BOPARAN: 1Q15/16 slightly below but outlook positive

BOPRLN GBP 5.25% 7/2019 (call 15/07/2016 @ 102.625) @ 93.25, YTW=7.43%, Z+615bps, B2 / B+ BOPRLN EUR 4.375% 7/2021 (call 15/07/2017 @ 102.188) @ 88.125, YTW=6.98%, Z+660bps, B2 / B+ BOPRLN GBP 5.5% 7/2021 (call 15/07/2017 @ 102.75) @ 88.25, YTW=8.16%, Z+660bps, B2 / B+ BOPARAN is a UK-based food manufacturer specialized in the poultry business. The group has released its 1Q15/16 results (ended 31 Oct. 2015), which were slightly below our expectations in terms of EBITDA margin. Continued price deflation was seen this quarter, again, reflecting the general fall in commodity prices. This resulted in a negative impact on LFL sales due to the group’s price passthrough model in its Protein division, which represents 69% of total sales. Similar to the last quarter, operational results were predominantly impacted by a strong decline in the Protein division (price deflation and loss of contract with Tesco last year), which was partly offset by the Branded division (positive customer response from new product launches).