Iceland - comment

Iceland’s numbers are out this morning and strong as expected.  Sales £20m lower than our model, but Gross Profit and Operating cashflow in line. Gross Profit margin is up 2 percentage points to 5.2% YTD versus prior year, reflecting top-line sales of 5% growth, energy reduction offset by some investment in price.  Leverage has fallen to 4.4x (3.9x under previous FRS 102 accounting)  Call is at 2 pm UK time but overall these numbers are in line with our projections.  The only caveat is we had a slightly higher EBITDA under FRS 102 accounting than reported.  

Separately, the CEO, and part owner, sold £1.5m of 2028 bonds during the quarter.  We had expected the Company to buy some bonds during Q3, as they have ample cash (£146m) on the balance sheet.