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FIIG Credit Research

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  • Bristow Update April 2019

    Apr 18, 2019
    On 15 April 2019, global aviation services provider Bristow announced it had obtained waivers on its covenants with certain secured lenders to further delay the release of its 10-Q quarterly report for the quarter ended 31 December 2018. Following the announcement, S&P downgraded the credit rating on both Bristow’s unsecured and secured notes and Moody’s also downgraded Bristow’s corporate family rating and the rating on its notes.
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  • Axsesstoday VA Appointment

    Apr 08, 2019
    Axsesstoday announced on 8 April 2017 that it had appointed Deloitte as voluntary administrator of the company. Although disappointing, this outcome is not unexpected in light of the lack of progress in resolving the breaches. We expect the administrator to start communicating with all creditors, including holders of the Junior Secured Notes, within the next fortnight.
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  • Axsesstoday ASX Release 7 March 2019

    Apr 03, 2019
    On 7 March, the trustee of Axsesstoday's Series II Notes and Subordinated Notes notified noteholders that the Company continues to be in breach of its obligations. As part of the notice, the trustee is calling a meeting of noteholders, to be held on 17 April 2019.
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  • Lucas TCS breach of covenant

    Apr 03, 2019
    On 7 March 2019, the trustee for the AUD65m 8% notes notified that one of Lucas’ financial ratios had failed to be met. No Noteholder action is required at this stage. Based on information currently available, we remain comfortable with the Company’s financial position as we understand the issues on the Cultana contract are not reflective of the broader performance of the Company.
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  • DirectBond Filter List April Update

    Apr 01, 2019
    The April 2019 update to our DirectBond List including new additions and our current Trading Restrictions list.
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  • Covenant Paper April 2019

    Apr 01, 2019
    Covenants and security, here to protect noteholders.
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  • StockCo 1H19 Performance Update – Recommendation Maintained

    Mar 27, 2019
    StockCo recently provided noteholders with an update on their 1H19 performance. Livestock receivables were AUD144m in 1H19, down around 15% in the half, while income was around 10% lower. The slowdown was expected, and is a result of prolonged drought conditions. Credit losses remain very low. We forecast StockCo’s financial performance in FY19 to remain subdued, although we expect the credit profile to remain sound, overall.
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  • Privium Group (Impact Homes) – 1H19 results

    Mar 21, 2019
    Privium Group (formerly Impact Group) reported its 1H19 results which were generally in-line with our expectations. Total 1H19 revenue was AUD140.1m (compared to our forecast of AUD136.0m) and EBITDA was AUD8.7m (compared to AUD8.8m). We have revised down our FY19 EBITDA forecast from AUD17.6m to AUD16.2m given lower sales volume being achieved, noting the Group’s credit profile regardless remains sound.
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  • Nufarm – 1H19 results

    Mar 20, 2019
    Revenues increased by 8% to AUD1.58bn while underlying EBITDA declined 2% to AUD120.9m. Given the continued dry weather in Australia and a slow start to the season in Europe Nufarm has revised down its FY19 EBITDA guidance to AUD440m-AUD470m (previously AUD500m-530m). Given the expected leverage by year end FY19 and continued challenging operating conditions, we expect Nufarm’s rating to remain under pressure (as evidenced by its current negative outlook by S&P).
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  • Rackspace Hosting Inc. 4Q18 Results

    Mar 19, 2019
    Rackspace Hosting Inc. reported 4Q18 results which were overall sound, with particularly good free cash flow generation. Total revenue increased 6% year on year to USD604m while adjusted EBITDA was relatively stable at USD185m. Rackspace’s largest division, Managed Hosting & Private Cloud grew 5% to USD366m, with 4Q18 recording the highest booking since the LBO.
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  • Mallinckrodt Plc 4Q18 Results

    Mar 19, 2019
    Mallinckrodt Plc’s results were broadly in line with market expectations. 4Q18 revenues of USD835m increased 5.6% on a constant currency basis, however declined 2.8%. when excluding acquisitions. 4Q18 adjusted EBITDA increased 10% to USD356m, compared to the prior corresponding period.
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  • Ovato Group (previously PMP) – Initiate recommendation of Market Perform

    Mar 15, 2019
    At the current price, we believe Ovato’s 8.25% November 2022 Notes offer fair relative value. While the Group has slightly revised down its FY19 guidance, it announced the closure of one of its plants and additional cost savings. The credit outlook is Stable, noting that establishing a track record of delivering the announced cost savings will be important in the future direction of our credit outlook.
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  • IMF Bentham Limited – Modest 1H19 Loss, underlying credit quality sound

    Mar 06, 2019
    IMF recently released their 1H19 results, with the company reporting an unaudited net loss after tax of AUD(10.4m). Despite the loss, we forecast IMF to report a material increase in key earnings metrics over the next few years. We have reiterated our Market Perform recommendation, with a Stable credit outlook.
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  • CML Group Ltd – Strong 1H19 Results, in line with guidance

    Mar 06, 2019
    CML recently released their 1H19 results, with the company reporting an unaudited net profit after tax of AUD4.4m, up 161% on the prior corresponding period. We have reiterated our Market Perform recommendation, with a Stable credit outlook.
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  • CenturyLink Inc - 4Q18 results

    Mar 04, 2019
    CenturyLink Inc. (CLINK) reported its 4Q18 results. Total pro forma revenue was slightly weaker at USD5.8bn (4Q17: USD6.0bn), however due to improved margins and realised synergies, adjusted EBITDA increased to USD2.2bn from USD2.0bn. EBITDA margins increased to 37.9% from 33.2%.
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  • Hertz Global Holdings - 4Q18 results

    Mar 04, 2019
    Hertz Global Holdings (Hertz) reported sound 4Q18 results supported by a strong pricing and residual environment. Total revenues were USD2.3bn, compared to USD2.1bn in 4Q17. Adjusted EBITDA was USD49m, compared to USD21m in the same period last year.
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  • Frontier Communications Corp - 4Q18 results

    Mar 04, 2019
    Frontier Communications (Frontier) released its 4Q18 results. Consolidated revenue totalled USD2.1bn in 4Q18 (down 4.2% YoY). While weak subscriber results continue to drag on the top line, 4Q18 marked the slowest YoY decline in quarterly revenues since the acquisition of the CTF assets.
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  • DirectBond Filter List March Update

    Mar 04, 2019
    The March 2019 update to our DirectBond List including new additions and our current Trading Restrictions list.
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  • Pioneer Credit – 1H19 results lower on increased costs. FY19 guidance reaffirmed

    Feb 28, 2019
    Pioneer Credit (PNC) reported 1H19 results, with net profit after tax down 33% on prior corresponding period due to increased employee and borrowing costs. EBITDA was unchanged. We believe PNC's credit quality remains solid, despite a weaker half-on-half performance, with the Company reaffirming guidance for FY19.
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  • Next Generation Clubs - We initiate a recommendation of Outperform

    Feb 26, 2019
    We believe the 7.90% 2023 Notes offer good relative value and have the potential for near term price appreciation at the current indicative mid-price AUD99.10 and a yield to worst of 8.23%. The outlook is Stable. Next Gen has provided management figures for the year to 31 December which were broadly in-line or stronger than expectations.
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