Three things you need to know in the financial markets this morning from investment writer, Tony Cross
There’s a pre-close trading update out from the AA this morning. Headline guidance puts EBITDA in the upper half of the previously ascribed range and there are no surprises in the statement. There’s even a nod to the PM at one point, with the company heralding it’s ‘Strong and stable’ cash conversion rate. The number of motor insurance policies written is up an impressive 16%, whilst the 2% decline in paid personal roadside assistance memberships was largely accounted for already.
Transport operator Stagecoach has a note out this morning, stating that it has been awarded a short term extension rail franchise for East Midlands Trains. It’s only for the period from March to August, although could see a further 24 weeks added. The company is quick to point out that revenue risk is weighted towards the Department for Transport.
Debenhams has updated the market this morning on both a new supply sourcing partnership, but perhaps more critically new debt financing details. The latter provides £40m worth of liquidity, charged at LIBOR plus 5%, or just over 6% in total. The pricing could be dialled up in Q2, but given the distressed state of the company, such a rate could be seen as attractive for providing a little extra headroom.