Approval of Monde Nissin Corporation’s Board of Directors of change in use of IPO Proceeds

Monde Nissin Corporation’s (PSE: MONDE) board of directors has approved, in its regular meeting today, August 9, 2021, the change in use of IPO proceeds, previously earmarked for capital expenditures, to pay down the majority of the remaining term loans of PhP15.6 billion, resulting in interest expense savings of approximately PhP700 million assuming interest rates remain at current levels. This action was done to avoid the significant negative carry associated with large cash balances as these have substantially lower investment returns than the interest payments on the outstanding debt.

The Board confirms that there is no change in the capital expenditure plans as stipulated in the IPO Prospectus, amounting to PhP26.5 billion or 57.2% of the net proceeds, and considers that the above change in the use of net proceeds is in the best interests of the Company and its shareholders.

Henry Soesanto, Monde Nissin’s CEO, commented: “Given the current interest rate environment where returns on cash are negligible and where Monde Nissin has a large amount of cash due to our IPO, it was determined that the most prudent course of action for shareholders is to pay down debt, resulting in significant interest savings and a reduction in interest rate risk. We continue to have strong conviction of the long-term growth opportunities of our businesses and capital expenditure plans and growth strategy will remain unchanged. Funding will be provided by our strong operating cash flows supplemented with existing lines of credit if needed.”