TSX:SOT.DB - Post by User
Comment by
HRc60to65on Dec 16, 2024 9:37am
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Post# 36363900
RE:RE:RE:RE:RE:RE:Par for the course...
RE:RE:RE:RE:RE:RE:Par for the course...Previous management has ereased shareholders equity.
GA has no choice, debentures shall be converted in equity (units) and 160M$ of new units to be issued to meet all covenants. Why, because 330M$ of equity was ereased too early from the book value by previous management. The value is there but can be used to calculate the convenants.
Q3 2024 MD&A page 37
The REIT's debt is subject to financial leverage, debt service coverage, debt yield, minimum unitholders equity and liquidity covenants, the following relate to the revolving credit facility:
A) Total debt to gross book value 65% or less. At September 30, 2024 the REIT's total debt to gross book value was 83.2%.
B) Senior debt, which is total debt excluding the REIT's convertible debentures to gross book value, of 55% or less. At September 30, 2024 the REIT's senior debt to gross book value was 72.5%.
C) Debt service coverage ratio not less than 1.25:1. At September 30, 2024 the REIT's debt service coverage ratio was 1.16:1.
D) Minimum unitholders' equity, which includes the REIT's Class B LP Units of $350.0 million. At September 30, 2024 the REIT's unitholders' equity was $170.2 million.
covenants
2024 impairment A B C D
30 May 10.8M$ 67.8% 59.3% 1.23:1. 500.4M$
30 June 154.4M$ 73.2% 64.4% 1.20:1 349.0M$
30 Sept 340.6M$ 83.2% 72.5% 1.16:1 170.2M$
Impairment charges are taking because interest rate increased and are destroying shareholders equity
Now interest rate are decreasing impairment charges (Change in fair value of investment properties) can not be reversed.