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Enerflex Ltd. Extends and Consolidates Credit Facilities, Targets 1.5x to 2.0x Bank-Adjusted Net Debt-to-EBITDA Ratio

Enerflex Ltd., a premier integrated global provider of energy infrastructure and energy transition solutions, has taken a significant step to enhance its financial flexibility and stability by extending and consolidating its credit facilities. The Company has agreed to extend the maturity date of its secured revolving credit facility (RCF) by one year to October 13, 2026, and increase availability to $800 million from $700 million. Furthermore, Enerflex will repay its existing term loan, reflecting the Company’s ongoing efforts to reduce finance costs and optimize its debt stack.

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Extension and Consolidation of Credit Facilities

Enerflex has entered into an agreement to extend the maturity date of its RCF by one year to October 13, 2026, increasing availability to $800 million from $700 million. The Company has received renewed lending commitments from all current syndicate members and has also introduced HSBC Bank USA, N.A. as a lender.

Repayment of Term Loan

As part of the extension, Enerflex will repay all outstanding amounts under its secured term loan (TLA) using cash on hand and availability under the expanded RCF. As at March 31, 2024, the TLA had drawings of $120 million.

Target Leverage Framework and Capital Allocation

Enerflex is introducing a new leverage framework, targeting a bank-adjusted net debt-to-EBITDA ratio of 1.5x to 2.0x. The new leverage framework is underpinned by the Company’s highly utilized U.S. contract compression fleet, contracted international Energy Infrastructure product line, and the recurring nature of its After-market Services business.

Strategic Priorities

As the Company operates within its target leverage range, Enerflex expects to re-evaluate capital allocation priorities, which could include increased dividends, share repurchases, additional growth capital spending, and/or further repayment of debt.

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