London, 30 November 2012 -- Moody's Investors Service has downgraded the ratings of notes issued by Punch Taverns Finance plc ("Punch A") and Punch Taverns Finance B Limited ("Punch B").
Issuer: Punch Taverns Finance plc
....GBP270M A1(R) Notes, Downgraded to Baa3 (sf); previously on Apr 5, 2011 Downgraded to Baa1 (sf)
....GBP300M A2(R) Notes, Downgraded to Baa3 (sf); previously on Apr 5, 2011 Downgraded to Baa1 (sf)
....GBP200M M1 Notes, Downgraded to B1 (sf); previously on Apr 5, 2011 Downgraded to Ba1 (sf)
....GBP400M M2(N) Notes, Downgraded to B1 (sf); previously on Apr 5, 2011 Downgraded to Ba1 (sf)
....GBP140M B1 Notes, Downgraded to Caa1 (sf); previously on Apr 5, 2011 Downgraded to Ba3 (sf)
....GBP150M B2 Notes, Downgraded to Caa1 (sf); previously on Apr 5, 2011 Downgraded to Ba3 (sf)
....GBP175M B3 Notes, Downgraded to Caa1 (sf); previously on Apr 5, 2011 Downgraded to Ba3 (sf)
....GBP215M C(R) Notes, Downgraded to Caa3 (sf); previously on Apr 5, 2011 Downgraded to B3 (sf)
Issuer: Punch Taverns Finance B Limited
....GBP201M A3 Notes, Downgraded to Ba2 (sf); previously on Apr 5, 2011 Downgraded to Baa3 (sf)
....GBP220M A6 Notes, Downgraded to Ba2 (sf); previously on Apr 5, 2011 Downgraded to Baa3 (sf)
....GBP250M A7 Notes, Downgraded to Ba2 (sf); previously on Apr 5, 2011 Downgraded to Baa3 (sf)
....GBP250M A8 Notes, Downgraded to Ba2 (sf); previously on Apr 5, 2011 Downgraded to Baa3 (sf)
....GBP77.5M B1 Notes, Downgraded to B3 (sf); previously on Apr 5, 2011 Downgraded to Ba3 (sf)
....GBP125M B2 Note, Downgraded to B3 (sf); previously on Apr 5, 2011 Downgraded to Ba3 (sf)
....GBP125M C Notes, Downgraded to Caa3 (sf); previously on Apr 5, 2011 Downgraded to B3 (sf)
The A3 (sf) ratings of the liquidity facilities in both transactions are unaffected by today's action.
Moody's does not rate the Class D1 Notes issued by Punch A. The ratings of the Class A2(R) Notes, Class M2(N) Notes and Class B3 Notes of Punch A are based on the underlying rating of the notes and are no longer based on the financial guarantee policy provided by AMBAC Assurance UK Limited (rating withdrawn). The ratings of the Class A7 and Class A8 Notes of Punch B are based on the underlying rating of the notes and are no longer based on the financial guarantee insurance policy issued by MBIA UK Insurance Limited (B3).
Punch A and Punch B represent whole-business securitisations (WBS) of portfolios of 2,604 and 1,850 leased pubs (as of Q4 2012) respectively, located across the UK. Punch A closed in March 1998 and has been subject to tap issuances in October 2000, November 2003 and July 2007 whereas Punch B closed in November 2002 and was restructured in August 2005.
The downgrade of the Notes reflects Moody's concerns on the deteriorating operating conditions in the UK pub industry and the persistently high leverage of the underlying securitisations. Moody's believes that the parent company's (Punch Taverns plc) plans to sell the non-core pubs in the underlying portfolios (32% of the portfolio in Punch A; 39% of the portfolio in Punch B by number of pubs) carries execution risk and will likely not be sufficient to manage the required debt repayment over time. Further, Moody's believes that the total leverage in the transactions will increase in the near term as the parent company plans to utilise a portion of the disposal proceeds for investing into the core estate to stimulate growth in the long term rather than prepaying debt.
