NEW LOOK SENIOR ISSUER PLCLS-NOTES 2015

Anyone have any information/thoughts on this. Price seems depressed and as such the yeild is high............I guess there must be problems?

Comments

  • Hi Paul

    New Look is suffering from the same malaise that is affecting all traditional brick and mortar retailers and their need to migrate to multi channel retailing, specifically online purchases. Couple to this that 'fashion' is by it name sake fickle and subjective and you can see the problem.

    Sales for the last FY are down circa 36M. Similarly it would appear that chasing sales has resulted in margins being reduced to around 10% and with profits decreasing by around a third to £97M

    Not all bad news as overseas sales continue to grow and as this is achieved in most markets by a franchise arrangement capital cost requirement is low. Similarly online sales in the last quarter of 2016 were up by around 20% and with third party online retailing showing growth of around 75%

    Not certain which senior issue that you are referring to; (maturing July 2022 XS1248516616 ?). If so, you are right the yield is currently at around 13.5%. More details are contained below

    https://www.wisealpha.com/loan/detail/13/newlook2022

    Not to dissimilar to Matalan. After a number of poor trading years the bond ( XS1070708349 6.88% - Maturing Jun 2019) was as recently as May of this year available on WiseAlpha for just shy of a YTM of 15%.

    https://www.wisealpha.com/loan/detail/31/mata

    However improvements towards the end of 2016 and a rise in sales in Q1 of 2017 means that the same bond as of today has a YTM of only 8.7%

    http://www.telegraph.co.uk/business/2017/07/10/matalan-inches-retail-gloom-lift-sales/

    Very much a case of weighing up the risk v reward and if you think established high street retailers have got it in them to adapt and evolve.

    One final point Paul, and something you might have already noted. As both of these are senior secured loans, access is usually restricted to institutions/high net worth individuals and in multiples of £100k. For retail scale investments currently only WiseAlpha has access to this form of debut and via notes issued against one or other specific senior or high yield loan


  • Arthgoch.............thanks for the information. The note is XS1248518158. The yield looks to be in the late 20's.............and I guess for that sort of yield one would expect to take on some risk.
  • edited January 4
    OK this bond is now hovering around 20, which means in they pay their biannual coupons ( one of which has just been paid) its yielding 70%!?
    Aside from a poor trading environment I haven't managed to find anything that suggests the company is in such a poor financial position that its debt should be at 20p in the pound? Anyone got any thoughts?
  • edited January 4
    I think they may have had a early redemption offer and then listed on TISE
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