Fabrib
Forumer storico
Gionmorg ne sa senz'altro di più; io immagino che quando non contribuirà più al capitale, verrà probabilmente richiamato.
Obbligazioni societarie HIGH YIELD e oltre, verso frontiere inesplorate - Vol. 1
- Creatore Discussione TRADING_IDEAS
- Data di Inizio
- Stato
Io ne so quanto voi!!!!
Peccato aver aperto la piattaforma tardi, altrimenti avrei potuto approfittare del denaro a 99.99 non era male come gain....
Fortescue Metals’ Note Redemption Is Credit Positive
Last Wednesday, Fortescue Metals Group Ltd. (Ba3 negative) announced that it had exercised its call option to repay $577 million of debt by issuing a redemption notice to holders of its 8.25% senior unsecured notes due in 2019. The debt-repayment is credit positive for Fortescue because it reduces the company’s total debt by around 7% and provides another indication of the company’s commitment to improving its balance sheet and protecting its credit quality in the weak price environment for iron ore. The 2019 notes, which Fortescue’s finance subsidiary FMG Resources (August 2006) Pty Ltd. issued, will be redeemed at par plus a redemption premium of 4.125%. Fortescue will fund the transaction with accumulated cash on hand. The redemption follows $1.1 billion of debt repayments that the company has completed already this year. The redemption will be completed on 1 June 2016. The redemption would lower Fortescue’s reported total debt to around $7.9 billion from around $8.4 billion at the end of March 2016, a nearly 40% reduction from the company’s peak debt level of around $12.7 billion in fiscal year that ended 30 June 2013 (see exhibit). We expect the repayment to improve Fortescue’s financial leverage, as measured by adjusted gross debt/EBITDA, by 0.2x-0.4x under our base-case iron ore price assumption of $40 per tonne for fiscal 2016. Fortescue’s adjusted debt/EBITDA was around 4.0x for fiscal 2015. Fortescue Metals Group’s Debt Levels, $ Billions The company’s debt has declined following its completion of major expansion activities in fiscal 2013. Note: Fortescue’s fiscal year ends 30 June. Source: Fortescue Metals Group Ltd. The debt-repayment is an example of Fortescue management’s application of excess free cash flow to debt reduction and its focus on achieving a targeted gearing ratio, as measured by book value debt/debt plus equity, of around 40%. This metric was around 52% for calendar 2015, and would improve to around 50% pro forma for the proposed transaction. The transaction will also lower Fortescue’s total interest expense by around $48 million per year, although this will be partially offset in the first year by the approximately $24 million premium paid to redeem the notes. A lower interest cost would slightly improve the company’s breakeven costs of production and aid in future free cash flow generation. Additionally, the debt repayment reduces the amount of total debt maturing in 2019 by around 10% to $4.8 billion. Notwithstanding the credit-positive aspects, the announced offer slightly reduces Fortescue’s liquidity cushion at a time when iron prices are low. However, by consistently reducing its unit cash costs and maintaining record production levels, Fortescue has been able to generate positive free cash flow in the lower price environment. Also, since falling below $40 per tonne in December 2015, iron ore prices have risen to an average of around $51 per tonne year to date 2016. This is around $11 per tonne over our 2016 base-case scenario, which we estimate would result in free cash flow generation of $500-$600 million above of our previous expectations and support the company’s ability to fund debt reduction while maintaining solid liquidity levels. Despite the recent increase in iron ore prices, we expect them to migrate toward our base-case scenario owing to the slowdown in steel making in China and overcapacity in global iron ore supply.
Last Wednesday, Fortescue Metals Group Ltd. (Ba3 negative) announced that it had exercised its call option to repay $577 million of debt by issuing a redemption notice to holders of its 8.25% senior unsecured notes due in 2019. The debt-repayment is credit positive for Fortescue because it reduces the company’s total debt by around 7% and provides another indication of the company’s commitment to improving its balance sheet and protecting its credit quality in the weak price environment for iron ore. The 2019 notes, which Fortescue’s finance subsidiary FMG Resources (August 2006) Pty Ltd. issued, will be redeemed at par plus a redemption premium of 4.125%. Fortescue will fund the transaction with accumulated cash on hand. The redemption follows $1.1 billion of debt repayments that the company has completed already this year. The redemption will be completed on 1 June 2016. The redemption would lower Fortescue’s reported total debt to around $7.9 billion from around $8.4 billion at the end of March 2016, a nearly 40% reduction from the company’s peak debt level of around $12.7 billion in fiscal year that ended 30 June 2013 (see exhibit). We expect the repayment to improve Fortescue’s financial leverage, as measured by adjusted gross debt/EBITDA, by 0.2x-0.4x under our base-case iron ore price assumption of $40 per tonne for fiscal 2016. Fortescue’s adjusted debt/EBITDA was around 4.0x for fiscal 2015. Fortescue Metals Group’s Debt Levels, $ Billions The company’s debt has declined following its completion of major expansion activities in fiscal 2013. Note: Fortescue’s fiscal year ends 30 June. Source: Fortescue Metals Group Ltd. The debt-repayment is an example of Fortescue management’s application of excess free cash flow to debt reduction and its focus on achieving a targeted gearing ratio, as measured by book value debt/debt plus equity, of around 40%. This metric was around 52% for calendar 2015, and would improve to around 50% pro forma for the proposed transaction. The transaction will also lower Fortescue’s total interest expense by around $48 million per year, although this will be partially offset in the first year by the approximately $24 million premium paid to redeem the notes. A lower interest cost would slightly improve the company’s breakeven costs of production and aid in future free cash flow generation. Additionally, the debt repayment reduces the amount of total debt maturing in 2019 by around 10% to $4.8 billion. Notwithstanding the credit-positive aspects, the announced offer slightly reduces Fortescue’s liquidity cushion at a time when iron prices are low. However, by consistently reducing its unit cash costs and maintaining record production levels, Fortescue has been able to generate positive free cash flow in the lower price environment. Also, since falling below $40 per tonne in December 2015, iron ore prices have risen to an average of around $51 per tonne year to date 2016. This is around $11 per tonne over our 2016 base-case scenario, which we estimate would result in free cash flow generation of $500-$600 million above of our previous expectations and support the company’s ability to fund debt reduction while maintaining solid liquidity levels. Despite the recent increase in iron ore prices, we expect them to migrate toward our base-case scenario owing to the slowdown in steel making in China and overcapacity in global iron ore supply.
NoWay
It's time to play the game
Temo che sia lì solo per far alzare i limiti dell'Euronext...
Joe Silver
Forumer storico
Grazie Gion, questo annuncio chiarisce che è richiamo.
AAA+
Forumer attivo
si ma se tutto va bene con iw la si vedrà oggi insieme all'ex new albertsons, più rimborso parziale ausol
fabriziof
Forumer storico
non c'era nulla da chiarire
iguanito
Forumer storico
Questa banca aveva rating Aa3 quando il bond è stato emesso ora è una tripla C!
Joe Silver
Forumer storico
Non vorrei girare il coltello nella piaga, ma su Binck la cedola è stata accreditata addirittura il 29 Maggio
- Stato
Similar threads
Obbligazioni societarie
HIGH YIELD e oltre, verso frontiere inesplorate, vol.3
