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10-Q
KOPPERS HOLDINGS INC. filed this Form 10-Q on 11/09/2017
Entire Document
 

 

The following table provides the components of net periodic benefit cost for the pension plans and other benefit plans for the three and nine months ended September 30, 2017 and 2016:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

(Dollars in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service cost

 

$

0.5

 

 

$

0.4

 

 

$

1.5

 

 

$

1.3

 

Interest cost

 

 

2.1

 

 

 

2.7

 

 

 

7.0

 

 

 

8.3

 

Expected return on plan assets

 

 

(2.4

)

 

 

(2.6

)

 

 

(7.4

)

 

 

(7.9

)

Amortization of net loss

 

 

0.5

 

 

 

0.5

 

 

 

1.5

 

 

 

1.7

 

Settlements

 

 

8.8

 

 

 

0.0

 

 

 

8.8

 

 

 

0.0

 

Net periodic benefit cost

 

$

9.5

 

 

$

1.0

 

 

$

11.4

 

 

$

3.4

 

Defined contribution plan expense

 

$

2.1

 

 

$

2.0

 

 

$

6.1

 

 

$

5.8

 

 

 

 

14. Debt

Debt at September 30, 2017 and December 31, 2016 was as follows:

 

 

 

Weighted

Average

Interest Rate

 

 

Maturity

 

September 30,

2017

 

 

December 31,

2016

 

(Dollars in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Term Loan

 

 

 

 

 

 

 

$

0.0

 

 

$

232.5

 

Revolving Credit Facility

 

 

3.81

%

 

2022

 

 

174.8

 

 

 

100.1

 

Construction and other loans

 

 

4.86

%

 

2020

 

 

38.1

 

 

 

40.4

 

Senior Notes due 2025

 

 

6.00

%

 

2025

 

 

500.0

 

 

 

0.0

 

Senior Notes due 2019

 

 

 

 

 

 

 

 

0.0

 

 

 

298.1

 

Debt

 

 

 

 

 

 

 

$

712.9

 

 

$

671.1

 

Less short-term debt and current maturities of

   long-term debt

 

 

 

 

 

 

 

 

12.8

 

 

 

42.6

 

Less unamortized debt issuance costs

 

 

 

 

 

 

 

 

12.1

 

 

 

8.7

 

Long-term debt

 

 

 

 

 

 

 

$

688.0

 

 

$

619.8

 

Senior Notes due 2025

In January 2017, Koppers Inc. completed a private placement offering of $500.0 million 6.00 percent Senior Notes due 2025 (the “2025 Notes”). Koppers Inc. used the proceeds from the offering of the 2025 Notes to repay its outstanding term loan and to fund a tender offer to repurchase its senior notes due 2019.

The 2025 Notes are our senior obligations, are unsecured and are guaranteed by Koppers Holdings Inc. and certain of Koppers Inc.’s domestic subsidiaries. The 2025 Notes pay interest semi-annually in arrears on February 15 and August 15 beginning on August 15, 2017 and will mature on February 15, 2025 unless earlier redeemed or repurchased. On or after February 15, 2020, the Company is entitled to redeem all or a portion of the 2025 Senior Notes at a redemption price of 104.5 percent of principal value, declining to a redemption price of 101.5 percent on or after February 15, 2022 until the redemption price is equivalent to the principal value on February 15, 2023.

The indenture governing the 2025 Senior Notes includes customary covenants that restrict, among other things, the ability of Koppers Inc. and its restricted subsidiaries to incur additional debt, pay dividends or make certain other restricted payments, incur liens, merge or sell all or substantially all of the assets of Koppers Inc. or its subsidiaries or enter into various transactions with affiliates.

Revolving Credit Facility

In February 2017, the Company entered into a new $400.0 million senior secured revolving credit facility (“the Revolving Credit Facility”). The maturity date is February 2022 and the interest rate is variable and is based on LIBOR.

Borrowings under the Revolving Credit Facility are secured by a first priority lien on substantially all of the assets of Koppers Inc., Koppers Holdings and their material domestic subsidiaries. The Revolving Credit Facility contains certain covenants for Koppers Inc. and its restricted subsidiaries that limit capital expenditures, additional indebtedness, liens, dividends, investments or acquisitions. In addition, such covenants give rise to events of default upon the failure by Koppers Inc. and its restricted subsidiaries to meet certain financial ratios.

As of September 30, 2017, the Company had $180.1 million of unused revolving credit availability for working capital purposes after restrictions from certain letter of credit commitments and other covenants. As of September 30, 2017, $45.1 million of commitments were utilized by outstanding letters of credit.

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