Rekeep - comment

The Company continues to manage its liquidity and significant working capital as it aims to deleverage before a refinancing.  Management again mentioned the potential for asset sale to aid debt reduction.  Rekeep has rearranged the FM4 fine instalment plan, extending it to May 29 (from Dec 25) and by making a payment of c. €7m has removed the penalty interest from cancelled instalments during covid.  

Adjusting for the impact of the roll-off of tax credits, adjusted EBITDA improved year on year.  Poland continues to outperform although this is hurting working capital.  As we said in our recent note, we were expecting further improvement in Working Capital in Q1.  This has happened in Italy, but due to the growth in business in Poland, overall working capital has deteriorated.  We will do further work on this point, especially concerning prospects for refinancing.  Tendering performance was a little underwhelming but the total amount of tenders still pending has nearly doubled in size, resulting from the low level of awards in Q1 in the market.