RAC conference call - upbeat call, likely larger dividend to shareholders

All,

RAC results had been already released end of February, so there were no fundamental new news from the conference call.  

Positive:

Management were very upbeat and momentum within the business is strong.  Already started to mention refinancing of the Class B notes, but acknowledged they have time (maturity Nov-22).  The Company have not bought back any Class B notes.  Negative:Likelihood of a larger dividend from free cashflow to be paid out. Management having discussion with sponsors in relation to size. Leverage should be looked upon as gross, as the unrestricted cash will be used for dividend.  Gross leverage through the Class B notes is 6.67x. (Net 6.3x)

Given the momentum and overall security package we remain positive on the Class Bs at 96% or 6.7% YTW. 
Due to the subscription based model, impact of coronavirus is likely to be minimal.  Any questions, please call.