Flora - comment

The bonds have rallied since we established our position; however, we are maintaining the exposure as the underlying investment thesis remains intact. When we initiated, we had anticipated that the company would enter discussions with its senior bank lenders regarding an extension of maturities. The release of limited preliminary results for Q4 and FY25 suggests that such a transaction may be forthcoming.

The disclosure itself is largely unremarkable, with revenues flat year-on-year and EBITDA declining modestly by 3.5%. The reduction in EBITDA has resulted in a marginal increase in leverage of 0.2x compared with December 2024. Looking ahead, Flora has provided FY26 guidance calling for low- to mid-single-digit organic revenue growth, low- to mid-single-digit EBITDA growth on a currency-adjusted basis, and continued debt reduction.