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Xerium Technologies Inc. Message Board

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  • nprfreak nprfreak Aug 13, 2010 9:26 PM Flag

    Interest Expense

    I looked for an explanation for the interest rate and didn't find it either. It was about 1.5M more than Q1 interest expense. BTW, only one month plus two days of the quarter was under the new credit facility. And note there is some debt "local" debt out there not included in either credit facility.

    I think the increase over Q1 may have had something to do with converting the currency and interest rate swaps to debt when the contracts were terminated last year. There's a detailed discussion of hedges, when they ended and how they were handled, in the 10Q.

    I ran a calculation for the $410M at 8.25% as broken out in the big 8-k filed right after the effective date. Using Euro at $1.26 and CAD at $0.97 (old numbers), I came up with $8.5M interest for the first 90-day period. That loan is already smaller, at $407M reported. Add on for the $60M loan at 6.25% and it looks like $9M ballpark. My calculation is $20M quarterly principal on the larger note.

    The only discussion on the CC was during the QA period. Snip with URL to Seeking Alpha transcript below. (Lots of little errors in transcription. The company files a transcript on 8-k: it corrects any mistatements by management.)

    Adam Ritzer - CRT Capital: Could you give me an idea of what you're going forward interest rate on your debt is going to be?

    Stephen Light: The large note, the 407 is at LIBOR plus 6.25. And that LIBOR has a floor of 2%. The $60 million term is LIBOR of two plus 4.25. So that's at 6.25.

    Adam Ritzer - CRT Capital: So the $17 million of quarterly interest expense is too high of modeling purposes. It's much lower than that Q3, Q4.

    Stephen Light: Yes, substantially lower than that.

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