With a current underlying EBITDA of GBP 145 million in Punch A and GBP 91 million in Punch B for FY 2012, the debt service coverage ratio (DSCR) in both securitisations would have been below the default covenant (1.25x) had the parent company not provided external cash support. During the financial year, total support amounted to GBP 79 million compared with approximately GBP 69 million in the previous year (+14%). Excluding the support to the portfolios' EBITDA, the DSCR for the quarter ended in Q4 2012 and for the rolling four quarters would have been 1.08x for Punch A whilst the same ratios would have been 1.07x and 1.04x respectively for Punch B.
Moody's expects that the cash flows from the portfolios will decline further in 2013, by approximately 7% from the trailing twelve month (TTM) EBITDA as of Q4 2012 and stabilise in 2013. As in its previous analysis, Moody's expects that an event of default will materialise under the Issuer-Borrower loan agreement in each of the transactions if and when the parent company stops its support. In the parent company's view, restructuring of both securitisations is required to avoid covenant defaults and deliver value to their stakeholders. Importantly, the parent company views both transactions, which securitises substantially all their pub estate, as over levered, unsustainable and in need of significant amendments. Moody's understands that the aim of the company is to achieve a consensual restructuring with their various stakeholders. At this time, the timing and terms of a likely restructuring are unknown to Moody's.
Primary sources of assumption uncertainty in relation to today's rating actions are (a) the current stressed macro-economic environment and (b) the viability of the UK pub industry which drive the operations of the borrowers in both transactions. Moody's assessment of these whole business securitisations relies on the structural and legal integrity of the transactions; in particular its assumption that the borrowers could be replaced by alternative operators in case of insolvency or default under their obligations. A deviation from this scenario whereby the assets and businesses of the borrowers would be liquidated in a shorter term or any other amendments to the current structures which would result in a change of the economic benefit to the noteholders will require Moody's to review its rating of the notes.
MOODY'S PORTFOLIO ANALYSIS
During FY 2012, the borrower under the Punch A portfolio sold 272 pubs (9% of the portfolio) and the total portfolio EBITDA (excluding parent support) declined by 9% to GBP 145 million. A total of GBP 49 million of debt (3%) was repaid in the financial year and as of end of Q4 2012, GBP 105 million was held as cash within the securitisation. As for Punch B, the borrower sold 189 pubs during the past year and the total portfolio EBITDA (excluding parent support) declined by 9% to GBP 91 million. A total of GBP 39 million of debt (4%) was repaid in the financial year and as of end of Q4 2012, GBP 69 million was held as cash within the securitisation.
While the parent company was able to achieve the book value on the disposals to-date, its target to dispose of c. 400 non-core pubs per annum over the next 3-4 years remain questionable to Moody's. Moody's is cautious with respect to achievement of certain price targets and the timing of the future disposals due to the increasing number of pub sales in the market combined with the lack of available funding for interested purchasers. As part of the company's strategy to drive growth in the core estate, among other initiatives, the parent company plans to spend approximately GBP 40 million (100k per pub) per annum over the next five years. Moody's understands that the return on such investments exceed the required hurdles. However, the long term positive effects are uncertain to Moody's especially considering the changing business risk profile for some of the tenants who will focus on increasing food sales. The pubs should become more resilient to the declining beer sales and improve their value proposition over time, but at the same time will be exposed to more price-elasticity and direct competition with the restaurant industry.
Given the adverse cash flow profiles of the pub portfolios combined with the weak credit strength of the pub operator, Moody's put considerable weight on the leverage of the notes when determining its ratings. In Moody's opinion, the current value of the pub portfolio in Punch A is approximately GBP 1.35 billion and in Punch B is GBP 861.6 million. The 11-13% haircuts to the book values of the portfolios stem from Moody's expectation of further cash flow declines to approximately GBP 135 million for the Punch A portfolio and GBP 86 million for the Punch B portfolio, and the overall weak state of the UK pub sector together with the low level of transactional activity. The downgrade of all notes today takes into account the leverage of the notes including the senior ranking swap mark-to-market (MtM) exposures associated with the floating rate notes in the transactions. In most of our scenarios, however, we do not assume the full MtM would crystallise. In Moody's opinion and in light of the pending restructuring, the likelihood of principal losses for the junior notes in both securitisation have increased since Moody's last review.
