Our 'BBB+' issuer and issue ratings for Vacse AB are unchanged following the publication of its Q1 2019 financial report.
Results as expected
The Q1 2019 report for Vacse is in line with our expectations. The company reports that increased interest in community services has led to an unrealised increase in property value for the first quarter of SEK 57.4m resulting in a slightly lower than expected loan to value ratio of 41.2%.
Thus far in 2019, Vacse has entered into two new agreements; a 20-year contract commencing in the summer of 2022 for the Courts Administration and a 25-year contract with municipality of Öckerö for the primary school which commences in 2021.
Stable financial position
During the quarter, Vacse has expanded its floating rate note maturing in 2023 by SEK 300m and redeemed SEK 280m of its two outstanding bonds which mature in 2019. Outstanding bonds and commitments for planned acquisitions amount to a total funding need of SEK 625m. The company proposed its first dividend payout of SEK 70m to its owners resulting in total expenses of SEK 700m during second quarter 2019. This compares to SEK 550m in revolving credit facilities available and SEK 134m in liquid funds. Vacse's Q1 results support our expectations of the company's continued stable cash flow generation.
This commentary does not reflect a rating action.
For more information, please contact:
Michael Andersson, +46 732 32 43 22, michael.andersson@nordiccreditrating.com
Mille O. Fjeldstad, +47 99 03 89 16, mille.fjeldstad@nordiccreditrating.com