16 Mar, 2016

Understanding Credit Portfolios

By |2016-03-16T02:33:12+11:00Mar 16, 2016|Bonds|

People often forget the underlying differences between equity and credit. While stock selection is all about picking winners in the equity market, the goal of credit selection is to avoid losers. First and foremost credit is about getting your money back and being adequately compensated for the risk of not getting your money back. In many ways this is the [...]

8 Mar, 2016

CML Group to issue $25 million in fixed rate bonds

By |2016-03-08T06:41:09+11:00Mar 8, 2016|Bonds|

CML today announced the proposed issue of new 6 year fixed rate notes paying 8.00% p.a. The proceeds will be used will assist in the acquisition of CashFlow Advantage and general corporate purposes. The group is seeking a minimum of $20 million from the deal and will not accept oversubscriptions of $25 million. The notes will be callable in March [...]

8 Mar, 2016

Payce annouce resolution to redeem remaining bonds

By |2016-03-08T06:21:42+11:00Mar 8, 2016|Bonds|

Payce have announced a proposed resolution to redeem the remaining $12.03 million Payce 9.50% 2018 notes outstanding. The outcome will be dependent on a vote by noteholders. If passed the notes will be redeemed by 108.50% of the outstanding principle of each note and all accrued interest to the 31 March 2016. If successful, the notes will be redeemed on the next [...]

3 Mar, 2016

Moody’s Investor Services downgrades BHP Billiton by two notches, outlook remains negative.

By |2016-03-03T23:24:15+11:00Mar 3, 2016|Bonds, Market Commentary|

Overnight Moody’s Investor’s Services downgraded BHP’s issuer rating by two notches from ‘A1’ to ‘A3’ and maintaining the outlook as Negative, completing a review that was initiated on 18th December 2015. Moody’s downgrade reflects recent weak results that have materially stressed BHP’s credit metrics relative to rating tolerances. Standard & Poor’s (S&P) downgraded BHP from ‘A+’ to ‘A’ with a [...]

2 Mar, 2016

Moody’s cuts Woolworth’s issuer rating

By |2016-03-02T02:45:03+11:00Mar 2, 2016|Bonds, Market Commentary|

Moody's Investors Service have downgraded the issuer rating and senior unsecured notes one notch leaving the outlook as negative.   Standard & Poor's on the 28th February announced no immediate ratings impact from the Master's write downs and first half 2016 results, although the negative outlook on the group remains.   As a result Woolworths now have a split rating difference of one [...]

23 Nov, 2015

Buy recommendation on Qantas bonds confirmed

By |2015-11-23T01:46:12+11:00Nov 23, 2015|Bonds|

Last week Standard and Poors announced the upgrade of Qantas' credit rating and its long awaited return to Investment Grade. This is a significant achievement given the overall slowdown of the Australian economy and is something which has been years in planning. As stated in our previous research notes, following weak FY14 results Qantas' management launched a thorough, all-encompassing transformation program which aimed to streamline the company [...]

22 Oct, 2015

Aurizon Holdings: Update a costs reduction story

By |2015-10-22T00:02:36+11:00Oct 22, 2015|Bonds|

Aurizon held its investor day on October 7th, at which it outlined its transformation program to deliver further cost reductions and productivity benefits totalling $310-$380m for the 3 fiscal years FY16 to FY18, which are crucial to achieve its target of delivering an Operating Ratio (OR) of 70% by FY18, ie an EBIT margin of 30% (versus an OR of 74.3% [...]

21 Oct, 2015

AGL Energy: News and Guidance is Credit Friendly

By |2015-10-21T23:55:48+11:00Oct 21, 2015|Bonds, Market Commentary|

Beginning of September, AGL disclosed that it completed the sale of its 50% participating interest in the 420MW MacArthur Wind Farm for $532m. This was earlier than expected as the company had guided for "first half of FY16" but in-line price-wise as it had anticipated a $500m price tag. It is an important milestone in AGL's target of $1bn of [...]