Current and Long-Term Financing
Financing arrangements exist at the subsidiary level. Hamilton Beach Brands Holding Company has not guaranteed any borrowings of its subsidiaries.
The following table summarizes HBB’s available and outstanding borrowings: | | | | | | | | | | | |
| | December 31 |
| | 2025 | | 2024 |
| Total outstanding borrowings: | | | |
| Revolving credit agreements | $ | 50,000 | | | $ | 50,000 | |
| | | |
| Total outstanding borrowings | $ | 50,000 | | | $ | 50,000 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| Total available borrowings, net of limitations, under revolving credit agreements | $ | 123,783 | | | $ | 107,257 | |
| | | |
| Unused available borrowings | $ | 73,783 | | | $ | 57,257 | |
| | | |
| Weighted average stated interest rate on total borrowings | 5.94 | % | | 5.20 | % |
| Weighted average effective interest rate on total borrowings (including interest rate swap agreements) | 3.30 | % | | 2.50 | % |
Including swap settlements, interest paid on total debt was $0.9 million, $0.5 million and $3.0 million during 2025, 2024 and 2023, respectively. Interest capitalized was not material in 2025, 2024 and 2023.
The HBB Facility the company has is a $125 million senior secured floating-rate revolving credit facility that expires with repayment due on December 13, 2029. The HBB Facility also has an optional $25.0 million term loan. The obligations under the HBB Facility are secured by all of HBB’s U.S. assets. The HBB Facility also requires HBB to achieve a minimum fixed charge coverage ratio in certain circumstances, as defined in the HBB Facility. As of December 31, 2025, HBB was in compliance with all financial covenants in the HBB Facility.
The maximum availability under the HBB Facility is governed by a borrowing base derived from advance rates against eligible trade receivables and inventory of HBB. As of December 31, 2025, interest on outstanding loans under the HBB Facility accrues at a per annum rate equal to, at HBB’s option, either Term Secured Overnight Financing Rate (SOFR) (as defined in the HBB Facility) plus 1.65% or the Base Rate (as defined in the HBB Facility) plus 0.00%. As of December 31, 2025, the HBB Facility requires a fee of 0.20% per annum on the unused commitment thereunder.
To reduce the exposure to changes in the market rate of interest, HBB has entered into interest rate swap agreements for a portion of the HBB Facility. Terms of the interest rate swap agreements require HBB to receive a variable interest rate and pay a fixed interest rate.
HBB does not expect to make voluntary repayments within the next twelve months under the HBB Facility as the rate of return to invest excess cash exceeds the average interest rate of the HBB Facility. A material decrease in interest rates could cause HBB to re-evaluate.
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.