MRO Magazine

Sterling Construction Company, Inc. Closes New Financing


June 1, 2015
By Business Wire News

THE WOODLANDS, Texas

Sterling Construction Company, Inc. (NasdaqGS:STRL) (“Sterling” or “the Company”), today announced that the Company has closed a new financing effective May 29, 2015 with funding to occur today. The new $40 million credit facility with Nations Equipment Finance (“NEF”) will be secured by Sterling’s equipment.

A summary of the agreement is as follows:

  • Four-year agreement with Nations Equipment Finance of Norwalk, CT
  • Total debt financing of up to $40 million, comprised of a $20 million term loan and up to a $20 million revolving credit line
  • Availability will be determined quarterly based on a 65% advance rate of the appraised value of the collateral pledged
  • Initial interest rate of 12% with pricing criteria that could cause the rate to decrease or increase by two percentage points based on fixed charge coverage ratio performance
  • No financial covenants

Thomas Wright, Sterling’s Executive Vice President and Chief Financial Officer, stated, “We are pleased to have closed a new financing with Nations Equipment Finance to replace our previous credit facility. The new agreement carries no financial covenants, which gives us the flexibility to fund our ongoing operations without disruption for the foreseeable future.”

“Completing our new financing arrangement was a major step in our turnaround process,” stated Paul Varello, Sterling’s CEO. “This new credit facility will enable us to continue to implement the operational improvements that we have underway. By securing this financing we can now focus our attention entirely on bidding and executing effectively on attractive construction projects in order to achieve sustained profitability and drive increased shareholder value.”

Sterling is a leading heavy civil construction company that specializes in the building and reconstruction of transportation and water infrastructure projects in Texas, Utah, Nevada, Arizona, California, Hawaii, and other states where there are construction opportunities. Its transportation infrastructure projects include highways, roads, bridges and light rail and its water infrastructure projects include water, wastewater and storm drainage systems.

This press release includes certain statements that fall within the definition of “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Any such statements are subject to risks and uncertainties, including overall economic and market conditions, federal, state and local government funding, competitors’ and customers’ actions, and weather conditions, which could cause actual results to differ materially from those anticipated, including those risks identified in the Company’s filings with the Securities and Exchange Commission. Accordingly, such statements should be considered in light of these risks. Any prediction by the Company is only a statement of management’s belief at the time the prediction is made. There can be no assurance that any prediction once made will continue thereafter to reflect management’s belief, and the Company does not undertake to update publicly its predictions or to make voluntary additional disclosures of nonpublic information, whether as a result of new information, future events or otherwise.

 

 

Sterling Construction Company, Inc.
Thomas R. Wright, 281-214-0800
EVP & Chief Financial Officer
or
Investor Relations Counsel:
The Equity Group Inc.
Fred Buonocore, 212-836-9607
or
Linda Latman, 212-836-9609