Sonic Reduces Total Debt

By Staff Writer January 20, 2020

Sonic Automotive Inc. completed the early retirement of all $289.3 million principal amount of its unsecured 5 percent Senior Subordinated Notes due 2023 on Dec. 30. Altogether, in 2019 the company reduced its total debt by approximately $235 million.

“By capitalizing on market conditions, we have made substantial progress towards our target of reducing debt by $300 million by mid-to-late 2020,” said David Smith, Sonic’s chief executive officer.

“This deleveraging has significantly improved Sonic’s financial position going into 2020 by reducing interest expense and improving our debt-to-EBITDA ratio. Our success in strengthening our balance sheet leaves us well positioned to continue to expand our EchoPark footprint and to explore potential acquisition opportunities for our franchised dealership portfolio.”

Sonic funded the redemption of the notes using available liquidity, including cash flow from operations, proceeds from the opportunistic disposition of underperforming franchised dealerships or those expected to have substantial future capital expenditure requirements and borrowings under the company’s recently completed mortgage facility.

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Last modified on Monday, 20 January 2020 14:48

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