The Lemon Fool

This Retail bond is due for maturity in 9 months, and is currently showing a mid price of 92.83 (91.65-94.00)
Based on a possible purchase at 93.50, this is showing a yield to my calculation of 13.5% which seems relatively high for a maturing bond.

I appreciate that the ord shareholders have had a bad time over the past few months, priced 27.98, giving market value of around £146m
I understand that although a Senior bond, it has no specific security over any of the properties
Current LTV as per 30th June accounts is 51.9%
Many of the debt covenants indicate a max of 60%, with management aiming for 40% (as per original prospectus)
Most of the debt is at around 3.5%, with maturities 2025-26

I'm a current holder since the original offer back in August 2018, planning to hold to maturity
Held a good number of Retail Bonds, Prefs over the past 14 years, although diminishing over the past 5 years due to lack
of retail bonds woth good security (last purchase was RMBI earlier this year)

Are there any other specific risks or information to this security?

I note from today's Q4 Trading Update that "The Company is actively exploring a range of refinancing options for the retail bond given its near-term maturity date". Bearing in mind that the maturity date is now only about 6 months away am I the only one worrying a little that they are still "exploring" options?

geoffp wrote:I note from today's Q4 Trading Update that "The Company is actively exploring a range of refinancing options for the retail bond given its near-term maturity date". Bearing in mind that the maturity date is now only about 6 months away am I the only one worrying a little that they are still "exploring" options?

Loan covenant breach looks pretty likely perhaps before the retail bond maturity. Medium term future of this company looks doubtful to me.

BullDog wrote:

geoffp wrote:I note from today's Q4 Trading Update that "The Company is actively exploring a range of refinancing options for the retail bond given its near-term maturity date". Bearing in mind that the maturity date is now only about 6 months away am I the only one worrying a little that they are still "exploring" options?

Loan covenant breach looks pretty likely perhaps before the retail bond maturity. Medium term future of this company looks doubtful to me.

Not sure on your view re "Loan covenant breach looks pretty likely perhaps before the retail bond maturity"

Statement March 2023 = Net loan-to-value ratio was 49.5% (2021: 42.4%); ample headroom remains on all loan covenants.
My understanding is that Loan Covenant Breach is at 60% ?

31st December 2023 = Net loan-to-value ratio 55.1% (2022: 49.5%)