BRIEF: EC Approves Italy's 5th NGEU Payment Request For EUR11 billion

MNI BRIEF: ECB's Eye On French Markets, Price Stability Key

MNI BRIEF: Lower Inflation Path Remains Bumpy - Lagarde

MNI BRIEF: 'Noise' Driving Economic Deterioration- Campos Neto

MNI China Daily Summary: Tuesday, July 2

MNI BRIEF: China Aims For AI Standards By 2026

MNI: US BLS: JOLTS QUITS RATE 2.2% IN MAY

MNI: US BLS: JOLTS OPENINGS RATE 8.140M IN MAY

MNI: US REDBOOK: JUN STORE SALES +5.6% V YR AGO MO

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

DCC Group (DCCLN NR/BBB/BBB): New Issue FV Analysis

CREDIT SUPPLY
Credit BulletsBulletHomepagemarkets-real-timeCreditDCC plc (DCC) Market News
  • Predominantly an energy (solutions plus mobility) business, pass through pricing so no direct exposure to commodity prices.
  • 74% of the profit from energy segment, of which 35% and growing comes from renewables. Margins have been quite stable suggesting the transition isn’t hurting profitability.
  • Low EBITDA margin business (4.6%).
  • Roadshow presents leverage as 0.9x; lease adjusted is 1.4x, however. Committed to IG rating.
  • £1.1bn in cash, £800mn RCF for total liquidity of £1.9bn. Debt including leases is £2.2bn.
  • FCF / Net Debt at 48%, with historically good cash flow conversion.
  • Historically active in bolt-on acquisitions with a good track record.
  • ATDBCN 3.647 05/31 (Baa1/BBB+) trades at Z+90. If we apply a 30bp discount conservatively for one notch, FV is 120bp area. The main negative is the low margins but looks like a reasonable credit overall.
134 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
  • Predominantly an energy (solutions plus mobility) business, pass through pricing so no direct exposure to commodity prices.
  • 74% of the profit from energy segment, of which 35% and growing comes from renewables. Margins have been quite stable suggesting the transition isn’t hurting profitability.
  • Low EBITDA margin business (4.6%).
  • Roadshow presents leverage as 0.9x; lease adjusted is 1.4x, however. Committed to IG rating.
  • £1.1bn in cash, £800mn RCF for total liquidity of £1.9bn. Debt including leases is £2.2bn.
  • FCF / Net Debt at 48%, with historically good cash flow conversion.
  • Historically active in bolt-on acquisitions with a good track record.
  • ATDBCN 3.647 05/31 (Baa1/BBB+) trades at Z+90. If we apply a 30bp discount conservatively for one notch, FV is 120bp area. The main negative is the low margins but looks like a reasonable credit overall.