On May 12, 2025, Paramount Global executed the fifth amendment to its credit agreement originally dated January 23, 2020, enhancing its financial framework to support ongoing strategic objectives and operational resilience. This pivotal amendment notably increases the ceiling for unrestricted cash and cash equivalents applied against its consolidated indebtedness for leverage calculations—from \(1.5 billion to \)3.0 billion—effectively doubling the flexibility in managing debt levels.
The amendment also redefines “Consolidated EBITDA” by permitting an additional add-back, capped at 15%, for cash items related to restructuring, business optimization programs, litigation, environmental reserves, and losses on business dispositions. This nuanced change allows Paramount to more accurately reflect its operational cash flow by excluding certain one-time cash charges, thereby potentially improving key financial ratios such as leverage metrics and EBITDA-based covenants.
Contextually, Paramount Global reported total revenue of \(29.21 billion and total liabilities of approximately \)29.39 billion for its fiscal year ending December 31, 2024. The company’s long-term debt stood at $14.5 billion, revealing a considerable leverage position. The amendment’s increase to the leverage calculation cash netting cap provides Paramount more leeway to optimize its capital structure amid ongoing market and regulatory challenges.
This strategic financial maneuver aligns with previous management commentary in earnings calls, emphasizing cost management initiatives, operational efficiencies, and positioning Paramount to weather economic uncertainties and sector-specific challenges, including evolving content consumption trends and the broader macroeconomic environment.
By bolstering the credit agreement with these refinements, Paramount Global enhances its liquidity profile and provides a more robust platform for growth investments, including content development, streaming infrastructure, and market expansion endeavors. The amendment underscores Paramount’s commitment to proactive financial stewardship as it navigates an increasingly competitive and dynamic media landscape.
For detailed reference, the full amendment document is publicly accessible via the SEC repository here: Paramount Global Credit Agreement Amendment.
Tags: ParamountGlobalCreditAmendment2025, ConsolidatedEBITDAAdjustments, LeverageRatioEnhancement, MediaIndustryFinancialStrategy, StreamingContentInvestment