SGMA - SigmaTron notified by lenders of events of default stock falls 4% after hours

2023-03-20 18:08:55 ET

• SigmaTron International ( NASDAQ: SGMA ) said Monday it was notified by its lenders of events of default under two of its credit agreements, sending its stock 4.2% lower after hours.
• The first notice was a result of SigmaTron's ( SGMA ) failure to maintain a fixed charge coverage ratio for the 12 months ending January 31 less than 1.10:1.0, as required under the credit agreement.
• The second notice was a result of SigmaTron ( SGMA ) permitting the total Debt to EBITDA Ratio for the 12 months ending January 31 to be greater than 5.00:1.00 in violation of the credit deal.
• The notices have not led to an increase of SigmaTron's ( SGMA ) obligations.
• As of Monday, the lenders have not exercised their respective rights or remedies under the credit deals.
• SigmaTron ( SGMA ) also revised financial projections for its Pet Tech Segment, resulting in a triggering event for its goodwill and long-lived asset groups.
• A non-cash pre-tax goodwill impairment charge of ~$13.3M and a non-cash intangible assets impairment charge of ~$9.8M would be recorded for the segment for the quarter ended January 31.
• Earlier, SigmaTron ( SGMA ) reported Q2 results .

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