Triton International LtdTRTN-PA
Triton International Ltd Debt Disclosure
Debt
The table below summarizes the Company's key terms and carrying value of debt as of the periods indicated:
| December 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||
| Outstanding Borrowings (in thousands) | Contractual Weighted Avg Interest Rate | Maturity Range | Outstanding Borrowings (in thousands) | ||||||||||||||||||||||||||
| From | To | ||||||||||||||||||||||||||||
| Secured Debt Financings | |||||||||||||||||||||||||||||
| Asset-backed securitization term instruments | $ | 2,579,832 | 2.04 | % | February 2028 | February 2031 | $ | 2,890,467 | |||||||||||||||||||||
| Asset-backed securitization warehouse | 240,000 | 6.96 | % | April 2029 | April 2029 | 320,000 | |||||||||||||||||||||||
| Total secured debt financings | 2,819,832 | 3,210,467 | |||||||||||||||||||||||||||
| Unsecured Debt Financings | |||||||||||||||||||||||||||||
| Senior notes | 2,300,000 | 2.45 | % | June 2024 | March 2032 | 2,900,000 | |||||||||||||||||||||||
| Term loan facility | 1,468,496 | 6.71 | % | May 2026 | May 2026 | 1,080,000 | |||||||||||||||||||||||
| Revolving credit facility | 930,000 | 6.71 | % | October 2027 | October 2027 | 945,000 | |||||||||||||||||||||||
| Total unsecured debt financings | 4,698,496 | 4,925,000 | |||||||||||||||||||||||||||
| Total debt financings | 7,518,328 | 8,135,467 | |||||||||||||||||||||||||||
| Unamortized debt costs | (43,924) | (55,863) | |||||||||||||||||||||||||||
| Unamortized debt premiums & discounts | (3,770) | (4,784) | |||||||||||||||||||||||||||
| Debt, net of unamortized costs | $ | 7,470,634 | $ | 8,074,820 | |||||||||||||||||||||||||
Asset-Backed Securitization Term Instruments
Under the Company's ABS facilities, indirect wholly-owned subsidiaries of the Company enter into debt agreements for ABS term instruments, including ABS notes. These subsidiaries are intended to be bankruptcy remote so that such assets are not available to creditors of the Company or its affiliates until and unless the related secured borrowings have been fully discharged. These transactions do not meet accounting requirements for sales treatment and are recorded as secured borrowings.
The Company’s borrowings under the ABS facilities amortize in monthly installments, typically in level payments over five or more years. These facilities provide for an advance rate against the net book values of designated eligible equipment. The net book values for purposes of calculating eligible equipment is determined according to the related debt agreement and may be different than those calculated per GAAP. The Company is required to maintain restricted cash balances on deposit in designated bank accounts equal to nine months of interest expense.
Asset-Backed Securitization Warehouse
Under the Company’s ABS warehouse facility, an indirect wholly-owned subsidiary of the Company issues ABS notes. This subsidiary is intended to be bankruptcy remote so that such assets are not available to creditors of the Company or its affiliates until and unless the related secured borrowings have been fully discharged. These transactions do not meet accounting requirements for sales treatment and are recorded as secured borrowings.
The Company's ABS warehouse facility has a borrowing capacity of $1,125.0 million that is available on a revolving basis to April 27, 2025, paying interest at term SOFR plus 1.60%. After the revolving period, borrowings will convert to term notes with a maturity date of April 27, 2029, paying interest at SOFR plus 2.60%.
During the revolving period, the borrowing capacity under this facility is determined by applying an advance rate against the net book values of designated eligible equipment. The net book values for purposes of calculating eligible equipment are determined according to the related debt agreement and may be different than those calculated per GAAP. The Company is required to maintain restricted cash balances on deposit in designated bank accounts equal to three months of interest expense.
Senior Notes
The Company’s senior notes are unsecured and have initial maturities ranging from 3 to 10 years and interest payments due semi-annually. The senior notes are prepayable (in whole or in part) at the Company's option at any time prior to the maturity date, subject to certain provisions in the senior note agreements, including the payment of a make-whole premium in respect to such prepayment.
On August 1, 2023, the Company’s $600.0 million, 0.80% senior notes matured. Payment at maturity was primarily funded by borrowings under Triton’s revolving credit facility. Additionally, three forward starting swaps with a total notional value of $300.0 million became effective on August 1, 2023, to offset a portion of the interest expense related to the borrowing under the revolving credit facility.
