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Debt Structure

(Millions of euro)
December 31,
Bank overdrafts1,4 - 3.0 7.5 1.4
Short-term bank loans 54,0 10,0 36.0 41.5 11.6
Bonds - - - - -
Short-term portion of long-term bank loans - - - - 25.0
Short-term portion of financial leasing - - -1.91.2
Debt to the factoring company 10,0 10,0 5.0 24.3 34.3
Other short-term loans - - - - 0.1
Other debts for purchase of minority interests - - - - 0.4
Short-term borrowings 65,4 20,0 44.0 75.3 73.9
Medium long-term loans - - - 48.6 189.3
Bonds - - - - -
Convertible Bonds 142,5 137,4 132.5 127.9 -
Medium long-term portion of financial leasing - - - 0.0 1.9
Other medium long-term loans - - - - -
Long-term borrowings 142,5 137,4 132.5 176.5 191.2
Total 207,9 157,4 176.5 251.8 265.1

The item “Bank loans and borrowings” include as the long-term borrowings:

  • an unsecured and unsubordinated equity-linked Bond issued on 22 May 2014, from Safilo Group S.p.A., guaranteed by Safilo S.p.A., maturing on 22 May 2019 with an aggregate principal amount of Euro 150 million;

  • a committed, unsubordinated and unsecured “Revolving Credit Facility” amounting to Euro 150 million expiring in July 2018, unused at December 31, 2017.

The Bonds have been issued at par in the nominal amount of EUR 100,000 per Bond and will pay a coupon of 1.25% per annum, payable semi-annually in arrears on 22 November and 22 May of each year.

The Bonds can become convertible into ordinary shares of Safilo Group S.p.A. following the approval on 10 July 2014 of the extraordinary general meeting of the Company of a capital increase to be solely reserved for the purposes of the conversion of such Bonds. The initial conversion price has been set at EUR 21.8623, representing a premium of 40.0% above the volume weighted average price of the ordinary shares of the Company on Mercato Telematico Azionario (MTA) of the Italian Stock Exchange between launch and pricing. The Company will have the right to elect to settle any exercise of conversion rights in shares, cash or combinations of shares and cash.

The Issuer will have the option to redeem any outstanding Bonds at their principal amount (plus accrued but unpaid interest to, but excluding, the redemption date) on or after 6 June 2017 if the volume weighted average price of a share for a specified period is at least 130% of the conversion price in effect on each relevant dealing day. The Issuer may also redeem the Bonds at any time at their principal amount (plus accrued but unpaid interest to, but excluding, the redemption date) if less than 15% of the Bonds originally issued remain outstanding.

At final maturity, on 22 May 2019, the Bonds will be redeemed at their principal amount unless previously redeemed, converted, or purchased and cancelled.

The offer is made solely to qualified investors, the Bonds, starting from July 23, 2014, has been admitted to be traded on the “Third Market” (MTF), non-regulated market of Vienna Stock Exchange.

This bond is carried at amortised cost, at an effective interest rate equal to 5.102%. Given the presence of a “cash settlement option”, the conversion option component represents an embedded derivative financial instrument booked in the corresponding balance sheet item under liabilities. The fair value changes of this instrument are immediately charged to income statement. At the balance sheet date, the fair value of the option amounts to nil.

The committed, unsubordinated and unsecured “Revolving Credit Facility” amounting to Euro 150 million expiring in July 2018 (expiration extended to November 30, 2018 on June 7, 2018), has been underwritten by Safilo S.p.A. and Safilo U.S.A. Inc. in July 2014. On December 31, 2016 this facility was not drawn by the Group.

Such loan is subject to the respect of operating and financial commitments, standard fo similar transaction. At 31st December 2017, the Group complies with all the outstanding covenants.

The short-term payables towards factoring companies are for contracts stipulated with leading factoring companies by the subsidiary Safilo S.p.A. for 10,000 thousand Euro.

Last updated: December 28, 2018

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