Quarterly report [Sections 13 or 15(d)]

Debt And Derivatives

v3.25.1
Debt And Derivatives
 6 Months Ended
Mar. 31, 2025
Debt Disclosure [Abstract]  
Debt And Derivatives DEBT AND DERIVATIVES
Table 7.1: Details of Debt
March 31, 2025 September 30, 2024
(in thousands)
Term Loan A (TLA) $ 875,625  $ 641,875 
Term Loan B (TLB) 496,250  498,750 
Revolver 135,000  — 
Subsidiary loan agreements —  5,194 
Total debt principal 1,506,875  1,145,819 
Less: Unamortized debt-issuance costs and discounts (14,074) (13,726)
Total debt 1,492,801  1,132,093 
Less: Current portion of long-term debt (47,055) (40,139)
Long-term debt $ 1,445,746  $ 1,091,954 
On March 20, 2025, we amended our existing credit agreement (the "Amendment") with J.P. Morgan Chase Bank, N.A. The Amendment increased our Term Loan A facility (TLA) by $250 million, leaving all other terms and conditions unchanged. Such amounts are available for general corporate purposes, including the funding of working capital, capital expenditures, and possible future acquisitions. Costs related to the Amendment have been reported as a reduction to the debt principal and will be amortized over the remaining term of the agreement.
Our credit agreements require us to comply with a number of covenants, including leverage and interest coverage ratios. At March 31, 2025, we are in compliance with all covenants. We do not believe that the covenants represent a significant restriction on our ability to successfully operate the business or to pay dividends.
The following table sets forth future minimum principal payments due under our debt obligations as of March 31, 2025 for the remainder of fiscal year 2025 through fiscal year 2031:
Table 7.2: Details of Future Minimum Principal Payments Due
Amount Due
(in thousands)
April 1, 2025 through September 30, 2025 $ 25,000 
Year ended September 30, 2026 55,625 
Year ended September 30, 2027 72,500 
Year ended September 30, 2028 78,125 
Year ended September 30, 2029 801,875 
Years ended thereafter 473,750 
Total payments $ 1,506,875 
Interest Rate Derivative Instruments
We utilize interest rate swaps to reduce our risk from interest rates, which we have designated as cash flow hedges.
•We have an arrangement for a notional amount of $75.0 million, which hedges a Secured Overnight Financing Rate (SOFR) component of our TLB to a fixed amount of 4.09%. This arrangement expires in September 2025.
•We have arrangements for a combined notional amount of $500.0 million, which hedges a SOFR component of our TLA to a fixed amount of 2.31%. These arrangements expire in May 2026.
•We have an arrangement for a notional amount of $75.0 million, which hedges a SOFR component of our TLB to a fixed amount of 3.72%. This arrangement expires in September 2026.
The balance of the debt pays interest based upon the SOFR. At March 31, 2025, our effective interest rate, including the original issuance costs and discount rate, was 5.4%.
At March 31, 2025, we recorded an asset of $10.2 million and a liability of $1.1 million to reflect the fair value of our interest rate swap agreements, compared to an asset of $12.6 million and a liability of $3.4 million at September 30, 2024. The asset and liability are recorded as "other assets" and "other liabilities," respectively, within our consolidated balance sheets. As these instruments are effective cash flow hedges, gains and losses based upon interest rate fluctuations are recorded within "accumulated other comprehensive income" within our consolidated financial statements.
In April 2025, we entered into two interest rate swap agreements for a combined notional amount of $250.0 million, effective June 1, 2026. The first arrangement is for a notional amount of $150.0 million and hedges a SOFR component of our TLA to a fixed amount of 3.14%. This arrangement expires in September 2027. The second arrangement is for a notional amount of $100.0 million and hedges a SOFR component of our TLA to a fixed amount of 3.19%. This arrangement expires in September 2028.
Debt And Derivatives DEBT AND DERIVATIVES
Table 7.1: Details of Debt
March 31, 2025 September 30, 2024
(in thousands)
Term Loan A (TLA) $ 875,625  $ 641,875 
Term Loan B (TLB) 496,250  498,750 
Revolver 135,000  — 
Subsidiary loan agreements —  5,194 
Total debt principal 1,506,875  1,145,819 
Less: Unamortized debt-issuance costs and discounts (14,074) (13,726)
Total debt 1,492,801  1,132,093 
Less: Current portion of long-term debt (47,055) (40,139)
Long-term debt $ 1,445,746  $ 1,091,954 
On March 20, 2025, we amended our existing credit agreement (the "Amendment") with J.P. Morgan Chase Bank, N.A. The Amendment increased our Term Loan A facility (TLA) by $250 million, leaving all other terms and conditions unchanged. Such amounts are available for general corporate purposes, including the funding of working capital, capital expenditures, and possible future acquisitions. Costs related to the Amendment have been reported as a reduction to the debt principal and will be amortized over the remaining term of the agreement.
Our credit agreements require us to comply with a number of covenants, including leverage and interest coverage ratios. At March 31, 2025, we are in compliance with all covenants. We do not believe that the covenants represent a significant restriction on our ability to successfully operate the business or to pay dividends.
The following table sets forth future minimum principal payments due under our debt obligations as of March 31, 2025 for the remainder of fiscal year 2025 through fiscal year 2031:
Table 7.2: Details of Future Minimum Principal Payments Due
Amount Due
(in thousands)
April 1, 2025 through September 30, 2025 $ 25,000 
Year ended September 30, 2026 55,625 
Year ended September 30, 2027 72,500 
Year ended September 30, 2028 78,125 
Year ended September 30, 2029 801,875 
Years ended thereafter 473,750 
Total payments $ 1,506,875 
Interest Rate Derivative Instruments
We utilize interest rate swaps to reduce our risk from interest rates, which we have designated as cash flow hedges.
•We have an arrangement for a notional amount of $75.0 million, which hedges a Secured Overnight Financing Rate (SOFR) component of our TLB to a fixed amount of 4.09%. This arrangement expires in September 2025.
•We have arrangements for a combined notional amount of $500.0 million, which hedges a SOFR component of our TLA to a fixed amount of 2.31%. These arrangements expire in May 2026.
•We have an arrangement for a notional amount of $75.0 million, which hedges a SOFR component of our TLB to a fixed amount of 3.72%. This arrangement expires in September 2026.
The balance of the debt pays interest based upon the SOFR. At March 31, 2025, our effective interest rate, including the original issuance costs and discount rate, was 5.4%.
At March 31, 2025, we recorded an asset of $10.2 million and a liability of $1.1 million to reflect the fair value of our interest rate swap agreements, compared to an asset of $12.6 million and a liability of $3.4 million at September 30, 2024. The asset and liability are recorded as "other assets" and "other liabilities," respectively, within our consolidated balance sheets. As these instruments are effective cash flow hedges, gains and losses based upon interest rate fluctuations are recorded within "accumulated other comprehensive income" within our consolidated financial statements.
In April 2025, we entered into two interest rate swap agreements for a combined notional amount of $250.0 million, effective June 1, 2026. The first arrangement is for a notional amount of $150.0 million and hedges a SOFR component of our TLA to a fixed amount of 3.14%. This arrangement expires in September 2027. The second arrangement is for a notional amount of $100.0 million and hedges a SOFR component of our TLA to a fixed amount of 3.19%. This arrangement expires in September 2028.