FIIG Research

Adani Abbot Point Terminal is performing slightly ahead of expectations, with current throughput about 10% ahead of prior year. We have revised our recommendation on the 2020 AUD notes to Underperform, due to yield compression as the next call date rapidly approaches. Although the current yield to worst of close to 4% may continue to be attractive to some investors, we believe there is better value in other names in the infrastructure sector. We are maintaining our Outperform recommendation on the 2022 USD notes.

Volatility increased in financial markets during 2018 with several geopolitical issues and tensions impacting asset classes and performance. Here we look at some of the key highlights from 2018.

Many residential property indicators are around the worst levels in years. The current environment is clearly weak and the housing market is likely to remain soft for some time.

Australian macro-economic conditions remain soft and are deteriorating based upon some measures, however, they are generally supportive of corporate and industrial credits.

With volatility set to continue into Q1 2019, it’s crucial for USD allocations to be diversified across sectors. Nevertheless, there is still a compelling argument for high yield with solid returns in the long run.

Lucas is a diversified civil construction, infrastructure and resources contractor in Australia. Established in 1969 and based in Adelaide, the company is privately owned by the Lucas family. David, Vivienne & Ben Lucas remain Directors within the business.

QMS Media Limited (QMS, Company, Group), listed on the Australian Stock Exchange in 2015, is the fastest growing listed outdoor media company in Australia and New Zealand.

FMG’s 2022 and 2024 High Yield (HY) bonds have been added to FIIG’s USD DirectBond list. The bonds offer exposure to a well-known Australian company, and are an attractive inclusion in USD portfolios yielding over 5.20%pa and 5.80%pa, respectively.

TransAlta Corporation (TransAlta), headquartered in Calgary, is one of Canada’s largest publicly traded wholesale power generators and marketers. It owns, operates, and manages a highly contracted and geographically diversified portfolio of assets representing nearly 9,000 megawatts (MW) of gross generating capacity across more than 70 facilities in Canada, the US and Australia.

TransAlta Corporation (TransAlta), headquartered in Calgary, is one of Canada’s largest publicly traded wholesale power generators and marketers. It owns, operates, and manages a highly contracted and geographically diversified portfolio of assets representing nearly 9,000 megawatts (MW) of gross generating capacity across more than 70 facilities in Canada, the US and Australia.

TransAlta Corporation (TransAlta), headquartered in Calgary, is one of Canada’s largest publicly traded wholesale power generators and marketers. It owns, operates, and manages a highly contracted and geographically diversified portfolio of assets representing nearly 9,000 megawatts (MW) of gross generating capacity across more than 70 facilities in Canada, the US and Australia.

The transaction is a single-borrower secured loan commercial mortgage-backed security (CMBS) that is secured by a portfolio of 85 pubs leased and operated by Australian Leisure and Hospitality Group Pty Ltd. (ALH).

FMG Resources (August 2006) Pty Ltd is a wholly owned subsidiary of Fortescue Metals Group Ltd. Fortescue Metals Group Ltd (FMG) is an ASX listed iron ore production and exploration company based in Perth with a market capitalisation of AUD12.9bn as at 12 December 2018.

FMG Resources (August 2006) Pty Ltd is a wholly owned subsidiary of Fortescue Metals Group Ltd. Fortescue Metals Group Ltd (FMG) is an ASX listed iron ore production and exploration company based in Perth with a market capitalisation of AUD12.9bn as at 12 December 2018.

With the global growth outlook for 2019 looking subdued, there is an increasing possibility the credit cycle is nearing an end. The cause and timing is uncertain, but investors should consider the ability of companies to refinance their outstanding debt as it comes closer to maturity.

We initiate recommendations on a range of notes supporting Australian PPP projects.

Mallinckrodt Plc (MNK) has announced it will spin off its speciality generics business to shareholders in 2019. The company previously announced its intention to divest the generics business and has been reporting it as discontinued operations. The separation will be completed through a pro-rata distribution of common stock to shareholders.

Despite strong economic growth during the year, 2018 proved to be a year of growing uncertainties leaving the outlook for the year ahead highly uncertain.

Westpac’s USD denominated, investment grade Tier 2 bond is the newest addition to our USD DirectBond offering. This bond is fixed rate and available in USD10,000 minimums. It would appeal to clients wanting to improve credit quality of their USD investments.

Westpac Banking Corporation (Westpac) is one of the four major banks in Australia in terms of market capitalisation and customers. Westpac is one of the top five companies on the ASX by market capitalisation (AUD95.3bn as at 9 November 2018).