GCR takes cognisance of significant revenue growth in FY21, peaking at N437.3bn over the review period. The growth was underpinned by stronger volumes in premium brands and inflation induced price increases. This notwithstanding, the EBITDA margin moderated by 2 percentage points to 18% in FY21, due to rising input costs and exacerbated by lingering forex challenges, albeit remaining in line with peer average. GCR anticipates 15% revenue growth in FY22 and 20% in FY23, supported by higher volumes from the optimal capacity expansion of the brewing plants and continued price increases.
The competitive position remains a positive rating factor, given MTN Nigeria’s deep market penetrating capabilities, rapidly growing network infrastructure, and strong subscriber base. As of June 2022, MTN Nigeria remains the leading mobile operator and provider of communication services in Nigeria, accounting for 38.4% of Nigeria’s GSM subscriber base. The competitive position is further supported by our expectation that the Nigerian telecoms sector will remain resilient in 2022 in terms of earnings and margins, despite the increasingly volatile operating environment. GCR expects the Company’s competitive position to be sustained over the medium term by strong customer acquisition, revenue generation, cost flexibilities and continuous expansion of network infrastructure.
Fox Street 6 (RF) Ltd (“Fox Street 6”, “the Issuer” or “the Transaction”) is a Residential Mortgage-Backed Securities (“RMBS”) securitisation of home loans originated by Investec Bank Ltd (“Investec”) to its private banking clients. This is Investec’s sixth Fox Street RMBS transaction which issued Notes on 8 August 2018.
JSE-listed Vukile Property Fund Limited (“Vukile”) is a retail-focused REIT with a South African and Spanish asset underpin. In our analysis, we assess Vukile’s consolidated financial position in respect of its balance sheet and earnings, as its direct Spanish portfolio is held through its 89.6% stake in Castellana Properties SOCIMI SA ("Castellana"), listed on the Spanish Alternative Stock Exchange ("MAB"). During FY22, Castellana acquired a 21.7% shareholding in Lar Espana Real Estate SOCIMI, S.A. (“Lar Espana”), a Spanish retail-focused REIT (with GVA of €1.4bn) externally managed by Grupo Lar. The REIT also holds non-strategic stakes in Fairvest Limited (JSE listed REIT) and a small Namibian portfolio.
The Dashboard exhibits performance metrics related to the South African Securitisation Programme (RF) Ltd – Series 1 transaction, which include credit enhancement levels, excess spread, defaults, recoveries and covenants. Click here for rating reports.
The Company has sustained a strong earnings trajectory over the review period. Revenue almost doubled to 21bn in FY21 (FY20: N11bn) outperforming budget of N17. 9bn. This was underpinned by growing customer patronage and higher prices across business segments. Despite persistent inflationary pressure and the recent surge in energy cost, efficient cost control saw EBITDA margin improve to 18.6% in FY21 and 26% during 1Q FY22 (FY20:17.8%). As Sundry Foods continues to build scale, GCR anticipates revenue growth of 35% for FY22 and 40% for FY23 as evidenced by the 1Q FY22 performance.
The Dashboard exhibits performance metrics related to the MW Asset Rental (RF) Ltd transaction, which include credit enhancement levels, excess spread, defaults, recoveries and covenants. Click here for rating reports.
MUA Uganda was established in 2003 as Phoenix of Uganda Company Limited, with the insurer’s portfolio comprising of short-term insurance offerings. Initially part of the group Phoenix of East Africa Assurance Company Limited, MUA Uganda became ultimately owned by listed Mauritius Union Assurance (“MUA Mauritius”), through the acquisition of Phoenix Trans Africa Holdings Limited (“PTHL”), later rebranded to MUA Trans Africa Holdings Limited. This wholly owned subsidiary of MUA Mauritius retains 66.0% of MUA Insurance (Kenya) Limited (“MUA Kenya”), the largest shareholder of MUA Uganda, with a 62.0% interest. Phoenix of Tanzania Assurance Company Limited, a related party, holds a further 13.6%, with the balance held by local individual investors.
Earnings is considered neutral to the ratings. Sundry Markets has maintained good revenue trajectory over the review period. Revenue rose significantly by c.66% to N33.6bn in FY21 (FY20: N20.2bn) well above its revenue forecast underpinned by rapid store expansion, increasing patronage across its existing stores as well as growing corporate clientele. The robust revenue position serves as a buffer against the persistent inflationary pressures particularly on operating costs.
The Dashboard exhibits key performance metrics related to the South African Securitisation Programme (RF) Ltd – Series 2 transaction, which include credit enhancement levels, excess spread, defaults, recoveries and covenants. Click here for rating reports.