Bonds: Metinvest announces 1H14 results; offers exchange for 2015s bondholders

Bonds: Metinvest announces 1H14 results; offers exchange for 2015s bondholders



23 жовтня 2014 года
ICU

In its unaudited 1H14 results announcement on Tuesday, Metinvest reported revenues down 8% YoY to US$6bn while EBITDA increased 29% YoY to US$1.6bn and net income up 46% YoY to US$653m. The company reduced its total debt by 10% to US$3.87bn as of 30 June 2014 from US$4.3bn as of 31 December 2013. Metinvest's net debt/LTM EBITDA ratio declined to 1.5x as of 30 June 2014 from 1.9x as of 31 December 2013.

Investment implications: The hryvnia devaluation was critical to allow Metinvest to boost its 1H14 earnings despite weak steel markets in Ukraine and Russia, slipping iron ore sales, and falling benchmark iron ore prices. However, the heavy impact of the military conflict in Donbass, together with the ongoing decline in iron prices, has yet to seriously hit the company's EBITDA in 2H14. Please see our recent note for further details. We believe that the proposed exchange offers a reasonable solution for investors, whereas remaining in 2015s would leave bondholders with a high risk of default, given the US$936m debt due to be paid by Metinvest in 1H15, the company's significant exposure to the military conflict, and no significant progress towards an official truce in Donbass. We see a high likelihood for the exchange to occur, possibly with the terms to some degree to be renegotiated in favor of the bondholders.

Источник: ICU

Другие обзоры облигаций от ICU


Компании

все компании