Lowell - 3 points confirmed
All,
Please refer to our still unchanged analysis here.
We were again unable to ask questions on the call, but DB asked the two most pertinent anyway. Overall management confirmed three important points today:
1) The company did not immediately after the refinancing come out with bad news. We did not think they would so soon, but we do somewhat suspect that to happen on the next call, however, which would bring the company in line with other players in the market.
2) Management made clear that the equity injection is to remain in the company. We have had no doubts around that point, but it was heatedly debated in the market.
3) Management failed to deny that it had sold NPLs or otherwise sold assets. The rate of collection is curiously accelerating and we too are concerned that the company has been changing the way it is monetising the portfolio. Failure to deny the asset sales does not immediately mean that asset sales have been responsible for the shift we are observing, but in absence of an alternative explanation, we remain concerned that current Cash EBITDA levels and the ERC book are being increasingly inflated.
Please reach out to discuss.
Wolfgang
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E: wfelix@sarria.co.uk
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