Creditreform Rating has upgraded the SME Issuer Rating of SANHA GmbH & Co. KG from CCC to B-. The outlook is stable.
Against the background of the expected improvement in the economic situation of SANHA GmbH & Co. KG, the positive outlook defined in last year's rating has been confirmed. In this respect, the current rating has been raised by one notch to B- with a stable outlook.
For more details regarding the rating, please refer to the rating summary below.
Creditreform Rating has confirmed the SME Issuer Rating of SANHA GmbH & Co. KG with CCC. The outlook was raised from stable to positive. The key factor for the assessment is that a new corporate situation has arisen following the full implementation of the bond prolongation on 1 July 2020. The process has a noticeable dampening effect on the rating. After a satisfactory business performance in 2019, the figures for the 2020 financial year already showed a partly significant decline in economic development compared to the previous year as a result of the economic distortions from the ongoing COVID 19 pandemic. The renewed global lockdown measures, which have been affecting the national economies to a considerable extent since autumn/winter 2020, continue to have a noticeable impact on SANHA's business development. Taking the improved financing conditions of the bond and loans granted in 2020 into account, the financing structures have been secured for the time being. However, this is also accompanied by an expansion of debt. Overall, we believe that the business situation will continue to be characterized by considerable exogenous uncertainties, especially against the background of the uncertainties arising from the further course of the COVID 19 pandemic and its impact on the economy, which will also be reflected in the 2020 figures and will also shape the 2021 figures.
Creditreform Rating has adjusted the SME Issuer Rating of SANHA GmbH & Co. KG from SD (Selective Default) to CCC with a stable outlook.
It was essential for the rating that the full implementation of the bond prolongation as of July 1, 2020 resulted in a new company situation to be assessed. This was the second bond restructuring that the company implemented within a few years out of a distressed situation at the expense of the bond creditors (1st bond prolongation took place in 2017). The process has a noticeable dampening effect on the rating. We therefore do not exclude medium and long-term adverse effects with regard to the capital market viability of SANHA GmbH & Co. KG. After a satisfactory course of business in 2019 and 1st quarter of 2020, the order intake and business figures of the company declined sharply in the second quarter of 2020, according to the management, as a result of the effects of the COVID 19 pandemic, whereby the first signs of recovery, due to the lifting of lockdown-Measures and catch-up effects, were already clear in June and, according to information, could lead to a roughly balanced half-year result. Together with improved financing terms and conditions and loans granted by Sparkasse Essen (KfW loan) and bank financing in Belgium, this counteracts a rating level below CCC. In return, the expansion of debt and the increased expenses due to the bond restructuring contribute to the current limitation of the rating. Overall, we believe that the business situation for the second half of the year, due to the uncertainties from the further course of the pandemic and its effects on the economy, will be characterized by considerable exogenous uncertainties, which is why we expect annual earnings below the previous year and a decline in internal financing power in 2020.
Creditreform Rating has downgraded the SME Issuer Rating of SANHA GmbH & Co. KG from April 7th, 2020 from C (watch) to SD as part of the monitoring process.
In the meeting on May 25, 2020, the majority of the bondholders of SANHA GmbH & Co. KG approved the restructuring concept regarding the bond 2013/23 (ISIN DE000A1TNA70), including an extension of the term of the bond by three years. With these adjustments, the bond will not be serviced on time in accordance to the original bond terms. This represents a temporary and selective default of the company in accordance with our rating methodology. Creditreform Rating will reassess the corporate rating as soon as the deadline for contesting the resolution of the second bondholders' meeting has passed and current financial and business information is available and has been assessed.
Creditreform Rating has downgraded the SME issuer rating of SANHA GmbH & Co. KG of 30.03.2020 from B- / negative to C / Watch NEW
Creditreform Rating downgraded the SME Issuer rating of SANHA GmbH & Co. KG from B- / negative to C / Watch NEW. The reason for the downgrade is an ad hoc press release dating April 7, 2020, in which the company announces its intention to restructure the bond ISIN: DE000A1TNA70 | WKN A1TNA7. The decision will be made by a creditor vote that will be held without a meeting between April 23, 2020 and April 25, 2020. Taking the company´s situation and the changed bond conditions into account, we consider a selective default of the issuer likely in the near future according to the default definition of Creditreform Rating AG. This is decisive for the present rating amendment and led to the rating of C / Watch NEW (negative)
SANHA GmbH & Co. KG (SANHA) communicated on April 7, 2020 that against the backdrop of the general deteriorating economic situation, the company received a concept from One Square Advisors GmbH on April 1, 2020 for the restructuring of the aforementioned bond, along with an attached calculation, and studied the possibility the days after receiving this concept. Following the improved operating performance indicators based on the preliminary group figures for 2019 and the first three months of the 2020 business year, which according to management were significantly better than the previous year in terms of average working day sales and order intake, SANHA noticed a decline in average working day order intake of -48.37% and a decline in average working day sales of -54.79% in the period from April 1, 2020 to April 6, 2020. Since the beginning of April, the company registered a strong decline, especially in the export business, due to restrictions in the movement of international goods. In contrast to the last rating meeting, the company sees itself clearly and unexpectedly affected by the effects of the COVID 19 pandemic, which led to the decision on April 6, 2020 for a bond restructuring and the above-mentioned creditor vote without a meeting.
