Matalan - comment

Following their maturity extension last month under new CEO Henrik Nordvall, the bonds traded up 3 points, but volumes are thin, so there won’t be much movement as a result of yesterday’s disclosure of FY26 (To February) and Q127 results. We were disappointed with the Q4 results, although we might have mistimed the 53rd week effect. As a result, the company fell some €6m short of our expectations, but we draw comfort from the better-than-expected Gross Margin in that quarter. Q127 confirms that Matalan remains on track, with slightly lower revenue at better margins hitting our EBITDA forecast precisely. The simple extension is a pragmatic positive for all parties, considering the progress management is making (and the diverse interests of investors/creditors). The new €25m line is not yet drawn. We will update our analysis on Matalan in due course.