Daily Brief Credit: Road King – Earnings Flash – H1 FY 2022 Results – Lucror Analytics and more

Road King’s H1/22 results were acceptable in our view. The company reported robust EBITDA growth and strong margin expansion, likely supported by deliveries of the higher-margin Hong Kong projects sold in FY 2021. Net debt improved marginally, in line with the stronger earnings.

That said, Cash/ST Debt was inadequate at 0.8x. Road King may face a funding gap for repayment of its USD 358 mn bonds in February 2023, though it should be able to bridge the gap through better cash collections in H2/22 or potential external financing (asset sales or equity issuances). Positively, the company has a well-spread debt maturity profile, with only one offshore bond coming due in 2023 and the next (USD 480 mn) due in September 2024.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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