Bortex Group Finance plc - Updated Financial Analysis Summary

On 26 April 2021, Bortex Group Finance plc published an updated Financial Analysis Summary (“FAS”) providing an overview of the company’s and the guarantor’s (namely Bortex Group Holdings Co Ltd) financial results in 2020, a comparison of the 2020 actual results with the forecasts published in the previous FAS dated 30 June 2020, as well as the forecasts for the current financial year ending 31 October 2021.

The following are the main highlights of the expected financial performance and financial position of Bortex Group Holdings Co Ltd in 2021:

  • Revenues are anticipated to drop by 6.4% (or -€1.4 million) to €20.9 million reflecting the significantly lower expected income from the sale of the remaining five units at the ‘TEN Apartments’ project in Sliema. On the other hand, although the Group is projecting a rebound in revenue from its apparel segment (+18.7%) and hotel operations (+30.2%), their contributions are expected to remain below pre-pandemic levels.
  • Cost of sales are expected to decline by 6.8% to €15.1 million whilst operating expenses are also projected to drop by 16.2% to €3.6 million. Nonetheless, the Group is anticipating a 31.8% decline in normalised EBITDA (i.e. when excluding the impact of the losses of the operations in Tunisia) to €2.5 million compared to €3.6 million in FY2020. The Group is forecasting an EBITDA of €1.0 million from the sale of the remaining units within the ‘TEN Apartments’ project, and an EBITDA of €1 million and €0.5 million from the apparel and hospitality segment respectively.
  • Total borrowings are forecasted to ease by €2.6 million to €24.8 million when including lease liabilities amounting to €5.1 million. Similarly, net debt is anticipated to decline to €22.5 million (31 October 2020: €26.1 million), largely reflecting the forecasted repayment of €2.1 million in short-term borrowings and the expected improvement in the Group’s cash balance to €2.3 million from €1.4 million as at 31 October 2020 following the sale of the aforementioned remaining units at the ‘TEN Apartments’ project.
  • The gearing ratio (calculated as total debt divided by total debt plus equity) is anticipated to decrease slightly to 49.3% (31 October 2020: 50.7%). On the other hand, the Group’s net debt to EBITDA multiple is expected to weaken from 7.2 times in 2020 to 9.1 times in 2021 whilst the interest cover is also expected to deteriorate from 3.5 times in 2020 to 1.6 times in 2021.
  • In a separate company announcement issued on 23 April 2021, the Group explained that its subsidiary ‘Bortex Tunisie Sarl’ is currently in the process of being liquidated. This decision was taken in order to stem losses which had been mounting since the onset of the pandemic and also in view of the rapidly degenerating political and socio-economic situation in the country.

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Bortex Group Finance plc – Financial Analysis Summary dated 26 April 2021.

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