In the heat of better operating results, Mediapro manages to refinance its debt, lightening the backpack of interest to be paid. Although it still had three years to face the bulk of the 500 million financial liabilities, the company controlled by Orient Hontai managed to refinance its obligations from 2027 to 2029 with a substantial reduction in the rate: which fell from 7.5% to 5.75%. In exchange, yes, the program rose from 500 million to 525 million euros.
According to two reports from Fitch and Moody’s, the debt was refinanced with a single creditor, as was arranged until now, with Pimco being the reference borrower of the firm run by Tatxo Benet. “Lower debt service costs provide some margin to support business growth and continued diversification of its high concentration with the La Liga contract,” Fitch maintains in its analysis.
The interest reduction gives Mediapro more room to boost its growth. Among the main initiatives is a fund of up to 1,000 million euros from third parties that will be managed and promoted to buy sports rights. Neither dividends nor large corporate operations are expected until 2027.
Despite this, the Catalan organization has been immersed in a diversification process for some time. And as a Moody’s analysis from last year stated, sports rights went from 50% of sales in 2019 to 30%. The provision of services to third parties – such as mobile units, production and transmission services or the exploitation of VAR in 17 football competitions – represents 40%.
With the diversification plan on the table, it is expected to reduce its dependence on the contract for the exploitation of LaLiga’s television rights internationally, which in 2024 will account for around 20% of ebitda, according to Fitch.
Despite the refinancing, Both agencies maintained their grade with a stable outlook: B2 in the case of Moody’s and B in the case of Fitch. The reason: the difficulties of transforming positive ebitda into positive cash flows. By 2025, margins of 13% are already expected, which will help cut the debt itself, which will drop to a ratio with Ebitda of 3 times in 2026, according to the agencies.
Cash flow, Mediapro’s biggest asset so far, should become positive in 2025 – it will continue to be red in 2024, a year that is going close to plan despite the slowdown in content production in the second half of the year. Despite the turnaround, it will remain moderate “around 2% of revenue” over the next two years. “This is an important factor before considering an upgrade to B+,” warns Fitch.
In 2023, the firm recorded a profit of 12 million euros compared to losses of 69.4 million in 2022. Sales were 1,204 million compared to the 1,177 million recorded in the comparable period.
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