The principal methodology used in these ratings was Moody's Approach to UK Whole Business Securitisations published in October 2000. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.
In this approach, a sustainable annual free cash flow is derived over the medium to long term horizon of the transaction, and then multipliers are applied to such cash flows in order to reach the debt which could be issued at the targeted long-term rating level for the Notes. In addition, we look at various haircuts on the pub values and consider different levels of swap MtM. As such, Moody's analysis encompasses cash flow analysis and stress scenarios.
The updated assessment is a result of Moody's on-going surveillance of commercial mortgage backed securities (CMBS) transactions. Moody's prior assessment is summarised in a press release dated 5 April 2011. The last Performance Overview for the affected transactions were published on 19 June 2012.
For ratings issued on a program, series or category/class of debt, this announcement provides relevant regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides relevant regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides relevant regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
The ratings have been disclosed to the rated entities or their designated agent(s) and issued with no amendment resulting from that disclosure.
Information sources used to prepare each of the ratings are the following: parties involved in the ratings and public information.
Moody's did not receive or take into account a third party assessment on the due diligence performed regarding the underlying assets or financial instruments related to the monitoring of these transactions in the past six months.
Moody's considers the quality of information available on the rated entities, obligations or credits satisfactory for the purposes of issuing these ratings.
Moody's adopts all necessary measures so that the information it uses in assigning the ratings is of sufficient quality and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources. However, Moody's is not an auditor and cannot in every instance independently verify or validate information received in the rating process.
Moody's Investors Service may have provided Ancillary or Other Permissible Service(s) to the rated entities or their related third parties within the two years preceding the credit rating action. Please see the special report "Ancillary or other permissible services provided to entities rated by MIS's EU credit rating agencies" on the ratings disclosure page on our website www.moodys.com for further information.
Please see the ratings disclosure page on www.moodys.com for general disclosure on potential conflicts of interests.
Please see the ratings disclosure page on www.moodys.com for information on (A) MCO's major shareholders (above 5%) and for (B) further information regarding certain affiliations that may exist between directors of MCO and rated entities as well as (C) the names of entities that hold ratings from MIS that have also publicly reported to the SEC an ownership interest in MCO of more than 5%. A member of the board of directors of this rated entity may also be a member of the board of directors of a shareholder of Moody's Corporation; however, Moody's has not independently verified this matter.
Please see Moody's Rating Symbols and Definitions on the Rating Process page on www.moodys.com for further information on the meaning of each rating category and the definition of default and recovery.
Please see ratings tab on the issuer/entity page on www.moodys.com for the last rating action and the rating history.
The date on which some ratings were first released goes back to a time before Moody's ratings were fully digitized and accurate data may not be available. Consequently, Moody's provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.
Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.
Deniz Yegenaga Asst Vice President - Analyst Structured Finance Group Moody'sInvestors Service Ltd. One Canada SquareCanary WharfLondon E14 5FA United Kingdom JOURNALISTS: 44 20 7772 5456 SUBSCRIBERS: 44 20 7772 5454 Christophe de Noaillat Associate Managing Director Structured Finance Group JOURNALISTS: 44 20 7772 5456 SUBSCRIBERS: 44 20 7772 5454 Releasing Office: Moody's Investors Service Ltd. One Canada SquareCanary WharfLondon E14 5FA United Kingdom JOURNALISTS: 44 20 7772 5456 SUBSCRIBERS: 44 20 7772 5454 (C) 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved.
CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. ("MIS") AND ITS AFFILIATES ARE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND CREDIT RATINGS AND RESEARCH PUBLICATIONS PUBLISHED BY MOODY'S ("MOODY'S PUBLICATIONS") MAY INCLUDE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY'S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY'S OPINIONS INCLUDED IN MOODY'S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. CREDIT RATINGS AND MOODY'S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY'S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY'S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY'S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY'S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.
ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED,DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT.