Creditreform Rating has confirmed the SME issuer rating of SANHA GmbH & Co. KG with B-. The outlook was adjusted from stable to negative. In the 2019 financial year, the SANHA Group was able to demonstrate both quantitative and qualitative improvements. The preliminary unaudited data for the 2019 financial year suggests a slight improvement in the financial ratio analysis. Along with the company's statement that sales for the beginning of the 2020 financial year are above those of the previous year, we initially consider the company's development as positive. This assessment is currently undermined by the substantial economic effects that we expect as a result of the COVID 19 pandemic. In addition, there are currently considerable uncertainties regarding the development of the pandemic and the countermeasures required by governments and public authorities. With regard to the SANHA Group, we consider there to be an increased risk that this could have a negative impact on the asset, financial and earnings position of the current or the subsequent year 2021. Therefore, our outlook takes our expectation and the risk of a deterioration of key financial figures into account. Whether SANHA GmbH & Co. KG will have to rely on the announced support measures of the German government and government-related institutions, remains to be seen.
Creditreform Rating confirmed the rating of SANHA GmbH & Co. KG at B-. The outlook has been adjusted from positive to stable. The main reason for the rating adjustment is that we believe that the earnings and internal financing power is weak. Especially, considering the current market situation. The financial ratio analysis did not show an improvement that would justify a rating upgrade. Also, before the adjustment of non-recurring effects does the financial ratio analysis on the basis of the preliminary financial figures of 2018 still show a weak credit worthiness which was below our expectation. So far, the substantive, investment and structural measures the company implemented do not reflect such an improvement that it could have a positive impact on the rating. We still believe that SANHA GmbH & Co. KG will have to improve its earnings- and internal financing power out of its operational business to be able to meet its long term debt obligations. For the current business year we expect a small increase of revenues and a positive financial result due to a well filled order book.
Creditreform Rating has confirmed the corporate rating of SANHA GmbH & Co. KG at B-. The outlook changed from stable to positive. A significant factor for the rating is, that we see the earnings and internal financing power, especially under the current industry situation, as too low. The analysis of the financial key figures did not show a sufficient improvement that would justify a rating upgrade. Additionally, the restructuring of the bond in 2017 to the detriment of the creditors, resulting from a crisis situation, still has a dampening effect on the rating. Together with market related risks, the rating will remain limited for the time being. However, we also noticed positive developments at different result-levels, as well as in the balance sheet. We hold the view that the situation of the creditors has overall improved due to the new bond terms and conditions. Together with the current positive order situation and the measures for improved cost efficiency a positive annual result for the SANHA group should be realizable in 2018.
Creditreform Rating has set the corporate rating of Sanha GmbH & Co. KG to B- with a stable outlook. The main reason for the assessment was that, with regard to Sanha GmbH & Co. KG, the complete implementation of the bond prolongation resulted in a company situation, which had to be reassessed as part of the monitoring process. The full effectiveness of the implemented remediation measures and the ensuing sufficient profitability and internal financing power must be further confirmed. We expect the company to report a year-on-year improvement in earnings concerning the Group for the past financial year 2017.
Creditreform Rating has downgraded the corporate rating of SANHA GmbH & Co. KG from C (watch) to SD within the monitoring process. The bondholders´ meeting of SANHA GmbH & Co. KG agreed on September 15th, 2017 to extend the maturity of the corporate bond 2013/2018 (ISIN DE000A1TNA70) by 5 years. Due to the extension of the maturity, the bond will not be paid in due time with respect to the original bond terms and conditions. In line with our rating methodology this constitutes as a selective default. Creditreform Rating will conduct a new assessment as soon as the final documentation of the bond as well as the current financial and operational information have been delivered.
Creditreform Rating has downgraded the corporate rating of SANHA GmbH & Co. KG from B- to C (watch) during the monitoring. Reason for the downgrade is a press release of the company from 19 June 2017 which announces plans of maturity extensions for the bond ISIN: DE000A1TNA70 | WKN A1TNA7. On that shall decide a creditors votes without assembly between 25 July and 31 July 2017.