MARAVAI LIFESCIENCES HOLDINGS, INC. 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk As of December 31, 2020, our primary exposure to interest rate risk was associated with our variable rate long-term debt. The New Credit Agreement bear interest subject to the Base Rate or the Adjusted Eurocurrency Rate. Interest rates can fluctuate for a number of reasons, including changes in the fiscal and monetary policies or geopolitical events or changes in general economic conditions. This could adversely affect our cash flows. As of December 31, 2019, we had four interest rate cap agreements with a financial institution to manage our variable interest rate risk on a portion of our credit borrowings under the First Lien Credit Agreement and Second Lien Credit Agreement. All four interest rate caps expired during 2020. As of December 31, 2020, we did not have any interest rate cap agreements in place. 95 We had $550.0 million of outstanding borrowings under our long-term debt facilities as of December 31, 2020. For the year ended December 31, 2020, the effect of a hypothetical 100 basis point increase or decrease in overall interest rates would have changed our interest expense by approximately $4.1 million. We had cash of $236.2 million as of December 31, 2020. Our cash is held in demand deposits and is not subject to market risk. Foreign Currency Risk The majority of our revenue is denominated in U.S. dollars; however, approximately 47.1% of our revenue was derived from international sales for the year ended December 31, 2020, primarily in Europe and Asia Pacific. However, only our sales in the United Kingdom are denominated in local currency. Our remaining international sales are denominated in the U.S. dollar. Our expenses are generally denominated in the currencies in which they are incurred, which is primarily in the United States and, to a lesser extent, the United Kingdom. As we expand our presence in international markets, to the extent we are required to enter into agreements denominated in a currency other than the U.S. dollar, results of operations and cash flows may increasingly be subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign exchange rates. To date, we have not entered into any hedging arrangements with respect to foreign currency risk. As our international operations grow, we will continue to reassess our approach to manage our risk relating to fluctuations in currency rates. 96 Table of Contents