All information contained herein is obtained by MOODY'S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided "AS IS" without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY'S is not an auditor and cannot in every instance independently verify or validate information received in the rating process. Under no circumstances shall MOODY'S have any liability to any person or entity for (a) any loss or damage in whole or in part caused by, resulting from, or relating to, any error negligent or otherwise or other circumstance or contingency within or outside the control of MOODY'S or any of its directors, officers, employees or agents in connection with the procurement, collection, compilation, analysis, interpretation, communication, publication or delivery of any such information, or (b) any direct, indirect, special, consequential, compensatory or incidental damages whatsoever (including without limitation, lost profits), even if MOODY'S is advised in advance of the possibility of such damages, resulting from the use of or inability to use, any such information. The ratings, financial reporting analysis, projections, and other observations, if any, constituting part of the information contained herein are, and must be construed solely as, statements of opinion and not statements of fact or recommendations to purchase, sell or hold any securities. Each user of the information contained herein must make its own study and evaluation of each security it may consider purchasing, holding or selling.
NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY'S IN ANY FORM OR MANNER WHATSOEVER.
MIS, a wholly-owned credit rating agency subsidiary of Moody's Corporation ("MCO"), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MIS have, prior to assignment of any rating, agreed to pay to MIS for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and procedures to address the independence of MIS's ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading "Shareholder Relations -- Corporate Governance -- Director and Shareholder Affiliation Policy."
Any publication into Australia of this document is by MOODY'S affiliate, Moody's Investors Service Pty Limited ABN 61 003 399 657, which holds Australian Financial Services License no. 336969. This document is intended to be provided only to "wholesale clients" within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY'S that you are, or are accessing the document as a representative of, a "wholesale client" and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to "retail clients" within the meaning of section 761G of the Corporations Act 2001.
Notwithstanding the foregoing, credit ratings assigned on and after October 1, 2010 by Moody's Japan K.K. ("MJKK") are MJKK's current opinions of the relative future credit risk of entities, credit commitments, or debt or debt-like securities. In such a case, "MIS" in the foregoing statements shall be deemed to be replaced with "MJKK". MJKK is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly owned by Moody's Overseas Holdings Inc., a wholly-owned subsidiary of MCO.
This credit rating is an opinion as to the creditworthiness or a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be dangerous for retail investors to make any investment decision based on this credit rating. If in doubt you should contact your financial or other professional adviser.
Nachrichten zu Punch Taverns PLC Unsponsored American Deposit Receipt Repr Shs
- vom Unternehmen
- Peer Group
Eventuell finden Sie Nachrichten, die älter als ein Jahr sind, im Archiv
Relevant: Nachrichten von ausgesuchten Quellen, die sich im Speziellen mit diesem Unternehmen befassen
Alle: Alle Nachrichten, die dieses Unternehmen betreffen. Z.B. auch Marktberichte die außerdem auch andere Unternehmen betreffen
vom Unternehmen: Nachrichten und Adhoc-Meldungen, die vom Unternehmen selbst veröffentlicht werden
Peer Group: Nachrichten von Unternehmen, die zur Peer Group gehören
Analysen zu Punch Taverns PLC Unsponsored American Deposit Receipt Repr Shs
Mehr zur Punch Taverns-Aktie
Heute im Fokus
Obama lobt Kongress-Pläne zu Handelsabkommen TTIP. G20 kritisieren USA wegen IWF-Stimmrechtsblockade. Nächster Paukenschlag in Pharmaindustrie möglich: Teva erwägt Mylan-Kauf. Fresenius verhandelt über Zukauf in Israel. G20-Finanzminister optimistischer über Weltwirtschaft. Merkel sieht perspektivisch Freihandelszone mit Russland. Obama ermahnt Griechenland zu Reformen. US-Autobauer Ford investiert Milliarden in Mexiko. Auswärtiges Amt bringt Deutsche aus Jemen in Sicherheit.
Diese Aktien sind auf den Kauflisten der Experten
Die besten Flughäfen der Welt
Welche Startups werden von Investoren am höchsten bewertet?