Kem One - comment

Kem One’s existing lenders have provided a further €30m of liquidity support, underlining the company’s ongoing cash burn. Management’s own projections indicate additional funding needs of €8m–€46m through FY28, with at least €18m potentially required by September 2026.

The company continues to point to a future recapitalisation to ensure long-term viability, which we fully expect will involve equitisation of the bonds. The incremental €30m facility appears to rank pari passu with the existing €200m term loan, although documentation is unclear, and carries a costly margin of Euribor plus 7.25%.

This is a clear case of kicking the can down the road. Trading in FY25 was materially worse than expected, with management now confirming EBITDA of negative €31m. The company has not disclosed detailed Q3 or Q4 results and instead relies on a familiar “hockey-stick” recovery, projecting EBITDA of €30m in FY26, €80m in FY27 and €140m in FY28. Given the track record, we see little credibility in these assumptions and view a further restructuring as unavoidable. Hope springs eternal.