Flora - comment

The numbers continue to improve although deleveraging has slowed. Investors don’t appear to care, with several balance sheet refinancings/taps reducing the subordinated debt of the balance sheet to €300m of a €5.4bn debt stack. These transactions have lowered the margin on the term loans and tapped the Secured bond.  The next near-term maturity is the sub bonds in May 2026, which will be paid down from cash generation over the next year. Everything else has been pushed out to 2028. 

Leverage stands at 6.2x, down from 6.5x on December 23 and 7.2x on December 22. Investors are happy to continue clipping the coupon. We generally agree although the guidance for FY25 is a little light. Sales growth is guided at low single digit, with EBITDA flat to slight growth. We maintain our position in the Sub bonds, but the position is up for sale in favour of something more interesting.