Debt

6 Months Ended

Aug. 27, 2022

Debt Disclosure [Abstract]

Debt

Debt

During the second quarter ended August 27, 2022, we amended and extended our committed revolving credit facility to include maximum borrowings of up to $385 million with a maturity of August 2027. As part of the amendment, we repaid the $150 million term loan with borrowings under the revolving credit facility. As of August 27, 2022, outstanding borrowings under our revolving credit facility were $235.0 million, while there were no outstanding borrowings under the revolving credit facility as of February 26, 2022.

Our revolving credit facility contains two financial covenants that require us to stay below a maximum debt-to-EBITDA ratio and maintain a minimum ratio of EBITDA-to-interest expense. Both ratios are computed quarterly, with EBITDA calculated on a rolling four-quarter basis. At August 27, 2022, we were in compliance with both financial covenants. Additionally, at August 27, 2022, we had a total of $12.3 million of ongoing letters of credit related to industrial revenue bonds, construction contracts and insurance collateral that expire in fiscal years 2023 to 2032 and reduce borrowing capacity under the revolving credit facility.

At August 27, 2022, debt included $12.0 million of industrial revenue bonds that mature in fiscal years 2036 through 2043. In March 2022, a $1.0 million industrial revenue bond matured and was repaid. The fair value of all industrial revenue bonds approximated carrying value at August 27, 2022, due to the variable interest rates on these instruments. Our credit facility, term loan and industrial revenue bonds would be classified as Level 2 within the fair value hierarchy described in Note 4.

We also maintain two Canadian committed, revolving credit facilities totaling $25.0 million (USD). At August 27, 2022, outstanding borrowings under our Canadian committed, revolving credit facilities were $3.8 million, while there were no outstanding borrowings under the Canadian facilities as of February 26, 2022.

Interest payments were $2.8 million and $1.9 million for the six months ended August 27, 2022 and August 28, 2021, respectively.