Altice International - comment

We are awaiting full numbers, but Altice International released their preliminary numbers and call yesterday. With the general consensus that Altice International will sell the Portuguese business, there is limited impact on trading levels from these numbers.  Following the new Term Loan in October last year and private placement of additional 2027 notes, Altice International have paid down the 2025 bonds and RCF drawings, leaving no major maturities until 2027 (the new notes).  Leverage remains above 4.5x with management guiding growth YoY for FY24 revenue and EBITDA, with Operating FCF in excess of €1bn.  Note, the Company intend to make a “small - less than prior years average of €600m” dividend to parent, which will leave leverage in the 4.0 - 4.5x range.  

With the Senior bonds trading inside 6.5% and Subs trading inside 8%, the bonds reflect the M&A activity in the sector versus the underlying leverage. Company expect to update the market on the sales process at the Q1 numbers.  Separately, the Altice UK loan, due to mature in October was extended to October 2026. We hold a sizeable 5% position in the 28s and are beginning to think of an exit as they are entering the 90s.