Indebtedness

9 Months Ended

Dec. 31, 2019

Note 16: Indebtedness

In June 2019, the Company executed an amended and restated credit agreement with a syndicate of banks that provides for a multi-currency $250.0 million revolving credit facility expiring in June 2024, which modified the Company’s then-existing revolver that would have expired in November 2021. As a result of the credit agreement modification, the Company deferred debt issuance costs of $1.1 million, which will be amortized over the term of the debt. In addition, this credit agreement provides for both U.S. dollar- and euro-denominated term loan facilities. At December 31, 2019, the Company’s term loan borrowings totaled $193.4 million, with repayments continuing into fiscal 2025. These term loans replaced the previously-existing term loans with repayments scheduled through fiscal 2022. Borrowings under both the revolving credit and term loan facilities bear interest at a variable rate, based upon the applicable reference rate and including a margin percentage dependent upon the Company’s leverage ratio, as described below. At December 31, 2019, the weighted-average interest rates for revolving credit facility borrowings and the term loans were 3.5 percent and 3.3 percent, respectively.

Long-term debt consisted of the following:

	Fiscal year of maturity		December 31, 2019			March 31, 2019
Term loans	2025		$	193.4		$	238.4
6.8% Senior Notes (a)	2021			73.0			85.0
5.8% Senior Notes	2027			50.0			50.0
Revolving credit facility (a)		-		27.0			-
Other (b)				6.6			14.3
				350.0			387.7
Less: current portion (a)				(16.2	)		(48.6	)
Less: unamortized debt issuance costs				(3.5	)		(4.0	)
Total long-term debt			$	330.3		$	335.1

(a)

On January 31, 2020, the Company issued $100.0 million of 5.9 percent Senior Notes with repayments ending in fiscal 2029. The Company used the proceeds to prepay the $73.0 million principal balance of the 6.8 percent Senior Notes, which were scheduled to mature in August 2020, and to repay $27.0 million of borrowings on its revolving credit facility. Since it had both the intent and ability to refinance these obligations on a long-term basis, the Company classified the $73.0 million of 6.8 percent Senior Notes and $27.0 million of its revolving credit facility borrowings within long-term debt on its consolidated balance sheet as of December 31, 2019.

(b)	Other long-term debt primarily includes borrowings by foreign subsidiaries and finance lease obligations.

Long-term debt matures as follows:

Fiscal Year
Remainder of 2020	$	4.1
2021		15.5
2022		21.7
2023		21.7
2024		21.7
2025 & beyond		265.3
Total	$	350.0

The long-term debt maturity schedule reflects the impacts from the January 2020 issuance of the 5.9 percent Senior Notes and the prepayment of the 6.8 percent Senior Notes.

As of December 31, 2019 and March 31, 2019, the Company’s revolving credit facility borrowings totaled $109.3 million and $47.1 million, respectively. With the exception of the $27.0 million of borrowings reported as long-term debt as of December 31, 2019, as discussed above, the Company reported these borrowings as short-term debt on the consolidated balance sheets. At December 31, 2019, domestic letters of credit totaled $5.3 million, resulting in available borrowings under the Company’s revolving credit facility of $135.4 million. The Company also maintains credit agreements for its foreign subsidiaries, with outstanding short-term borrowings of $18.9 million at both December 31, 2019 and March 31, 2019.

Provisions in the Company’s credit agreement, Senior Note agreements, and various foreign credit agreements require the Company to maintain compliance with various covenants and include certain cross-default clauses. Under its primary debt agreements in the U.S., the Company has provided liens on substantially all domestic assets. In addition, as specified in the credit agreement, the term loans may require prepayments in the event of certain asset sales. The Company is also subject to a leverage ratio covenant, which requires the Company to limit its consolidated indebtedness, less a portion of its cash balance, both as defined by the credit agreements, to no more than three and one-quarter times consolidated net earnings before interest, taxes, depreciation, amortization, and certain other adjustments (“Adjusted EBITDA”). The Company is also subject to an interest expense coverage ratio covenant, which requires the Company to maintain Adjusted EBITDA of at least three times consolidated interest expense. The Company was in compliance with its debt covenants as of December 31, 2019.

The Company estimates the fair value of long-term debt using discounted future cash flows at rates offered to the Company for similar debt instruments of comparable maturities. As of December 31, 2019 and March 31, 2019, the carrying value of the Company’s long-term debt approximated fair value, with the exception of the Senior Notes, which had an aggregate fair value of approximately $124.9 million and $137.2 million, respectively. The fair value of the Company’s long-term debt is categorized as Level 2 within the fair value hierarchy. Refer to Note 3 for the definition of a Level 2 fair value measurement.