(Boursier.com) — Argan has just proceeded, as planned, with the repayment of its bond loan in the amount of 130 million euros, issued in June 2017, at a fixed rate of 3.25%.
Argan recalls having blocked this sum after the bond issue of 500 ME carried out under particularly favorable conditions in November 2021 (rate of 1.011% for a maturity in November 2026). Most of the property company’s debt (68% at the end of 2022) is in mortgage form (asset by asset) with progressive amortization of the capital, thus requiring no short-term refinancing.
Furthermore, with marginal exposure to changes in 3-month Euribor rates (only 8% of gross debt at the end of 2022), Argan’s cost of debt is very insensitive to the increase in rates observed on the markets. since the first half of 2022.
Thus, for an average 3-month Euribor rate projected at 3.4% for the whole of 2023, the average cost of debt would stand at 2.4%.
With a ‘BBB-‘ rating (‘stable’ outlook) confirmed in February by S&P, Argan confirms the quality of its signature.
Announced at the start of the year, “the debt reduction strategy is reflected in a gradual and constant reduction in the stock of gross debt linked to the double effect of the natural amortization of mortgage loans (around 100 ME / year) and, from time to time, proceeds from targeted disposals of warehouses at the end of 2024 or the beginning of 2025 depending on market developments”, explains the management of Argan.
©2023 Boursier.com