Del Monte Pacific

[CityFarmer]

As a CFO of the company, he should be one of the key people to drive the recent M&A. The change will allow him to focus on few important functions during this period...

(not vested)

Del Monte Pacific names incumbent CFO as new Chief Corporate Officer

SINGAPORE (Sept 21): Del Monte Pacific's incumbent chief financial officer (CFO), Ignacio Carmelo O Sison, has now assumed his new role as the chief corporate officer (CCO).

Sison will primarily be in charge of corporate and strategic planning, enterprise risk management, investor relations and corporate sustainability following his promotion on Monday.

He will also be responsible for Del Monte's corporate governance for the Singapore Exchange, Philippine Stock Exchange and Philippine Securities and Exchange Commission.
...
http://www.theedgemarkets.com/sg/article...te-officer

[white collar]

Company took a tiny tiny 5th nibble. A 5th Share buyback 63,000 share @ S$0.295 since the takeover.
http://infopub.sgx.com/Apps?A=COW_CorpAn...95e3926629

[white collar]

Fantastic fantastic set of results released this morning - Link - http://infopub.sgx.com/FileOpen/DMPL_2Q_...eID=381731

In short, company has now turned profitable and gearing has fallen to a much more comfortable level of 5.5X. Operating cash flow has improved tremendously but it is still negative attributed primarily to inventory building (working capital requirements). $332mn of new debt added to the balance sheet in H1'16. All debts have bullet repayment profile at end of term.

Will dig deeper into the numbers of course but YAY

[testwrite]

i am from a negative supporter of this counter to a supportor, just bought some at price of 0.34, the result is surprisingly well, it is so over leverage and it can still make reasonable profit, given at the very high current leverage, if there can produce consistent result, it will be an exceptional stock, let see how it will unfold

[cif5000]

I couldn't find the requirement to half the debt before dividend can be paid.

Banking loan covenants would require certain debt service coverage ratio from operating cash flow. 

Looks like DMFI can start streaming up dividend much earlier than expected. 

Q2 EBITDA was US$53.4m after adjusting for one-off gain. For debt/EBITDA of less than 5.25x, DMFI needs to exceed ~US$235m or they can reduce the debt slightly (not half) at DMFI level. Not beyond reach IMO.

[white collar]

i am from a negative supporter of this counter to a supportor, just bought some at price of 0.34, the result is surprisingly well, it is so over leverage and it can still make reasonable profit, given at the very high current leverage, if there can produce consistent result, it will be an exceptional stock, let see how it will unfold

Welcome to the supporter camp! 

And congrats to those who vested in the last 12 months. The wait is starting to pay off!

Sold a small portion of my stake from today's results.... to buy bananas.

[CY09]

Decent results, operating cashflow before wc changes for HY is 90M (need to minus 20M Capex and 40 Mil interest). Converting it to full year, Del Monte will be able to generate about USD 60 Mil of free cash flow. Coupled with the recent preference share sale, del monte should be just able to pay down the term loans of US 970 mil in 2021; barring any bank's stunts (i.e. HSBC and China Fishery)

[specuvestor]

Del Monte is an interesting LBO case study for me which I didn't buy any tickets for the show.

Capex has been about halved and cashflow is hand to mouth with inventories shrunk in 3Q (end Jan as per new fiscal year). Pending the US$360m preferred perpetual to be issued in Phil which is taking longer than I expected. The LBO US biz surprisingly dipped.

They should really reward their CFO

If EBITDA stays, the ratio of debt/EBITDA is meaningless. I am taking the debt/EBITDA as an indicator, on the growth needed to clear the debt... The integration is still going-on, and synergy is the hope...

(not vested)

EBITDA can only cover interest expense means debt is not going to be repaid. Hence debt over EBITDA is just a ratio and meaningless. Unless they can swap debt for equity and cut capex it will be brinkmanship for some time, until biz improves

This is an LBO. Group EBITDA of US$21.5m can't even cover interest expense of US$23.9m is indeed worrisome with cash of just US$28.5m. Cash call have to come sooner rather than later.

[cif5000]

Final dividend of US$0.0133.

http://infopub.sgx.com/FileOpen/DMPL_4Q_...eID=410623

[white collar]

Final dividend of US$0.0133.

http://infopub.sgx.com/FileOpen/DMPL_4Q_...eID=410623

The dividends are back. Gearing is now 4.98x and there is no longer a restriction to make such distributions.
A nice LBO story showcasing how the rights issue can deleverage the strong stable cashflow company so quickly.
Kudos to the management on the debt structuring. Too clever.