Financing Agreements

6 Months Ended

Mar. 31, 2024

The following table summarizes Hillenbrand’s current and long-term debt as of:


	March 31, 2024		September 30, 2023
$1,000 revolving credit facility (excluding outstanding letters of credit)	$	112.2	$	505.1
$200 term loan	187.5		192.5
€185 term loan	194.5		195.0
$500 senior unsecured notes (1)	494.1		—
$400 senior unsecured notes (2)	398.6		398.0
$375 senior unsecured notes (3)	373.2		372.9
$350 senior unsecured notes (4)	346.9		346.6


Total debt	2,107.0		2,010.1
Less: current portion	20.0		19.7
Total long-term debt	$	2,087.0	$	1,990.4

(1)Includes unamortized debt issuance costs of $5.9 at March 31, 2024.

(2)Includes unamortized debt issuance costs of $1.4 and $2.0 at March 31, 2024 and September 30, 2023, respectively.

(3)Includes unamortized debt issuance costs of $1.6 and $1.8 at March 31, 2024 and September 30, 2023, respectively.

(4)Includes unamortized debt issuance costs of $3.1 and $3.4 at March 31, 2024 and September 30, 2023, respectively.

$500.0 senior unsecured notes

On February 14, 2024, the Company issued $500.0 of senior unsecured notes due February 2029 (the “2024 Notes”). The 2024 Notes were issued at par value and bear interest at a fixed rate of 6.25% per year, payable semi-annually in arrears beginning August 2024. Deferred financing costs associated with the 2024 Notes of $6.2 are being amortized to interest expense on a straight-line basis (which approximates the effective interest method) over the term of the 2024 Notes. The 2024 Notes are unsecured unsubordinated obligations of the Company and rank equally in right of payment with all other existing and future unsubordinated obligations.

Subject to certain limitations, in the event of a change of control repurchase event (as defined in the 2024 Notes Indenture), the Company will be required to make an offer to purchase the 2024 Notes at a price equal to 101% of the principal amount of the 2024 Notes, plus any accrued and unpaid interest to, but excluding, the date of repurchase. The Company may redeem the 2024 Notes at any time in whole, or from time to time in part, prior to February 15, 2026, at its option at the “make-whole” redemption price, as described in the 2024 Notes. The Company may also redeem the 2024 Notes at any time in whole, or from time to time in part, on or after February 15 of the relevant year listed, as follows: 2026 at a redemption price of 103.125%; 2027 at a redemption price of 101.5625%; and 2028 and thereafter at a redemption price of 100.000%. At any time prior to February 15, 2026, the Company may redeem up to 40% of the aggregate principal amount of the 2024 Notes with the proceeds of one or more Equity Offerings (as defined in the 2024 Notes Indenture) at a redemption price of 106.250% of the principal amount of the 2024 Notes being redeemed. In each of the above cases, the Company will also pay any accrued and unpaid interest to, but excluding, the applicable redemption date.

Other borrowing activity

As of March 31, 2024, the Company had $19.5 in outstanding letters of credit issued and $868.3 of borrowing capacity under the Facility, of which $500.5 was immediately available based on the Company’s most restrictive covenant. The weighted-average interest rates on borrowings under the Facility were 6.02% and 5.91% for the three and six months ended March 31, 2024, respectively, and 3.12% and 2.53% for the three and six months ended March 31, 2023, respectively. The weighted average facility fee on the Facility was 0.23% and 0.21% for the three and six months ended March 31, 2024, respectively, and 0.20% and 0.16% for the three and six months ended March 31, 2023, respectively. The weighted-average interest rate on the $200 term loan was 7.19% and 7.08% for the three and six months ended March 31, 2024, respectively, and 5.99% and 5.84% for the three and six months ended March 31, 2023, respectively. The weighted-average interest rate on the €185 term loan was 5.59% and 5.60% for the three and six months ended March 31, 2024, respectively. There were no borrowings on the €185 term loan for the three and six months ended March 31, 2023.

Remaining unamortized deferred financing costs related to the Facility, $200 term loan and €185 term loan were $5.2 in aggregate, as of March 31, 2024, and are being amortized to interest expense over the remaining term of these agreements.

In the normal course of business, the Company provides, primarily to certain customers, bank guarantees and other credit arrangements in support of performance, warranty, advance payment, and other contractual obligations. This form of trade finance is customary in the industry and, as a result, the Company maintains adequate capacity to provide the guarantees. As of March 31, 2024 and September 30, 2023, the Company had credit arrangements totaling $588.7 and $587.9, respectively, under which $361.1 and $326.9, respectively, were used for guarantees. These arrangements include the Company’s Syndicated L/G Facility Agreement (“L/G Facility”) and other ancillary credit facilities. Remaining unamortized deferred financing costs related to the L/G Facility were $1.4 and $1.6 as of March 31, 2024 and September 30, 2023, respectively, and are being amortized to interest expense over the remaining term of the agreement.

As of March 31, 2024, Hillenbrand was in compliance with all covenants contained in the foregoing agreements and credit instruments, and there were no events of default.