March 06, 2025 10:22 GMT
TRANSPORTATION: Air France-KLM; FY24 Results (x2)
TRANSPORTATION
(NR/BB+/BBB-) (Equiteis +21%)
An edit we do see supply coming - if not for the matured €500m Jan line, for hybrid refi (into normal bonds). It has a €500m 2022 issued hybrid on a 6% coupon that will step-up in July - it can redeem them at any time from then and indication in earnings call is it will refi.
Guided earnings growth will move it below 1.5-2.0x target on current debt load so it has room for the above. Another €0.5b steps and is callable from July 2026 (on a 6.9% coupon currently) and another €1.5b on a Nov-27 call (paying 6.4% currently).
It's paying avg. €230m/6.4% on the €3.6b hybrid stack that is equity under IFRS vs. €57m/3.6% on the €1.6b vanilla bonds. Neither S&P nor Fitch give equity treatment.
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