El Corte Inglés issues €500 million bond issue

English court completed the placement of €500 million of senior notes, the group announced this Wednesday, highlighting that high demand received – which exceeded the offer by approximately seven times – demonstrated investor confidence in the company, which received support from both the national and international investment community.

The issue, aimed at qualified investors, was carried out for a period of seven years with a maturity date of June 2031. The bonds will bear an annual coupon of 4.25%. This is the most oversubscribed operation of a Spanish company since November 2020, with 240 investors participating. This operation represents the first bond issue to which credit agencies assigned an investment grade corporate rating. Standard & Poor’s and Fitch.

In particular, both agencies assigned El Corte Inglés an investment grade rating for the first time in its history, reflecting the group’s results for the 2023-2024 financial year announced last week, as well as the company’s efforts to reduce debt in recent years. and its “solid” financial flexibility.

The operation was developed with the support of seven placement banks: Bank of America, BNP Paribas, Crédit Agricole CIB, Deutsche Bank, JP Morgan, Grupo Santander and Société Générale, to which were added nine more participating institutions: Barclays, BBVA, CaixaBank, Citigroup, Goldman Sachs, Intesa Sanpaolo, Kutxabank-Norbolsa, Sabadell and Unicaja-Kenta Capital. Linklaters and Cuatrecasas, as well as Allen and Overy Shearman, were involved in the operation as lawyers.

The El Corte Inglés Group ended the 2023-2024 financial year (as of February 29, 2024) with global revenues of 16,333 million euros, representing an increase of 5.4% compared to the previous year, while its recurring net income increased sharply. 73.7%, up to 359 million euros, is the highest figure achieved by the company since 2009.

He net profit, For its part, it amounted to 480 million euros, which is lower than the previous year due to the lack of extraordinary income received from the operation with Mutual.

The figure is therefore not comparable to the profit for the 2022 financial year, when it increased its net profit more than sevenfold to 870 million euros, the highest figure achieved so far.

Also gross operating result (Ebitda) amounted to 1,081 million in the 2023-2024 financial year, an increase of 13.6% compared to the previous year, driven by improved profitability and improved efficiency, which helped consolidate the growth trajectory.