricter confinement measures to contain a third outbreak, which could slow down the recovery of results. In this sense, we believe it is positive to confirm the confidence that the financial sector maintains in Alsea's future, while allowing it to continue with its strategic projects and organic growth, and without forgetting that if it is necessary to reduce leverage, the potential placement of the European business in the stock market could be an additional source of resources to contribute to the objective of strengthening the company's capital structure after the pandemic's onslaught.