Term Loan Facility
The Company's term loan facility has a maturity date of May 27, 2026, which amortizes in quarterly installments and has a reference rate of term SOFR plus 1.35%. This facility is subject to covenants customary for unsecured financings of this type, including financial covenants that require us to maintain a minimum ratio of unencumbered assets to certain financial indebtedness.
On September 1, 2023, the Company and its wholly-owned subsidiaries, Triton Container International Limited and TAL International Container Corporation (the "Borrowers"), amended Triton's term loan facility to increase the size of the accordion feature under the term loan agreement to allow the Borrowers to increase the aggregate commitment amount under the agreement by up to an additional $500.0 million. Concurrently with the closing of the amendment, the Borrowers exercised the accordion and increased their borrowing under the term loan facility by $500.0 million. There was no change to the maturity date or reference rate under the term loan facility as a result of the amendment and incremental borrowing.
Revolving Credit Facility
The revolving credit facility has a maturity date of October 26, 2027, and has a maximum borrowing capacity of $2,000.0 million. The reference rate is term SOFR plus 1.35%. This facility is subject to covenants customary for unsecured financings of this type, primarily financial covenants that require us to maintain a minimum ratio of unencumbered assets to certain financial indebtedness.
The Company hedges the risks associated with fluctuations in interest rates on a portion of its floating-rate debt by entering into interest rate swap agreements that convert a portion of its floating-rate debt to a fixed rate basis, thus reducing the impact of interest rate changes on future interest expense. The following table summarizes the Company's outstanding fixed-rate and floating-rate debt as of December 31, 2023:
| Balance Outstanding (in thousands) | Contractual Weighted Avg Interest Rate | Maturity Range | Weighted Avg Remaining Term | ||||||||||||||||||||||||||
| From | To | ||||||||||||||||||||||||||||
| Excluding impact of derivative instruments: | |||||||||||||||||||||||||||||
| Fixed-rate debt | $4,879,832 | 2.23% | Jun 2024 | Mar 2032 | 4.2 years | ||||||||||||||||||||||||
| Floating-rate debt | $2,638,496 | 6.73% | May 2026 | Apr 2029 | 3.0 years | ||||||||||||||||||||||||
| Including impact of derivative instruments: | |||||||||||||||||||||||||||||
| Fixed-rate debt | $4,879,832 | 2.23% | |||||||||||||||||||||||||||
| Hedged floating-rate debt | 1,847,000 | 4.00% | |||||||||||||||||||||||||||
| Total fixed and hedged debt | 6,726,832 | 2.72% | |||||||||||||||||||||||||||
| Unhedged floating-rate debt | 791,496 | 6.73% | |||||||||||||||||||||||||||
| Total debt outstanding | $7,518,328 | 3.13% | |||||||||||||||||||||||||||
The fair value of total debt outstanding was $6,905.9 million and $7,264.7 million as of December 31, 2023 and December 31, 2022, respectively, and was measured using Level 2 inputs.
As of December 31, 2023, the maximum borrowing levels for the ABS warehouse and the revolving credit facility were $1,125.0 million and $2,000.0 million, respectively. Certain of these facilities are governed by either borrowing bases or an unencumbered asset test that limits borrowing capacity. Based on those limitations, the availability under these credit facilities at December 31, 2023 was approximately $1,148.7 million.
The Company is subject to certain financial covenants under its debt financings. As of December 31, 2023, the Company was in compliance with all financial covenants in accordance with the terms of its debt agreements.
Debt Maturities
At December 31, 2023, the Company's scheduled principal repayments and maturities were as follows (in thousands):
| Years ending December 31, | |||||
| 2024 | $ | 953,357 | |||
| 2025 | 470,517 | ||||
| 2026 | 2,119,575 | ||||
| 2027 | 1,317,992 | ||||
| 2028 | 591,830 | ||||
| 2029 and thereafter | 2,065,057 | ||||
| Total debt outstanding | $ | 7,518,328 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2023 | Feb 29, 2024 | Showing above |
| 2022 | Feb 14, 2023 | |
| 2021 | Feb 15, 2022 | |
| 2020 | Feb 16, 2021 | |
| 2019 | Feb 14, 2020 | |
| 2018 | Feb 19, 2019 | |
| 2017 | Feb 27, 2018 | |
| 2016 | Mar 20, 2017 | |
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.