ModivCare new $325 million revolver has better interest, flexibility

By Devika Patel

Knoxville, Tenn., March 25 – ModivCare Inc. has strong liquidity after a February refinancing of a previous revolving credit facility with a new $325 million undrawn revolver.

The new revolver has lower interest rates and gives the company more flexibility than the older agreement.

In addition, ModivCare is committed to driving down its net leverage ratio, which stands at 3.7x.

“We ended the fourth quarter of 2021 in a strong financial position with $133 million of cash and cash equivalents and zero borrowings on our revolver,” chief financial officer L. Heath Sampson said on the company’s fourth quarter and year ended Dec. 31, 2021 earnings conference call on Friday.

“In February, we refinanced our prior revolving credit facility with a new $325 million revolving credit facility, which remains undrawn.

“The new revolver reflects competitive market terms, including lower interest rates, incremental capacity of a $100 million and increased flexibility for the company’s future capital needs,” Sampson said.

The company is committed to getting its net leverage ratio down to 3x from its current 3.7x.

“Our consolidated pro forma net leverage was 3.7x at the end of the fourth quarter of 2021,” Sampson said.

“We remain committed to our net leverage target of 3x and maintaining a strong balance sheet,” Sampson said.

Helping to drive down leverage, ModivCare has quadrupled its adjusted EBITDA over the past three years under its new chief executive.

“We ended 2021 with a full-year adjusted EBITDA of $205 million, which is a meaningful improvement compared to the $51 million of adjusted EBITDA that the company achieved in 2019 when I joined as CEO,” president and chief executive officer Daniel E. Greenleaf said on the call.

Cash and cash equivalents were $133,139,000 as of Dec. 31, 2021, compared to $183,281,000 as of Dec. 31, 2020.

Long-term debt, net of deferred financing costs, was $975,225,000 as of Dec. 31, 2021, compared to $485.98 million as of Dec. 31, 2020.

ModivCare is a Denver-based technology-enabled healthcare services company that provides a suite of integrated supportive care solutions for public and private payors and their patients.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.