SML - Synlait Milk Ltd

[Bikeguy]

I would expect a demand of 9-10% interest rate if convertible notes issued because Synlait has no options.

Interesting too that they talk about financial assistance from Bright Dairy but not A2, final confirmation that the latter are happy to see them go to the wall.[/QUOTE]

I don’t really understand why A2 would be happy to see SML go to the wall?
Would that not put A2 in a position (currently) of not having the manufacturing capability for the product that produces their main revenue for their main market?

[Balance]

I would expect a demand of 9-10% interest rate if convertible notes issued because Synlait has no options.

Interesting too that they talk about financial assistance from Bright Dairy but not A2, final confirmation that the latter are happy to see them go to the wall.[/QUOTE]

Who knows what kind of discussions are going on between Bright & ATM?

[Bikeguy]

Who knows what kind of discussions are going on between Bright & ATM?[/QUOTE]

Well said, this is a very symbiotic relationship and neither stand to benefit really if the other falls…
When these cards are played we are going to see what has really been going on…who ever benefits the most will show who’s pulling the strings…

[billkiapi]

seems that the Synliar and A2 relationship is broken, and it sounds like it was self inflicted. lots of assumptions out there, and we will see on Tuesday. I think we will see a great gooey mess of ego driven damage to A2 relationship but there may be a stay if execution for Synliar

[JimmyTrade]

The big reveal tomorrow!

[Newman]

The big reveal tomorrow!

The title is interesting though the article does not reveal any new information. https://www.rnz.co.nz/news/business/...t-half-results

[Sideshow Bob]

https://www.nzx.com/announcements/428830

Key financial metrics:

• Revenue up 3% to $793.5 million.
• Earnings before interest, taxes, depreciation, and amortization (EBITDA) was $19.9 million. Adjusted EBITDA was $36.1 million.
• Net loss after tax was ($96.2) million. Adjusted net loss after tax was ($17.4) million.
• Net debt up 8% to $559.0 million.
• Gross profit down 47% to $43.6 million.
• Forecast base milk price for the 2023 / 2024 season is $7.80 per kg/MS up from $7.50 per kg/MS.

Full year 2024 (FY24) guidance statement

Synlait has updated its FY24 guidance.

The previously announced guidance stated that earnings before interest, taxes, depreciation, and amortization (EBITDA) performance was expected to be broadly flat or down compared to FY23. Synlait’s FY23 EBITDA was $90.7 million.

Synlait now expects the FY24 EBITDA result to be significantly down on FY23 within the range of $45 million to $60 million, excluding a non-cash adjustment for the product costing method change of approximately $17 million.

The FY24 EBITDA result is impacted by:

• Softening demand and/or margins across all business units.
• Adverse foreign exchange and product mix.
• Increased operating expenses e.g., legal costs, inventory management, and a range of other costs.

In addition to the above, Synlait is facing material uncertainties in respect of the timings and outcomes of various deleveraging options which are currently progressing. The deleveraging options include an equity raise, a North Island strategic asset review, and the sale of Dairyworks.

The half-year financial statements further detail these material uncertainties. All shareholders are encouraged to review this disclosure in detail.

The Board and Management remain fully committed to deleveraging Synlait's balance sheet and continuing the focus on improving profitability for the balance of 2024.
The FY24 EBITDA guidance excludes all current and future impairments relating to Synlait and Dairyworks.

Conference call details:

CEO Grant Watson and CFO Rob Stowell will host a webcast briefing on the result at 11.00am (New Zealand time). Participants can register for the webcast here:
https://ccmediaframe.com/?id=SPQQa98o

[Sideshow Bob]

The banking syndicate remains supportive, with amendments confirmed:Balance sheet options narrowed Synlait well supported


• Extension of the $130 million prepayment from 28 March 2024 to no later than 15 July 2024.
• An additional $30 million of short-term funding from 28 March 2024 to 27 June 2024.
• Amendment of the shareholders’ funds covenant from $600 to $400 million (an ‘at all times’ covenant).
• Amendment of the interest cover ratio is reduced from 2.25x to 1.75x for FY24.

The Board has received a letter of support from Bright Dairy, which owns 39.01% of Synlait, that reinforces its ongoing support for the company.

[Leemsip]

wow thats terrible...
stock should seriously tank today?

[Sideshow Bob]

wow thats terrible...
stock should seriously tank today?

Tank Further.....