Enpro Inc. Amends and Extends $800 Million Credit Facility

Enpro Inc. has entered into a Second Amendment to its Third Amended and Restated Credit Agreement, enhancing and extending its senior secured revolving credit facility. The revised agreement, effective April 9, 2025, maintains Bank of America, N.A. as the Administrative Agent and extends the maturity date to April 9, 2030.

Under the amended terms, Enpro secured access to an $800 million revolving credit facility, with the flexibility to request additional term loans or revolving commitments based on financial performance. These incremental options include up to the greater of $275 million or 100% of consolidated EBITDA for the most recent four-quarter period, plus additional capacity tied to a senior secured leverage ratio.

Key Features of the Amended Facility:
Interest Terms: Borrowings may accrue interest based on either the alternate base rate or the Term SOFR rate, plus an applicable margin that adjusts based on Enpro’s total net leverage ratio. Initial margins are 1.375% for Term SOFR loans and 0.375% for base rate loans.

Commitment Fees: An annual fee of 0.175% applies to undrawn portions of the facility, also subject to adjustment based on leverage.

Borrower Flexibility: Enpro and its wholly owned subsidiaries may utilize the facility. Additional foreign subsidiaries may be added as borrowers, and domestic subsidiaries are required to serve as guarantors.

Collateral and Covenants:
Borrowings are secured by a first-priority lien on:

100% of capital stock in domestic subsidiaries,

65% of capital stock in first-tier foreign subsidiaries,

and substantially all assets of Enpro and its guarantor subsidiaries (excluding real estate).

Financial covenants include:

A maximum consolidated total net leverage ratio of 4.0x, with a temporary increase to 4.5x permitted after qualifying acquisitions (up to three times).

A minimum consolidated interest coverage ratio of 2.5x.

The agreement also imposes limitations on incurring debt, granting liens, making investments, paying dividends, and engaging in mergers or affiliate transactions, among others. Standard events of default such as covenant breaches, insolvency, or change of control are also outlined.

This amendment provides Enpro with extended financial flexibility and supports its ongoing capital structure optimization and strategic initiatives.

Enpro reported strong fourth-quarter and full-year 2024 results, showing improvements in profitability and financial performance.

For the fourth quarter, sales increased 3.7% to $258.4 million, with organic sales rising 1.2%. GAAP net income from continuing operations improved significantly to $13.9 million, compared to a loss of $4.9 million in the prior year. Adjusted EBITDA rose 24.1% to $58.2 million. Diluted earnings per share from continuing operations increased to $0.66, up from a loss of $0.23, while adjusted diluted earnings per share grew 31.9% to $1.57.

For the full year, sales totaled $1.05 billion, down 1.0%, with organic sales declining 3.9%. GAAP net income from continuing operations increased to $72.9 million, a sharp rise from $10.8 million in 2023. Adjusted EBITDA grew 7.1% to $254.8 million, while diluted earnings per share rose to $3.45, compared to $0.51 in the prior year. Adjusted diluted earnings per share improved 6.4% to $6.96.

Looking ahead to 2025, Enpro expects revenue growth in the low to mid-single-digit range, with adjusted EBITDA projected between $262 million and $277 million. Adjusted diluted earnings per share are forecasted to be between $7.00 and $7.70. The company highlighted its strong balance sheet and cash flow generation, supporting further investment in organic growth and strategic acquisitions.