Revolving Credit Facilities for
Broadcast & Media Businesses
Flexible access to working capital that can move with changing production schedules, projects and short-term commercial requirements.
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Your Workload Changes. Your Funding May Need to Change With It.
Broadcast and media businesses do not necessarily require the same amount of working capital every month.
One period may involve relatively normal expenditure.
Another may involve several overlapping productions or live events, with crew, travel, equipment, facilities and supplier costs all falling due within days of each other.
A revolving credit facility can provide an agreed funding limit that can typically be drawn, repaid and redrawn, subject to the lender’s terms.
How Revolving Credit Works
A lender agrees a facility limit.
The business can draw funds from that facility when required, subject to available headroom and the provider’s terms.
When customer receipts arrive or the working-capital requirement reduces, borrowing can be repaid.
Available capacity may then be reused in future.
This can make revolving credit particularly relevant to businesses with recurring but variable working-capital needs.
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Why It Can Suit Broadcast & Media Businesses
Draw When Required
Use additional funding during periods of increased expenditure.
Repay When Cash Arrives
Reduce outstanding borrowing as customer receipts enter the business.
Reuse the Facility
Available headroom may then be used again for a later requirement.
Avoid Taking an Unnecessary Lump Sum
Borrow according to the immediate requirement rather than automatically drawing the full facility.
Maintain a Working-Capital Buffer
Create access to additional liquidity for periods when several projects overlap.
Three Projects. Three Different Cash Positions.
Project A
Delivered and invoiced. Payment remains outstanding.
Project B
Currently live. Crew and suppliers need paying.
Project C
Confirmed. Mobilisation starts next week.
The business has revenue associated with all three projects. But cash does not enter and leave the business in the same order. A revolving credit facility may provide additional flexibility during those overlapping periods.
Revolving Credit or Business Loan?
A business loan normally provides a defined lump sum with agreed repayments.
A revolving facility provides flexible access to an agreed limit.
Where the requirement is a one-off investment, a term loan may be suitable.
Where the working-capital requirement repeatedly rises and falls, revolving credit may provide a better fit.
Revolving Credit or Invoice Finance?
Invoice finance is connected to eligible receivables.
Revolving credit does not necessarily depend on a particular invoice being available at the point of drawdown.
That means it may be useful earlier in the project cycle, including mobilisation.
The better option depends on the cash-flow pattern and financial circumstances of the business.
What Could a Revolving Facility Support?
Subject to facility terms:
- Crew and freelancers
- Supplier deposits
- Equipment rental
- Travel
- Accommodation
- Payroll
- Production costs
- Multiple overlapping projects
- Short-term operating expenditure
- Unexpected costs
- Commercial opportunities
Working Capital That Moves With
Your Business
If funding needs regularly increase and decrease as projects begin, complete and get paid, speak to MacManus about whether a revolving credit facility may be suitable.
Revolving Credit FAQs
A revolving credit facility provides an agreed limit from which funds can typically be drawn, repaid and redrawn subject to the provider’s terms.
Charging structures vary. Interest is commonly related to amounts drawn, while additional facility fees may also apply.
Potentially, where the proposed expenditure is permitted within the lender’s terms.
The purposes can overlap, but the structures, providers, security and pricing may differ.
These facilities are generally designed to allow repayment and subsequent reuse, although individual terms apply.
Providers may assess turnover, profitability, cash flow, borrowing, credit profile and overall affordability.
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