Coffee, Croissants & Credit/Benelux Credit Digest published today

Benelux Credit Digest: It is with great pleasure that we present our Benelux Credit Digest, our annual overview of the key fundamentals and credit metric developments of the most important corporate and financial credits in Belgium, the Netherlands and Luxembourg.

Coffee, Croissants & Credit/Shell announces further diversification

The last twelve months have seen a number of oil & gas majors announcing plans to diversify their activities. Shell (RDSALN) announced that the company will spend US$500m to open 5,000 new non-fuel convenience stores. Shell will also open 500 hydrogen filling stations in 10 European countries. Altogether, the company will spend between $1bn and $2bn in renewable projects per year by 2020. Shell has a portfolio of solar and wind farms and has doubled its spending on clean power energy in recent y...

Coffee, Croissants & Credit/Moody's takes action

Moody's has changed its outlook on Iberdrola (IBESM) from positive to stable. The rating is maintained at Baa1. Moody's takes note of the lower profitability performance in 2017. EBITDA declined c.8% due to weaker margins in the UK and in Spain. At the same time, net debt was 12% higher at €32.9bn. FFO/net debt weakened significantly from 18% to 14.5%. Moody's has put its Baa3 rating on RWE (RWE), its Baa2 on Innogy (IGYGY) and E.ON (EOANGR) on review for downgrade following the acquisition...

Telecom Italia/Further deleveraging ahead; stable maintained/STABLE

Coffee, Croissants & Credit/TI to strengthen balance sheet further

Telecom Italia (TITIM) reported a decent set of 4Q17 results. Total sales rose 1.2% to €5.1bn, while improving 2.8% on an organic basis. This brings the full year number to €19.8bn (+4.2% reported and +2.7% organically). Service revenue growth amounted to 3.3% and 1.9% in 4Q17 and 2017, respectively. Reported EBITDA decreased 25.8% to €1.6bn, but this was due to non-recurring charges. Excluding these charges and on an organic basis EBITDA growth would have been 4.1%, bringing the full year...

Coffee, Croissants & Credit/Elliott eyeing a stake in Telecom Italia

Elliott Management is reported to be building a stake in Telecom Italia (TITIM) as the activist shareholder is concerned about how the company's largest shareholder Vivendi is running the business, according to Bloomberg citing sources familiar with the situation. Elliott is reported to be worried about Telecom Italia's share price and operational performance since Vivendi took control. Elliott is contemplating nominating directors to Telecom Italia's board and to push for other (not specified) ...

Coffee, Croissants & Credit/One-offs push RBS earnings to quarterly lo...

RBS (RBS) reported a loss for the last quarter with one-off costs again pressuring the bank's performance. The CET1 capital ratio instead improved with lower RWA. The bank has sufficient buffers to absorb the expected Basel III update induced RWA inflation. That said, the one-offs keep coming, and the bank guides for higher restructuring costs than expected earlier. With the US DoJ settlement still to come, the bank is not out of the woods yet. Credit negative.

Telecom Italia S.p.A. - September 2017 (LTM): Peer Snapshot

Peer Snapshot:  Telecom Italia S.p.A. - September 2017 (LTM) 11 January 2018 (in US millions) FYE Dec-15 FYE Dec-16 LTM Sep-17 FYE Dec-15 FYE Dec-16 LTM Sep-17 FYE Dec-15 FYE Dec-16 LTM Sep-17