Broder Bros. Co. Announces Fourth Quarter and Fiscal Year Results
The company relies primarily upon cash flow from operations and borrowings under its revolving credit facility to finance operations, capital expenditures and debt service requirements. Borrowings and availability under the revolving credit facility fluctuate due to seasonal demands. Historical borrowing levels have reached peaks during the middle of a given year and low points during the last quarter of the year. Borrowings under the revolving credit facility were $100.8 million at December 26, 2009 compared to $122.9 million at September 26, 2009 and $150.0 million at December 27, 2008. The reduction in revolver debt was mainly due to a reduction in inventory (net of a smaller decrease in accounts payable) partially offset by payment of transaction costs in connection with the exchange offer. Borrowing base availability at December 26, 2009, September 26, 2009 and December 27, 2008 was $31.5 million, $33.9 million and $35.9 million, respectively.
Management believes that it has the ability to manage cash flow and working capital levels, particularly inventory and accounts payable, to allow the company to meet its current and future obligations, pay scheduled principal and interest, and provide funds for working capital, capital expenditures and other needs of the business for at least fiscal 2010. Additional information regarding the company's liquidity position can be found in the company's 2009 Annual Report which will be posted on the company's corporate Web site at www.broderbrosco.com.